Pumpkin Knife Required…..

In these times of ever sharper focus on constrained budgets, department heads are driven to find areas where costs can be saved. In capital-intensive projects it is often tempting to identify training as a ‘soft-target’ to trim spending.

Wealth Warning! Any short-term training savings could lead to longer-term pain.

Analyst research into the effectiveness of training spend, shows that a relatively small investment can reap large rewards. For example:
– Project success can be boosted by up to 30% if at least 1.5% of the project cost is ear-marked for training. (1)
– Productivity gains of about 15% are derived from every euro or dollar invested in training. (2)
– Over 40% of employers agree that an IT skills gap has a negative impact on productivity (3)

It’s not just project and productivity gains that make targeted training a sound investment. Providing opportunities for your staff to train and develop vastly increases their likelihood of staying for the long haul. Just pointing your staff to a list of available workshops and webinars won’t cut the mustard though.

Managers who invest time and effort in identifying development opportunities focussed on the needs of each individual team member, will reap the benefits in reduced staff turnover. This is most effective when the training programme has the aim of developing a “culture of identification” between the organization and the employee. When the employee feels more connected with the company, the intention to search for another job decreases substantially.

Differences are noted between on-the-job training and off-site schooling. Studies suggest that outside training may in fact, reduce commitment(4). An oft-cited example is of the young high potential colleague who benefits from executive MBA training at great expense to the company, only to jump ship at the first opportunity. Some organisations have introduced bonds or repayment schemes to counter the threat of ‘MBA brain drain’. On the other hand, internal training programmes such as those favoured in Japan have been demonstrated to boost attachment and increase the employee’s commitment to the organisation (5).

Some organisations take their commitment to staff learning opportunities to a whole new dimension. At Merkle Direct Marketing Inc. employees can take classes on a variety of topics, and many of the courses are not directly job related. The company argues that even seemingly irrelevant classes like pumpkin carving are valuable to the organisation, as employees become better overall learners. This in turn, boosts the company’s total intellectual capital(6).

All told, your company will benefit from a well-developed training offering for your employees. The strategies you deploy to develop your colleagues will not only improve employee retention and boost morale, but will also benefit project delivery.

I’m off to get my pumpkin and carving knife!

Warm Regards
Timothy Crossett, Executive Energy

(1). IDC MarketScape: Worldwide IT Education & Training, 2013 Vendor Analysis
(2). & (3). IDC: HP Education Services: The Value of Training the IT Organization
(4). Green, F., Felsted, A., Mayhew, K., & Pack, A. 2000. The impact of training on labour mobility: Individual and firm-level evidence from Britain. British Journal of Industrial Relations, 38(2): 261-275
(5). Lincoln, J. R., & Kalleberg, A. L. 1996. Commitment, quits, and work organization in Japanese and U.S. plants. Industrial and Labor Relations Review, 50(1): 39-59.
(6). Charest, A., Training Ideas, Inc.com