The corporate training conundrum
Pouring resources into upgrading employee productivity is not enough by itself in this time of rapid technological change
While addressing the employees of the bank just before her retirement, former chairman of the State Bank of India (SBI) Arundhati Bhattacharya said she would like to believe that she is leaving behind a “learning” organization. The underlying anxiety in this remark was probably due to the impact of digitization on the bank’s competitive preparedness to meet the challenge from nimble plug and play fintechs and new entrants in the financial sector, which is witnessing a lowering of entry barriers.
In my almost four-decade association with SBI, one common refrain throughout the organization was about the lack of adequately trained/qualified personnel to man desks dealing in specialized matters like forex, treasury and lending. This was despite a structured training needs assessment done by the human resources department with the heads of operational functions. Based thereon, a training calendar was drawn up and implemented. Now, with the advent of digitization which has significantly altered the structure of competition in the industry, this problem has become only more acute. The number of specialized areas requiring trained/experienced personnel have expanded to include new areas like risk management, compliance, data analytics, wealth management, etc.
Beyond the financial sector, it is true that most big organizations have large budgets committed to “renewal” and learning to help fight the difficult battle of bridging the knowledge and skill gaps of its personnel—and implementing the change agenda in an ever-changing business ecosystem. For example, SBI boasts of a robust training infrastructure with five “apex” colleges and almost 60 learning centres; the bank spends an average of Rs180 crore annually on learning and development for its 280,000 employees. Other large organizations are known to have a similar resources commitment to their training systems. However, the effectiveness of the initiatives taken by all organizations for improved workforce quality is a moot point. Training evaluation models like the Kirkpatrick four-level model and the Jack Phillips method have been subject to much abuse and have not proved to be reliable indicators of the efficacy of the training systems in individual organizations.
According to a Harvard Business Review (HBR) survey last year, almost 70% of all programmes conducted worldwide are related to leadership development. American corporates spent $356 billion in 2015 on training their employees, but only one in four of them observed any salutary impact on the organization performance. Employees mostly reverted to their old styles of working post-training. As such, HBR aptly termed it the “great training robbery”.
To be fair to the training systems within most organizations as well as independent training institutions, vast improvements have been made in the last two decades in the areas of training methodology and delivery. Moving from the standard “one size fits all” classroom training to on-site trainings through visiting trainers and helplines, the system has today gone on to make growing use of AI (Artificial Intelligence) and neuroscience. It has delivered inputs through gamification, e-capsules, webinars, etc., to empower the employee in internalizing the requisite inputs for a better delivery of his responsibilities. In many service organizations, including banks and insurance companies, machine learning has also been made possible with lessons, etc., delivered to the screens of individual employees. Morgan Stanley, for instance, has seen tremendous benefit from this in their wealth management practice in the US.
Significant emphasis is placed these days on mentoring to develop a leadership pipeline. Also, there is incentivization for the employees to take up external certification programmes to improve their skills and knowledge. As such, to bring training within reach of all their employees, many organizations consciously work to ensure the availability of the five “A”s of training: anywhere, anytime, any content, any device and any one.
But no matter how good the quality of inputs may be from any of the delivery platforms, the success of the training system in any organization is dependent on how effectively the top management is able to obtain unvarnished feedback from trainees on the efficacy of the programmes. The management must necessarily utilize the feedback to draw up a training strategy which is in line with corporate goals and values. It then needs to champion the change agenda prompted by the training system for heightened performance.
To do this successfully, the leadership may have to prepare their personnel and create fertile ground for the cross-department collaboration necessary to embrace and implement the change. Continuous organizational learning and renewal is one of the elements—along with human resources, strategic choices, efficiency of implementation and effective leadership—essential for an organization to become high performing in an overall sense. After all, those who sweat more in training, bleed less in combat.
The training system is, therefore, an important facet in any organization’s efforts at having a competitive advantage built on strong core competencies and cultural capabilities. Any shortcoming in this regard would, probably, indicate that the organization is over-investing in training but failing to put talent development in its proper strategic change context.
Ashwini Mehra is former deputy managing director of the State Bank of India.
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