9 Steps To Create an Impactful Employee Development Plan [Free Template]

Written by Gem Siocon
11 minutes read

Businesses are finding that the traditional emphasis on education alone has not resulted in a pool of applicants who possess the required skills. These skills gaps impact organizations on several levels, including hobbling the ability to innovate and increasing costs associated with workers. This highlights the need for HR to develop effective employee development plans.

What is an employee development plan?
Types of employee development plans
The benefits of employee development
The biggest challenges in employee development planning
Practical examples of successful employee development plans
How can HR assist managers in creating an employee development plan?
Employee development plan template (Free download)

This article will provide HR managers with a clear understanding of an employee development plan and how to assist managers and employees in creating and implementing an effective plan.

What is an employee development plan?

An employee development plan helps individuals improve their knowledge and skills for their present and future roles in the organization.

Creating an employee development plan requires consideration of both the needs and goals of the employee and the organization. Documenting a professional development plan ensures accountability and transparency for the employee, HR team, and management.

Types of employee development plans

  • Performance-based plan: The goal of this plan is to improve an employee’s performance. It identifies areas that the person needs to improve, sets new targets, measures progress, and creates strategies to achieve those employee development goals. 
  • Succession plan: The HR team determines critical roles within the company and develops training plans to prepare younger and newer employees to assume these roles. 
  • Management-by-objectives: This plan focuses on short-term objectives as the person sets individual goals and milestones contributing to the company’s overall goal. Employees are always self-evaluating to improve their performance, and then they can modify objectives as they see fit. 
  • Ad-hoc: This informal employee development plan works individually, emphasizing the person’s personal needs. It works for workers interested in improving their specific skill sets to grow their careers. 
  • Leadership development plans: A leadership development plan is a detailed and strategic plan to help staff acquire and develop leadership skills in preparation for management roles in the workplace. 
Employee Development Plan Steps
Learn about how HR can create an employee development plan in detail below!

The benefits of employee development

Rather than hiring all external candidates for management positions, here are some reasons why a company should develop its staff: 

1. Addressing skills shortages

In a recent Gallup research, 48% of American workers would switch to a new job if offered skills training opportunities. This indicates that staff development should form part of your compensation and benefits package to entice candidates to work for your company. 

Providing employees with learning opportunities can boost employee engagement, resulting in higher productivity and profitability while lowering employee turnover. 

2. Bridging skills gaps

Technology is rapidly changing the workplace. Skills are becoming outdated faster, and people need to upgrade their competencies to keep up with their jobs and industries. 

Companies should take the opportunity to upskill existing employees across the business to assist in bridging skills gaps. Employees may then work in your organization for longer and possess a deeper understanding of your customers and culture – a unique asset that will contribute immensely to your company’s success. 

3. Improved employee engagement and morale

Gallup studies have shown that engaged employees result in business growth. An engaged workforce often equates to higher productivity rates, increased profitability and employee retention. Low employee morale is just as damaging to the business. It has been found that teams with disengaged employees experience 37% more absenteeism and make 60% more errors in their work than engaged employees.  

The value of employee development programs for organizations is evident. Employees that participate in training and development can double profitability for the business, increase sales and lead to happier customers. 

4. Remaining competitive

Companies can face challenges when looking to hire and retain the right talent, especially in a tight labor market. While top talent seeks to work for a company that will support them in continuing to build their skills and advance in their careers within the organization. 

As an organization, you can assist your employees to gain the right skill sets and technical knowledge to launch new products or services and remain competitive in the market. Training should focus on boosting the core strengths of your workforce and addressing their weaknesses to improve a company’s overall success. 

5. Improving diversity and inclusion

Organizations should also aim to upskill and reskill all employees, especially those from underrepresented groups. Invest in professional development across your employee population with internal and external resources to guarantee each person progresses in their career journey.

L&D and DEI specialists within the organization should work together to develop succession plans and leadership training programs. Tackle topics such as inclusive leadership and unconscious biases in the workplace. 

6. Creating a culture of learning

With accelerating technological changes and labor trends, companies need an agile working environment and learning culture. An agile learning culture gives your company the upper hand over competitors through speed and flexibility. 

Organizations must address these changes with a robust employee development plan to help staff quickly learn and adapt to emerging work situations and market demands. 

