Training
When the economy is in a recession and costs are being cut in many businesses, there is always a temptation to cut spending on training. This ‘saving’ can look like a simple way to cut costs quickly,but nothing could be further fromthe truth.Research in 2007 shows companies that don’t train are two and a half times more likely to fail than those that do. “More than ever we need people who are developed, trained,
TO WIN
committed,motivated, innovative and driven in what they do. This is one of the vital keys to ensuring businesses survive and stay competitive when the odds are against them, together with being ready to embrace the opportunities as the upturn eventually starts to happen,” says JennyHayes, IBEC. Areport by the international leadership organisationCommon
ALAN SHERLOCK, SFA EXECUTIVE,
TRAINING AT IBEC, ABOUT THE
IMPORTANCE OF INVESTING IN EMPLOYMENT TRAINING, ESPECIALLY DURING A
DOWNTURN
TALKS TO JENNY HAYES, HEAD OF MANAGEMENT
Purpose found that 97pc of the companies it surveyed said that cutting their spending on training during a previous downturn had negative consequences on the business in both the short and long term,with a critical loss of top talent being a significant trend reported. Evidence shows that those companies that invest in the area of
training during a downturn are better placed to growthe business as soon as the economy starts to recover. Cutting this cost in the short termis a seriousmistake thatwill
cost organisations dearly in the future, so all training professionals need to continue influencing decisionmakers in the business as to the value and contribution of focused training and development initiatives during this time. An example of a progressive, innovative company that survived
the dramatic fall in their business after 9/11 and brought the company back to profitability when many competitors went out of business was SouthWest Airlines. A series of major cuts were initiated after the dramatic slump
in the business which followed the 9/11 disaster.However,Herb Kelliher,CEO, resisted cutting the training budget even at the bleakest time for the organisation.The company’s University for People,with a US$3mannual budget, kept its full funding, as all training and development activitywas recognised as being central to the success of the company at this time. The budget for training was actually increased, with targeted
programmes designed to help staff dealwith uncertainty.Keeping morale upwas seen as a critical role of the training department as staff feared losing their jobs aswell as being unsure of howto deal with security threats overall in the airline industry. As our economy is in one of theworst recessionswe have seen,
46 OWNER MANAGER VOL 3 ISSUE 4 2010
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