Soft target, hard impact

12/11/2012

If you’re tempted to cut back on L&D when budgets are tight, think twice. ‘Isn’t it easier to cut staff training than to make cuts in other business areas?’ Easier, maybe; wiser, maybe not. Let me pose four inter-related reasons why business leaders should pause before letting the axe fall.

Consider your talent. Talented people are those who make a disproportionate contribution to your organisation’s success. They’re the ones who leave a big hole if they leave. They’re also the ones who will find it easiest to leave if you don’t invest in their learning and growth.

Consider what makes your business succeed. Whatever your business is and does, I can guarantee it will depend on knowledgeable, skilful people. Disinvest in people development and, over time, your knowledge and skills base will erode and your performance with it.

Consider engagement. Engaged people are those who put in discretionary effort, sell your business by their enthusiasm, inspire and motivate others to do their best. Such people love to learn and grow. Cut back on L&D and you risk losing the hearts of your most committed players.

Consider your customers. They look to your business with high expectations of high quality products or services, and high quality customer service. If customer experience is compromised by poor service from untrained or disheartened staff, you can wave goodbye to their cash.

But what are the corresponding demands on L&D? Is L&D as an investment of value per se? It does symbolise valuing and investing in people. Nevertheless, the onus lies on L&D professionals to ensure its value in terms of attraction, retention, development and business results.

I would be interested to hear of any examples from organisations where business leaders have chosen to continue or increase investment in L&D in hard economic times. For example, what were the drivers, what convinced you, how did you achieve it, what were the results?

21 Comments

Michael Ferguson

13/11/2012 03:02:29 am

As it says on the back of our business cards here at Developing Professionals International: "If you think training is expensive - try NOT training..."! We're lucky enough to work mostly with clients who do seem to get that...

Nick Wright

17/11/2012 03:40:40 pm

Hi Michael and thanks for the note. Do you have any examples of why the clients you work with continue to prioritise investment in L&D, especially in the current economic environment? With best wishes. Nick

21/11/2012 05:54:51 pm

Nick, in response to your comment - and thanks for the interesting thread by the way - those continuing to invest in people do share one thing - confidence in the future.

I have been around a long time - and this prevailing "economic climate" will end once enough people are sufficiently naffed off with it. It's ultimately a matter of psychology and sentiment, NOT economics - the first drives the second. There is still as much money in the world as there was in the old 'economic climate' - nothing's changed, except confidence. THANKFULLY some of our key clients share OUR confidence that good things are around the corner - and those ready to take advantage - having invested in their people - will be first off the starting blocks with a huge competitive advantage!

Arlene Shapiro

14/11/2012 03:41:42 am

This is an interesting article and really gets to the heart of budget reductions. Training can be accomplished peer to peer, manager to staff, use of social media. Learning is organic and needs to be maintained with innovating methods to retain and grow talent.

17/11/2012 03:50:17 pm

Hi Arlene and thanks for your comments. I agree that 'training' can be achieved in a number of different ways, many of which don't need to incur external costs. What are the most innovative methods you have used or experienced? With best wishes. Nick

Christine MacDonald

14/11/2012 03:42:50 am

Excellent points, especially about engagement. I think businesses often underestimate how much they depend on their staff putting in discretionary effort.

17/11/2012 03:59:38 pm

Hi Christine and thanks for the feedback. I think the relationship between L&D and engagement is an interesting one. It partly depends on what people value at work. If staff see 'opportunity to develop' as a key motivator for joining or staying with an organisation, reducing L&D can reduce engagement. Do you have any examples from your experience where you have seen this relationship outworked in practice? With best wishes. Nick

Sharyn New

14/11/2012 06:35:31 am

Isn't that so true? Cut back on training and other staff development, and then the decision makers wonder why they have no skilled personnel available when the new opportunities arise!!

24/11/2012 01:11:30 pm

Hi Sharyn and thanks for the note. I think you raise an important point about succession or building capacity to seize fresh opportunites. Investing well in L&D is an investment in future potential, not just current capability. Have you seen examples where this has happened in practice...either good or bad examples? With best wishes. Nick

Ceferino Dulay Jr.

