Training and development has always been an important issue within organizations. However well a company carries out its recruitment activities, it will usually be necessary to equip individual employees with the skills necessary to be able to function fully within the organization. Also, as mentioned above, if a company invests in new technology, it will need to train existing employees.
As companies change, individuals have to be trained and developed in order that they can continue to function efficiently. There is nothing new in this. However, for a number of reasons, training has recently become an issue of central concern. Many of the reasons relate to globalization and increasing worldwide competition and the need to control costs. Among of the reasons explained below:
1. Increasing importance of product and service quality
To try to differentiate their product from that of their competitors many companies are increasingly focusing on quality of product and service. Striving for quality generates considerable training needs. For example, shop floor employees need to be trained in techniques such as statistical process control, ‘zero defect’ and ‘right first time’ techniques. If employees are to become responsible for their own quality, they need the skills necessary to be able to correct faults, to be trained in problem solving techniques such as cause-and-effect analysis, for example, Collin (2001).
Equipping employees with the requisite skills to be able to operate in a quality-oriented environment is important, but so too is ‘attitudinal’ training. Employee commitment to quality and to the ethos of continuous improvement requires extensive training in corporate values and corporate culture, in order to instill within the workforce the importance of customer care, service and product quality. Developing a philosophy of quality, or a ‘quality culture’, therefore represents a considerable training and development issue (Mabey and Salaman, 1995).
2. Flexibility
The environment within which companies are operating is becoming increasingly turbulent. If organizations are to be able to adapt to their changing environments, there is a need for employees within the organization to be adaptable also. An organization is only able to take advantage of an emerging market or move into a new market niche if its employees possess the skills to be able to operate effectively within the new market or niche (Crofts, 1995). As such, there is an increasing emphasis on ‘emergent skills’ that might not be necessary at the current point in time, but may well be essential in the future. In such a situation, recruiting employees who are ‘trainable’, and will be willing and able to learn new skills as the organization requires, also becomes important. If the existing workforce is not willing to learn new skills, it may be that the first step would be to train them to accept change and to change their attitude to training.
Also, a workforce will be more effective where employees do not just perform a single job task, but where they are able to move between different job tasks. This requires employees to be ‘multi-skilled’ (i.e. to be trained in a wide range of skills). Employees who are fully trained to carry out all aspects of production can then be moved around as the workload requires (Hyman, 1996).
3. New technology
With the growth in advanced technologies, there is a demand for labor that possesses the requisite knowledge and skill to use the technology effectively. It will be impossible for companies to take advantage of new technological developments, or to adapt to new technology, unless the workforce possesses the relevant skills. It is important for managers to receive training in new technology also, if they are to be in a position to be able to disseminate knowledge to their subordinates (Hyman, 1996).
4. Downsizing and de-layering in lean organizations
In recent times, companies have sought ways to control costs. Sometimes initiatives include stripping out middle-management layers. For the remaining managers and supervisors, their ‘span of control’ has increased. They have become responsible for a wider range of functions and a larger number of staff. As spans of control increase, managers and supervisors are no longer able to exercise direct control over their subordinates.
Instead, the expectation is that the managers will delegate more and trust their staff. Equipping managers with the interpersonal and coaching skills necessary to be able to adopt this style of management is therefore increasingly important (Hyman, 1996). The most difficult challenge is to change the attitude of managers so that they do trust their staff.
5. Employee commitment
There is an increasing realization that the provision of training, employee development and long-term education is central in terms of the generation of employee commitment (Holden, 2001). Studies (Wiley 2010) have shown that training and development play a part in influencing the engagement of workers in organizations. This is highlighted in particular where graduate recruits are concerned. There is an increasing acknowledgement that new graduates will be unwilling to work for companies that do not provide them with opportunities to learn new skills or opportunities for systematic management development (Tulgan 2009).
Employees may view the willingness of the organization to train them and to invest in their development as setting up an obligation that needs to be reciprocated. The employee may then work harder or be prepared to stay in the organization. See more on this in 4.8 Commitment.
6. ‘Spillover effect’
The training of an individual employee may also have a beneficial effect on all the other employees in that team or section. Better performance or more skilled working practice may be transferred from the person who was trained to their co-workers through collaboration and daily interaction. The organization benefits by more than the money spent on one training course. Sometimes managers take a deliberate decision to send only one worker on the course to learn new skills and expects that worker to train the others. This is called cascade training. The advantage is that it is cheaper as only one worker goes on a course. The disadvantage is that if the trained worker has not fully understood the training, then all the workers in that section will not be fully trained as a consequence.
7. Skills and labor shortages
The seventh reason to answer why training and development is important in HRM related to Skills and labor shortages. In times when unemployment is low companies cannot expect to find skilled workers among the shrinking pool of unemployed. In such a situation, if companies need specific skills, it becomes increasingly necessary to develop them in-house. However the reverse is not true, that organizations do not need to train when there are large numbers of unemployed. Most labor markets suffer from skills shortages and so although there may be many people seeking works, they may not have the skills and knowledge required by an employer.
