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C h ap ter One

Introduction to Employee
Training and Development
Objectives 3. Discuss various aspects of the training
design process.
A fter reading this chapter, you should be
able to j: 4. Describe the amount and types of
training occurring in U.S. companies.
1. Discuss the forces influencing the
w orkplace and learning; e n d explain 5. Discuss the key roles for training
how training can help companies deal professionals.
w ith these forces;; 6. Identify appropriate resources
2. Draw a figure or diagram and explain (e g-, journals, websites) for learning
how training, development, informal about training research and practice.
learning, and kno w ledge m anage
ment contribute to business success.

Forces Affecting the Workplace Make Training


a Key Ingredient of Company Success
Custom e r service, productivity, safety, employee retention and grow th, uncertainty in
the economy, extending learning beyond the classroom, the use of n e w t e ch no logy—
these are just som e of the issues affecting companies in all industries and sizes and
influencing training practices.
The exam ples presented below show how these concerns have affected com p a
nies in several different business sectors and how training has helped them succeed.
M any companies, recognizing that learning goes beyond typical fa ce-to-face
classes, are using technology to m ake it easier for employees in different locations
to learn and share know ledge through formal courses, as w ell as through collabo
ration. For example, Gam eStop, the retailer of new and used video gam es, hard
w are, entertainment software, and accessories, has 18,000 em ploye es in more than
6 ,600 locations in the United States, Australia, Canada, New Ze aland, and Europe.
W ho doesn't like to play video gam es like Super Mario, Borderlands, or DragonBall
XenoVerse! Its customers can get gam es from Gam eStop that they can't ge t anyw here

4
Chapter 1 Iritraduction to Employee Training and Development 5

else, and it allows customers to buy, sell, or trade games unlike many of its co m
petitors. GameStop serves a variety of customers, including five-year-olds and their
parents who are looking for Nintendo gam es to adult gamers who w ant to buy the
latest gaming equipment. Most Gam eStop employees (called game-associates) hold
part-time, entry-level jobs, requiring w orking several shifts during the w e ek. They
often leave for other jobs or opportunities such as going back to school. Training
helps GameStop successfully deal with turnover by ensuring new employees provide
consistent customer service that translates into satisfied customers and return busi
ness. Most new employees w ho join Gam eStop are expert gamers, have expertise
about the technology and trends influencing the gam ing market, and were loyal cus
tomers. As a result, GameStop's training doesn't focus on teaching employees abou t
video games but instead emphasizes how to interact with customers and understand
their gaming needs. Also, the training helps employees become ambassadors for the
company by sharing their know ledge and passion for gam ing with customers. The
LevelUp program is an online program that enables employees to complete training
on their own time and at their own pace, scoring points based on achieving different
skills and advancing to the next level. Training content varies based on the em ploy
ees' needs; it allows them to log in and out of training at any time and skip se c
tions they already know. The LevelUp program helps prepare new gam e-associates
as well as provide training for more experienced game-associates who may be more
interested in a retail career and w ant to gain the know ledge and skills necessary to
become assistant managers and store managers.
McAfee, part of Intel Security, is the world's largest dedicated security technology
company. M cAfee protects consumers and businesses from the malware and em e rg
ing online threats. Sixty percent of employees use social networking tools that sup
port learning and 50 percent of training content is delivered using self-paced online
instruction. M cAfee also encourages knowledge sharing. Employees can connect
online with potential mentors and mentees based on the personal profiles they cre
ate. A career development group helps employees collaborate and share ideas about
their personal development. A language learning community is available for employ
ees around the world to talk to each other to improve their language skills.
Blue Cross and Blue Shield of M ichigan uses Knowlt and MISource to reach
employees at forty different locations. Knowlt includes wikis, w eb courses, podcasts,
discussion boards, and e-learning to provide information on more than eighty busi
ness topics. MISource gives claims and customer service employees access to infor
mation they need to better serve customers. Scotiabank Group, with operations in
more than fifty companies, developed an internal social networking application,
FaceForward, which includes user profiles, blogs, wikis, and social bookmarks.
US Airw ays provides extensive training for flight attendants and pilots. Newly
hired flight attendants receive five weeks of training, including an introduction to
the aviation industry, and Airbus cabin simulators include " door trainers " to practice
opening emergency exits under difficult evacuation conditions, such as total d ark
ness and billowing smoke. Training also includes jumping into a pool and inflating
a life raft and helping passengers into and out of a raft. Federal law requires a n
nual classroom safety training for flight attendants, and performance drills every
two years. Pilot training includes practicing skills in a simulator that presents m any
6 Part 1 The C ontext for Training and Development

differen t scenarios, such as both engin es failing, and re-creates the fe e lings and
sounds experienced in fligh t, including turbulence. Forced landings and w a ter d it c h
ings are t a u gh t in th e classroom . The payoff for this type of extensive tra ining w a s
m ost evident in the sp e ctacularly safe landing of US Airw ays Flight 1 549 and its 155
p assengers and fligh t cre w in the Hudson River in 2009. Based on their alm ost a u t o
m atic responses deve lop ed through years of training, fligh t attendants w ere able to
calm p assengers, prepare them for a crash landing, and open doors and infla te life
rafts to assist in th e orderly but quick exit of the slowly sinking airplane. The co c k p it
cre w fo llo w e d th e tra ining they received in ho w to cope w ith engin e failure and su c
cessfully condu ct ed a w a te r landing.
Sources: Based on M. McGraw, "Staying Power," Human R esource Executive (January/February 2015)
39-41; " M cAffee. Part of Intel Security," TD (October 2014): 98 Training Top 125. training (January/
February 2011): 54-93. 36; S. McCartney, " Crash Courses for the Crew. " The Wall Street Journal
(January 27, 2009): D1, D8.

INTRODUCTION
T he exam ples discussed in the chapter opener illustrate how training can c o n trib u te to
co m p an ies’ com petitiveness. C om petitiveness refers to a co m p an y 's ability to m aintain
and gain m arket share in an industry. Although they are different types of b u sin esses, these
four com panies have training practices that have helped them gain a c o m p etitiv e a d v a n -
tage in their m arkets. T hat is, the training practices have helped them grow the business
and im prove custom er service by providing em ployees with the know ledge and skills they
need to be successful.
C om panies are experiencing great change due to new technologies, rapid d e v e lo p -
m ent o f know ledge, globalization o f business, and developm ent o f e -c o m m e rce . A lso,
com panies have to take steps to attract, retain, and m otivate their w o rk fo rces. T ra in in g is
not a luxury; it is a necessity if com panies are to participate in the global and electro n ic
m arketplaces by offering high-quality products and services. T raining p rep a re s em p lo y -
ees to use new technologies, function in new work system s such as virtual tea m s, and
com m unicate and cooperate w ith peers or custom ers w ho m ay be from d iffe re n t cultural
backgrounds.
H um an resource m anagem ent refers to the policies, practices, and sy stem s that influ-
ence em ployees’ behavior, attitudes, and perform ance. H um an resource p ractices play a key
role in attracting, m otivating, rew arding, and retaining em ployees. O th er h u m an resource
m anagem ent practices include recruiting em ployees, selecting em p lo y e es, designing
w ork, com pensating em ployees, and developing good labor and e m p lo y e e relations.
C hapter Two, “ Strategic Training,” details the im portance placed on train in g in co m p ari-
son to other hum an resource m anagem ent practices. To be effective, train in g m ust play a
strategic role in supporting the business.
H um an resource m anagem ent is one o f several im portant functions in m ost com panies.
O ther functions include accounting and finance, production and o p e ra tio n s, rese a rc h and
developm ent, and marketing. Keep in m ind that although hum an reso u rce m anagem ent
practices (such as training) can help com panies gain a com petitive a d v an tag e, the com -
pany needs to produce a product or provide a service that cu sto m ers value. W ithou t the
Ch a p t e r 1 Introduction to Employee Training and Development 1

financial resources and physical resources (e.g., equipm ent) needed to produce products
or provide services, the com pany will not survive.
This chapter begins by defining training and developm ent and discussing how the training
function has evolved. Next, the forces that are shaping the w orkplace and learning are
addressed. These forces influence the co m p an y 's ability to successfully m eet stakehold-
e rs’ needs. The term stak eh old ers refers to shareholders, the com m unity, custom ers, em -
ployees, and all the other parties that have an interest in seeing that the com pany succeeds.
The discussion o f the forces shaping the w orkplace (including technology, globalization,
and attracting and w inning talent) highlights the role o f training in helping com panies gain
a com petitive advantage.
The second part o f the chapter focuses on current trends in the training area. This sec-
tion also introduces you to the train er's role in a business and how the training function is
organized. This section should help you understand current training practices, the types
o f jo b s that trainers m ay perform , and the com petencies needed to be a successful trainer
(or, if you are a m anager, to identify a successful trainer). The chapter concludes with an
overview o f the topics covered in the book.

