THE ROLE OF THE WORKPLACE ARCHITECT-LEARNING TO MANAGE THE WORK-LIFE MERCENARIES-SPEAK TO BE LISTENED TO ,NOT MERELY HEARD-THE POWER OF COLLECTIVE TALENT-
The role of the Workplace Architect
SHAPING THE FUTURE
In the concluding part of the series on the New Organisation, we take a look at HR’s future role and the capabilities that will be required from HR professionals
Trust and commitment will be the driving values of the New Organisation, which is characterized by dynamic human interactions and flexible work systems. The challenge in the future for organizations would be to have processes, systems and interactions that foster and strengthen these values. To do so, organizations would need to constantly innovate and strengthen their ability to foresee and manage diverse individual needs, and align individual energies to organizational goals.
In the new scheme of things human resource management is no longer the job of one designated department but a collective responsibility shared across the organization. Given this fact, the HR department’s role would necessarily have to change. On of the key responsibilities of HR in the New Organisation would be to build facilitating mechanisms, processes and tools that would equip organizations and individuals to take ownership of this shared responsibility.
HR’S NEW RESPONSIBILITIES
HR’s role in the New Organisation will be more as Workplace Architects, responsible for creating effective workplaces that deliver business goals. The workplaces will be defined not merely by the physical or virtual space but also by the behaviour and interactions of employees. In the New Organisation, the Workplace Architect’s responsibilities will extend beyond the traditional service and strategic advisory role to creation and design of new workplaces. It will go beyond consultative advisory to becoming central to business and organization architecture. As talent becomes the crucial denominator in instilling business competitiveness, Workplace Architect will emerge as pivotal managers in delivering people value. HR would have to transform, as businesses will look towards it to deliver tangible commercial benefits.
Besides working with business in ensuring that goals are achieved; these new Workplace Architects will also be responsible for:
1. Looking ahead to the future and developing organization capabilities and creating new talent pools.
2. Building workplaces that have the capability to embrace diversity and enhance productivity.
3. Managing and facilitating change while simultaneously providing the anchor for continuity.
DEVELOPING AND CREATING NEW TALENT POOLS
In these times of scarcity of employable skills, the new Workplace Architects will be required to play a larger role in sourcing and grooming talent for the New Organisation. Their role will go beyond merely identifying and recruiting talent but will extend to creating new talent pools and training individuals and communities with organization specific skills and capabilities. Their role would extend beyond the workplace to partnering with schools and educational institutes to develop the right skill sets and groom and nurture new talent. The need for such partnering will be driven not only by the woeful shortage of trained people and the inadequate employable skills imparted by our education system but also by the fact that organizations are getting more and more specific in their requirements of skills to deliver business goals. Data suggests that only 10,000 of the 90,000 management graduates who qualify each year from different institutes in India are employable. The situation is equally alarming in the engineering field where only 25% of the total engineering graduates who pass out every year are employable. A key responsibility of the Work—place Architects in the New Organisation would be to take an active and partnering role with educational institutes in developing course curriculum, teaching, methodologies and ensuring that relevant work-specific skills are imparted in schools and colleges. Companies like Infosys, TCS and many other organizations have already taken the lead in this and are partnering with engineering colleges to make the academic curriculum relevant to work needs. For instance, Pune-based Zensar has forged an alliance with Symbiosis to hire 180 students. While Zensar is teaching these students the elements of IT in its two-year programme, Symbiosis focuses on teaching them management as part of the curriculum.
Besides contributing to identifying and developing new talent pools these new Work Place Architects would continue to be responsible for ensuring that the workforce remains committed, creative and motivated by providing learning opportunities that help them develop their spectrum of capabilities and skills. With organizations seeking shorter time horizons to success, the challenge for these Workplace Architects shall be to find ways to minimize the time horizon between learning and delivering outcomes. The Workplace Architects have to continuously find inventive and creative ways of building a culture of learning and relearning. This may include building processes and systems that allow for learning and assimilation through experimentation.
