3 Reasons Providing Employee Education Can Be Better Than a Pay Raise for Distribution Professionals - Modern Distribution Management

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3 Reasons Providing Employee Education Can Be Better Than a Pay Raise for Distribution Professionals

Employee education is a retention tool that leads to internal advancement and provides a direct benefit for the distributors who invest in it, says Texas A&M's Kourtney Gruner.
Midsection view of audience sitting in a row with paperwork continuing education

What comes to mind when you think about employee benefits? Often the answer is pay raises, island vacations, or a craft beer cart rolling through the hallways at 4:30 on Fridays.

While such benefits have their place, they are fleeting. High-achieving employees who have already invested years in the industry hold deep reserves of technical expertise. These ambitious professionals may be accustomed to yearly bonuses, but not in long-lasting development. According to Gallup, 87% of millennials rate professional or career growth and development opportunities as important to them in a job.

While money can be a great motivator, the psychology behind fleeting bonus structures does not meet a professional’s desire to improve, gain access to leadership positions or deepen their skill sets. An applicable education, on the other hand, is compelling to a true distribution expert. Even during challenging times, distribution companies can commit to providing employees with educational opportunities. Here are three reasons why:

1. Employee Education Leads to Advancement

Advancement requires a robust multi-disciplinary understanding within an organization that rarely happens (only) on the job. Advanced degrees that are industry specific stretch professionals into new areas and skill sets. For instance, a salesperson may learn the processes behind delivery timelines and operations while a C-level executive will learn about operations on the warehouse floor. This kind of deliberate, holistic education helps professionals immediately begin to work across departments and improve processes at their companies.

Learning to think critically about how all the moving pieces of distribution work together opens doors for employees to take on more responsibility at work, often obtaining new job titles or pay raises. Additionally, employees gain increased confidence in approaching conversations with leadership and feel qualified to give feedback and input, which gives them access to more leadership opportunities.

2. Distributors Benefit from Highly Educated Employees

It’s difficult to quantify how a raise or a bonus may improve performance, but education results in measurable improvements for companies.

Organizations that leverage education as an employee benefit report measurable impacts on their efficiencies. For instance, students in specialized distribution programs may complete projects designed to solve problems at their workplace that deepen their company’s ROI.

Students graduate as leaders equipped with autonomy and a road map for moving their companies forward. Some companies report meeting five-year-goals or seeing millions of dollars in company savings within months after their employees graduated with expanded skillsets.

When weighing the cost of tuition against the cost of giving out obligatory raises each year, companies discover that offering education as an employee benefit pays for itself many times over. Raises don’t guarantee better performance or increased knowledge, while education benefits the employee and the employer.

3. Employee Education Is a Retention Tool

When companies commit to educating employees, they report a shift in company culture and communication throughout the entire workplace over time. This becomes its own retention tool as co-workers begin to feel they are on the same playing field, having learned more about the various departments and understanding their colleagues in a deeper way.

Companies that value education develop mutual trust and loyalty in their employees. In some cases, co-workers have even created pathways for each other’s advancement, as employees advance and co-workers continue to pursue their education.

Distribution is an industry built around specific technical information and myriad moving pieces. Earning a degree that is laser-focused on solving distribution programs is key to equipping professionals to immediately perform their specific jobs better. These programs bring employees together from every company department.

The benefits of employee education reach further than vacations or year-end bonuses. An industry-specific master’s program is sure to yield a higher return over time when factoring the cost of tuition against a host of fleeting benefits. The most productive and valuable employees aren’t always looking for another perk and they may find the journey of self-improvement much more rewarding.

Kourtney Gruner is the assistant director of student services and capstone coordinator for the Master of Industrial Distribution program at Texas A&M University. Contact Mark Lorenzo at mark.lorenzo@tamu.edu for more information about the MID program.

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