7. Reducing turnover

In the Gallup research conducted, 48% of American workers indicated they would switch to a new job if offered skills training opportunities. Learning new skills leads to career growth, which is integral to job satisfaction. 

In addition, learning programs can help companies save money by removing the need to hire and train new employees, which costs both time and money for the business. 

8. Aligning employee development with organization goals

How well do employees in the organization understand the business goals and overarching strategy? HR may be hard-pressed to find tangible examples of this in the business, particularly in a large or siloed company. 

Yet, there is great value in ensuring that employees have ‘a line of sight’ between the work that they are doing and the broader objectives and strategy. This can result in better decision-making for the business, as well as the individual’s own development goals. Employees who understand the organization goals are better equipped to align their development with the outcomes required.

A summary of how to develop an employee development plan and benefits of employee development.

The biggest challenges in employee development planning

No matter how good the intentions are, employee development programs are hard to plan and implement because of the following reasons: 

  1. Managers are too busy: In a survey by Wrike, 98% of managers spend 40%-87% of their work week on communications alone (6-15 hours a week on meetings, and 62% spend 2-4 hours daily on emails). Unsurprisingly, finding time to motivate their team to take upskilling opportunities is challenging, especially if their core focus is hitting ROI-related goals like productivity or sales. 
  1. Employees are too busy: In the same Wrike survey, 94% of employees reported feeling stressed at work, while almost 33% stated experiencing high-stress levels. Too much stress negatively affects productivity and personal lives. Employees may hesitate to participate in training programs even if it means career advancement because of the additional workload on top of daily responsibilities. 
  1. Lack of frequency of employee development: When training is conducted sporadically, employees won’t be able to fully grasp and apply the knowledge due to poor information retention. Learning should be conducted regularly and timely through repetition and revisiting previously known information to keep memories fresh, minds sharp, and employees engaged.

Practical examples of successful employee development plans

AstraZeneca and IBM are two companies that are providing innovative ways to upskill and develop their employees’ skills: 

1. AstraZeneca: Leader as Coach

Global pharmaceutical and biotech company AstraZeneca has a ‘Leader as Coach’ hands-on, experiential training program.  

Participants are evaluated by their direct reports and managers with criteria such as ‘create an environment that encourages others to maximize their potential and  ‘acknowledge and celebrate team accomplishments’. The feedback from the managers guides the participant and the learning and development team to understand the program’s impact and progress. 

2. IBM: Training programs

Tech giant IBM is offering various training programs to close skills gaps and enhance their employees’ skills:

  • Your Learning: Platform-driven learning where employees learn about AI, design thinking, and blockchain skills they can use to build their future careers
  • IBM Credentials: Staff earn certifications, digital badges, and specialties after completing the course
  • AI Skills Academy: Employees learn new ways to interact with AI-enabled tech and business problems

How can HR assist managers in creating an employee development plan?

The steps outlined below can help HR  and management to prepare employee development initiatives:

Step 1: Gain executive buy-in

Work closely with managers to understand what their employees need. For example, global green energy company Orsted launched a training program called ‘Power Your Career,’  aimed at improving employee retention and career mobility. 

The company’s HR team conducted in-depth interviews with managers across organizational levels, followed by focus group discussions. The discussions addressed employee development issues like giving constructive feedback and effective one-on-one meetings. The initiative resulted in improved quality of leadership and employee interaction with particular emphasis on continuous development.

Step 2: Start with a skills gap analysis

Perform a skills gap analysis with the company’s goal in mind to get a detailed understanding of the skills lacking on individual and team levels. Measure each person’s current abilities and each department’s strengths to streamline your training program for maximum benefit. 

Determine all the skills needed and then set goals based on the data collected. 

Step 3: Consider company goals and key objectives

Evaluate the company strategy by considering the current goals and challenges of the company, impending organizational changes, and business needs in the future. 

Next, identify the knowledge and competencies required to contribute to this strategy. Then define the desired outcome for both the business and the employee. 

Step 4: Align to your employee’s development goals

It’s essential for HR to ensure that employee development plans are collaborative and aligned with both the employee’s and the company’s aspirations. To achieve this, encourage managers to discuss the employee’s career development goals.