BUILDING PRODUCTIVE WORKPLACES
Earlier, individuals had to be flexible to fit in with organization norms. Now, however, the New Organisations will need to be flexible to adjust to individual needs. One of the key responsibilities of the Workplace Architects of the future would be to create work systems and environments that are capable of embracing diverse individual needs. The role would encompass building structures and systems to engage with professionals in different ways — be it employee, service provider, free agent — and have the capability to connect across locations. Although technology would be central to building these workspaces, the new Workplace Architects would be at the forefront of building organization capabilities to manage these dynamics. Besides leveraging the power of technology to connect remotely, environment sensitiveness would be needed to utilize physical spaces effectively to enhance individual productivity. And at the same time, the Workplace Architects would have to be culturally and socially sensitive in matters of communication, feedback, work management and work-life balance.
Industry and enterprise is witness to myriad kinds of change — change with growth, change through mergers and acquisitions, right sizing, de-layering, change in the way people engage with enterprise and so on. A key responsibility of the new Workplace Architects would be to manage change and to counsel or guide employees through work-life transitions that are often an outcome of the change. It will not be unusual to hear of organizations transitioning through several phases of growth and restructuring arising out of mergers and acquisitions—in such situations the role of the Workplace Architect would be to manage continuity with change.
A NEED TO BROADBASE CAPABILITIES
In order to deliver credibly and effectively in the New Organisation it will be necessary for Work—place Architects to have a solid foundation of professional expertise and understanding of what drives and motivates individuals. They would also need to broad-base their capabilities so they can contribute and lead by providing strategic forward-looking perspectives in matters of engaging with people.
Understanding business will continue to be a key skill requirement for Workplace Architects. A deep understanding of organizational DNA shall be required so as to consider and evaluate strategic choices. In addition, individuals will need to build capabilities in the following areas.
1. Understanding the skills market place, the competitive landscape, and market and business constraints.
2. Understanding technology and its ability to empower so that desirable outcomes are achieved.
3. Understanding usage of spaces — both real and virtual — in building productive work environments.
4. Managing diversity not merely in terms of workforce ethnicity and talents but also in terms of work arrangements and models.
5. Guiding and counseling people through periods of transition.
6. Using analytical and predictive tools in assessing talent movements and trends and in proactively addressing change emerging from these movements.
7. Using organization audit tools and measurements as a means of identifying organization gaps and providing effective decision support.
People are central to business success in the organizations of tomorrow. It is, therefore, important that businesses should have the capability to forecast workforce market trends and understand the voice of their people just the way a market researcher understands and works upon the voice of the customer. This will enable them to make the right strategic choices. The time has come for tomorrow’s Workplace Architects to not merely align but lead people in achieving organization goals.
If there is one word that you constantly hear in corporate corridors in India today, it is ‘innovation’. It has literally become a buzzword for companies moving into the super league.
Innovations in product, technology, marketing approaches, services, business strategy and procedures can only come about through innovations in HR to provoke out-of the-box thinking. As somebody pointed out, successful innovation is not about ideas or inventions — it’s about the people. Rising to the challenge more and more, companies are coming up with strategies to instill a culture of innovation and competitiveness among employees.
There is no fixed approach to driving innovation — for some companies it is about creating a more fun, open atmosphere at work so that the environment can produce a Eureka moment. For others, it could be through promoting diversity. Several companies invest in training so that employees abandon linear thinking and breakout of associative barriers. Another trend — at least among the IT firms — is the appointment of Chief Innovation Officers.
Here are some ways that companies go about making innovation a religion among their workforce.
1. Creating a culture of change: -- A Gallup poll of over a million employees in 400 companies showed that at least, 50% were performing below potential. Obviously, then attitudinal change was called for. To shake up people and drive performance, companies recognize the imperatives to introduce a culture of change. For instance, Jubilant Organosys has introduced Sankalp, ‘a mass movement for change and renewal’. The idea, according to Jubilant, is to discard the conventional ideas and encourage new thinking among employees.
2. Relentless questioning: -- Encouraging employees to ask questions often stimulates innovation. Many companies today have out-of-the-box idea boxes in the office where employees can drop their suggestions and ideas. Some even have questions boxes to encourage a culture of asking questions. At Airtel, experiments were done with ‘appreciative inquiry’, an organizational development tool that is used to foster change as well as create more of what’s working and what’s not.
