Why Are Organisations and Individuals Reluctant to Invest in Training - Term Paper Example

Introduction Organisations around the world have for years invested a great deal of their resources on employee training and development. Training and developing employees means impacting them with relevant knowledge and skills so as to use the same to propel organisational performance. This is done in order to make their work more efficient and be able to adapt to upcoming trends or be able to multitask. Training is mostly for a specific job or task and it is short term while development is long term and it encompasses general operations. Training on the other hand is technical unlike development which is more theoretical. Many profit making organisations have their end goal being increased productivity translating to increased profitability. Bearing this in mind and the immense benefits that accrue organisations, many are still reluctant to invest in this endeavour (Gratton 2007). This paper will look into benefits of training and developments to firms and employees and delve to explain why some organisations and individuals are reluctant to invest in training. Benefits of training and development of employees As mentioned earlier training and development of employees has numerous benefits to both a firm and its employees. One of the key benefits is that it results in higher productivity thereby increased profitability. Employees’ morale is improved which makes them identify more with the profit path and the specific goals of a business. Due to improved performance the firm creates a positive image in the process (Boxall & Purcell 2007). This in turn offers it a competitive edge over its rivals thereby being able to acquire a sustainable market leadership position. In the course of training employees, better relationships are created between them and their superiors which is a powerful motivating factor. Employees are easily satisfied when well trained which also helps in lowering turnover. High turnover in firms destabilises their attainment of set goals and objectives. Due to the increased profitability there is high likelihood for there to be more extrinsic motivational policies including more benefits, better salaries, performance related rewards and many more (Cameron 2006). Employees also like to be associated with a highly performing firm and this improves their self esteem. For a firm there is reduction in costs as employees who have successfully gone through training and development require less supervision. Well trained employees are usually independent in action as well as in thought and are highly responsible. Lack of heightened supervisory roles is basically as a result of employees’ high level of skills and knowledge to perform their tasks (Noe 2010). These and more are the advantages that a firm and its employees will reap in case the firm invests in training and development. Reasons for reluctance in investment in training and development Resource intensive Many firms’ budgets are quite strict and while making them, the management tries to allocate finances to those aspects that are directly related to production or service delivery. This in other words means that they allocate resources mostly to profit centres. Training and developing employees is time consuming and above all has a huge financial attachment. Managers in many firms consider the benefits that accrue a firm after the training and compare them to the financial burden that the endeavour will pose (Delbridge et al. 2006). Many managers are conservative in their management approach and this leads them to retain the status quo in regards to employee level of knowledge and skills. To send employees for further training will involve the organisation to pay for the tuition fees, travelling and accommodation costs. Of importance to note is that these employees while on training are being paid their normal salaries and at times even allowances. Considering they are not working per se the burden becomes overwhelming. This is more the case with Small and Medium Size Enterprises (SMEs) (Kotey and Folker 2007). Irrespective of the management’s understanding of the benefits that training and development of staff may bring, this burden is seen to choke the reserves or drain the profits earlier earned (Armstrong 2006). Managers in these instances usually tend to use other tactics to ensure that employees are trained. One of them is employing highly educated and experienced workforce that assures the firm of long term reliance on such employees’ knowledge and expertise. The other is development of policies that require employees to have attained minimum knowledge or skills level so that they can enrol themselves for training without involving the organisation (Bartel 2008). The latter is the most common one where managers set minimum education or expertise level for a department and offer a timeframe. Takes employees off their positions for a while As earlier stated employees while in training usually leave their positions of work. Training and development is time consuming and at times it is a process just like taking a course through a normal school situation. Some training and development programs are conducted in the firm’s premises for hours or even a few days. Other programs will require employees to even move out of their country for months for training. This will inevitably result to these employees vacating their work stations and concentrating on the company-paid training program. Back at the firm the vacant position must in one way or the other be filled by either hiring interns or increasing roles and responsibilities to the existing staff (Bandt and Haines 2002; Rynes and Connerley 2005). It is clear here that these two choices are costly to the company while considering it is paying for the training and allowances including paying normal salary to the trainees. Offering more responsibilities to other staff members is not only cumbersome but may hurt one of the key forces behind productivity; motivation. Training and development therefore forces a firm to spend more while leaving vacancies to fill. Employees are more able and equipped to leave to other firms One of the major drawbacks that training and development brings is that when employees are well trained they become more marketable. This in short means that they are eyed by many other firms more so the competitors. Many firms even multinationals have come to experience this first hand. Training an employee makes them have more knowledge and skills that are mostly essential to a firm’s sustainability. In many cases these skills are the most up-to-date and this makes these particular employees major assets after training. Other firms view them as such as well and competitors are always keen to follow up on other firms’ training and development programs for them to poach employees (Noe 2010). Their marketability results in other firms wooing them with better payment packages and many opt to leave for greener pastures. Firms are in the process forced to add on salaries and generally to make the payment package more attractive to avoid poaching. Managers therefore take these processes and unpredictable nature of people as a threat to a firm’s stability and choose not to involve their employees in such programs altogether. Poor habits are passed on Training is usually carried out in firms in the same way over and over again, year after year. Since employees are trained more on how they can handle bigger and more sophisticated responsibilities, such training is likely to be done in the same place and through the same channels (Karen 2006). An example is training of banking or insurance company staff whereby if they are trained by the same trainers year after year, there is high likelihood that they are to be pasted copies of the former trainees. This then leads to duplication of ideas and ways of doing things. This in turn results in passage of bad and good habits alike year after year. This in the long run is not a healthy tendency for the firm as ideas will just be duplicated from one management generation to the next and in case poor training was done on certain aspects it is easy for them to run in the organisation undisputed for long. Firms view this as a way of creating room for retrogressive thinking which trickles down to production or service delivery. In the same case there is a high risk of developing some long lasting undesirable aspects of a firm’s corporate culture. Narrow experience One fact about training employees is that they become more specialised the more they train (Khurana et al. 2006). Training makes employees look into less and less aspects of their work. As earlier mentioned training is more specific while development is general. The former if carried out results in employees taking a course that narrows their scope therefore their capabilities. Instead of them being more multitasking they do less but with the required quality and expertise. This is dangerous in firms where employees are required to be jacks of all trade (Baker 2007). This only fits well with big firms the size of multinationals where responsibility line is clearly laid out and specialisation is the order of the day. Small firms on the other hand where people are required to take many responsibilities training employees may result in them preferring fewer specialised tasks which may make the firm employ more people. Lack of quantifiable benefits Almost all stakeholders of a firm require tangible results for everything that is done more so that which drains financial resources from it. Looking critically into the outcomes of training of employees most are more or less quality related. This quality cannot in turn be directly traced in production and service delivery or in profits. The whole training issue therefore becomes a speculation and theoretical that after the process, employees are to be productive and lead to higher profits (Noe 2010). Managers look into tangible results in offering support of their policies and it proves difficult to convince shareholders that training will definitely lead to positive results in regards to company’s performance. In appreciation of this fact managers therefore find it prudent to seek other avenues to cover for the training gap. This is because in as much as there is need to have a well trained workforce, the bottom line is whether such an investment is quantifiable. Ignorance Ignorance is one leading factors towards managers and firms not adopting certain policies or implementing them. There is a tendency by managers to take after their predecessors or endeavour to maintain the status quo of a firm. In case such firms have a tendency for the management not to adopt training and development of staff with the seriousness it deserves then such people will retain this trend. Other managers are reluctant in researching on the new trends in their industry which in turn forces firms to send their employees for further training (Sparrow 2009). Some managers do not have an idea of where to start in case they wanted to start a training program. Others do not know where to go to seek these services and the worry is that they are not willing to take the initiative to know how to go about it. This is one of the issues that lead to firms lagging behind in issues to do with technological advancement, innovation and creativity. This happens more often in SMEs where the management does not have a big scope to cover or huge aspirations (Kotey and Folker 2007). In big firms this is however not the case as managers are under intense pressure to perform and they have resources at their disposal to indulge in all measures that will ensure success; training being one of them. Recommendations Looking into this issue and topic it is clear to see that the reasons why training and development of staff is undermined are not justified. Managers need to look beyond their firm and see what direction the rest of the world is heading. In the current global economy firms no matter how small have the chance of becoming multinationals as the business environment has span far and wide opening doors to a huge pool of customers. The benefits of training and developing staff far outweigh lack of it and this is a fact that managers and firms worldwide should embrace. Considering multinationals in all sectors from food industry like McDonald’s to motor industry e.g. Honda, training and developing staff led them to where they are today from very humble beginnings decades back (Schuler and Jackson 2007). Such huge firms have not relented on taking their employees for further training irrespective of the aforementioned drawbacks because they understand how beneficial it is. Conclusion Training and development is not an easy avenue for many firms to follow towards success. It is agreeable that it requires huge capital outlay and stakeholders are quite sceptical of such expenditures but in the long run it goes a long way in assisting an organisation to succeed in the increasingly competitive business arena. Firms looking into extensive growth and market presence that is sustainable cannot achieve this unless their workforce is ready for the challenge. This readiness on the other hand is facilitated by organisations enrolling their employees for training. Employees after training become more productive and organisations benefit a great deal as argued in the paper. The onus is therefore left for the management to embrace the right policies for their firms. Training and development is one that will see an organisation sustain its production and service delivery initiatives through increased productivity, quality assurance and increased profitability. 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