Line of Business
Skimping on staff training is "risky" for Canadian firms
While many cash-strapped Canadian firms are cutting (or eliminating) staff training to save costs in these dire times, experts warn this could be a low-gain, high-pain approach. Instead they suggest exploring creative approaches to training that are flexible, but get the job done. INCLUDES VIDEO.4/27/2009 5:00:00 AM By: Joaquim P. Menezes
As Canadian firms struggle to contain costs and keep the lights on, employee training is an area hard hit by the financial downturn.
According to surveys by analyst firm Info-Tech Research Group, cutting "discretionary spending" – including staff training programs – is one of the earlier, "almost reactionary steps" taken by many Canadian firms.
It represents one of the four main major cost-cutting areas for Info-Tech clients, said Robert Garmaise, vice-president of research and strategy at London, Ont.-based Info-Tech.
Others are staffing and salary changes, project portfolio management, and vendor and outsourcing management.
Garmaise was speaking on IT Cost Reduction in 2009 at IT360, a day-long conference and expo held in Toronto earlier this month.
He said businesses should be extremely wary about cutting or eliminating expenditure on staff training, conferences, team-building and such activities.
"Attempts to reduce these are fraught with risk" and represent a "low gain, high pain" approach. "They may save costs a little, but can have a big [negative] impact on the client organization."
Read related article: Ten "low pain, high gain" ways Canadian firms can cut IT costs
It's a view echoed by Cushing Anderson, program vice-president for project-based services research at analyst firm IDC in Framingham, Mass.
IDC's Corporate Learning Outlook for 2009, he said, shows that cash-strapped businesses are likely to implement cuts in staff training programs.
"Budgets are being scrutinized, held flat, or sometimes slashed," said Anderson in a keynote Web cast titled "Maximizing the value of your training through flexible delivery." The keynote was part of the Virtual Education Learning Symposium 2009 hosted by SAP AG last week.
But if the general tendency these days is to reduce or eliminate staff training, at least a few Canadian firms are bucking the trend.
One of them is Harry Rosen, the well known chain of men's fashion stores.
"Today, when the situation is difficult I'm going to intensify training for the staff," said executive chairman Harry Rosen, during a recent Microsoft Canada-organized SMB roundtable.
In many stores, said Rosen, employees are distanced from buying decisions, not really understanding the product.
By contrast, exceptional customer knowledge and service distinguished his store from the very beginning, he said.
"I kept records of everything customers purchased, everything I knew about them. Customers understood I really knew about them and came back to shop with us frequently."
As business grew, Rosen worked with his staff to fine-tune this process of capturing customer information. "The focus was on relationship building."
And ongoing staff training helped maintain and intensify this focus.
For this reason, even during the tough 1980s recession, Rosen recalls, his firm didn't skimp on training – and he attributes a big part of its success in those difficult times to that.
Today, confronted with another market downturn, Rosen is once more reviewing what the most appropriate strategy should be for his menswear store chain.
"It doesn't appeal to us to introduce a lower-priced product," he said. "We're probably going to sharpen the selection at certain price points, but aren't going to trade down."
Instead in order to deepen the customer focus at his stores staff training will be intensified.
"I believe in spending money sending staff to trade shows, visiting vendors, talking to them. It's very expensive, but makes career people out of the sales persons, makes them fully informed about their customers."
Recent research indicates such an approach can pay off … big time.
IDC's Anderson says the analyst firm's researchers have uncovered compelling examples of how trained employee teams have improved performance.
Teams that met most or all of their objectives were found to have had "twice the amount of training" than those that met with little success, he said.
One IDC study found well-trained IT teams were at least 10 per cent more productive than average ones. "In a specific case, it resulted in more than $70,000 improvements in productivity every year -- the equivalent of one full-time team member in a 10-person IT support team."
On the flip side, Anderson suggested that cutting down on necessary training for IT staff could be very risky.
A new tech rollout is usually a complex and longwinded affair, he noted, with testing and implementation taking weeks, if not months.
After all that effort, he said, trying to manage or even use a technology or product without adequate skills sharply reduces the benefits it could offer.
That's why IT managers polled by IDC believe their team's skill "is the most important factor in the success of critical IT functions."
Page Navigation 1) "Today, when the situation is difficult I'm going to intensify training for the staff." - Page 1
2) Cost, convenience, mobility, engagement, and even corporate culture determine choice of a training method. - Page 2
3) Right now Intel favours a "blended approach" to training. - Page 3
| Bookmark: delicious | Google | Technorati | StumbleIt | Yahoo! |
 |
|
| Related Articles | |
|
Security requirements complicate software rollout Certifiably prepped thanks to e-learning tool Good reasons why video games are great for the ... |
blog comments powered by Disqus