TR A IN IN G A N D DEVELO P M EN T: K E Y C O M P O N EN TS O F LEA R N IN G
O ur focus in this book is to help you understand the role o f training and developm ent in
to d ay ’s organizations. To do this, it is im portant for you to understand w hat training and
dev elo p m en t m eans in the b ro ad e r b usiness contex t. F ig u re 1.1 show s the role o f tra in -
ing and dev elo p m en t for the business. T he overall goal o f train in g and d e v elo p m en t
is learnin g. L earn in g refers to em p lo y ees a c q u irin g kno w led g e, sk ills, c o m p e ten c ie s.

F IG U R E 1.1
The Business
Role of
Training and
Development
8 Part 1 The Context for Training and Development

attitudes, or behaviors. But the focus of training and developm ent is not just on em ployees
learning for its own sake. Today, m erely offering training program s is not enough to get
support and funding from executives and to establish the credibility of the training and
developm ent function to m anagers and employees. Learning needs to dem onstrate how it
contributes to the co m pan y’s com petitive advantage through im proving em ployee perfor-
m ance, supporting the business strategy (such as growing the business), and contributing
positively to business outcom es such as quality, productivity, developm ent of new prod-
ucts, and retaining key em ployees. From a com pany’s perspective, what em ployees learn
contributes to the developm ent o f intangible assets such as hum an capital. H u m a n c a p ita l
refers to know ledge (know what), advanced skills (know how), system understanding and
creativity (know why), and m otivation to deliver high-quality products and services (care
w h y ).1 H um an capital m ay be more valuable than physical capital (equipm ent or technol-
ogy) or financial capital (m onetary assets, cash) for providing a com pany with an advan-
tage over its com petitors, because it is difficult to imitate or purchase and it is unique to
the company.
There are a num ber o f different ways that learning occurs in a com pany. They are rep-
resented on the outside o f the circle in Figure 1.1. Training refers to a planned effort by a
com pany to facilitate learning o f job-related com petencies, know ledge, skills, and behav-
iors by em ployees. T he goal o f training is for em ployees to m aster the know ledge, skills,
and behaviors em phasized in training and apply them to their day-to-day activities. T radi-
tionally, com panies have relied on formal training through a course, program , or “event"
to teach em ployees the know ledge, skills, and behaviors they need to successfully perform
their job. D evelopm ent is sim ilar to training, except that it tends to be m ore future-focused.
D evelopm ent refers to training as well as formal education, jo b experiences, relationship,
and assessm ents o f personality, skills, and abilities that help em ployees prepare for future
jo b s or positions. We will discuss developm ent in more detail in C hapter N ine, “ Em ployee
D evelopm ent and C areers.” Form al training and developm ent refers to training and d e-
velopm ent program s, courses, and events that are developed and organized by the com -
pany. Typically, em ployees are required to attend or com plete these program s, w hich can
include face-to-face training program s (such as instructor-led courses) as well as online
program s. As you will see later in the chapter, U.S. com panies invest billions o f dollars in
form al training.
Inform al learning is also im portant for facilitating the developm ent o f hum an capital.2
Inform al learning refers to learning that is learner initiated, involves action and doing,
is m otivated by an intent to develop, and does not occur in a form al learning setting.3
Inform al learning occurs w ithout a trainer or instructor, and its breadth, depth, and tim ing is
controlled by the em ployee. It occurs on an as-needed basis and m ay involve an em ployee
learning either alone or through face-to-face or technology-aided social interactions.
Inform al learning can occur through m any different ways, including casual unplanned
interactions with peers, e-m ail, inform al m entoring, or com pany-developed or publically
available social netw orking w ebsites such as Twitter or Facebook. T he application of
social m edia from a m arketing strategy to a learning strategy and the availability o f W eb 2.0
technologies such as social netw orks, m icroblogs, and wikis allow em p lo yees easy access
to social learning or learning through collaboration and sharing w ith one or tw o o r more
people.4 One estim ate is that inform al learning may account for up to 75 percent o f learning
w ithin organizations.
Chap ter 1 Introduction to Employee Training and Development 9

One reason why informal learning may be especially im portant is that it may lead to the
effective developm ent o f tacit know ledge, which can be contrasted with explicit knowl-
edge.5 Explicit know ledge refers to know ledge that is well docum ented, easily articulated,
and easily transferred from person to person. Exam ples o f explicit knowledge include
processes, checklists, flow charts, form ulas, and definitions. Explicit knowledge tends to
be the primary focus o f formal training and em ployee developm ent. Tacit know ledge re-
fers to personal knowledge based on individual experiences that is difficult to codify. The
characteristics of formal training and developm ent program s, such as the relatively short
duration of classroom or online training and lim ited opportunities for practice, may limit
the extent to which tacit know ledge can be acquired. Thus, informal learning is central to
the developm ent o f tacit know ledge because it involves em ployee interactions in personal
relationships with peers, colleagues, and experts through which tacit knowledge is shared.
It is important to recognize, however, that informal learning cannot replace formal training
and em ployee developm ent. Formal training and developm ent are still needed to prepare
em ployees for their jobs and to help them advance to future positions. Informal learning
com plem ents training by helping em ployees gain tacit knowledge that formal training
cannot provide.
K nowledge m anagem ent refers to the process of enhancing com pany perform ance
by designing and im plem enting tools, processes, systems, structures, and cultures to im -
prove the creation, sharing, and use o f know ledge.6 Knowledge m anagem ent contributes
to informal learning. G4S Secure Solutions provides security solutions around the w orld.7
Its employees are spread across field offices and client locations. M ost G4S security of-
ficers don't have com puter access or are restricted by client firewalls. But security offi-
cers need timely information in order to protect clients and property. Seeking and sharing
knowledge can help save lives. As a result, the com pany developed an Internet and social
networking solution. It provides access to com pany m aterials, announcem ents, policies
and procedures, training manuals, operational and support tools, and best practice forums.
It can be accessed from anywhere, giving em ployees the ability to ask questions across
the company as well as within their office, location, or work team. The solution includes
social networking features sim ilar to Facebook. Em ployee can create profiles that have
their skills, interests, achievements, projects, and contact inform ation. They can partici-
pate in threaded discussions. Tags can be used to identify sim ilar docum ents or discus-
sions on the same topic. Caterpillar Inc. moved toward becom ing a continuous learning
organization with the help of knowledge m anagem ent.8 Thirty years ago. Caterpillar Inc.,
a m anufacturer of construction and m ining equipm ent, engines, and gas turbines, had
most of its value in its plant and equipm ent. Today, intangible assets account for most
of the com pany's value. C aterpillar's w eb-based knowledge m anagement system, known
as Knowledge Network, has thousands o f com m unities of practice. They range m size
from small team s to hundreds o f em ployees worldwide. The com m unities o f practice are
useful for em ployees to gain both explicit and tacit knowledge. They are used to distribute
inform ation, post questions, and provide space for reference materials. One com m unity
of practice focused on bolted joints and fasteners. This gives specialized engineers w ho
generally work alone in m anufacturing facilities the ability to ask other engineers q u es-
tions or get second opinions on designs and problems. The com m unity ot practice has
resulted in improved decision making, increased collaboration and team w ork, and better
product design and development. For example, m em bers of the Bolted Joints and Fastener
10 P a rti The Context for Training and Development

community and the Dealer Service Training Community saved more than SI 5 m illion
from online discussions.
M any companies who recognize the value of learning have taken steps to ensure that
formal training and employee development is linked to strategic business objectives and
goals, use an instructional design process to ensure that these programs are effective, and
compares or benchmarks the company’s programs against its com petitors or other com pa-
nies in the industry.9
Consider the role of learning at PricewaterhouseCoopers."’ Its Learn ins: and Hducation
(L&E) team was restructured to better link it to the business goals related to value and im -
pact. L&E works with the business to understand what it wants education to be. It ensures
ongoing innovation in training delivery and instructional methods by evaluatin'.: em erging
technologies and using them in small pilot projects. The chief learninu officer in charge
o f L&E is a m em ber of the com pany’s leadership team, which gives that individual the
opportunity to discuss ideas regarding training methods, delivery, and content with other
top-level managers. L&E sponsors traditional and virtual classroom courses, self-study,
team-based learning, action learning projects, coaching and m entoring, and conferences,
and it has served more than 150,000 users each year, with over 6.000 courses. 12.000
classroom -based training sessions, and 19.000 web-based training sessions.
PricewaterhouseCoopers uses a learning management system to create a simile access
point for training activities. To help employees learn on an as-needed basis, the co m p an y 's
e-learning includes video and audio conferencing, virtual classroom s, and w ebcasting.
To evaluate the success of training, L&E considers its influence on outcom es, such as
retention of top people. Also, focus groups are used to determ ine w hether trainees and
m anagers are satisfied with the training. A program on sustainability was designed to help
partners understand how to provide solutions for their clients. The co m p an y ’s investm ent
in the program has paid off. The company believes that it has achieved a return on invest-
m ent o f more than 1,000 percent in new business sold and reputation gains in the m ar-
ketplace. In the future, L& E plans to further strengthen the relationship betw een training,
developm ent, and the business by focusing on how it can make learning even m ore ac ce s-
sible and closer to the point where em ployees need it. L& E wants to integrate learning and
knowledge to speed em ployees’ developm ent and improve their com petencies.
This discussion is not m eant to underestim ate the im portance o f “ traditional train in g ”
fa focus on acquisition o f know ledge, skills, and abilities), but it should alert you that for
m any com panies, training is evolving from a focus on skills to an em phasis on co n tin u o u s
learning and creating and sharing knowledge. This evolution o f training is discu ssed in
C hapter Two.