As companies change, individuals have to be trained and developed in order that they can continue to function efficiently. There is nothing new in this. However, for a number of reasons, training has recently become an issue of central concern. Many of the reasons relate to globalization and increasing worldwide competition and the need to control costs. Among of the reasons explained below:
1. Increasing importance of product and service quality
To try to differentiate their product from that of their competitors many companies are increasingly focusing on quality of product and service. Striving for quality generates considerable training needs. For example, shop floor employees need to be trained in techniques such as statistical process control, ‘zero defect’ and ‘right first time’ techniques. If employees are to become responsible for their own quality, they need the skills necessary to be able to correct faults, to be trained in problem solving techniques such as cause-and-effect analysis, for example, Collin (2001).
Equipping employees with the requisite skills to be able to operate in a quality-oriented environment is important, but so too is ‘attitudinal’ training. Employee commitment to quality and to the ethos of continuous improvement requires extensive training in corporate values and corporate culture, in order to instill within the workforce the importance of customer care, service and product quality. Developing a philosophy of quality, or a ‘quality culture’, therefore represents a considerable training and development issue (Mabey and Salaman, 1995).
2. Flexibility
The environment within which companies are operating is becoming increasingly turbulent. If organizations are to be able to adapt to their changing environments, there is a need for employees within the organization to be adaptable also. An organization is only able to take advantage of an emerging market or move into a new market niche if its employees possess the skills to be able to operate effectively within the new market or niche (Crofts, 1995). As such, there is an increasing emphasis on ‘emergent skills’ that might not be necessary at the current point in time, but may well be essential in the future. In such a situation, recruiting employees who are ‘trainable’, and will be willing and able to learn new skills as the organization requires, also becomes important. If the existing workforce is not willing to learn new skills, it may be that the first step would be to train them to accept change and to change their attitude to training.
Also, a workforce will be more effective where employees do not just perform a single job task, but where they are able to move between different job tasks. This requires employees to be ‘multi-skilled’ (i.e. to be trained in a wide range of skills). Employees who are fully trained to carry out all aspects of production can then be moved around as the workload requires (Hyman, 1996).
3. New technology
With the growth in advanced technologies, there is a demand for labor that possesses the requisite knowledge and skill to use the technology effectively. It will be impossible for companies to take advantage of new technological developments, or to adapt to new technology, unless the workforce possesses the relevant skills. It is important for managers to receive training in new technology also, if they are to be in a position to be able to disseminate knowledge to their subordinates (Hyman, 1996).
4. Downsizing and de-layering in lean organizations
In recent times, companies have sought ways to control costs. Sometimes initiatives include stripping out middle-management layers. For the remaining managers and supervisors, their ‘span of control’ has increased. They have become responsible for a wider range of functions and a larger number of staff. As spans of control increase, managers and supervisors are no longer able to exercise direct control over their subordinates.
Instead, the expectation is that the managers will delegate more and trust their staff. Equipping managers with the interpersonal and coaching skills necessary to be able to adopt this style of management is therefore increasingly important (Hyman, 1996). The most difficult challenge is to change the attitude of managers so that they do trust their staff.
5. Employee commitment
There is an increasing realization that the provision of training, employee development and long-term education is central in terms of the generation of employee commitment (Holden, 2001). Studies (Wiley 2010) have shown that training and development play a part in influencing the engagement of workers in organizations. This is highlighted in particular where graduate recruits are concerned. There is an increasing acknowledgement that new graduates will be unwilling to work for companies that do not provide them with opportunities to learn new skills or opportunities for systematic management development (Tulgan 2009).
Employees may view the willingness of the organization to train them and to invest in their development as setting up an obligation that needs to be reciprocated. The employee may then work harder or be prepared to stay in the organization. See more on this in 4.8 Commitment.
6. ‘Spillover effect’
The training of an individual employee may also have a beneficial effect on all the other employees in that team or section. Better performance or more skilled working practice may be transferred from the person who was trained to their co-workers through collaboration and daily interaction. The organization benefits by more than the money spent on one training course. Sometimes managers take a deliberate decision to send only one worker on the course to learn new skills and expects that worker to train the others. This is called cascade training. The advantage is that it is cheaper as only one worker goes on a course. The disadvantage is that if the trained worker has not fully understood the training, then all the workers in that section will not be fully trained as a consequence.
7. Skills and labor shortages
The seventh reason to answer why training and development is important in HRM related to Skills and labor shortages. In times when unemployment is low companies cannot expect to find skilled workers among the shrinking pool of unemployed. In such a situation, if companies need specific skills, it becomes increasingly necessary to develop them in-house. However the reverse is not true, that organizations do not need to train when there are large numbers of unemployed. Most labor markets suffer from skills shortages and so although there may be many people seeking works, they may not have the skills and knowledge required by an employer.