Training and Development effects on ROI

Introduction

Training and development are identified as one of the key factors in HR management with the rapidly changing competitive environment (Snell, Bohlander and Vohra, 2010). Organizations invest billions of dollars for training and development just to keep their employees motivated and competent. Skillful employees won’t stay competent as their skills become obsolete with the time (Qasim,2009).

The structural training and development in any organization includes different methods catering to different job categories. It’s a continuous updating of knowledge, skills and abilities of employees to cope with new technologies, processes and systems. Training and development adopted by any organization to maintain the productivity, employee performance and to be competitive in the market (Armstrong, 2006).

This blog discusses the objectives of T&D and the approaches both modern and old by way of adapting different methods with a literature review.

Training

Training can be defined as change in attitude, skills or knowledge of a person with a resultant improvement in the behavior. A training need identified by a planned activity conducted after a thorough need analysis and target at certain competencies, most importantly, it is to be conducted in a learning atmosphere (Rae, 1997).

Training is a reflective activity that enables learners to utilize previous experience to understand and evaluate the present, thus shaping future actions and formulating new knowledge (Carnell, Eillen, et al. 2000)

Addition to that, Training refers to a systematic setup where employees are instructed, and taught matters of technical knowledge related to their jobs. It focuses on teaching employees how to use particular machines or how to do specific tasks to increase efficiency (TopPR, 2020).

While designing the training program it has to be kept in mind that both the individual goals and organizational goals are kept in mind. Although it may not be entirely possible to ensure a sync, but competencies are chosen in a way that a win-win is created for the employee and the organization (Rae, 1997).

Development

Employee development is psychological oriented mainly provided for people who deals with managerial tasks (Cole, 2004). As compared to technical staff, managerial staff will be very low in number because manager who is having more efficiency can manage more number of people which is a real manager capability, but coming to technical jobs cannot be done by one or with minimum available skilled labor if there is need for high or large production (Snell, Bohlander and Vohra, 2010). ultimately development of employees is by way of learning by way of observations to develop knowledge. In fact, training is also provided for management level personnel to understand technicalities involved and nature of work done by the staff working under them, ultimately to manage them (Coetzee, 2007)

For example, it is mandatory to attend training modules on presentation skills for all the employees at GoodYear, since the presentation skills help them on their performance (Management Study Guide, 2020)

Approach of Training and Development

The approach for training and development is to find out the training needs of the employees. The needs may differ from job categories and the layers of designations in different companies. The training gaps could be identified through a systematic approach evaluating the employee’s current competencies (Armstrong, 2006). Training needs Analysis also helps to identify the business objectives and employee percentage who need training in order to gain the competencies. There are many ways to conduct the training needs analysis and performance evaluation, interviews, customer feedbacks, tests, observations and surveys are few methodologies (Armstrong, 2006).

Training Process

When there is a gap between the current performance and the expected level of performance, it could be lack of training. The process of training can be described in ADDIE model which include 5 steps (Mahoney, 2018) and illustrated in figure 1.0.

Figure 1.0: ADDIE Model

(Source: Mahoney, 2018)

  

The practical applicability of this process is explained below as per the author’s view;

Analyze

Obtain and review relevant resources by analyzing the training need and gaps using the previous evaluation information and identify which areas are lacking by which group of employees. At this stage the findings may documented and reviewed.

Design

Plan and conduct group design meeting to finalize the training programmes that would effectively conduct. The implementation and evaluation plans also should be finalized at this stage.

Development

Using the draft materials and applications, the most suitable training programme will be developed using the best practice. The final deliverables should be approved by the top management.

Implementation

Implementation plan should be executed at this stage and the organization should be prepared with the trainers to conduct the programme and the printed materials or other relevant materials should be kept ready. The training should be given to the selected set of employees.

Evaluation

At this stage the trainer, training programme and its content should be evaluated by the participated employees to get a feedback which could be used to analyze the next cycle.  

1.0    Recommendations to align Training and Development for a high ROI

As every organization invest billions on training and development of the employees, the return of investment is also important to analyze. According to Steve Glaveski, $359 billion are spent globally on training. However, only 25% of respondents to a McKinsey survey said their training programs measurably improved business performance (Glaveski, 2019).

1.      Align with Strategy: Learning and development strategy always should be aligned with the business strategy.

2.      Set Clear Objectives and Goals - Align the objectives and goals of a specific training program with L&D priorities as well as the needs of stakeholders.

3.      Get Cost/Benefit Calculations Right – Arranging workshops at a one place with two or more group of employees with common training needs

4.      Involve the Leaders- It is important to get the support of the leadership to continue training programs as employees may see the leaders as role models.

5.      Customize for Effectiveness – Training programmes should be cater to the requirement and training needs to create effectiveness. Customization of the programme may be done by modifying, adding/ removing content as suitable (Rorso, 2020).

Reference

Anon., 2020, Management Study Guide, Training and Development - A Key HR Function (2020). <https://www.managementstudyguide.com/training-development-hr-function.html> , viewed on 28^th May 2020.

Armstrong, M., 2006. A Handbook of Human Resource Management Practice. illustrated ed. s.l.:Kogan Page Publishers.

Coetzee, M., 2007. Practising Education, Training and Development in South African Organisations. illustrated ed. s.l.:Juta and company Ltd.

Cole, G. A., 2004. Management Theory and Practice. illustrated ed., Cengage Learning EMEA.Glaveski, S., 2019. ‘Where Companies Go Wrong with Learning and Development’. Harvard Business Review-October 2019, Issue Harvard Business Publishing.

Mahoney, D., 2018. Lean Learning Using the ADDIE Model. s.l.:American Society for Training and Development.

Qasim, J., 2009. Training and Development-Effectiveness of Training and Development in Private organization. www.Academia.edu, p. 84.

Rae, L., 1997. Planning and Designing Training Programmes. illustrated ed. s.l.:Gower publishing Ltd.

Rorso, P., 2020. How to Get a High ROI on Training. www.academia.edu.

Snell, S., Bohlander, G., Vohra, V., 2010. Human Resources Management, A South Asian Perspective. 1 ed. India: Cengage Learning.