DESIGNING EFFECTIVE TRAINING


The tra in in g d esig n p ro ce ss refers to a system atic approach to r d eveloping train in g
program s. Figure 1.2 presents the seven steps in this process. Step 1 is a needs a sse ss-
m ent, w hich is necessary to identify w hether training is needed. Step 2 is to en su re that
em ployees have the m otivation and basic skills necessary to m aster the train in g co n ten t.
Step 3 is to create a learning environm ent that has the features n ecessary to r learn in g to
occur. Step 4 is to ensure that trainees apply the training content to th eir jo b s. T h is step
Chapter 1 Introduction to Employee Training and Development 11

F IG U R E 1.2 Training Design Process

involves having the trainee understand how to m anage skill improvem ent, as well as get-
ting co-w orker and m anager support.
Step 5 is to develop an evaluation plan. Developing an evaluation plan includes iden-
tifying what types of outcom es training is expected to influence (for exam ple, learning,
behavior, or skills), choosing an evaluation design that allows you to determ ine the influ-
ence o f training on these outcom es, and planning how to dem onstrate how training affects
the “bottom line" (that is, using a cost-benefit analysis to determ ine the m onetary benefits
resulting from training). Step 6 is to choose the training m ethod based on the learning
objectives and learning environm ent. This step may include a traditional training m ethod
of face-to-face interaction with a trainer or e-learning using w eb-based training or mobile
learning. Step 7 is to evaluate the program and make changes in it or revisit any of the
earlier steps in the process to improve the program so that learning, behavior, change, and
other learning objectives are obtained.
The training design process shown in Figure l .l is based on principles ot Instructional
System Design. In stru c tio n a l System D esign (ISD ) refers to a process for designing and
developing training program s. There is not one universally accepted instructional sys-
tems developm ent model. The training design process sometim es is referred to as the
ADDIE model because it includes analysis, design, developm ent, implem entation, and
evaluation." In Figure l . l . Step l, conducting needs assessm ent, and Step 2. ensuring
em ployees’ readiness for training, are related to analysis. The next three steps -creating a
learning environm ent, ensuring transfer o f training, and developing an evaluation plan
are design issues. Step 6, selecting and using a training method, relates to im plem entation.
Step 7, m onitoring and evaluating the program, relates to evaluation. Regardless o f the
specific ISD approach used, all share the following assum ptions: -
• Training design is effective only if it helps em ployees reach instructional or training
goals and objectives.
12 Part 1 The Context for Training and Development

• M easurable learning objectives should be identified before the training program begins.
• Evaluation plays an im portant part in planning and choosing a training m ethod, m oni-
toring the training program , and suggesting changes to the training design process.
Trainers for A bsorbU , the internal college for ITU AbsorbTech, an industrial laundry
service com pany, design courses using the ADDIE m o d el.13 A bsorbU focuses on learning
needs related to custom er service, production, leadership, and sales. They find that using
the A D D IE m odel helps them to identify training needs and desired results and focus at-
tention on know ledge transfer or behavior change. Also, they use A D D IE when they are
revisiting courses to review them and ensure that the content rem ains useful.

O v e rco m ing th e Fla w s o f the ISD M odel


Som e training professionals argue that the ISD model is flawed for several rea so n s.14 First,
in organizations, the training design process rarely follows the neat, orderly, step-by-step
approach o f activities shown in Figure 1.1. Second, in trying to standardize their own
ISD m ethod used in the training function, some organizations require trainers to provide
detailed docum ents o f each activity found in the model. This adds tim e and cost to devel-
oping a training program . Third, the ISD im plies an end point: evaluation. However, good
instructional design requires an iterative process of design, execution, evaluation, and re-
consideration o f the needs that the program was designed to m eet, as well as the learning
environm ent, the transfer of training, and all the other activities in the ISD process. Fourth,
m any com panies claim to use an instructional design approach but dilute its ap p licatio n .1^
This m ight include assum ing that training is the best solution w ithout investigating other
causes for perform ance gaps, failing to identify training objectives and results, focusing
too m uch on the training m ethod while ignoring the role o f the work environm ent in trans-
fer o f training, and concentrating evaluation on w hether trainees liked the program rather
than on m easuring the im pact o f training on jo b perform ance or business results. Despite
these criticism s, use o f the ISD process is the best way to help ensure the effectiveness of
training and developm ent.
The training design process should be system atic, yet flexible enough to adapt to busi-
ness needs. D ifferent steps may be com pleted sim ultaneously. For exam ple, a business
leader w ho was an im portant stakeholder at Deloitte wanted a training m odule for new
em ployees on how to deliver exceptional custom er service to be quickly red e sig n ed .16
T he fast turn-around tim e was necessary because of its business im plications. M any new
em ployees hired each week needed to understand how to provide cu sto m er service the
D eloitte way. Three team s o f talent developm ent professionals w ere each given the same
set o f learning objectives to create a revised program . T hroughout the p rocess they ex-
changed and critiqued each o th er’s ideas. At the end of the day the ideas for the revised
program were presented to the business leader. The business leader review ed the team s'
recom m endations and agreed that hybrid course design based on tw o o f the tea m s' recom -
m endations would be the best solution. Keep in m ind that designing train in g un system -
atically will reduce the benefits that can be realized. For exam ple, ch o o sin g a training
m ethod before determ ining training needs or ensuring em p lo y ees’ read in ess for training
increases the risk that the m ethod chosen will not be the m ost effective one for m eeting
training needs. Also, training m ay not even be necessary and m ay result in a w aste of tim e
Chapter 1 Introduction to Employee Training and Development 13

and money. Employees may have the knowledge, skills, or behavior they need but sim ply
not be motivated to use them.
The introduction of new technologies such as mobile learning (discussed in C h a p te r
Eight) highlights a shift from trainees having to learn from an instructor in one location
to trainees learning independently and not being bound to learn in the w orkplace. Still,
good training design requires determ ining the trainees’ needs, identifying resources so
that trainees can learn what they need to know, and providing them with access to refer-
ence materials and knowledge bases when they encounter problems, issues, or qu estio n s
on the jo b .17
The development of a web-based training program focused on teaching m anagers the
skills needed to run effective business meetings provides a good exam ple o f the in stru c-
tional design process. The first step of the process, needs assessm ent, involved d e te rm in -
ing that managers lacked skills for conducting effective m eetings and helped to identify
the type of meetings that m anagers were involved in. The needs assessm ent process in -
volved interviewing managers and observing meetings. The needs assessm ent process also
identified the most appropriate training method.
Because the managers were geographically dispersed and had easy access to c o m p u t-
ers. and because the company wanted a self-directed, self-paced program that the m an a g -
ers could complete during free time in their work schedule, the training designers and
company management decided that web-based training was the appropriate m ethod. B e -
cause training was going to be conducted over the web. the designers had to be sure that
managers could access the web and were fam iliar with tools for using it (e.g.. w eb b ro w s-
ers). This relates to determining the m anagers’ readiness for training.
The next step was to create a positive learning environm ent on the web. D esigners
made sure that the program objectives were clearly stated to the trainees and provided
opportunities within the program for exercises and feedback. For exam ple, trainees w ere
asked to prepare an outline for the steps they would take to conduct an effective m eet-
ing. The designers built into the program a feedback system that indicated to the m an -
agers which of the steps they outlined were correct and which needed to be changed.
The designers also included assessm ent tests that allowed the trainees to receive feedback
through the program and to skip ahead or return to earlier material based on their scores
on the tests. The assessm ent included a test of meeting skills that the managers com pleted
both prior to and after com pleting the program. The assessment tests were stored in a data
bank that the company could use to evaluate whether trainees’ m eeting skills im proved
from pretraining levels.