15/11/2012 07:42:49 am

Training doesn't have to be a formal activity. Informal training can even have a greater impact on performance. For example, a regular staff meeting where projects/activities are discussed not only for updating on project results but more on analyzing what happened and planning the next step (beyond the original project plan at the start of the project) is a much more potent activity in improving performance and creating an atmosphere of creativity and need for results. Although training is a venue for off-line acquisition of knowledge and skills, regular discussions is real-life learning and evaluation of results which, in the end, have more lasting impact on performance.

17/11/2012 04:28:12 pm

Hi Ceferino. I agree with you that the workplace provides lots of opportunities for people to learn and develop without access to formal 'training'. It provides great opportunities to learn from experience, to apply learning immediately and to develop reflective insight and practice. In that sense, a reduced L&D budget does not of itself signal the end of learning. I guess the value of L&D in its more conventional sense is that it can provide fresh input, access to different models, standardisation of approaches etc. The question becomes, perhaps: 'how to pursue learning in the face of reduced budgets'. With best wishes. Nick

Emmaline Datey

18/11/2012 06:53:01 pm

I agree with Nick.

19/11/2012 01:20:08 am

Thanks Emmaline. Do you have any experiences of organisations investing or disinvesting in L&D that you would be happy to share with us? With best wishes. Nick

Cefeino

19/11/2012 10:08:50 am

I have designed a Learning and Performance strategy without really putting much dent on the budget by making more use of already available resources. For example, I used our technical experts in designing and conducting technical training program through a technical trainers training program I designed based on my experience in business and operations. Immediately, I have a whole set of technical courses which the trainers can conduct to improve operational competencies. I involved the experts and managers in this activity (as trainers, planners/evaluators) so that they have a say on topic, design and conduct of courses, etc., and develop ownership of the program. I found that in the process of making their training courses, the experts and supervisors/managers develop a deeper understanding of their own areas and relate them to others as they listen to other participants' presentation of their course materials. In effect, a more cohesive group was developed who had a wider understanding of the complete process. I believe that the business impact of the whole process outweighed the cost of the training program and benefited the organization in terms of cost/quality/work relationship improvements.

Dhruva Trivedy

22/11/2012 04:32:57 pm

Nick - Read your blog. My experience tells me that there would be very few responses to the question you have posed at the end of the article. The reason is very simple. Managements are short-sighted and do not think long term. Half of our business would have been lost if they were otherwise. As consultants to the organisation we hand-hold them to come out of this perspective.

22/11/2012 04:35:11 pm

Hi Dhruva. Sounds like you've had some experiences of organisations choosing not to invest in L&D. Do you have any positive experiences from your consultancy that you would be willing to share? With best wishes. Nick

22/11/2012 05:36:59 pm

Thanks for responding Nick. L&D needs to be sold to the entrepreneurs in most cases. However those who wish to invest in L&D mostly are doing so to keep up with the Jones'. A client who wishes to invest in all genuineness is a rare variety, I have yet to come across. I would believe that the organisation is genuinely interested only when I would find concrete follow up mechanisms and proper assimilation of all that are infused as inputs, in order to go up the value chain, and for which proper benchmarks are set.

Ahmed Shteiwey

25/11/2012 12:15:25 am

Hi Nick,
as long as "Employees & Training" are recorded on the accounting books as "Operating Expenses",

"Training" as an "Investment" will continue to be a concept, almost all business people believe in, but rarely practice.

25/11/2012 12:17:04 am

Hi Ahmed and thanks for the note. Have you seen examples of businesses investing in L&D and, if so, what motivated them to do it? In other words, are there positive examples to learn from and build on? With best wishes. Nick

Mukundlal H.R.

25/11/2012 08:53:08 pm

The epitome of every Organization is to attain a Profitable Progressive nature, spreading its might, Externally through its Productline, far & wide, Internally expanding Vertically & horizontally. The Successfull outcome Depends & Demands, a team of Skilled & Dedicated employees, competent with the perspectives at hand, which Only,an Endorsed standardardize training schedule, can achieve !

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17/7/2013 05:01:01 pm

I certainly believe that this is definitely a soft target that can have a really good impact. Planting such small tress help us sustain our economic balance. It’s better to make a strict order on planting trees in our current scenario where the pollution is increasing day by day.