9. Training & Development - Future-Proof Your Workforce

Cost-effective ways to upskill employees and improve retention.

Imagine this -  You hire a new employee with great potential. They have the right attitude, fit well with the team, and show enthusiasm for the role. But after a few months, you notice they’re struggling. Mistakes are creeping in, deadlines are being missed, and they lack confidence in making decisions.

You consider letting them go and hiring someone more experienced. But then you realise—the issue isn’t the employee. It’s the lack of training.

For many SMEs in New Zealand, training is often overlooked or seen as a luxury rather than a necessity. Business owners assume employees will “learn on the job” or that formal training is too expensive. However, not investing in training comes at a much higher cost -

• Lower productivity – Employees take longer to complete tasks and make more mistakes.

• High turnover – Workers who don’t see opportunities to grow will leave for employers who offer development.

• Reduced innovation – Without new skills, businesses struggle to adapt and compete in a fast-changing market.

A well-trained team is not just an asset—it’s a competitive advantage. Investing in employee development leads to higher retention, stronger performance, and a more resilient business.

The Solution – Make Training a Business Priority

SME owners don’t need to spend huge amounts on formal training programs. Even small, cost-effective development opportunities can significantly improve employee performance and satisfaction.

Here’s how to create a practical, scalable training strategy for your SME -

1. Identify the Skills Your Business Needs

Before investing in training, determine what skills will have the biggest impact on your business. Ask yourself -

• What technical skills are essential for employees in each role?

• What soft skills (e.g., communication, leadership) would improve teamwork and customer service?

• Are there industry changes (e.g., new technologies or regulations) that employees need to stay updated on?

By identifying key skill gaps, you can target training efforts where they will make the biggest difference.

2. Offer On-the-Job Learning Opportunities

Many SMEs don’t have the budget for expensive external training, but on-the-job training is often just as effective. Consider -

• Mentorship programs – Pair experienced staff with newer employees for knowledge-sharing.

• Job rotation – Allow employees to experience different roles to broaden their skills.

• Shadowing opportunities – Let employees observe senior team members to learn best practices.

These approaches not only enhance skills but also improve employee engagement and teamwork.

3. Utilise Free and Low-Cost Training Resources

There are many affordable training options available to SMEs in New Zealand -

• Business.govt.nz Learning Hub – Free online courses tailored to small businesses.

• NZTE (New Zealand Trade and Enterprise) Workshops – Government-funded training for SMEs.

• Industry Associations – Many trade bodies offer free or subsidised training programs.

• Online Platforms – Websites like Coursera, LinkedIn Learning, and Udemy provide cost-effective courses on everything from digital marketing to leadership skills.

Encouraging employees to self-learn and take online courses is a great way to upskill without significant costs.

4. Support Career Growth with Internal Promotions

Employees are more likely to stay in a business if they see a clear path for growth. Ways to support internal development include -

• Providing leadership training for employees who show management potential.

• Promoting from within whenever possible, rather than hiring externally.

• Offering employees new responsibilities to help them develop their skills and experience.

By creating a culture of learning and progression, SMEs can retain talent and build a loyal workforce.

5. Make Training Part of the Company Culture

Training isn’t just a one-off event—it should be an ongoing part of your business. To reinforce a culture of learning -

• Allocate a small budget each year for employee development.

• Encourage knowledge-sharing sessions, where employees teach each other new skills.

• Recognise and reward employees who take the initiative to develop their skills.

A strong learning culture leads to a more skilled, engaged, and motivated workforce.

Reflective Scenario – What Would You Do?

You have two employees -

• Employee A has been with you for years but is struggling to keep up with new technology.

• Employee B is ambitious and wants to develop leadership skills but isn’t sure how.

Instead of hiring externally, you could -

• Provide upskilling workshops to help Employee A adapt to new systems.

• Enrol Employee B in a leadership development program to prepare them for future management roles.

By investing in training, you retain valuable employees and future-proof your business.

Golden Nugget - "Train people well enough so they can leave. Treat them well enough so they don’t want to." – Richard Branson

SMEs don’t need huge training budgets—they just need a commitment to continuous learning. Investing in your employees’ growth is an investment in your business’s success.