THE FORCES INFLUENCING WORKING AND LEARNING


Table 1.1 illustrates the forces that are influencing working and learning. G lobalization
o f business, dem ographic changes, new technologies, and econom ic changes are several
of the forces shown in Table 1.1 that influence all aspects of our lives: how we purchase
products and services, how we learn, how we com m unicate with each other, and what we
value in our lives and on the jo b .18 These forces are affecting individuals, com m unities,
businesses, and society. To survive, companies must address these forces— with training
playing an important role.
14 P a rti The Context for Training and Development

TABLE 1.1 Economic cycles


Forces
Globalization
Influencing
increased value placed on intangible assets and human capital
Working and
Learning
Focus on link to business strategy
Changing demographics and diversity of the workforce
Talent management
Customer service and quality emphasis
New technology
High-performance work systems

Eco n o m ic Cycles
It is im portant to recognize that regardless o f the current econom ic cycle, training has been
show n to positively contribute to the co m pan y’s perform ance. For exam ple, com panies
th at used m ore selective staffing and training before the recession ou tp ro d u ced and had
b etter perform ance than com petitors before the econom ic recession o f 2009 and recovered
m ore q u ick ly .19
Today, there are m any positive signs that the U.S. econom y is ex p erien cin g positive
m om entu m .20 E m ployers are adding jo b s at the fastest rate since the late 1990s. T he un-
em ploym ent rate was 5.5 percent in February 2015, the low est in seven years. C on su m er
spending benefited from steady jo b grow th, and low er gasoline prices rose in the fourth
quarter o f 2014 at the fastest rate since the first quarter o f 20 06 .21 G row th in the gross d o-
m estic product (G D P) was 2.4 percent higher than the increase in 2013, and U .S. m anu fac-
turing output m oved past its prerecession levels. Surveys suggest that co m p an y C E O s are
optim istic about the U.S. eco n o m y ’s grow th p rosp ects.22 H iring co n tin ues to be a priority
for C E O s w ith tw o-thirds planning to add new em ployees in the next year.
However, there are several threats to continued econom ic g ro w th .23 D espite the low
unem ploym ent rate, em p lo y ee’s pay is slow ly increasing, w hich can u ltim ately result in
reduced consum er spending. B roader m easures o f unem ploym ent in clu d in g the num bers
o f involuntary part-tim e em ployees and long-term unem ployed w ere dow n d u rin g 2014,
but still higher than before the recession. A lso, there are concerns that the F ed eral R eserve
B ank will begin to raise the borrow ing rate for federal funds, w hich has been near zero
since the end o f 2008. T he low est fund rate in history was provided as an em ergency
m easure during the financial crisis several years ago, but the econ om y h a s n 't show n that
it can grow w ithout it. A fund rate hike could affect grow th, inflation, and e x ch an g e rates
throughout the world.
D espite com panies looking to add new em ployees to expand o p e ra tio n s, rep lace retir-
ing em ployees, or keep up w ith increased dem and for their pro du cts and serv ices, m any
com panies m ay be unable to find new em ployees with the skills they n e e d .24 A lso, valu-
able high-perform ing em ployees m ay be looking to change jo b s for h ig h er w ag es or better
career opportunities. As a result, com panies are having problem s a ttrac tin g and retain in g
talented em ployees and are looking to training as part o f the solution. For e x a m p le, Panera
B read, W alm art, Starbucks, and A etna all raised e m p lo y ees’ pay.25 In ad d itio n to raising
pay, Starbucks has focused on learning as a way to attract and retain e m p lo y e e s and show
it is com m itted to their success. S tarbucks C ollege A chievem ent Plan pays e m p lo y e e s ’ tu i-
tion for an online bachelor’s degree from A rizon a State U niversity. E m p lo y e e s can ch o ose
Ch ap t e r 1 Introduction to Employee Training and Development 15

from forty degree program s. The only requirem ents are that em ployees have to be working
at least twenty hours each w eek; are U .S.-based w orking in support centers, plants, or at
any of com pany-operated stores (including Teavana, La Boulange, Evolution Fresh, and
Seattle’s Best Coffee stores); and do not yet have a bach elor’s degree. Em ployees admitted
to Arizona State as a ju n io r or senior will earn full tuition reim bursem ent for each year of
coursework they com plete tow ard a bachelor's degree. Those adm itted as freshm en and
sophom ores will receive a partial scholarship and need-based financial aid toward the
com pleting their degree. Em ployees have no com m itm ent to rem ain at Starbucks after
they graduate.

G lob aliza tion


Every business must be prepared to deal with the global economy. Global business expan-
sion has been m ade easier by technology. The Internet allows data and inform ation to be
instantly accessible and sent around the world. The Internet, e-m ail, and video conferenc-
ing enable business deals to be com pleted betw een com panies thousands o f m iles apart.
G lobalization is not lim ited to any particular sector o f the economy, product m arket, or
com pany size.26 C om panies w ithout international operations may buy or use goods that
have been produced overseas, hire em ployees with diverse backgrounds, or com pete with
foreign-ow ned com panies operating within the U nited States. G lobalization is also likely
to increase as m ajor opportunities to expand into new m arkets grow due to the increasing
num ber o f consum ers overseas who have products and services and the incom e to buy
them.
One estim ate is that developing econom ies and em erging m arkets such as those found
in the BRIC nations (Brazil, Russia, India, and C hina) are responsible for 19 percent o f
the w orld’s econom y.27 O ther countries such as Indonesia. M alaysia. Kenya. Colum bia,
and Poland which have a grow ing m iddle class, strong infrastructure, business-friendly
regulations, and stable governm ents are likely new em erging m arkets. The im portance
o f globalization is seen in recent hiring patterns o f large U.S. m ultinational corporations
who have increased their overseas w orkforce, particularly in A sia.-8 For exam ple, Oracle,
the business hardw are and softw are developer, added workers overseas resulting in over
60 percent o f its em ployees located outside the U nited States. M arkets in Brazil, China,
and India have resulted in 60 percent o f General E lectric’s business outside the United
States, with over half o f its em ployees being located overseas. Clothing retailer Gap Inc
Clothing retailer Gap Inc., opened its first com pany-ow ned store in China in 2010. t as
stores in forty-eight countries, including Asia, Australia, Eastern Europe, Latin A m en ,
the M iddle East, and Africa. Banana Republic, a Gap Inc. company, recently expanded to
im portant cities for fashions, including Ginza, Paris, and M dan. Coca-Cola operates in
more than two hundred countries. Coke recently opened its forty-third pro ^ction aci
ity in China and plans to invest $5 billion in Africa over the next six years. o e a so
plans to open its first bottling plant in M yanmar, which will create thousan s o jo s over
the next five years. Gap believes it needs to continue to expand its international presence
because the U.S. m arket is m aturing and has many com petitors. Yum! Brands, the parent
com pany o f KFC, Pizza Hut and Taco Bell, has over 6,200 stores in C hina contributing
over 50 percent of the com pany’s profits.31
Global com panies are struggling both to find and retain talented em ployees, especially
in em erging markets. Com panies are moving into China, India, Eastern Europe, the M iddle
16 Part 1 The Context for Training and Development

East, Southeast Asia, and Latin Am erica, but the dem and for talented em p lo y ees exceeds
the supply. Also, com panies often place successful U.S. m anagers in charge o f overseas
operations, but they lack the cultural understanding necessary to attract, m otivate, and retain
talented em ployees. To cope with these problem s, com panies are taking actio n s to better
prepare their m anagers and their fam ilies for overseas assig n m en ts and to en su re that
training and developm ent opportunities are available for global em p lo y ees. C ross-cu ltu ral
training prepares em ployees and their fam ilies to understand the cu ltu re and n orm s o f the
country to which they are being relocated and assists in their return to their ho m e country
after the assignm ent. C ross-cultural training is discussed in C h a p te r Ten.
M cD onalds continues to open new stores throughout the w o r l d / 2 It o p en ed its first
restaurant in Vietnam in 2014 and is planning to open a store in K azak h stan in 2015. The
Vietnam store is the 10,000th restaurant for M cD onalds in A sia, P acific, M id d le East, and
Africa. K azakhstan is M cD onalds 120th global m arket! To train future m an a g e rs in store
operations, leadership, and staff m anagem ent skills needed for glo bal e x p a n sio n to be
successful, M cD onalds has seven H am burger U niversities in the U nited S tates and abroad,
including cam puses at O ak Brook, Illinois; Sydney; M unich, G erm an y : L o n d o n , E ngland;
Tokyo, Japan; Sao Paulo, Brazil; and Shanghai, China. All provide train in g m aterials and
tools that can be used in different languages and cultures.
IBM obtains m ore than tw o-thirds o f its revenue from o u tsid e the U n ited S tates and
is seeking to build team leadership in order to com pete in em erg in g m ark e ts aro u n d the
world. IB M ’s C orporate Service Program has donated the tim e and se rv ic es o f about 600
em ployees for over 1,000 projects in countries such as Turkey, R o m an ia, G h a n a , V ietnam ,
the Phillipines, and T anzania.33 The goal o f the program is to d ev elo p a le a d e rsh ip team to
learn about the needs and the culture o f these countries w hile at the sam e tim e providing
valuable com m unity service. For exam ple, eight IBM em p lo y ees from five c o u n trie s trav-
eled to Tim isoara, R om ania. Each em ployee was assigned to help a d iffe re n t co m p an y or
nonprofit organization. O ne softw are-developm ent m anager h elp ed G re e n F o re st, a m anu-
facturer o f office, hotel, school, and industrial furniture, reach its goal o f c u ttin g co sts and
becom ing m ore efficient by recom m ending the com pu ter e q u ip m e n t and sy ste m s needed
to increase production and exports to W estern E urope. A n o th er e m p lo y e e w o rk e d w ith a
nonprofit organization that offers services to disabled adults. B esid es b e n e fitin g the co m -
panies, the em ployees also found that the experience helped th em u n d e rsta n d c u ltu ral dif-
ferences, im prove their com m unication and team w ork skills, and gain in sig h t in to global
m arketing and strategy.
G lobalization also m eans that em ployees w orking in the U n ited S ta te s w ill c o m e from
other countries. O ne estim ate is that im m igrants, som e o f w hom are illeg al, w ill account
for an additional m illion persons in the w o rk force.34 Im m ig ran ts p ro v id e sc ie n tific talent
and also som etim es fill low -w age jo b s. T he im pact o f im m ig ra tio n is e s p e c ia lly large
in certain areas o f the U nited States, including the states on th e P acific C o a st, w here
70 percent o f new entrants to the w orkforce are im m ig ra n ts.33 U .S. c o lle g e s c a n n o t keep
up w ith the dem and for engineers. To find engineers, c o m p a n ies have to lo o k o v e rse a s to
C hina, Japan, Korea, and India to hire th em .36 T he H -1B visa p ro g ra m is fo r p erso n s in
highly skilled and technical o ccu pation s requiring c o m p letio n o f h ig h e r e d u c a tio n . New
visas are capped at 65,000 per year, 2 0,0 00 o f w hich are reserv ed fo r e m p lo y e e s w ith U.S.
m a ste r’s degrees. There is no cap on H - lB s for em ploy ees w o rk in g fo r the g o v ern m en t,
universities, and other nonprofit institutions. The largest n u m b er o f H 1-B v isa s are issued
Chapter 1 Introduction to Employee Training and Development 17

