Magazine article Workforce Management

Training Adapts to the Downturn

Magazine article Workforce Management

Training Adapts to the Downturn

Article excerpt

IN DIFFICULT ECONOMIC TIMES, TRAINING DOLLARS USUALLY ARE A TEMPTING LINE ITEM TO CUT. BUT IN THE CURRENT DOWNTURN, SOME COMPANIES ARE TAKING A DIFFERENT APPROACH. SOME ARE JUDICIOUSLY CHOOSING PROGRAMS TO CUT OR REDUCE BASED ON LONG-TERM STRATEGIC GOALS, AN EXPERT SAYS.

NEWSPAPER FINANCIAL sections read more like the obituaries some mornings, but the sales associates at HelmsBriscoe must forge on. Every day the roughly 1 ,000 associates at the meeting-site selection company must convince corporate and association leaders that they still need to book for meetings that might be a year or more away.

It's a tough sell as executives curtail such events either because of immediate cost concerns or fears that they'll appear spendthrift in a tight economy, says Nell Nicholas, a HelmsBriscoe regional director who serves the New England area. To update their sales pitch, the associates in the New England office - who work exclusively on commission - reached out last fall for training assistance.

Those sessions have helped the associates reframe their approach, Nicholas says. Now they highlight the ways that HelmsBriscoe can assist with economy-related headaches, such as abrupt meeting cancellations or unused blocks of rooms. (The Scottsdale, Arizona-based company books $2 million a day globally in hotel space and other related revenue.) They also play up their ability to ease the workload of overtaxed human resources staffers and event planners, Nicholas says. "There's a lot more multitasking going on in this economic environment," she says. "Outsourcing is a great way to go. Companies are receptive."

During economic downturns, training dollars might appear to be a tempting line item to cut or re-evaluate as companies shed workers. Some companies will likely adjust their thinking in the recession, tracking return on investment more closely and restricting limited dollars to the most talented employees, training leaders say. In the years after the dot-com bust around the late 1 990s, a sizable percentage of training moved to technology-based options that didn't involve travel expenses, according to data from the American Society for Training & Development.

The retrenchment in this recession appears to be substantial, according to a new report by research firm Bersin & Associates. In 2008, average training expenditures per employee fell about 1 1 percent, from $1,202 per learner in 2007 to $1,075 per learner last year. The U.S. corporate training market shrank from $58.5 billion in 2007 to $56.2 billion in 2008, the greatest decline in more than 1 0 years, according to the report, which was released in January.

But radical or indiscriminate cuts can be risky, because economic tumult exposes yawning business challenges and emerging competitive opportunities alike, says Pat Galagan, executive editor for the American Society for Training & Development. "Often in tough times, companies will change direction," she says. "They will change their business model or decide to put more emphasis on a particular function, such as sales. Those things require more training rather than less."

MAXIMIZING DOLLARS

Galagan says she is watching for trends in technology-based learning. From 2001 to 2003, the average percentage of hours that companies devoted to e-learning and other technology-based options increased from 11.5 percent to 26.2 percent, according to data compiled in ASTD's annual "State of the Industry" report. "We could see another big jump," she says.

Based on early feedback, Laird Post of management consulting firm Booz & Co. predicts that corporate leaders will be more selective in how they cut staff development. "In past downturns it's been very typical to stop all training for an indefinite period of time because it's simpler and easier to do it that way," he says.

This time around, it appears that corporate leaders are more inclined to use "a scalpel," choosing programs based on longterm strategic goals, says Post, leader of the human capital management practice at Booz. …

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