2010 Oxford Business & Economics Conference Program
ISBN : 978-0-9742114-1-9
Submitted To:
2010 Oxford Business & Economics Conference (OBEC)
Title of the Paper:
Training: a Cost or an Investment?
Depends upon the Way You Go!
Author:
Zafar Saeed
Master of Commerce (continued) at the Australian National University, Australia
Lecturer, Department of Management Sciences
The Islamia University of Bahawalpur, Pakistan
Contact Information:
Address: School of Management, Marketing and International Business
ANU College of Business and Economics
The Australian National University, Canberra, Australia
Cell #. +61 431 720014
Email: zafarsaeed2@yahoo.com
June 28-29, 2010
St. Hugh’s College, Oxford University, Oxford, UK
2010 Oxford Business & Economics Conference Program
ISBN : 978-0-9742114-1-9
2010 Oxford Business & Economics Conference (OBEC)
Training: a Cost or an Investment?
Depends upon the Way You Go!
ABSTRACT
It is an extension or add-on work upon the paper “Beating Subjectivity in TNA with Numbers
…” which won the best paper award on peer review basis in EABR conference in Austria in 2008.
Subsequent discussion and work brought me to this new comprehensive version with a literature
derived sketch. Whether to train? When to train? Whom to train? What to train for? How to train?
These are the key questions and are detrimental in the fate of contemporary organizations in goingon intense competition. Therefore, if we can solve these issues by selecting the right time, right job,
right people and right content for training, it can really pay back and prove itself an investment
instead of the other way. This can break the conservative shell of management about training. The
absolute objectivity in training need assessment may not be possible but this framework offers much
more than the ongoing practices. The framework provides a stepwise guide through the whole
process and even provides standards for the post-training evaluation. In addition, it is an attempt to
contribute various new ratios into the disciplines which can be handy in many ways.
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ISBN : 978-0-9742114-1-9
KEY WORDS
Training needs assessment, objectivity, pressure point, job groups, and Key Responsibility Areas.
INTRODUCTION
‘Don’t gamble, always assess’, is an extremely important advice for a T & D manager. Most of the
firms don’t assess the training needs and those which assess actually do not assess! But even those
firms which try to do the genuine assessment can’t get the expected outcomes. The roots of this
failure mostly reside in the subjectivity of the approaches and methods used for assessment of
training needs. Selection of jobs, people and tasks for training as well as the content carries a high
degree of subjectivity, both on the part of trainer and the management. Unfortunately, this
subjectivity is not innocent in nature and bites the organization very badly in the long run as well as
in the short run. Corporate world is badly looking for some solution, and so are the theorists – an
open secret!
THEORATICAL FOUNDATION
Noe (2006) considers training as one of the most vital elements for the prosperity of an
organization in contemporary world of change. Once the organization has identified a problem
which is declared important enough to consider and resolve, it should go through a series of
integrated questions/steps before it trains its employees. On following page is the proposed model
developed out of extensive exploration of the training and development literature which guides a
manager smoothly whether to train or not, and if not to train what alternatives could be considered.
Once the training manager concludes that training is the best option for the resolution of the
problem, her actual tough asks start. Which or how many job groups to train? Who are the people in
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2010 Oxford Business & Economics Conference Program
ISBN : 978-0-9742114-1-9
the job group(s) to be trained? Who should be selected first if all job groups can’t be trained at once?
What should be the content of the training? How should be the allocation of budget and time
between the training modules? Last but equally important, what should be the criteria for training
evaluation?
Most training theorists and practitioners agree that the training process has at least four steps or
phases: assessment; design and development; delivery and follow up; and evaluation. Each phase is
important; however, needs assessment phase is the most critical. Errors at this stage put all
subsequent stages off target. Miller & Osinski (2002) find need assessment as the critical activity for
training and development function. Often training programs fail due to assessment (analysis) phase.
Billie (2008) argues that assessment allows the learner and instructor to mold their respective efforts
based on needs. McGehee and Thayer (1961) set three foundations of needs assessment: the
organization; task; and person. All scholars of the discipline agree to them but what next? Literature
survey reveals that need assessment is neglected in true sense of the word, especially when it is so
crucial for a successful training. It fails to address specific attributes and issues (Kerr & Burzynski
1988; Zemki 1985). Despite its realized importance, very few studies focus assessment of needs for
training (Goldstein 1986; Morano 1973; Wexley 1984). Moore and Dutton (1978) revealed that from
1953 to 1978 only one in ten companies reported used systematic approaches to determining training
needs. Erffmeyer et al. (1991) conclude that two-thirds of firms utilized informal, judgment
approaches to need assessment, and only one-third of the companies were “often” conducting
formalized needs assessment for their training programs.