3. Setting stretch targets: -- Taking a lead from Jack Welch’s famous stretch targets at GE, many companies today believe in setting goals that are outrageous and look well-night impossible. Either way, it is a win-win situation as stretch targets always energize people. As Welch himself famously said, “We have found that by reaching for what appears to be the impossible, we often actually do the impossible; and even when we don’t quite make it, we inevitably wind up doing much better than we would have done”.
4. Fun at the workplace: -- A joyful environment promotes the spirit of innovation. Innovation cannot happen in an environment that is not fun. Recognizing this, most companies today invest in a fun-filled workplace where people volunteer to do certain assignments because it is enjoyable.
5. Making room for failure: -- There is no success without initial failure. When new ideas come forth, not all will succeed. Rather than reject ideas, allow room for experimentation. Often failure to implement an idea will force the employee to quit the workplace and start-off an entrepreneurship based on that same idea.
Ultimately, it is about giving the right inputs. Successful ideas only burst forth when companies manage to create conditions that are conducive to innovation. It’s therefore, necessary to have an open culture, encourage questioning, break down associative barriers, challenge assumptions and provoke non-linear thinking for growth.
SHAPING THE FUTURE
Learning to manage the work-life mercenaries
In the second part of our series on challenges in the New Organization, we look at the people dimension
While technology and communication will change the way the New Organizations operate, the real change will be in the way people and organizations interact. The ‘people dimension’ in the New Organization will, therefore, be of critical importance.
Individual expectations from work today are very different from the past. Earlier, individuals sought security in employment and in return gave loyalty. Today, they seek opportunities for impact, contribution and growth and in return help create individual and collective value for themselves and for the organization. They view their work as a means of personal fulfillment and are increasingly motivated by intangibles such as work-life balance, spiritual fulfillment and values. You could call them ‘work-life mercenaries,’ moving jobs and careers to achieve personal aspirations. They view career growth and professional development as their primary responsibility and use organizations as a vehicle for personal and professional growth.
Increasingly, this New Organization employee will seek our opportunities for adding to his or her portfolio of capabilities/strengths rather than focus on security. Respect and credibility are today more important than authority and power. Despite the short-term nature of project spans or job contracts, employees today look for work that not only makes remunerative sense but also gives them a sense of purpose, of achievement, of learning, of contribution and of leaving a legacy of work well done and values well lived. In short, they will expect more out of work and more control over when, where, how and with whom they work.
This new orientation will mark the shift in the way organizations will view talent and the way they engage with it. Attitudes will change from ‘people have the capability to manage themselves’. The new thinking will be – people create value rather than organizations create value.
Facilitating effective human interactions and flexibility will, therefore, be the keystones in managing the people dimension of the New Organization. This will be seen not only in the way offices are built but also in the way responsibilities, ambitions and outcomes are aligned.
Personalized office rooms and names plates will be an anachronism as the focus will change to-wards creating interactive work spaces that are used by ‘work life mercenaries’ or ‘work nomads’. With virtual offices becoming a growing reality, the need would be to create effective workspaces for human interactions that are available on a need basis. The new workspaces will focus on promoting people productivity and protecting health, on being environmentally responsible and finally on being cost-effective. Already, several companies are looking beyond effective utilization of floor space index to better use of natural resources, including light and greenery, conservation of water resources and ergonomically designed spaces that improve productivity. The ITC,WIPRO,IL&FS, ONGC offices are examples of ‘green’ offices or ‘smart’ offices.
MANAGING PEOPLE – EVERYBODY’S RESPONSIBILITY: No longer is the people dimension of an organization solely the HR director’s responsibility. With talent becoming the critical differentiator between organizations and with individuals dictating the terms of engagement, the responsibility for managing people will devolve across all levels – from a CEO to a team member or peer. Questions that will be asked at various levels are:
CEOs – are we listening to our employees?
Managers – are we investing and enabling people to succeed?
Peers – are we sharing/collaborating to grow?