for computer-related occupations (43 percent). U.S.-based M icrosoft and Intel are tw o o f
the top ten companies using H-1B visas, but m ost are used by Indian com panies such as
Tata Consultancy Services and W ipro Ltd.37 O ther visa program s are available fo r low er-
skilled temporary or seasonal w orkers (H2-A. H2-B). M any o f these im m igrants w ill have
to be trained to understand the U.S. culture. U.S. em ployees will need skills to im prove
their ability to com m unicate with em ployees from different cultures.
Globalization also means that U.S. com panies have to carefully consider the co sts and
benefits of moving jobs overseas or using foreign suppliers. The U nited States lost six
million factory jobs betw een 1998 and 2010. However, since 2010 the U nited S tates has
added millions of factory jo b s.38 O ffshoring refers to the process o f m oving jo b s from the
United States to other locations in the world. The reasons given for offshoring factory and
other jobs often include lower labor costs and the availability o f a skilled w orkforce w ith a
strong work ethic. However, many com panies are deciding to keep their factory w ork in the
United States rather than send it offshore. This is occurring for several reasons, in clu d in g
higher product shipping costs, fear o f supply chain disruptions due to natural disasters and
political instability, quality concerns, and custom er preference for U .S.-m ade p ro d u c ts.39
Also, rising labor costs in som e countries, such as China, are becom ing m ore co m p a rab le
to those in the United States. Finally, some countries’ local standards for safety, health ,
and working conditions may be substantially lower than in the U nited States, resu ltin g
in negative publicity and turning off potential custom ers. For exam ple, H anesbrands h as
added workers to a plant in North C arolina.40 The socks are knitted there and then sent
to a plant in El Salvador that sews, dyes, and packages the socks. A lthough El S a lv ad o r
has the advantage on labor costs, electricity costs in North Carolina were m uch less. A lso,
having plants in both places also provides a backup in case o f problem s. Peds L e g w e a r
also makes socks in North Carolina allowing the company to avoid im port taxes, cut sh ip -
ping costs, and respond faster to shifts in dem and. Plus, selling socks m ade in the U n ited
States was a m ajor reason why W almart contracted with the company. A pple is know n fo r
introducing revolutionary and functional products such as the iPhone, M ac A ir c o m p u te rs,
and the iPad.4'A pple relies on m anufacturing partners in Asia to build its products. A p p le
Inc. has been criticized by labor groups who have challenged how its m anufacturing p a rt-
ners in Asia have treated their em ployees. Apple has taken these criticism seriously and is
auditing its suppliers and m anufacturing facilities to take steps to reduce, if not e lim in a te ,
illegal and poor treatm ent of workers who assem ble or provide m aterials for any o f its
products. Apple is especially focused on ensuring that its partners d o n ’t hire u n d e ra g e
workers, provide adequate training, and pay fair wages. In those cases in w hich A p p le 's
recom m endations based on its audits were not adopted, the com pany term inated its re la -
tionship with the supplier.

Increased Value Placed on In tangible Asse ts and Hum an C a p it a l


Training and developm ent can help a com pany’s com petitiveness by directly in cre asin g
the com pany’s value through contributing to intangible assets. A com pany’s value in clu d es
three types o f assets that are critical for the com pany to provide goods and serv ices: fi-
nancial assets (cash and securities), physical assets (property, plant, equipm ent), and in -
tangible assets. Table l .2 provides examples o f intangible assets, w hich consist o f h u m an
capital, custom er capital, social capital, and intellectual capital. H um an capital refers to
18 P a r t i The Context for Training and Development

TABLE 1.2 Human Capital


Examples of
• Tacit knowledge
Intangible
• Education
Assets
• Work-related know-how
Sources: Based on • Work-related competence
L. Weatherly,
Human Capital—
Customer Capital
The Elusive Asset • Customer relationships
(Alexandria, VA: • Brands
SHRM Research
Quarterly, 2003); • Customer loyalty
E. Holton and • Distribution channels
S. Naquin, “New
Metrics for Employee Social Capital
Development,“ Perfor- • Corporate culture
mance Improvement
Quarterly 17 (2004):
• Management philosophy
56-80; M. Huselid, B. • Management practices
Becker, and R. Beatty, • Informal networking systems
The 'Workforce Score-
card (Boston, MA: • Coaching/mentoring relationships
Harvard University
Press, 2005).
Intellectual Capital
• Patents
• Copyrights
• Trade secrets
• Intellectual property

the sum of the attributes, life experiences, know ledge, inventiveness, en erg y , an d en th u -
siasm that the com pany’s em ployees invest in their w ork.42 In tellec tu a l c a p ita l refers to
the codified knowledge that exists in a com pany. Social ca p ital refers to re la tio n sh ip s in
the company. C ustom er capital refers to the value o f relatio n sh ip s w ith p e rso n s o r other
organizations outside the com pany for accom plishing the goals o f the c o m p a n y (e.g ., rela-
tionships with suppliers, custom ers, vendors, and governm ent a g e n cie s). In ta n g ib le assets
are equally as valuable as financial and physical assets, but they are not s o m e th in g that can
be touched and they are nonm onetary.
Intangible assets have been shown to be responsible for a c o m p a n y ’s c o m p e titiv e ad-
vantage. Several studies show that investm ents in training and d e v e lo p m e n t lead to in-
creases in financial perform ance, productivity, and in n o vation.44 T h e A m e ric a n S ociety
for Training and D evelopm ent (A STD ) found that co m p an ies that in v ested the m ost in
training and developm ent had a shareholder return that w as 86 p e rcen t h ig h e r th an c o m -
panies in the bottom h alf and 46 percent higher than the m arket a v e ra g e .44 T ra in in g and
development have a direct influence on hum an and social capital b e c au se th ey affect e d u -
cation, w ork-related know -how and com petence, and w ork re la tio n sh ip s. T ra in in g and
developm ent can have an indirect influence on c u sto m er and so cial c a p ital by helping
employees better serve custom ers and by providing them w ith the k n o w le d g e n eed ed to
create patents and intellectual property.
As m entioned earlier in the chapter, intangible assets such as h u m an c a p ita l also c o n -
tribute to a com pany’s com petitive advantage because they are d iffic u lt to d u p lic a te or
imitate.45 For example, consider com panies in the airline industry. S o u th w e s t A irlin es
is consistently profitable and usually ranks high in on-tim e arrivals and o th e r in d icato rs
Chapter 1 Introduction to Employee Training and Development 19

of airline success.46 One of the distinctions between Southwest Airlines and its competi-
tors is how it treats its employees. For example. Southwest has a policy of no layoffs and
was able to maintain this record even during the difficult time for airlines following 9/l 1.
Southwest also emphasizes training and development, which provide its employees with
skills to perform multiple jobs. This benefit allows Southwest airplanes to be cleaned and
serviced at airports quickly because employees have multiple skill sets that can be applied
to various aspects of readying an aircraft for departure. As a result o f these human resource
policies. Southwest employees are loyal, productive, and flexible (which contributes to
the success of the airline). O ther airlines may have sim ilar or greater levels of financial
assets and may have physical assets that are comparable to Southwest's (e.g.. same type
of airplanes, sim ilar gates), but what contributes to Southwest's success and gives the
company a competitive advantage are its intangible assets in the form of human capital.
American Airlines and United Airlines have similar (or greater!) financial and physical
assets but have not been successful in competing with Southwest by offering flights on
the same routes.
Consider the effort that M acy’s is undertaking to develop human capital, social capital
and custom er capital.47 Almost half o f custom er complaints at M acy’s department stores
are focused on interactions with sales associates. To cut costs to survive durinơ the re-
cession, M acy’s closed stores and invested in technology to improve efficiency, which
diverted attention away from custom er service. But now M acy’s is making a considerable
investment in training its sales associates to provide better custom er service and to help the
company to meet sales growth targets. The new training program requires new sales asso-
ciates to attend a three-hour training session and includes refresher courses and coachino
from managers when they are working on the sales floor. The “MAGIC Selling Program"
(“M AGIC” stands for meet and make a connection, ask questions and listen, give options
and advice, inspire to buy, and celebrate the purchase) is designed to help sales associates
make more personal connections with shoppers. Positive interactions with sales associates
contribute to the number of items that a custom er purchases and can help enhance M acy's
service reputation as customers share experiences on social network sites such as Twitter
and Facebook.
Chapters Seven, Eight, and Nine discuss specific training and development activities
that contribute to the development of human and social capital. How to measure human
capital is explained in Chapter Six, “Training Evaluation.” The value of intangible assets
and human capital has three important implications:
1. A focus on knowledge workers,
2. Em ployee engagem ent, and
3. An increased emphasis on adapting to change and continuous learning.

