The value of training

Jeremy_Sole.jpgBy Jeremy Sole
CEO, NZ Contractors' Federation

Recently I attended the Fletcher/MacDow open day celebrating the success of the Hobson Project in Auckland. It is a considerable project with multiple and significant challenges, several of which were still to be addressed.

While there I was struck by the professionalism displayed at the open day by both organisations’ employees. The quiet confidence, no-nonsense demeanor and helpfulness of the site workers was particularly impressive.

Was it a coincidence that these businesses managed to acquire such an impressive, committed, self motivated team with great pride in the work and in the companies they worked for?

I think not.

This is the result of shrewd investment decisions and you can bet it took some courage to make this type of investment when there is no measureable tangible return ascertainable at the point of decision.

There is however a strong and easily explained commercial imperative that even the most cautious shareholders would take as read. The investment was in their people, and I want to explore this and see if we can explain the impressive outcomes that can be achieved from developing people.

Let’s look through the lenses of the three Es: efficiency, economics and effectiveness.

The first E is for efficiency – given the challenges we are currently facing in the industry, especially on cash flows and liquidity, is people development the most efficient use of scarce resources? We are all familiar with the cost benefit justification of purchasing a new piece of plant. Try doing that with an investment in training – there is no way to calculate the full value of training and developing people, except with hindsight.

Many of our industry’s workers either got off the career bus at the wrong stop, or they never got on the bus in the first place, and this has an effect on their motivation, self perception and self determination. This is compounded when employers recognise only the current status of a particular individual and not their potential.

In my previous life in the organisational development world I often saw people learn new skills and start to achieve things they had never considered themselves capable of – and when that begins to emerge you have the makings of a professional and self determined individual who is willing to contribute more of themselves to the business.

This in itself is not necessarily an argument for going out and spending on training and we all know stories when the training spend was a pure and simple waste of money.

Often the best outcomes come not from purchasing training but from creating an environment where learning takes place, simply because you have stimulated the desire to participate.

Achieving an ideal environment to develop people has for a long time been the holy grail of the training world, but try thinking back to times in your career when you felt a high degree of engagement in your work, high levels of self motivation, and a deep sense of fulfillment. I’ll bet that at that time you feel a sense of your own self worth and competence, and that others are recognising that competence and or potential in you. I’m willing to bet that you have been given a degree of autonomy that you feel is about right for carrying out the responsibilities that have been delegated to you. And further, I’m willing to bet you are participating in a team and a project that is creating something that is significant and is making a difference.

So if this works for you, why not give it to someone else as well? This is what makes the difference between a business that is muddling along and one which is truly exceptional.

Coming back to the first E, and to find an answer to the efficiency question is simply measuring the value of the spend against your estimation of what your business could achieve if your people were to be skilled, self determined and motivated enough to contribute to the efficient running of the business, generate innovative ideas, and eliminate waste – and if you could find a way of releasing this in them.

So the second E is about choosing the most economical method of achieving your people development outcomes.

While there are no magic bullets here, the highest value leverage points for creating the environment described above is your own leadership and willingness to develop and delegate, and at the skill level of your supervisory staff.

Indeed this is the case for most Kiwi businesses, and poor leadership and supervisory staff skills are the leading causes of staff turnover and in this country. As a manager or owner in the business this applies to you as well.  And if you are thinking “what if I train them and they leave?” try reframing that as, “what if I don’t train them and they stay?”

That leaves us with the third E: effectiveness. This goes to the heart of what is the right way to upskill your people. It isn’t hard to work that out for technical skills all the background work in this area has already been done for you by ITOs such as Infratrain. Their people can get you on track to get the skill development under way and they will even pay for most of it. Signing people up for a national qualification doesn’t need to be a big thing for you or a life sentence – but for your employees it may just be the circuit breaker that ultimately transforms their performance.

Given the impending economic recovery in New Zealand, you had better be thinking about this, as you can be sure that when the recovery begins, your competitors may be very enthusiastic about offering this opportunity to those who are currently your staff.


Contractor Vol.33  No.5  June 2009
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