CEO responsibility will also include talent transformation, helping employees and independent work-agents enhance their portfolio of strengths. Significant management time and effort will be spent on issues of nurturing and retaining talent. For instance, Genpact’s CEO and president, Pramod Bhasin, allocates nearly 40% of this time to people issues – reviewing talent, overseeing training programmes, conducting Town Halls and skip-level meetings, and talking to associates in every corner of the globe. Jeff Immelt, chief executive, GE is reported to spend 30% of this time on people matters – the same amount of time he spends on, say, business, finances or operations.
The Economist Intelligence Unit in its annual survey of CEO’s Corporate Priorities for 2007 and Beyond also points out that 51% of CEOs in the emerging markers consider talent management as their top priority along with managing globalization.
Meanwhile, the manager’s focus would be on providing an environment to enable people to succeed. With the growing tribe of distant workers, it will become important to find ways to keep people connected to the business direction, mission and culture, as well as keep them linked to the internal organization networks. New responsibilities will include managing and evaluating people whom one may rarely observe, guiding team members to bridge language barriers, communicate across cultures, and operate within the business practices of other countries, as well as helping distance employees get the opportunities and support they need for career advancement.
As for peers and team members, it is increasingly evident that responsibility for people perform-ance also vests with teams and co-workers, too. Sharing, talking, collaborating are ways of growing. A well known MIT study found that people are five times more likely to ask a co-worker for information than to consult the Internet, database, or computer system. Research also indicates that globally more than 67% of the workforce learns most when working together with a colleague on a task. The organization will, therefore, look at ways by which the practice of knowledge sharing and collaboration becomes a habit.
CONTINUOUS LEARNING WILL BE THE KEY TO GROWTH: Even as individuals hone their skills through self-identified learning programmes, organizations will constantly seek ways to provide them experiences where there is an opportunity to learn. At the organization level, focus will be more on building systems that foster continuous learning and enhance creativity and problem solving. Collaboration and team performance will also be an area of focus. Organizations would also adopt a wide variety of training systems that will include secondments and project-based assignments. Several companies today encourage employees to identify learning paths that fit in with their long—term career goals, some even offering online learning systems that give employees the flexibility to learn at their own pace. Others even go so far as to en—courage employees to pursue a learning activity – not necessarily work related – of their choice.
On their part, individuals will increasingly opt for coaching and mentoring as it can be tailored to their specific learning style.
The challenge for organizations will be to find effective ways to capture individual learning through work experience in ways that can be shared. Knowledge Management Systems seek to do that.
FLEXIBILITY WILL BE THE ORDER OF THE DAY: Diversity at the work place will be visible not only in terms of gender and ethnicity but also in terms of individual needs, ambitions, and aspirations. Organizations, therefore, need to build systems that have the ability to embrace this diversity, manage complexities that could arise out ofmeeting the different needs and stay business focused.
Flexible work systems are therefore imperative. This will include having different work engage-ment models – employee, consultant, and service provider. We already see evidence of this in organizations with persons engaged on short duration basis of specific skills/needs. Organizations will also have to look at a host of ways to address specific needs of individuals – this would include flexible work hours, flexi-location models-home or office, flexi-compensation systems, flexi-learning systems, etc.
Multinational like Accenture, Cisco and IBM are increasingly adopting innovative work models such as telecommuting. Pregnant ladies, people with health concerns, those with family commitments, and employees who are on tour frequently benefit from such a framework.
Cisco encourages this practice in India as well, and most employees have the flexibility to work from home or outside of office on an ad-hoc basis. IP solutions from Cisco and emerging technologies like Tele-Presence are making location irrelevant and remote working feasible.
At IBM India too, the focus is on results, not on activity or face-time. Ideally, what the employee does is important-not where he or she does it, or how many hours it takes. Over 40% of IBM’s global population works in a mobile environment and 78% of IBM managers have a team with some remote workers. Work from home option is accepted and utilized more, with an increase of 50% since 2004.
Companies are also adopting flexi-learning systems for employee development. Tesco en—courage’s its employees to register for a retail certification course from Indian Institute of Manage—ment.