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2010 Oxford Business & Economics Conference Program
ISBN : 978-0-9742114-1-9
Imp. Problem/
Issue/Pressure point
Non-organisational
(Training)
Organisational
(Non-training)
Environmental
Personal
Will
(Attitude)
Knowledge
Political
Economic
Social
Technological
Legal
Competition
Customers
Skills
(Knowledge,
Skills &
Abilities)
Skills
Abilities
Literary
Soft
Physical
Hard
Reading
Level
Cognitive
Verbal
Quantitative
Reasoning
Quantify the gap
Yes
Can the gap be filled satisfactorily?
Organisation lacks resources
Train!!!
Develop
resources
No
Employees lack abilities or
willingness
Compromise
Transfer!
Demote!
Fire!
Model developed out of the literature review
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2010 Oxford Business & Economics Conference Program
ISBN : 978-0-9742114-1-9
Allison (1990) says that despite the best intentions, needs assessment is still more a goal
than reality. … Inadequate needs assessment ultimately creates situations training doesn’t do what it
is expected. Allison further points that while trainers generally agree on what constitute an effective
objective or evaluation or role play, but there is less accord on how to conduct training needs
assessment. This confusion about “good” professional practice makes it difficult to learn to be a
good professional. Numerous studies have suggested that many training programs are adequately
planned, and in particular are designed without the proper assessment of training needs (Goldstein
1980, Landy 1989, Morano 1973, Moore & Dutton 1977; Wexley 1984; Zemke 1985). Landy (1989)
points that most managers view planning of training programs as simply telling the training
department that training is needed and give little importance to assessing training needs. Zemke
(1985) feels that workplace measures and time constraints create “we already know the training
needs” attitude. Erffmeyer et al. (1991) find that training needs assessment should focus knowledge,
skills and abilities (KSA) to develop them against required level but feels that current practices don’t
reveal an overall systematic approach. Wright and Geroy (1992) say that most training theorists still
define needs in terms of the equation:
Standard or desired – Present or actual = Training needs
performance
performance
They also highlight that despite improvement in needs assessment methodology, the accuracy
of current practices is questionable because of managerial subjectivity or attitude toward training.
They accept that faced with undefined body of amorphous theory and practice, researchers and
June 28-29, 2010
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2010 Oxford Business & Economics Conference Program
ISBN : 978-0-9742114-1-9
practitioners are still searching for more effective ways to isolate needs. Lee (2009) acknowledges
the importance of training and trainers by accepting that now more than ever it is important to be the
trusted training advisor to the executives who rely on your expertise in developing their staff.
Companies are trimming the fat. … Training hours, according to him, have been cut, yet the
developmental needs are increasing. Very first, out of the seven strategies advised by Lee, is
“enhance your competencies in training assessment, design, development and delivery”.
PROPOSED FRAMEWORK
Despite the fact that different methods, both quantitative and qualitative, are available for
training needs assessment but need for a comprehensive yet integrated framework with smoothly
flowing steps is dominant in theory. Such a framework or model should make use of existing
practices. The author is proposing this improved version of framework to address these unmet needs.
Following are the sequential steps of the proposed framework:
1. Identify and clarify the pressure point/issue/indicator.
2. Rule out the organizational reasons to be sure that it is a training issue.
3. Identify the job-groups related for the pressure point.
4. List the tasks/KRAs of each job-group listed.
5. Select the tasks out of this list which are relevant to the problem or issue under consideration.
6. Write down relevant knowledge, skills and abilities and attitudes (KSAs) for each job group.
7. Select those KSAs which are related to the problem and objectively assign weights to those
selected KSAs of each job group.
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2010 Oxford Business & Economics Conference Program
ISBN : 978-0-9742114-1-9
8. Identify the gap between the desired and current levels of competencies for every element
of KSAs for each group.
9. Multiply the gap for each element of KSAs for each group with its respective weight this will help to select the right training content with appropriate emphasis.