Focus on Knowledge Workers


One way that a company can increase its intangible assets, specifically human capital is by
focusing on attracting, developing, and retaining knowledge workers. K now ledge w orkers
are em ployees who contribute to the company not through manual labor, but through what
they know, perhaps about customers or a specialized body of knowledge. Employees can-
not simply be ordered to perform tasks; they must share knowledge and collaborate on
solutions. Knowledge workers contribute specialized knowledge that their managers may
20 P arti The Context for Training and Develofxment

not have, such as inform ation about custom ers, and m anagers depend on these know ledge
workers to share that inform ation. K now ledge w orkers have m any job op po rtun ities. If
they choose, they can leave a com pany and take their know ledge to a com petitor. K now l-
edge workers are in dem and because o f the grow th of j o b s requiring them .

Employee Engagement
To fully benefit from em ployee know ledge requires a m anagem ent style that focuses on
engaging em ployees. E m ployee engagem ent refers to the degree to w hich em ployees are
fully involved in their work and the strength o f their co m m itm en t to th eir jo b and the com -
pany.48 Em ployees who are engaged in their work and com m itted to th eir co m p an ies give
those com panies a com petitive advantage, including higher productivity, better custom er
service, and lower turnover.
Perhaps the best way to understand engagem ent is to c o n sid er how co m p a n ies m easure
em ployee engagem ent. C om panies m easure em p lo y ees' eng ag em en t levels w ith attitude
or opinion surveys. A lthough the types o f questions asked on these su rveys vary from
company to com pany, research suggests the questions generally m easure th em es such as
pride in the com pany, satisfaction with the job, prospects for future grow th w ith the com -
pany, and opportunity to perform challenging w ork.40 How do we know if an em plo yee is
engaged? An engaged em ployee is passionate about their w ork, is co m m itted to the com -
pany and its m ission, and w orks hard to contribute. E n gagem ent survey resu lts show that
only 30 percent o f U.S. em ployees are engaged in their w ork, 52 p ercen t are not engaged,
and 18 percent are actively disengaged.50 A ctively diseng ag ed e m p lo y e es cost the United
States billions o f dollars every year in lost productivity.
For example, Bridgepoint Education, a for-profit education services ho lding company,
recognizes that em ployee engagem ent is necessary for success.51 To increase em ployee
engagement, the com pany uses events, celebrations, and a social learning platform to facili-
tate conversations betw een em ployees and their m anagers. For ex am p le, com p an y leaders
host discussions with em ployees, com m unicate goals, and give em p lo y ees a ch ance to ask
questions. The results o f Satellite H ealthcare’s, a renal care provider, en g ag em en t survey
showed that em ployees want m ore resources supporting their career d e v e lo p m en t.5~ As a
result, Satellite developed a C areer Pyram id that defines the positions w ithin a dialysis ca-
reer category including the position titles from entry-level jo b s to top m anagem ent. The
education, experience, and com petencies for each position are listed. S tan d ard s to r prom o-
tion and developm ent to advance to each level on the pyram id are provided. T he Career
Pyramid is especially useful for em ployees in entry-level jo b s such as patient care tech-
nicians because it provides a clear structure on possible career m oves and the skills that
em ployees need to develop. Em ployee engagem ent scores collected a lte r the C a re er Pyra-
mid was im plem ented have im proved and 92 percent o f em plo yees rep ort they expect to
have a long-term career with Satellite. At M ohaw k Industries, a co m p an y that provides car-
pet and rugs for residential and com m ercial custom ers, each em p lo y ee has a card that lists
their developm ent goals and the business goals. T hese cards help em ployees^have conversa-
tions with their m anagers to ensure personal and business goals are align ed. At L iteG ift, a
Houston-based nonprofit that recovers hum an organs and tissues from recently d eceased do-
nors and m atches them to transplant recipients across the U nited S tates, en g a g em e n t m eans
having em ployees w ho never give up on finding a d o n o r/ L ifeG ift s C E O , m ad e em ployee
engagem ent a priority and started m easuring engagem ent annually startin g in 2008. W hen
Chapter 1 Introduction to Employee Training and Development 21

engagement fell in the last survey, Holtzman required the company m anagers to hold q uar-
terly one-on-one discussions with each o f their employees, separate from annual evalua-
tions. Results from the surveys and discussions ensure that employees receive the training,
emotional support, and other resources needed to deal with the dem ands o f the job. M ost
companies do not deal with life-or-death issues as LifeGift does, but focusing on em ployee
engagement can ensure that employees are satisfied and productive.

Change and Continuous Learning


In addition to acquiring and retaining knowledge workers, com panies need to be able to
adapt to change. Change refers to the adoption of a new idea or behavior by a com pany.
Technological advances, changes in the workforce or governm ent regulations, glob aliza-
tion, and new com petitors are am ong the many factors that require com panies to change.
Change is inevitable in com panies as products, com panies, and entire industries experi-
ence shorter life cycles.55 For example, every aspect of Capital BlueCross is changing due
to health-care reform .56 The com pany's leadership developm ent curriculum helps prepare
leaders at all levels of the com pany to deal with these changes. It includes providing
each leader with a coach who reinforces what was learned in the curriculum and tailors
it to the individual strengths and challenges of each learner. Each leader also shares what
they learned with the em ployees who report to them. Hu-Friedy, a com pany that m anu-
factures dental instruments, employs 750 em ployees.57 Hu-Friedy is spending $60,000
on an apprenticeship program to develop its em ployees' skills. M any o f em ployees have
worked on the factory floor making instrum ents for years but d o n 't have the complex
understanding of heat treatm ent, metallurgy, and metal com position necessary for making
improvements to the com pany’s products and production processes. Hu-Friedy hopes the
apprenticeship program will help keep production work in the United States and keep the
company competitive. The characteristics o f an effective change process are discussed in
Chapter Two, “Strategic Training.”
A changing environm ent means that all em ployees must em brace a philosophy of learn-
ing. A learning organization em braces a culture o f lifelong learning, enabling all em ploy-
ees to acquire and share knowledge continually. Im provem ents in product or service quality
do not stop when formal training is com pleted.58 Em ployees need to have the financial,
time, and content resources (such as courses, experiences, and developm ent opportunities)
available to increase their knowledge. M anagers take an active role in identifying training
needs and helping to ensure that em ployees use training in their work. Also, em ployees
are actively encouraged to share knowledge with colleagues and other work groups across
the company using e-m ail and the Internet.59 At The Cheesecake Factory Inc., w hich
operates about 160 restaurants in the United States, learning is less about formal program s
and courses and more about being available on an as-needed basis, driven by em ployees.
The company is focused on fostering continuous learning related to guest satisfaction
and perfect execution o f the many dishes on its menu. To do so, the com pany is c reat-
ing interactive learning content that em ployees access at work. Through the V ideoC afe,
em ployees can upload and share short videos on topics such as custom er greetings and
food preparation. The com pany plans to develop interactive games, including a sim ulation
for building the perfect hamburger. Hands-on, employee-driven learning is supported by
m anagers observing em ployees and providing coaching and feedback to help develop new
skills and reinforce their use in the workplace. C hapter Five, Program D esign, d iscu sses
22 Part 1 The Context for Training and Development

learning organizations and knowledge management in detail. For a learning organization


to be successful, teams of employees must collaborate to meet cu stom er needs. M anagers
need to empower employees to share knowledge, identify problem s, and m ake decisions,
which allows the company to experiment and improve continuously.
Social collaboration and social networking technology are helping em p loy ees share
knowledge and contribute to the development of a learning o rg a n iz a tio n /’1 C'areSource
uses wikis, websites with content created by users, and discussion boards to encourage
em ployees to engage in critical thinking and learn from each o th er by sharing ideas about
how to apply skills that they have acquired in formal training program s. C o ldw ell Banker
encourages its real estate professionals to develop and share videos o f the best sales tech-
niques using the com pany’s video portal. Coldwell B anker also uses c o m m u n ities o f prac-
tice to encourage em ployees to share best practices and provide insights on how to best
approach specific types of job assignm ents. inVentiv Health, Inc. uses tools on Facebook
to help sales em ployees share information and update lessons learned.

Focus on Links to Business Stra t egy


Given the im portant role that intangible assets and hum an capital play in a co m pan y's
com petitiveness, m anagers are beginning to see a m ore im portant role for train ing and
developm ent as a m eans to support a com pany's business strategy: that is, its plans for
m eeting broad goals such as profitability, market share, and quality. M an ag ers expect
training and developm ent professionals to design and develop learning activ ities that will
help the com pany successfully im plem ent its strategy and reach b usin ess goals. Strategic
training will be discussed in greater detail in C hapter Two.

