Develop people for your organisations

 

But how can you train and develop (T&D) for performance and create real value (ROI of its cost)?

T&D is considered the key to developing a highly skilled workforce, equipping companies with a competitive advantage by improving performance and creating differentiation. However, it also requires a great investment of time and money from companies (Wilkinson and Redman, 2013, p. 151).

 

If T&D is considered a cost, then this is one of the first things that a company might save on. If T&D is to be seen as an investment, then there has to be ample proof or security that there will be a return on investment in the form of improved productivity or results for the company. The investment would be a strategic choice and would usually have a longer-term perspective.

 

Black & Lynch (1996) citing Bishop (1994) indicated that employer-provided training and development raises subjective productivity and performance measures by almost 16%. Again, Black & Lynch (1996) cite Bartel (1989) who stated that returns on T&D investments increase productivity by 16%.

 

Other sources like Wilkinson and Redman point out that highly skilled workers can contribute more to the production process, integrate technology better, need less supervision and produce higher quality jobs (Wilkinson & Redman, 2013, p. 162). 

 

Only companies possessing valuable HR resources that others cannot easily duplicate or substitute will outperform competitors that lack such resources (Barney, 1991 cited Crook T.R.et al., 2011, p.443)

 

It’s important to nurture bright talent, but the key factor to actually improving performance and getting a ROI is for companies to retain the employees that have received T&D over a longer period of time (Crook T.R.et al., 2011. P. 453).

 

How can you conduct and manage T&D in a way that increases effectiveness?

For T&D to be effective it needs to be aligned with the company’s strategy, as Josh Bersin (2014) said, “Today’s corporate training organizations must be highly aligned with their business’ immediate and urgent corporate priorities, while also building long term capabilities for the future”.

 

According to Silverman R.E (2012): The first step in doing training is to do a training-needs analysis, figuring out who needs training and what kind”.  Some of the advanced development tests like EASI can be useful in this part of the process.

 

Secondly a conducive environment and a learning culture need to be created in the company: 90% of what is learned may be lost within the first few weeks if it is not anchored, reinforced and transferred to the workplace.

 

Companies must give employees the opportunity, freedom and support (from managers) to practice and apply the skills and knowledge they have acquired in T&D and the motivation to sustain, if learning is to be effective.

 

This is strongly supported by a study of 3 HR and 4 Operational Management (OM) practices in a longitudinal study. The results showed that none of the OM practices had any significant effect on productivity. Out of the 3 HR practices, empowerment (7%) and training (6%) added an aggregated 9% value per employee. (Birdi, K et al., 2008, P.490)

 

Companies need highly skilled workers as a strategic differentiator, especially when competing on quality (Wilkinson & Redman, 2013, p.161). Recent studies within companies show that 7 out of 10 employees are not reaching their full potential because of lack of T&D.

 

Investing in T&D helps companies to stay competitive and makes it a great place to work. It motivates employees to develop, feel committed, stay loyal and allows them to use their competence and experience for the company on a long-term basis.

 

High-impact learning organizations are aware that they need to be rapid and flexible in their T&D activities to match and respond to the quickly changing business conditions and the resulting needs from a company’s strategy.

 

Companies, which provide an environment that fosters learning, empower and motivate their employees to transfer acquired knowledge to the workplace, while retaining them and their experience/know-how, are sure to have a ROI of their T&D (not costs) investments!

 

A humorous quote to summarize the dilemma of T&D:

CFO to CEO: What happens if we train all our employees and they leave us?

CEO to CFO: What happens if we don’t and they stay?

Norbert Mörtl

Value People - helping people and organizations to grow and perform