10. Sum-up the TN-score for each job-group to find TN group score.
11. Multiply target value for each element of KSAs of each job group with its respective
weight and then sum them up to find the firm’s target score for KSAs under
consideration.
12. Objectively assign weights to each job-group according to its degree of relevance to the
pressure point.
13. Multiply each job-group weight with its TN-scores to find TN-decisive scores: they
help in the selection and prioritization of groups for training.
The use of numbers and ranks is not new in social sciences but theory to this date has not
proposed their use in training in such a comprehensive and integrated fashion. This framework has
the ability to incorporate different methods of assessment currently in practice like psychometric,
graphology, reflection, discussions, evaluating JD, seniors’ input, subordinates’ input and expert
input etc. In onward discussion, the whole process is elaborated through an assumed example.
ELABORATION OF PROPOSED FRAMEWORK
Let’s consider an example of a firm which is facing a problem of a rapid sales decline
against targets and in comparison with last year’s sales figures. Management in such a case is surely
more than worried to bring the firm back on track. It has analyzed and found that it is not an
June 28-29, 2010
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2010 Oxford Business & Economics Conference Program
ISBN : 978-0-9742114-1-9
organizational issue which means it is a training issue. Analysis further reveals that there is nothing
wrong with the environmental factors and it is directly associated with the employees. Now, firm
identifies the job groups related with the issue or pressure point, which is a poor sales achievement
in this case. Following job groups appear more upfront based upon their intense relevance with the
problem.
1. Area Sales Managers (ASMs)
2. Sales Promotion Officers (SPOs)
3. Distributors
4. Field Execution Officers (FEOs)
Here, ASMs are the group which is responsible for the sales management of a larger area
through SPOs, distributos and FEOs. They are employees of the firm. SPOs are the group who
focuses upon customers to generate sales and build relationships within the company parameters. In
other words this is the group who put management’s strategies into action, supervised by ASMs.
Distributors in this example are contractors who agree to perform forward channel member role in
given parameters. While FEOs are the distributors’ field force responsible for order-taking and stock
delivery.
Because taking all four groups together will take a lot of space and readers’ time, so steps five
to nine are shown only for one groups, SPOs. The other three groups would join from step ten to
present a big picture. As a next step, the firm chalks out the tasks or key responsibility areas (KRA)
of each of these four responsible job groups. The firm’s relevant executives can do it well, though
information is also available in job description document of the firm.
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i.
Sales Presentation
ii.
Building relationship with customers
iii.
Territory coverage
iv.
Ensuring product availability
v.
Reporting/feedback to organization
vi.
Team coordination
ISBN : 978-0-9742114-1-9
All these tasks are not of equal importance in terms of their contribution to the problem
under discussion. Some may even be irrelevant with it in actual situations. Therefore, it is important
to pick only those tasks further which have significant association with the issue. This again needs
an expert technical input from the relevant corridors, here marketing and sales executives who can
guide training manager doing it rightly. It is advised that the training people should not do it by
them; it is simply not their area of expertise. The following three KSAs are selected, while in actual
practice this number of KSAs may be greater.
i.
Building relationship with customers
ii.
Sales presentation
iii.
Territory coverage
These hand picked tasks against the one point criteria of relevance to the problem/issue for
the job group under discussion are now worked out for their KSAs (required knowledge, skills and
abilities & attitudes). According to Erffmeyer et al. (1991), training needs assessment should focus
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2010 Oxford Business & Economics Conference Program
ISBN : 978-0-9742114-1-9
knowledge and abilities (KSA) to develop them against required level. JD can help the training
manger in this step or again relevant functional executives should be consulted for help.
Task
Requirement
Knowledge
Skills
Attitude & Abilities
Building
- Human psychology
- Listening
- Pleasant Looking
Relationships
- Relationship
- PR
- People-orientation
- Product
- Selling
- Enthusiasm
-Selling skills (theory)
- Presentation
- Proactiveness
- Customers
- Persuasion
- People-orientation
- Territory management
- Adventurous
Techniques
Sales Presentation
Territory Coverage - Territory
- Hardworking
Among the list of KSAs, those are selected which stand out in terms of their relevance with the
problem. Then they are assigned weights by the functional/technical experts (not the trainers). Not
only this but target scores, if they are not industry standards, are also told by the functional experts.