Ch a nging D e m ogra p h ics and D iv e rsity o f t h e W o r k f o rc e


In the United States the Bureau o f Labor Statistics (BLS), an agen cy o f the D epartm ent
o f Labor, tracks changes in the com position o f the U.S. labor force and fo recasts trends.
Com panies face several challenges as a result o f increased d e m o g ra p h ic s and diversity of
the workforce. Population is the single m ost im portant factor in d e te rm in in g the size and
com position o f the labor force, which is com posed of people w ho are e ith e r w o rking or
looking for work. The civilian labor force is projected to increase by 18 m illion betw een
2012 and 2022, reaching 163 m illion by 2022.62 The w orkforce w ill be o ld e r and m ore
culturally diverse than at any tim e in the past 40 years.

Increase in Ethnic and Racial Diversity


Between 2012 and 2022, the U.S. labor force will continue to grow m ore ethn ically and
racially diverse due to im m igration, increased participation o f m inorities in the w orkforce,
and higher m inority fertility rates. Betw een 2012 and 2022, the p ro jected annual growth
rates for Hispanics (2.5 percent) and “other groups” (which includes ind iv idu als o f m ultiple
racial origin, Am erican Indians and A laska Natives, and Native H aw aiians) (2.7 percent) are
higher than for African A m ericans and other groups.63 By 2022, the w o rk fo rce is projected
to be 78 percent white, 12 percent A frican A m erican, and 6 percent A sian and 2 p ercent other
ethnic or cultural groups. By 2022, 53 percent o f the labor force will be m en an d 47 percent
will be women. Not only m ust com panies face the issues o f race, gender, eth nicity , and na-
tionality to provide a fair w orkplace, but they m ust also develop train ing p ro g ra m s to help
imm igrants acquire the technical and custom er service skills required in a serv ice econom y.
Chapter 1 Introduction to Employee Training and Development 23

FIG U R E 1.3
Comparison of
the Age of the
2012 and 2022
Labor Force.
Source: Based on
Bureau of Labor
Statistics. U.S.
Department of
Labor. Employment
Projections: 2012-2022.
News Release.
December 19th. 2013.
from www.hls.gov/cmp.
accessed February 25.
2015.
I I 16 to 24 years old
I I 25 to 54 years old
I I 55 years and older

Aging Workforce
Figure 1.3 com pares the projected distribution of the age o f the workforce in 2012 and
2022. In 2018, baby boomers will be 57 to 70 years old. and this age group will arow
significantly between 2012 and 2022. The labor force will continue to age. The 55-Cand-
older age group is expected to grow by approxim ately 12 million to 42 million in 2022,
representing a 29 percent increase between 2012 and 2022. This 12 million is nearly *ali
o f the 8.5 million workers who are projected to be added to the workforce by 2022.64 The
labor force participation of those 55 years and older is expected to grow because older
individuals are leading healthier and longer lives than in the past, providing the oppor-
tunity to work more years. In addition, the high cost of health insurance and"decrease in
health benefits will cause many employees to keep working to m aintain their employer-
based insurance or will prompt them to return to work after retirem ent to obtain health
insurance through their employer. Also, the trend toward pension plans based on indivi-
duals’ contributions to them rather than on years of service, will provide yet another incen-
tive for older em ployees to continue working.
The aging population means that com panies are likely to employ a growing share of
older workers— many o f them in their second or third careers. O lder people want to work
and many say they plan a working retirement. Despite m yths to the contrary, worker per-
form ance and learning in most jobs is not adversely affected by aging.65 Older employees
are willing and able to leant new technology. An em erging trend is for qualified older
em ployees to ask to work part-time, or for only a few m onths at a time, as a means of
transitioning to retirement. Em ployees and com panies are redefining what it means to be
retired to include second careers, as well as part-time and tem porary work assignments.

G e n era tional Differences


Five generations are represented in the workforce, each one with unique and sim ilar char-
acteristics to the others. In Table 1.3, the year born, nicknam es, and ages of each gen-
eration are shown. Consider some o f the attributes that are believed to characterize each
24 Part 1 The Context for Training and Development

TABLE 1.3 Year Born Generation Ages


Generations in
the Workforce 1925-45 Traditionalists >69
Silent generation
1946-64 Baby boomers 51-69
1965-80 Generation X 35-50
1981-95 Millennials 20-34
Generation Y
Echo boomers
1996- Generation Z <20
Digital natives

generation.66 For exam ple, m illennials also known as G eneration Y or H cho B oom ers,
grew up with access to com puters at hom e and school and access to the Internet. They
grew up with diversity in their schools and were coached, p raised , and e n c o u ra g e d for
participation rather than accom plishm ent by their baby b o o m er paren ts. M illen n ia ls are
characterized as being optim istic, w illing to work and learn, e a g er to p lease, self-relian t,
globally aware, and value diversity and team w ork. They are also b eliev ed to have high
levels o f self-esteem , to the point o f narcissism som etim es.
Generation X ers grew up during a tim e when the divorce rate d o u b le d , the n u m b er o f
wom en working outside the hom e increased, and the personal c o m p u te r w as invented.
They were often left to their own devices after school (latchkey kids). T h ey value sk ep ti-
cism , inform ality, and practicality, seek w ork-life balance, and d islik e c lo se su p erv isio n .
They tend to be im patient and cynical. They have ex p erienced c h a n g e in all o f th eir lives
(in term s o f parents, hom es, and cities).
Baby boom ers, the “M e” generation, m arched against the " e s ta b lis h m e n t" for equal
rights and an end to the Vietnam War. They value social c o n s c ie n tio u s n e s s and in d ep e n -
dence. They are com petitive, hardw orking, and concerned w ith the fair tre a tm e n t o f all
em ployees. They are often considered to be w orkaholics and rigid in c o n fo rm in g to rules.
Traditionalists or the Silent G eneration grew up during the G re a t D e p re ssio n and lived
during W orld W ar II. They tend to value frugality, are p atrio tic and lo y al, a d h e re to rules,
loyal to em ployers, and take responsibility and sacrifice for the g o o d o f the co m p an y .
It is im portant to note that although generation d ifferen ces likely e x ist, m e m b e rs o f the
sam e generations are no m ore alike than m em bers o f the sam e g e n d e r o r race. R esearch
suggests that different gen eration s o f em ployees have sim ila ritie s as w ell as d iffe re n c e s.67
D ifferences in w ork ethic have been found betw een baby b o o m e rs, G e n e ra tio n X ers, and
m illennials. H ow ever, m illennial em ployees are m ore s im ila r th an d iffe re n t fro m oth er
generations in their w ork b eliefs, jo b values, and g e n d e r b e lie fs. T h e lack o f stu d y o f
generational differences over tim e, the inability o f m ost stu d ie s to s e p a ra te g e n e ra tio n a l
effects from age or life stage, and possible d ifferen ces a c ro ss g e n e ra tio n in ho w they
interpret survey item s used in studies m eans that you sh o u ld be c a u tio u s in a ttrib u tin g d if-
ferences in em ployee behaviors and attitudes to g e n e ra tio n a l d iffe re n c e s .68 A lso , treatin g
em ployees differently based on th eir age, such as only in v itin g y o u n g e r e m p lo y e e s to
attend training or developm ent p ro g ram s, m ay result in a d v e rse legal c o n se q u e n c e s
Ch ap t er 1 Introduction to Employee Training and Development 25

(e.g., em ployees forty years or older are covered by the Age D iscrim ination in Em ploy-
ment Act).
Nonetheless, m em bers o f each generation may have m isperceptions o f each other,
causing tensions and m isunderstanding in the w orkplace.69 For exam ple, m illennials may
think Generation X m anagers are bitter, jaded, abrasive, uninterested in them, and poor
delegators. In turn, their G eneration X m anagers consider m illennials too needy for atten-
tion, demanding, and overly self-confident. M illennials m ight believe that baby boom ers
are too rigid and follow com pany rules too closely. They believe that em ployees in the
older generations have been too slow to adopt social m edia tools and value tenure over
knowledge and perform ance. Traditionalists and baby boom ers believe that m illennials
d on’t have a strong work ethic because they are too concerned with work-life balance.
Also, members of the younger generations may resent baby boom ers and traditionalists
who are working longer before retiring, thus blocking prom otions and career moves for
younger workers. We will discuss the potential im plications o f generational differences for
training and developm ent in Chapters Four and Five.
Com panies can use increased diversity to gain a com petitive advantage. A Society for
Human Resource M anagem ent (SHRM ) survey o f its m em bers showed that 68 percent
have practices to address workplace diversity.70 Im portant outcom es expected from diver-
sity practices included improved public image o f the company, improved financial b o t-
tom line, decreased com plaints and litigation, and retention and recruitm ent o f a diverse
workforce.
Training plays a key role in ensuring that em ployees accept and work more effectively
with each other. To successfully m anage a diverse workforce, m anagers and em ployees
must be trained in a new set o f skills, including:
1. Com m unicating effectively with em ployees from a wide variety o f backgrounds
2. Coaching, training, and developing em ployees o f different ages, educational b a c k -
grounds, ethnicities, physical abilities, and races
3. Providing perform ance feedback that is free of values and stereotypes based on gender,
ethnicity, or physical handicap
4. Training m anagers to recognize and respond to generational differences
5. Creating a work environm ent that allows em ployees o f all backgrounds to be creative
and innovative.71
Consider the program s that several com panies are offering to capitalize on o ld er
em ployees’ skills and accom m odate their needs, provide training and developm ent o p p o r-
tunities that appeal to a diverse workforce, and cope with generational differences.72 M any
of these program s are a part of com panies’ efforts to m anage diversity, which we w ill
discuss in more detail in Chapter Ten. S.C. Johnson offers retirees tem porary work a ssig n -
ments, consulting and contract work, telecom m uting, and part-tim e work. C entegra H ealth
System ’s phased retirem ent program offers flexible scheduling, including part-tim e w ork,
com pressed workweeks, jo b sharing, summ ers off, and long-distance contract work.
CV S/pharm acy has stories in every climate and region in the United States. CV S created
its Snowbirds Program to allow older em ployees to move among locations according to
their preferences. This is especially important for older em ployees who spend w inters in the
26 Part 1 The Context for Training and Development

