I am noticing an interesting but disturbing trend … companies are cutting back on training.
In his article in the July 2009 issue of “Hydrocarbon Processing”, Heinz Bloch goes so far as to say this about company management and training
“…Management will not support what it deems of little value….” (and I do not think I am taking him out of context).
While I think management sees more than “little value” in training, the cutbacks do seem quite severe.
In my personal experience, about 85% of the training I have received during my career (paid for by my employer) has resulted in a positive payback to my employer. While I do not have firm numbers, my estimate is that return on investment (ROI) over the life of the facility was well over 6, and the payback period was frequently less than 6 months.
Surely good training on a business asset, even in these tough economic times, is good sound economic management, isn’t it? (Forgive me for being cynical, but) What university is producing MBA graduates that decline to invest in a business specific opportunity with ROI=6 and payback of less than 6 months?
In addition, when the recovery begins (and it will), how will companies be able to respond to the new challenges, opportunities, or developments? Those that made an investment in training (and an investment in training is typically a very small number compared to other ongoing costs) will be able to recover and act faster and better, leaving their competitors behind. I understand some companies are in worse situations than others, where there is no liquid cash available (that is another topic, how organisations are managing with invoices not being paid in a timely manner, which impacts the cash flow chain thoroughly from top to bottom). But tough times call for bold and forward thinking contingency plans. Doing nothing = standing still, standing still = no progress, no progress = losing a competitive advantage.
Query … why cut back on training? The usual answer is the need to either cut costs or preserve capital. Those two mindsets are defeatist. Training should be viewed on the asset side of the ledger. Since that disposition will take time to overcome, here is a more practical alternative … why are companies not negotiating with training organisations to deliver training on an alternative structured payment plan? This allows companies to retain cash for longer, it allows companies to keep the skill set of the remaining employees up, and it better positions them for the pending recovery.
Query … why are companies not identifying and quantifying the skills gap now, to better determine what will be required when the economy improves? This allows training companies to use this slow period to develop new products/services, and improve/enhance existing products/services.
When we look at professional sports, sports people continually train. They train for situations that may never happen, but they train. In sports, an amateur trains to get something right, but a professional trains until they cannot get it wrong.
But I guess the ultimate query is … do companies see training as adding to the value of the company AND the employee, or just to the employee?