However, objective measures should be ensured to calculate the current scores of employees or
group against these selected KSAs. If less number of people, say fewer than ten, are in the groups,
the individual scores of all can be calculated and thus a group average can be found. Immediate
management and/or sales achievements against targets can also present the selected group of SPOs
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2010 Oxford Business & Economics Conference Program
ISBN : 978-0-9742114-1-9
as potential trainees. In case of a large group, a true representative sample should be taken to
calculate the current standings of the job group against KSAs.
Category Weight Target Current
(1 to 5)
value
KSA element
w
Listening
PR
Relationship Technique
Persuasion
Hardworking
Total
S
S
K
S
A
.30
.22
.20
.15
.13
t
4.50
4
4
4.75
4
(1 to 5)
c
2
1
2
3
2
Gap
value
(1 to 5)
g
2.50
3
2
1.75
2
TN-score
value or
gap
Product
w*g
.75
.66
.40
.26
.26
2.33
This 2.33 is the training needs score or gap product of SPOs. The composition of this score
guides the trainer that around 32% (0.75/2.33*100) of the trainer’s emphasis, in terms of budget,
time and energy, should be put on improving listening skills, about 28% (0.66/2.33*100) upon
building public relational skills and so on.
We started our example with four job groups which found more relevant with the problem of
massive sales decline. Suppose adopting the same sequence of steps for them result in the following
training needs scores or gap-products.
Job Group
TN-Group Score/Gap product
FEOs
3.50
Distributors
3.00
ASMs
2.50
SPOs
2.33
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Here it is evident that FEOs are having highest training needs score. So if a training manager
wants to conclude at this point, the first job group that should be trained appears to be the FEOs.
And if budget, time and other constraints allow only one group be trained; only FEOs should be
trained. But this would be a huge mistake to conclude something here. Instead, the trainer should
again seek input from the firm’s top management (both corporate and functional) to prioritize and to
assign weights to the responsible job groups based upon their relevance to the problem. The trainer
is not qualified to do it without their expert input. Following is the assumptive outcome of this
trainer-executive interaction.
Job Group
Weight
TN-Group Score
TN-priority Score
SPOs
.40
2.33
0.932
ASMs
.25
2.52
0.630
FEOs
.20
3.00
0.600
Distributors
.15
3.50
0.525
Here is the result of not making a mistake of concluding at the previous stage, from group TNscores. FEOs’ group which appears the top most candidates for training in resolution of the problem
at previous stage is down at the third number. Contrarily, the SPOs’ group which was the last
consideration, in terms of group training needs score or gap product, becomes the most deserving
among all and yet with a huge margin. This shows how big mistake it would have been not going for
relative importance of job groups with respect to the problem.
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SOME IMPORTANT RATIOS
In addition to the above objective procedure of TNA, there are some other useful bye-products
of this framework. To illustrate them, same data, as above, is being used below with some assumed
extension.
KSA
element
Category
W
e
i
ght
Ideal
value
(1-5)
Ideal
Product
(1-5)
w
i
W*i
Best
in
class
Target
value
(1-5)
Target
product
Curr.
value
(1-5)
Curr.
product
Gap
Value
Gap
Product
b
Best
in
class
product
w*b
t
w*t
c
w*c
g*w
Listening
S
.30
5
1.50
4.75
1.425
4.50
1.35
2
0.60
g
=t-c
2.50
PR
S
.22
5
1.10
4
0.88
4
0.88
1
0.22
3
0.66
Relationship
Techniques
K
.20
5
1.00
4.50
0.90
4
0.80
2
0.40
2
0.40
Persuasion
S
.15
5
0.75
4.50
0.675
4.75
0.71
3
0.45
1.75
0.26
Hardworking
A
.13
5
0.65
4.50
0.585
4
0.52
2
0.26
2
0.26
-
1.0
-
5.00
-
4.47
-
4.26
-
Total
1.93
-
0.75
2.33
1. KSA-ambition ratio
In KSA-ambition ratio, the firm can calculate its current KSA standing against the ideal
= (Target score/Ideal score)*100
Or, KSA-ambition ratio = (t/i)*100
e.g. KSA-ambition ratio for SPO = (4.26/5.00)*100
=85.2 %
Which we can interpret that the firm is 85.2 % ambitious in selected key KSAs or fells 4.8%
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short when the reference is the ideal.
