When Companies Should Invest in Training Their Employees — and When They Shouldn’t

According to one industry report, U.S. companies spent over $90 billion dollars on training and development activities in 2017, a year-over-year increase of 32.5 %.

While many experts emphasize the importance and benefits of employee development — a more competitive workforce, increased employee retention, and higher employee engagement — critics point to a painful lack of results from these investments. Ultimately, there is truth in both perspectives.

Training is useful at times but often fails, especially when it is used to address problems that it can’t actually solve.

Many well-intended leaders view training as a panacea to obvious learning opportunities or behavioural problems. For example, several months ago, a global financial services company asked me to design a workshop to help their employees be less bureaucratic and more entrepreneurial.

Their goal was to train people to stop waiting around for their bosses’ approval, and instead, feel empowered to make decisions on their own. They hoped, as an outcome, decisions would be made faster. Though the company seemed eager to invest, a training program was not the right way to introduce the new behaviour they wanted their employees to learn.

Training can be a powerful medium when there is proof that the root cause of the learning need is an undeveloped skill or a knowledge deficit. For those situations, a well-designed program with customized content, relevant case material, skill-building practice, and a final measurement of skill acquisition, works great. But, in the case of this organization, a lack of skills had very little to do with their problem. After asking leaders in the organization why they felt the need for training, we discovered the root causes of their problem had more to do with:

Ineffective decision-making processes that failed to clarify which leaders and groups owned which decisions
Narrowly distributed authority, concentrated at the top of the organization
No measurable expectations that employees make decisions
No technologies to quickly move information to those who needed it to make decisions
Given these systemic issues, it’s unlikely a training program would have had a productive, or sustainable outcome. Worse, it could have backfired, making management look out of touch.

Learning is a consequence of thinking, not teaching. It happens when people reflect on and choose a new behaviour. But if the work environment doesn’t support that behaviour, a well-trained employee won’t make a difference. Here are three conditions needed to ensure a training solution sticks.

1. Internal systems support the newly desired behaviour. Spotting unwanted behaviour is certainly a clue that something needs to change. But the origins of that unwanted behaviour may not be a lack of skill. Individual behaviours in an organization are influenced by many factors, like how clearly managers establish, communicate, and stick to priorities, what the culture values and reinforces, how performance is measured and rewarded, or how many levels of the hierarchy there are. These all play a role in shaping employee behaviours.

In the case above, people weren’t behaving in a disempowered way because they didn’t know better. The company’s decision-making processes forbid them from behaving any other way. Multiple levels of approval were required for even tactical decisions. Access to basic information was limited to high-ranking managers. The culture reinforced asking permission for everything. Unless those issues were addressed, a workshop would prove useless.

2. There is a commitment to change. Any thorough organizational assessment will not only define the skills employees need to develop, but it will also reveal the conditions required to reinforce and sustain those skills once a training solution is implemented. Just because an organization recognizes the factors driving unwanted behaviour, doesn’t mean they’re open to changing them. When I raised the obvious concerns with the organization above, I got the classic response, “Yes, yes, of course, we know those issues aren’t helping, but we think if we can get the workshop going, we’ll build momentum and then get to those later.” This is usually code for, “It’s never going to happen.” If an organization isn’t willing to address the causes of a problem, a training will not yield its intended benefit.

3. The training solution directly serves strategic priorities. When an organization deploys a new strategy — like launching a new market or product — training can play a critical role in equipping people with the skills and knowledge they need to help that strategy succeed. But when a training initiative has no discernible purpose or end goal, the risk of failure is raised. For example, one of my clients rolled out a company-wide mindfulness workshop. When I asked a few employees what they thought, they said, “It was interesting. At least it got me two hours away from my cubicle.” When I asked the sponsoring executive to explain her thought process behind the training, she said, “Our employee engagement data indicated our people are feeling stressed and overworked, so I thought it would be a nice perk to help them focus and reduce tension.” But when I asked her what was causing the stress, her answer was less definitive: “I don’t really know, but most of the negative data came from Millennials and they complain about being overworked. Plus, they like this kind of stuff.” She believed her training solution had strategic relevance because it linked to a vital employee metric. But evaluations indicated that, though employees found the training “interesting,” it didn’t actually reduce their stress.

There is a myriad of reasons why the workload could have been causing employees stress. Therefore, this manager’s energy would have been better directed at trying to determine those reasons in her specific department and addressing them accordingly — despite her good intentions.

If you are going to invest millions of dollars into company training, be confident it is addressing a strategic learning need. Further, be sure your organization can and will sustain new skills and knowledge by addressing the broader factors that may threaten their success. If you aren’t confident in these conditions, don’t spend the money.

Author:  Ron Carucci

Ron Carucci is co-founder and managing partner at Navalent, working with CEOs and executives pursuing transformational change for their organizations, leaders, and industries.