At the heart of the New Organization, which is centered on human interactions and flexibility, lies trust and mutual commitment between individuals and organizations. The challenge in the future would be to have processes, systems and interactions that foster and strengthen this trust. Or—ganizations would, therefore, need to constantly innovate and strengthen their ability to manage diverse individual needs, to foresee requirements and proactively address these.
Workplace coaching is taken to new levels as companies strive to ‘ignite the genius’ within their employees
How to unleash the true potential of employees is a challenge most corporates face. One way is through corporate coaching. It’s a concept that is fast gaining ground among Indian companies at all levels, including the CEO and CFO level.
Among others Godrej Industries, L&T and Bharti Telecom have introduced coaching at the workplace. Issues tackled could range from time management to motivation, unlocking passion and creativity. But people issues – how to influence, garner support and increase engagement – are the biggest areas where companies seek coaching support.
According to Santosh Babu, managing director, Training Alternatives, who provides executive coaching, there are two kinds of models for coaching – the first is business expertise coaching while the second is behavioural or systemic coaching. Since the term coaching is a sporting lexicon, he gives an analogy from the field. In the first case, a great sportsman himself turns to coaching – say, a Franz Beckenbauer. In the second case, a Nambiar or a John Buchanan is called in for coaching help. Now Nambiar is not a great runner yet he could unleash the potential in P.T. Usha, while Buchanan, a management expert, has worked wonders with the Australian cricket team.
So, essentially, it’s all about unleashing potential or “igniting the genius within”. The assumption is that talent, ideas and skills are latent in you. According to Babu, at the corporate level, you could either get in a business consultant to provide coaching or go in for a behavioural coach.
Essentially, there are different types of coaching available.
1. Top leadership coaching: Increasingly, talent management experts like Anil Sach dev of Grow Talent, Pavan Chowdhary of Yvonne or Tarun Sheth of Shilputsi are being called in to coach CEOs and COOs. Basically, coaches act as their sounding board and help them navigate their business as well as personal challenges. According to Santosh Babu, often CEO coaching turns out to encompass the whole company since you end up reaching out to the whole team to align them to one line of thinking. Often it is situation specific. For instance on his website, Prasad Kaipa of the Kaipa group mentions instances wherein he was called in coaching when a new technology was about to be introduced in a company, or when a CEO and the founding chairman were not seeing eye to eye.
2. Coaching workshops for managers: Today, many companies are sending their managers to training programmes where they learn to be coaches so that they can assist their team to hit peak performance. In a way, this also proves to be another platform for greater employee engagement and for upping productivity. For instance, recently Training Alternatives prepared about 200 people from Bank of America’s BPO to be coaches and mentors. Here the tacit knowledge of the manager is used to get the best out of his team.
3. Hiring a coaching firm on a retainership basis: This works quite akin to an employee assistance programme or healthcare programme. So, corporates tie up with such a company and employees are free to seek coaching support any time to scale up performance.
4. Last-ditch effort: Earlier, this was done to help a failing manager. But these days the trend is reserved with coaching provided more to high-potential executives.
5. Life Coach: This is more of a spiritual, inner awareness programme. Just as an image management expert is used to refurbish the external look of the person, the life coach tackles the inner conflicts within the person.
Finally, what most corporate coaches stress is that to achieve optimum results, the session needs to be taken seriously by the participant, the feedback and advice has to be acted upon diligently. Effective coaching hinges totally on the individual.
Preparation, presentation, passion and power are the four simple constituents that can make you a great speaker
It is an undisputed fact that being good at your career is an absolute must for consistent career growth. But how do you get to the top? The answer lies in following the four P’s…
Preparation: good preparation is the key; you should have a sound knowledge of the topic, and have plenty of specifics and analogies to use for examples.
Presentation: next, no matter what you’re speaking about, how you present it and how you look presenting it has a lot to do with how well others will listen to you. Decide before you begin just what kind of examples to use, or if there are any ways you can enhance your presentation with audio-visual material, pictures, or illustrations. You could start by examining whether your speech has those intimidating little sound patterns like ‘um,’ ‘arr’ and ‘ah’ that only weaken the impact of what you’re trying to say thus portraying you more as an indecisive than an assertive speaker. Your ‘present—ability’ increases by being tidily dressed, having a pleasant disposition, and adopting positive body language.