We can also use best-in-class score to calculate this ratio instead of the ideal score.
= (Target score/Best-in-class score)*100
Or, KSA-ambition ratio= (t/b)*100
For example, KSA-ambition ratio for SPO = 4.26/4.47)*100
= 95.3 %
Which we can interpret that the firm is 95.3 % ambitious in selected key KSAs or fells
4.7 % short when the reference is the best-in-class.
2. KSA-deficiency ratio
It is a ratio of employees’ current gap in selected KSAs to firm’s own set target value.
Deficiency ratio = (Group TN-score/group target score)*100
While,
Group target score = sum of (weight of each KSA*target value for the KSA)
Or,
= (g*w/t)*100
e.g. Deficiency ratio for SPOs = (2.33/4.26)*100
= 50.65 %
The deficiency ratio of all job groups can be calculated in the same way.
3. Training-hit ratio
This is another important ratio which tells effectiveness of the training.
= (Pre-training aggregate score - Post-training aggregate score/Target score – Pre-training
score)*100
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e.g. Assuming post-training score as 3.00, training-hit ratio for SPOs = (1.93 – 3.00)/2.33*100
= 45.9 %
Remember, negative signs are not to be taken into account.
These ratios can give insights to the trainer and the top management that where they
stand in absolute terms, against best-in-class, against their own set targets and what they
have achieved in their training.
CONCLUSION
The paper provides a comprehensive guideline for trainers and management to craft an
objective training program. Its utility starts as an organization identifies a headache or problem and
declares it as a training matter. Then it helps through all micro aspects about the job groups to be
trained, people within them, types of content, and time and budget appropriation within those
modules. The proposed framework offers enough advancement towards achieving objectivity in
needs assessment for training. It also provides the luxury of incorporating any existing practices of
assessment and does not deny any of them. The implementation of framework needs a close working
relationship between the trainer, top management and relevant functional department(s) because
there are many steps where only top management or functional management has to provide inputs.
The time and money invested in its application is worth saving a lot of subsequent costs, including
the cost of poor training. The suggested ratios in the paper can be very efficient for busy strategic
executives. The whole process of assessment is run with numbers which ensures objectivity. Onward
discussion and contribution from scholars of this discipline can make it more fruitful and practical
for the corporate world.
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REFERENCES
Allison, R. (1990), Overcoming obstacles to needs assessment, Training, March, 27 (3)
ABI/INFORM GLOBAL, 36.
Billie, C. (2008), What’s your assessment strategy, Training, 45 (70), 14.
Erffmeyer, R. C., Russ, K. R., & Hair, J. F. (1991), Need assessment and evaluation in sales
training programs, The Journal of Personal Selling and Sales Management, Winter 11 (1)
ABI/INFORM Global, 17.
Goldstein, I. L. (1980), Training in work organizations, Annual Review of Psychology, 31, Annual
Reviews, Inc., 229-272.
Kerr, M., & Burzynski, B. (1988), Missing the target: Sales training in America, Training and
Development Journal, July, 68-70.
Landy, F. J. (1989), Psychology of Work Behavior, (4th Ed.), Brooks Cole: Pacific Grove, CA.
Lee, K. (2009), Be the trusted training advisor,” Training; Feb; 46, 2; ABI/INFORM Global, 18.
McGehee, W., & Thayer, P. W. (1961), Training in business and industry, New York: John Wiley.
Miller, J. A. & Osinsky, D. M. (2002), Training needs assessment,
Morano, R. (1973), Determining organizational training needs, Personal Psychology, 26, Fall, 479487.
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Moore, M. L., & Dutton, P. (1978), Training needs analysis: Review and critique, Academy of
Management Review, 3, 532-545.
Noe, A. R. (2006), Employee Training & Development, New York, NY, USA, Irvan
Professional Publication.
Wexley, K. N. (1984), Personnel training, Annual Review of Psychology, 34, Annual reviews, 519551.
Wright, P. C., & Geroy, G. D. (1992), Need analysis theory and effectiveness of large-scale
government-sponsor …, The Journal of Management Development, 11 (5), ABI/INFORM
GLOBAL.
Zemke, R. (1985), The systems approach: A nice theory but …, Training, 22, 103-108.
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