Organisations focus upon the development of available resources to meet the ever-increasing challenges presented by the competitive environment. Training the organisation’s employees is one of the major continuous investments that organisations make in their employees, although undeniably payroll represents the largest labour cost of any organisation.
However, employees’ salaries represent a recurrent cost that the organisation needs to maintain its’ operations running as smoothly as possible, whereas investment in training represents the organisation’s largest investment in human capital.
Similar to managing one’s investment portfolio, managing the training process effectively will result in the desired Return on Investment (ROI). Hence, identifying the training that needs to be undertaken, selecting the avenues to use for this training and if the training would have achieved its purpose, are crucial aspects to managing this investment. For the training delivered to be effective, it is thus fundamental that the investment made in training will meet the organisation’s current and future requirements.
In today’s competitive environment the effective organisation has to cater for its ever-increasing needs of developing its human capital while simultaneously ensuring that this remains viable.
Training Needs Analysis (TNA) is an annual exercise normally carried out to identify the training needs required by employees to cope with their work demands, to meet their skill shortages and to eventually add value to what the organisation is doing. However, many times the training identified does not result in the desired benefits. We normally shift responsibility onto the employee for not having learnt well what has been taught, but could this be the result of a mismatch between the training identified and the training given?
An effective TNA starts off by identifying the gaps that exist between the current skill base and the required skill base of the organisation. Although training gaps are normally quite evident, choosing the best methods to bridge these gaps is usually a much more difficult task.
With the ever increasing focus on employee performance and the additional value generated by employees the most appropriate method to use is not necessarily the best one available. For example, although face-to-face training may be the best method available to learn managerial skills, the most appropriate method is most probably an experiential one, where employees are exposed to managerial situations and learn the necessary skills through experience.
For this reason, after identifying the gaps between current and required skills, the next step in an effective TNA is to identify the avenues available to build bridges to meet training requirements. Although such means are normally quite opaque, the most appropriate are those that make use of available resources in the most efficient manner.
Organising a face-to-face training course may be more costly and less effective than adopting an e-learning approach, whereby employees would normally be able to achieve the same learning objectives but with a smaller trade-off between employees’ development and lost productive time. As technology has assisted us become more productive at the workplace, similarly technology has enabled us to become smarter and have more information available for learning at our own pace.
Personalising the means of meeting one’s learning requirements means that we can adapt our learning activities according to our personal lifestyles. Taking these factors into consideration, the last step in an effective TNA is ensuring that the learning objectives set out have been met, and if not, what further requirements need to be covered over the forthcoming training period.
Determining whether a TNA has been effective involves determining the ROI generated by the selected training activities. Training activities should include all learning opportunities, irrespective of whether these were formal or informal, paid or unpaid. Learning activities are thus the vehicle for generating the required ROI from training that helps us determine if the set objectives would have been met.
Calculating the ROI on training means identifying and measuring the additional value that has been generated by the training activities. If this cannot be quantified, other numerical options are used such as coefficients for time saved, quality improvements and increased efficiency to determine the additional value that the training activities have generated within the organisation.
Just how capital investments mature over time, likewise the investment made in training matures further as employees apply the acquired knowledge at the workplace and in their personal development for the organisation’s benefit.
Conducting a TNA and determining the ROI on training are two stages of the same cyclical process that are complemented by the actual training activities and can be further understood through available training courses.