The training was a failure. All of that time, all of that
effort, all of that money, just gone, just out the window and gone. What other
explanation was there, after all, for drop after drop in the hard numbers from
a talented sales team in the wake of a training and development session?
It could have happened at any business, but for the purposes
of this story, it happened at a large technology company with headquarters in
the Midwest. The top executives, frantic for answers, called a corporate
training firm. “Our sales are down,” the executives said. “We need training.”
That technology company was part of a large percentage of
businesses that continued to invest in corporate training, education and
development during the last couple of years. Thousands and thousands of others
turned away from training, unable or unwilling to spend more money during the
But a panel of more than 30 industry experts and academic
professionals agreed that it would have been far better for businesses to
continue to spend on training during those tough times to invest in their
employees and to show the extent of that investment, to improve the business
and keep it up to date, to be in a better position when the economy ultimately
turns around than to tighten the budget. The same rule applies now, too.
“The question is not, ‘Where should I be training?’ but,
‘Where should I be spending my dollars on people in the organization?’” says
Alec R. Levenson, research scientist, Center for Effective Organizations,
Marshall School of Business, University of Southern California. “In terms of
the choices you have, you can choose to pay people more, you can choose to
train them, you can choose to increase benefits.
“What is the return to you of increasing the ability or
abilities of the people you have?”
Make a plan
Members of the corporate training firm arrived the next day
and talked with as many employees as possible at the technology company, from
executives to engineers to those slumping sales representatives and everyone
else in between. They prodded and probed and asked questions. They were curious
about what, exactly, had happened.
They wanted to know, before they embarked on another
training session, whether another training session was actually necessary.
This is what you should do when you’re in the process of
determining whether to invest in training and development for your employees.
You should prod and probe and plan, because just as you shouldn’t approach a
new business venture without a model and a solid idea of what you want to
accomplish, neither should you approach training without thoughts of what you
need to tackle.
“What should companies focus on for their employees?” says
Newt Margulies, professor emeritus and associate dean, executive education,
University of California Irvine. “Companies are taking a harder look at their
strategy, and whatever flows out of that strategy becomes the areas they would
like to focus on for education and training.”
And even though those needs will vary from business to
business, from industry to industry, there are a number of common training
areas on which almost all businesses should focus.
I go, I hear about five things, and the first is leadership,” Margulies says.
“Leadership means different things in different companies, but 90 percent of
what we do in those programs is helping people do an assessment of how they
lead. I also hear a lot about operations excellence. How do we improve the way
we deal with customers and how we respond to customers?
“The third is
management strategy. What is it and how do we formulate a management strategy?
The fourth is project management. How do you really manage an effective project
team? What are the elements that contribute to project success? The fifth is
really teams, in every sector. How do we become more effective? And how do you
make judgments about the effectiveness of teams?”
Open your wallet
Those members of the corporate training firm remained in the
offices for a couple of days. They wanted to follow every lead and turn over
every stone. They wanted to find out what had happened to the sales team after
that apparently disastrous training and development session. And the technology
company executives had no problem paying to keep them around. They wanted to
find out what happened, too.
Do you want to keep your top employees after the job market
opens again? Do you want all of your employees to be happy and to enjoy their
work right now? Investing in training and education is an important part of
helping you do just that. The average business spends about $1,060 on training
and education per employee per year, according to research by ASTD.
There are also effective ways to spend a little less, if your
revenue is still down or if you opt to not invest as much in training. Turning
toward local colleges and universities to design a custom program for your
employees is often less expensive than sending them to open enrollment courses,
as are distance learning and online courses. Some businesses opt to look within
for employees who are experts in a specific area and can train the rest of the
“This is a good time to begin thinking seriously about it,”
Margulies says. “Now is the time to ready yourself for the upswing, because the
upswing is coming. I can’t tell you that it’s coming in 2011 or 2012, but you
know it’s coming. Here’s the opportunity for you to help develop your internal
talent so that you’re ready. Whatever you want to do, how do you ready your
folks for that?”
Keep an eye on results
At last, an answer for our corporate training firm and our
technology company in the Midwest. That previous training session, as it turned
out, was not to blame for lower sales numbers. No, the culprit was instead the
fact that the technology company executives had recently installed a drastic
restructure of the compensation program. That program encouraged the sales team to try and sell only one of their
many products, and that is what
The training had not been the problem at all.
In fact, without that recent training session, the
technology business might have planted itself in more trouble because of the
new structure of the compensation program. The best money spent might well have
been the money spent on the training and the worst might have been the money
that was about to have been spent unnecessarily correcting that training.
The only way to know where you are is to know where you were.
In order to receive a more relevant return on your investment, watch the
progress from the planning stages through the training itself, then during the
months, even years, beyond.
“The larger macroeconomic trends are both in
favor of and against training, paradoxically,” Levenson says. “The argument
against is that, when you have such high unemployment, it should be easier to
reach outside the organization and buy the capabilities you need in the
external markets. The argument in favor is that it almost doesn’t matter what
happens in the external market, that by investing in training, you’re showing
them you are investing in them, that this is a shared destiny for the
organization and the individual.”