Developing Talent Through Strategic Training

Among the wide range of organization management practices, training is arguably the most frequently adopted strategy for developing job-related knowledge and skills that individuals need to enhance their work performance.

When effectively planned and implemented, training can be extremely beneficial to both individuals and organizations. It enhances learning capacity, increases employee engagement and loyalty, improves more job satisfaction, reduces turnover rates, improves performance, leads to higher profit margins, and even enhances income per employees.

Despite these benefits, the overall return on investment (ROI) in training is debatable. Ample evidence shows the ROI for training remains much smaller compared to the enormous costs incurred.

In the first of the four-part Talent Development Webinar series hosted by MSCI on April 11, 2024, (watch the replay here) I and  participants from the MSCI member companies took a close look at training as an industry, its proven benefits, as well as remaining/emerging challenges.

When done right, training can make a profound impact on both the employees and the employers. The key is to ensure training is used strategically as the “right” solution. Here is the recap of the key ideas covered in the webinar.

Who’s your talent?

To use training as an intervention, we need to first understand who needs to be trained. “Talent” has become a business buzz word — so popular that it is our daily language. However, the meaning of “talent” can differ greatly depending on different individuals and their point of view. Here is my take on talent:

• Every individual has talent within, visible or hidden.
• Talent can be innate or learned.
• Every individual has the potential to create added value, big or small.
• All employees have potential talent that is worth nurturing or developing.

What is your definition of talent? Who do you consider as talent within your company? Based on your experience and observations, which groups of employees in your company have received the most attention in terms of investment in training, and why? These questions are important to answer because they are the underlying values that drive your company’s training practices.

What is training like as an industry?

Training has been such a popular organizational strategy that there is an entire industry built around it. The 2023 Training Industry Report, produced by Training magazine and based on a survey with U.S.-based organizations of all sizes, revealed some interesting findings. For example, in 2023:

• A total of $101.8 billion was spent on training.
• An average of $954 was invested in each learner.
• An average of 57 hours of training was provided to each learner.
• On average, organizations allocated the biggest portions of their training budget to mandatory compliance training (13%), management/supervisory training (12 percent), followed by onboarding training (11 percent) and DEI training (7 percent).
• In terms of training delivery, companies have begun transitioning from remote training during COVID-19 back to in-person training post pandemic, especially in areas such as managerial/supervisory skills, interpersonal skills, and onboarding training.

Going forward, the report highlights three top priorities for training in terms of resource allocation in 2024:

• To increase the effectiveness of training program
• To increase learner usage of training programs
• To measure the impact of training programs.

To add more food for thought, here are some additional statistics based on another 2023 study on employee training and development.

• Only 41 percent of all U.S. employees are formally trained.
• 59 percent of employees report no formal workplace training.
• 52 percent of companies provide one week or less of training.
• Only 29 percent of employees are very satisfied with current career advancement opportunities.
• 74 percent of employees identified the lack of employee development opportunities as a barrier for them to reach their full potential.

What can you do to optimize training?

Despite the challenges mentioned above, the need for training will only increase. For organizations to thrive in the digital world, they must upskill and reskill their employees and adopt a more human-centered management approach. This presents a tremendous opportunity for training. It’s time to let training shine! In the webinar, I mapped out an action plan consisting of nine elements.

Cultivate the ‘right’ mindset. Having the right mindset is the first step towards effective training. It is critical to remember that training is not always the solution. So, take your time to distinguish between your needs and your wants, to focus on the end (performance), not just the means (behaviors); take time to start evaluation from the outsets.

Seek strategic alignment. Training can be impactful only when it is strategically aligned with the external business environment (labor market, customer needs, etc.), the organization context (vision, mission, structure, culture, and processes), business strategies, and performance needs. Without such alignment, training can be aimless.

Clarify the purpose. Ask yourself: what goals do we try to achieve through training? Because training can serve different purposes, and depending on the purpose, the outcomes of training may or may not be easily observed or quickly transferred. Generally speaking, here are five goals for training: to elevate awareness; to change behavior; to enhance performance; to develop competencies, and to build expertise.

Take a systematic approach. Regardless of the methodology you choose, the key is to have a systematic plan or process in place. One of the popular training models is ADDIE — Analyze, Design, Develop, Implement, and Evaluate. These five steps are by no means a sequential process, and you can start from any phase. However, to make training truly effective, you must invest adequate time and energy in analysis (A) and evaluation (E), which are commonly overlooked in practice.

Identify the root cause. Very often, the need for training is initiated because something is noticeably wrong or not working. For example, your sales people are not meeting their monthly sales quotas; you receive more customer complaints about your employees; you see multiple errors in a work report from your subordinates. These issues can lead you (manager or supervisor) to turn to training as a quick fix or solution. However, more often than not, they turn out to be the “presenting” problems; and what you see is likely the symptom rather than the root cause. The good news is, there are a variety of tools out there to guide you for root cause analysis, for example, the Fishbone Diagram.

Adopt best practices. One of the easiest ways to improve your current training is learning from others’ successful tips. In my webinar, I highlighted six for your consideration:

• Make training an ongoing process instead of a one-time event;
• Incorporate videos into training to enhance understanding and knowledge retention;
• Personalize training to accommodate individual learning need;
• Make training easy to complete;
• Use learning management system (LMS) to facilitate training delivery; and
• Provide on-demand training opportunities to allow employees to participate at their own convenience.
  

Measure the impact. Remember the old saying: what gets measured gets done. First, make sure you identify or develop specific, quantifiable measures to start with. Second, determine what you will measure and at what levels. Typically, all training programs are measured at Level (Reaction) and Level 2 (Learning), and mostly at Level 3 (Application). However, very little effort has been made to measure the degree to which training impacts the bottom-line results — Level 4 (Impact), and even less to calculate the return on investment in training (Level 5, ROI). To ensure training a strategic intervention, you must evaluate its outcomes across all levels.

Conduct proper evaluations. To be able to capture the impact of training requires proper evaluation tools. Different types of evaluations exist for different purposes; knowing when to use what is critical to success. Here are three approaches to evaluation:

• Formative evaluation is usually performed when conducting during performance analysis, cause analysis, and selecting/design of interventions. It is diagnostic, ongoing, developmental, and continuous. The data generated from this type of evaluation helps improve the effectiveness of the training program.
• Summative evaluation is usually performed during the delivery and after completion of the training program. The data generated from this type of evaluation helps determine immediate competence of trainees and the overall effectiveness of training.
• Confirmative evaluation is usually performed six to 12 months after completion of training. It is built on and goes beyond formative and summative evaluations. The data generated from this type of evaluation helps determine knowledge and skill transfer, ROI, and organizational impact.

Facilitate training transfer. The ultimate goal of training is to apply new learning at work. However, research shows that there are multiple barriers in the workplace that prevent employees from incorporating the newly acquired knowledge and skills into daily practice. Some of the major barriers are unfavorable work conditions (time pressure, inadequate equipment, inadequate budget, few opportunities to use new skills), lack of peer support, and most of all, lack of management support. Removing these barriers is essential to ensuring desired training outcomes.

To conclude, the best investment you can make as an organizational leader is in your people. Since resources are finite, invest strategically in programs that will truly make a difference. When you manage to do so, your company will reap the benefits generated by your skilled and engaged employees.

Jia Wang is a professor in the Department of Educational Administration and Human Resource Development at Texas A&M University. Her research focuses on international and national human resource development, organization crisis management, and learning within organizations.