Passion: the key to speaking to others is, in a way conveying to them your passion.
Power: the more passionate you are about something, the greater your power of conviction, your self-belief.
The most effective speakers are the ones who combine all the four ‘Ps’ in a way that makes people sit up and listen. The trick is to find your own personal balance and make your passion and power of conviction come through above all else.
SHAPING THE FUTURE
The power of collective talent
Focusing on the star performers alone no longer works –it is imperative to broad-base training now
Call it talent multiplication, managing the middle or broad basing training, but one thing is evident. Companies are fast changing their leadership training strategies. Focusing on a select few A-level managers or ‘star performers’ is today fraught with risks given the high rates of attrition. Instead, it makes sense to spread the leadership training to all levels. Those men out there in the middle, managing small business units or teams are as important to the company today, as the flamboyant leader at the front or even the high potential entry-level candidate.
Till recently most companies ignored the middle or discounted the contributions made by them. So compensations were not aligned to their performance, and no clear strategies were made to elicit commitment from the manager in the thick of things. In fact, a recent Mercer research on middle management in UK points out how nearly 50% of middle managers surveyed were seriously considering leaving their organization.
In India, where an acute shortage of middle managers is being faced by most industries, companies are increasingly realizing that this actually is the golden layer. The focus therefore, is shifting from the creamy layer to this crucial operational anchor.
Says Kiriti Sen, group vice-president, HR, MIRC Electronics (ONIDA), “Leadership training has now percolated down from just the top brass to middle-level managers who head business units”.
Sen predicts that with attrition levels reaching 25% in many companies, we are going to see a lot of training focused on middle managers as companies fight to retain talent. Also, the he points out, since the middle management group represents the talent pool from which future leaders will come, companies know they need to invest in a lot of talent management here.
Indeed, the rising attrition levels is the reason why consulting firm, Accenture points out that focusing on star performers or high potential candidates is not a sound strategy. Not only is there fierce competition for star performers, making it difficult as well as expensive to secure them, but also it is also tough to retain them, as they tend to be individualistic. UPS, Marriott and GE are some companies that have successfully adopted talent multiplication principles to stay successful.
Organizational development consultant Santosh Babu describes how there are two schools of thought – one that thinks that charismatic leadership is necessary for the success of an organization and second, that charisma works well only in politics, non-governmental efforts and other fields, but in management, it is sound capabilities and ‘the power of collective talent’ that takes the company ahead in the long run. He points to ‘long surviving’ companies like IBM and Bata as examples of this second approach.
Even in cricket, we have seen the example of the power of collective talent being successfully used. The Australian cricket team, coached by a management expert, John Buchanan focuses on winning the game through team effort and harnessing every players’ capabilities rather than relying on individual brilliance. The strength of the Australian team is that literally every player is an all—rounder with multiple capabilities.
Similarly, many companies today train ‘everyone on everything’. According to organizational development experts there is no other alternative as there is too much churn. If employees have been trained for multiple positions, it is easier to move them up in the company. The business imperatives of today are also such that having domain expertise in one area is simply not enough. Take the CFO of today, who is so different from the finance head of the past. No longer is the CFO’s nose buried solely in accounts, but instead he has to sniff out strategies to shore up the bottom line, introduce sustainable measures in the company as well as have an intelligent say in new technologies and HR. Which is why companies like Marriott insist that, say a finance intern also needs to work in other departments. The expectation is that if each manager knows the processes and systems of other units, there is better synergy between two departments leading to improved all-round performance.
Several companies also have a policy of targeting ‘high potential’ candidates from the entry—level to the supervisory level and investing leadership skills on them. Take Airtel, for instance. It conducts a ‘Leadership is everybody’s business’ programme wherein 30 high potential employees are provided training focused on helping them achieve personal mastery, team and leadership mastery, and business mastery. Explains Santosh Babu; “The idea behind this exercise is that if you know how to manage yourself, you can manage others better. Second is the need to understand others, influence others and leader others. Third is to have business acumen and entrepreneurial skills”.
