A prominent researcher noted that there is a strong correlation between training expenditures per employee and a firm’s customer retention rates. Retention rates significantly affect a firm’s performance. One study discovered that a 1 percent drop in customer attrition can add up to 5 percent to a company\’s bottom line. Employees who receive training generally offer better service.

Organizations thrive on training, and employees see the value in training. They want more of it! Yet, many in senior management fail to see its value if the training does not directly increase the bottom line.

A medium-sized casualty insurance company located in the mid-west spent in 2010 a total of $600 million in U. S. training. American industries annually spend up to $95 billion on training and development, and many corporations believe that only 10% of these expenditures actually result in the improvement of job performance. The casualty insurance company apparently finds the opposite result as do many large corporations.

The primary problem of corporate training programs is that learning professionals fail to categorize the learning program appropriately. They do not properly assess the amount of learning that is transferrable immediately. Another fault of corporate training is that mistakes are made in the needs analysis or the design of the learning program.

If a training program fails to achieve the intended results it is highly probable that the reason is found in one or all three areas of the corporate culture:

1. Failure to understand the training program’s capabilities.

2. The corporate senior executive staff is not involved in the process of conveying to employees the importance of the training and the expectations for the training.

3. Line management is often not required to report on the transfer of the training to job performance.

Accountability in every area of a corporation is essential in the highly competitive global environment.

TRAINING IS NOT OFTEN VIEWED AS A VALUE-ADDED FUNCTION

Well-respected experts believe that corporations which invest large sums of money in people do better than corporations that invest large sums in R&D. This would support the claim that people are the most valuable asset. Invest in people and the corporations respond by growing. This is, however, likely to be a hard sell in today’s economy.

A NEW PROBLEM FOR SELLING TRAINING HAS SURFACED

Hiring is still slow after two years into the recovery. The economy is producing as much GDP as it was before the Great Recession began, but it is being done with seven million fewer jobs. Since the recovery began, business spending on employees has grown 2 percent while equipment and software spending has swelled 26 percent, according to the Commerce Department.

A recent study found that more than 90% of training professionals in Fortune 1000 companies sense pressure to cut training costs.

Training that solves business problems will be embraced by all of management. The safest decision a training professional can make is to deliver a training program that corrects a problem which has plagued the corporation.

CONCLUSION

Many Fortune 500 companies are increasing their training budgets for 2011. Ford, Xerox, IBM, Intel and Microsoft are corporations that are focused on the future and avoiding the corporate debacles that beset so many companies during the Great Recession. Training may be part of the answer to avoiding a corporate collapse.

The author of this article is an expert in management training. You can find more information about managing training and development on their website.

The author of this article is an expert in [http://www.poudrerivergroup.com] management training. You can find more information about [http://www.poudrerivergroup.com] managing training and development on their website.

Author Bio: The author of this article is an expert in management training. You can find more information about managing training and development on their website.

Category: Business Management
Keywords: management training, managing training and development, corporate training