During the meeting, the manager should actively listen to the employee. They can ask questions to understand their professional goals, their plans within the company, or the competencies they need for future projects and guide the conversation towards aligning these personal goals with the broader objectives of the company.

Step 5: Determine the right type of training 

Help managers and employees determine the resources available to provide the employee with the training they require.

Here are some employee development plan examples and resources: 

  • Cross training: Training employees to perform duties in different roles. It could also be training them to perform jobs outside their scope of expertise. 
  • Job rotation: Employees rotate between different jobs or areas at specific times or intervals 
  • Mentoring: Managers and senior staff can give expert advice and industry wisdom to less experienced employees.

Step 6: Create targets and structure for learning

Teams can often be too busy, and employees may de-prioritize their learning. So HR and managers can agree to a designated space and time for education. 

Employees are provided targets and structure for learning. For example, managers can assign their direct reports to complete 48 hours of learning every six months. Quantifying targets makes it easier for supervisors to motivate their teams to achieve learning tasks. 

Another approach could be to give assignments on a schedule with specific deadlines or milestones. People can advance through the course against a fixed schedule and with their colleagues.

HR can also create employee development plan templates. These documents detail the employee development goals and skills to gain and help come up with a development action plan on how to achieve these goals. By using an employee development plan template, managers and employees can lead structured, focused conversations and track progress.

Employee development plan template.

Step 7: Develop SMART goals

SMART goals help employees focus their efforts to increase their chances of reaching their goals: 

  • Specific: Set specific targets that state what an employee is developing, e.g., ‘’improve technical skills in data analysis.’
  • Measurable: Consider how these goals can be measured, e.g., ‘successfully conduct two analyses in R in Q2′.
  • Achievable: Help employees plan how to achieve the goals and determine whether these are attainable. Evaluate what needs to happen to achieve these goals.
  • Relevant: Consider if it is appropriate to the company goals. Evaluate whether each goal is relevant to achieving the company goals. 
  • Timely: Determine timeframes and deadlines. Separate each element and determine mini-time-driven goals.

Step 8: Turn training into action 

Enable employees to turn what has been learned into action. Encourage managers to assess whether their team members have applied what they’ve learned. 

For example, financial services company Aegon implemented an ‘Analytics for Leaders’ program, which encourages team members to create ways to apply analytics to the business. The process was repeated, and managers provided a report on the specific actions that resulted from the training. 

Step 9: Track results (with data)

Your employee development is incomplete if you don’t track the results.

Ensure regular meetings and feedback with employees to assess progress, like reaching set targets, showing improved performance, and solving problems. Find ways to make training programs more accessible, enticing, and effective for employees.

You should also measure the impact of the employee development plans on the organizational level, like increased productivity, more streamlined work processes, and enhanced employee engagement. 

If you are looking to further develop your knowledge and expertise in crafting an effective Learning and Developing strategy, AIHR’s Learning and Development Strategy Certificate Program will help you to map organizational learning maturity, set up formal learning programs, and strengthen the informal learning landscape.

To sum up

Employee development plans are a crucial investment in the growth and future of both the individual and the organization. The key to success lies in creating personalized, well-structured plans that align employee aspirations with the company’s objectives.

As businesses face skills shortages and rapid changes in how work is done, fostering a culture of continuous learning and development is not just beneficial; it is essential for long-term success and sustainability.


How does an employee development plan enable business continuity?

Employee development plans guide the company to identify the right people in their workforce, understand their career goals and promote their career progress. Using different employee development ideas and resources ensures business operations continue by having trained individuals step in the vacated positions when employees resign or retire from their roles. 

What should a development plan include?

An employee development plan should include short- and long-term goals each person will strive to achieve, like learning new skills, gaining certification, or getting a promotion. As the employee makes career progress, they can adjust their professional development plan to fit their interests and situations. 

What is the difference between an employee development plan and a professional development plan?

Employee development plans emphasize building the person’s competencies to align with company goals and growth, according to staffing requirements or business skills gaps. Meanwhile, the professional development plan is more personalized by focusing on the individual’s professional growth regardless of the person’s current or future organization. 

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Gem Siocon

Gem Siocon is a digital marketer and content writer, specializing in recruitment, recruitment marketing, and L&D.

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