But according to an emerging new school of thought, even this strategy of providing differentiated training to a targeted few candidates is not too sound. The danger of this policy is that a lot of untapped talent in the company goes unexploited and consequently leads to de-motivated employees.
New tools and advance in training methodologies – such as e-learning modules and better measurement indices that now give you the ROI of training – are facilitating the process of training everybody. In the past, the logistical nightmare involved in training – assembling employees at a location and taking them off their work schedules for a session, meant that only a few candidates were trained. And they in turn trained others. But today, the whole logistical issue of gathering employees together for a training session is resolved through methods like e-learning. So what are the best methods of talent multiplication?
According to Accenture, at the core of talent multiplication are four Ds – define, discover, develop and deploy. The first task is to define exactly what talents are needed to execute a business strategy. Then comes the task of finding the talent and introducing measures to retain them. The third task is to develop skills – both individual and collective and finally, to leverage the skills.
Indeed ‘deploying talent’ can prove to be a goldmine for companies as talent skills of employees can be used to develop new streams of businesses.
Measuring the impact of training
For long-term economic benefits, it is important to look after assets carefully. Following this simple economic principle, companies are now nurturing their most important assets – people. And one way of increasing the valuation of their human capital is by imparting training.
HR heads point out how training is no longer a feel good exercise but one that has huge business imperatives. Today, more and more companies are treating training programmes as an investment rather than expense. Clearly, then they are seeking returns on their investment – not only through a huge spike in performance and profitability but also as a means of retaining employees.
But even as the volume of training has shot up, the measurement of the success of the activity still remains a little shaky. Typically, a few feedback forms, comments and suggestions are all that are made by way of evaluating impact of training. Anita Shantaram, director, Grid Consultants points out that training evaluation, finding the return on investment and follow-up programmes need to be taken a bit more seriously.
But the good news is that several tools and methodologies are now available to evaluate training. And Indian companies who have increased their training budgets in a big way are now demanding quantitative and qualitative analyses to justify the costs incurred on these exercises. Says Muralidhar Rao, president and COO, NIS Sparta, “ROI, a grey area in training, is now being address-ed through measurement tools”.
The benefits of measuring the impact of training are huge – not only does it lead to better compliance and all-round improvement in performance, but formal evaluation also helps improve the design of the training exercise to provide better value and increased benefits.
Also, since a variety of training methodologies are today available to companies ranging from outbound, classroom and e-learning, evaluation helps in identifying the best method to employ. Through evaluation companies can also judge which are the training areas that need to be outsourced in-house thereby saving on costs.
So what are the checks and balances needed to make sure that investment in training yields positive returns?
First is to make sure that you have fully understood the costs parameter – often companies take into account only the direct expenses, which may include the design and development costs of the exercise as well as the costs of faculty and materials. But as Kiriti Sen, group vice-president, HR, MIRC Electronics, points out there are a lot of indirect costs like the effort involved in mobilizing people, the costs of rooms, equipment, the opportunity costs, the promotional costs and perhaps even the costs of evaluating the impact. So, on paper the expenditure incurred in training may only be one percent of revenues but in reality it is bound to be closer to five percent of revenues.
Other parameters needed to be factored in included efficiency and compliance. How much effort is involved in covering all the employees, the degree of retention of the learning, how much of the learning gets translated into practice by employees, the behaviour modification post-exercise and, finally, performance change.
A variety of subjective and objective tools are used to measure these inputs. These ranges from feedback forms or ‘happy sheets’ to charts that measure productivity before and after the exercise, subjective tests to test behaviourial change and other performance measurement tools.
Admittedly, certain areas like increase in productivity or reduction in mistakes are easy to measure through quantitative analysis, says Rajat Rakheja, associate partner in Training Alternatives, while performance change and behaviour modification – which need qualitative analysis – may be a little more difficult to track.
At the end of the day, experts suggest that the best method to evaluate training is to treat it as a capital investment and use accounting techniques like ROI to measure maximum impact.
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