southern states and sum m er in the northern states. M ore than l .()()() e m p lo y e e s, including
retail clerks, pharm acists, and m anagers, have p articipated in the pro g ram .
Johnson & John son’s analysis o f w o m en 's leadership pro g ram s sho w ed that, although
the com pany was not experiencing g reater turnover o f w om en, it had been ineffective
in reaching m ulticultural wom en and w om en o f c o l o r / 3 T he co m p an y has since created
a program , titled “Crossing the Finish Line," for h ig h -p e rfo rm in g , h ig h -p o te n tia l m ulti-
cultural wom en and wom en o f color. T he program includes a tw o -an d -a -h a lf day project
in which participants have open conversations w ith their m an ag ers and w ith executives,
including the CEO and the vice chair o f the com pany. T he p ro g ram h elp s Jo h n so n &
Johnson identify wom en w ho should be given new dev elo p m en t o p p o rtu n itie s, as w ell as
help them understand that they m ust be visible, establish n etw o rk s, and take the initiative
to ask for developm ent assignm ents. Also, the program ed u c ate s m an a g e rs a b o u t cultural
differences and creates an aw areness o f how an e m p lo y e e 's c u ltu re m ight affect his or her
career.
Dell Inc., a technology com pany, provides a course for all o f its new m an a g e rs that
includes topics such as leading m ultigenerational team s and d e v e lo p in g c o n n e c tio n s w'ith
the em ployees who report to them .74 All successful m anagers at D ell m ust have the ability
to relate to and m otivate a m ultigenerational w orkforce, to c re a te tea m s to w ork together,
and to encourage an entrepreneurial spirit, regardless o f w hat g e n e ra tio n the m anagers
come from. Dell also uses em ployee resource groups for e m p lo y e e s to c o n n e c t, build
relationships, and netw ork. For exam ple, the resource g ro u p for m ille n n ia ls is called
“GenNext.” Dell also encourages em ployees to participate in d isc u ssio n w ith m anagers
about new ways to consider w here and how work gets done. T h is a llo w s e m p lo y e es to
choose to work rem otely and telecom m ute, w hich helps them m eet th e ir p e rso n a l needs,
yet successfully com plete their work.
M asterC ard Inc., the credit card com pany, is now fo c u sin g on d e v e lo p in g p aym ent
and security in novations.75 The p ercen tag e o f M a ste rC a rd 's e m p lo y e e s fro m the m ille n -
nial generation has grow n from 10 percen t in 201 0 to 38 p e rc e n t in 2 0 1 4 . A s a result,
M asterC ard created learning pro g ram s that are m ore a p p e a lin g to the w a y s th at m ille n -
nials want to learn. For exam ple, an e -le arn in g p ro g ra m th at uses g a m ific a tio n and ani-
m ation was developed to m ake req u ired in fo rm a tio n s e c u rity a n d c o m p lia n c e train in g
m ore fun and less dull and boring. E m p lo y ees take the ro le s o f “ s u p e rh e r o e s " to prevent
security issues such as not op ening e -m a ils that m ig h t c o n ta in m a lw a re . W ith in the
experience em ployees becom e c h a ra c te rs in the s c e n a rio and th ey h av e to m ak e im p o r-
tant decisions.

Talent M a n age m e n t
Talent m anagem ent refers to the system atic, plann ed, and stra te g ic effo rt by a co m p a n y to
use bundles o f hum an resource m an agem ent p ractices, in clu d in g a c q u irin g and assessin g
em ployees, learning and d evelopm ent, p erfo rm an ce m a n a g e m e n t, an d c o m p e n sa tio n
to attract, retain, develop, and m otivate h ighly sk illed e m p lo y e e s an d m a n a g e rs. Talent
m anagem ent is becom ing increasin gly m ore im p ortan t b e c au se of c h a n g e s in d e m a n d for
certain occupations and jo b s, skill req u irem en ts, the a n tic ip a te d re tire m e n t of the baby
boom er generation, and the need to d evelop m anag erial talen t and sk ills of th e next gener-
ation o f com pany leaders. A lso, the results o f surveys su g g est th at o p p o rtu n itie s to r career
growth, learning, and developm ent, and the p erfo rm an ce o f e x c itin g an d c h a lle n g in g w ork
Chapter 1 Introduction to Employee Training and Development 27

are some of the most important factors in determ ining em ployees’ (especially millennials)
engagem ent and com m itm ent to their current em ployer.76
For Cognizant, a global technology solutions company, business is based on knowledge
which depends on the skills o f its w orkforce.77 Talent developm ent is seen as a strategic
business driver. To develop talent, all em ployees have individual developm ent plans that
support their career goals. Learning at Cognizant focuses on building both technical and
leadership talent to ensure em ployees help improve their clients’ businesses. Cognizant
has several program s to build talent. The Career A rchitecture program helps em ployees
choose a career track that m atches their interests and skills. It helps identify training courses
and job rotations that can help em ployees move along their career track. The Emerging
Partners program develops senior account m anagers and senior delivery managers. The
program includes case studies, role-plays, and sim ulations. M ore than 100 m anagers have
completed the program and 45 percent have moved within six months into leadership roles
involving interactions with clients. Approxim ately 50.6 million jo b openings are expected,
more than two-thirds from the need to replace workers who retire or leave. M ost o f the em -
ployment growth betw een 2012 and 2022 is expected to be in service-providing occupa-
tions. Employm ent in construction is the second highest projected employment increase,
resulting in 1.6 million new jobs between 2012 and 2022.78
Health care and social assistant services, are expected to be one-third o f the total pro-
jected increase in total em ploym ent from 2012 to 2022. This will add 5 m illion jobs. On
the other hand, em ploym ent in m anufacturing, federal governm ent inform ation, utilities
farm ing, fishing, and forestry occupations is expected to decline. Keep in mind that there
are likely some exceptions to these projected trends. Com panies that require special-
ized labor to make industrial lathes, com puter chips, and health-care products requiring
specialized skills, plan to expand and locate near towns and cities that have such an
available w orkforce.79 For exam ple, G reatbatch Inc., which m akes m edical products, has
expanded near Fort W ayne, Indiana, to take advantage o f the local w orkforce's special-
ized skills.
Table 1.4 shows ten of the thirty fastest-growing occupations projected betw een 2012
and 2022. O f the thirty fastest-growing occupations, fourteen are related to health care
(such as personal care aids, home health aides, genetic counselors, and physical therapists)
and five are related to construction (insulation workers, brickm asons and blockm asons
electrical, tile, and marble setters’ helpers). The growth in health care reflects the inpatient
and outpatient medical care that is needed for the aging U.S. population. The growth in
the construction occupation is related to replacem ent needs, growth in the economy, and
the need to repair the aging U.S. infrastructure. Slightly less than two-thirds of the thirty
fastest-grow ing occupations require education beyond high school, i.e., at least an associ-
ate’s degree or higher. O ccupations requiring education beyond high school are expected
to grow faster and pay more per year (an estim ated $30,000) than those requiring a high
school diplom a or less. O ccupations that require an apprenticeship for training, including
many construction jobs, are projected to grow approxim ately 22 percent between 2012
and 2022, which is faster than for jobs requiring any other type o f on-the-job training.

Retirement o f Baby Boomers


As the oldest baby boomers continue to retire in the next several years, the implications for
the workforce could be enorm ous.80 This could hinder prospects for economic growth and
28 Parti The Context for Training and Development

TABLE 1.4 Examples of the Fastest-Growing Occupations

Employment Change 2012-2022


Number Most Significant
Occupation (in thousands) Percent Education or Training
Industrial-organizational 1 53 Master's degree
psychologists
Personal care aids 581 49 Short-term, on-the-job training
Home health aids 424 49 Short-term, on-the-job training
Insulation workers 14 47 Short-term, on-the-job training
Interpreters and translators 29 46 Bachelor's degree
Diagnostic medical sonographers 27 46 Associate's degree
Helpers - Brick, block, and stone 11 43 Associate's degree
masons, tile and marble setters
Occupational therapy assistants 13 43 Associate's degree
Genetic counselors 1 41 Master's degree
Physical therapy assistants 29 41 Associate's degree
Sources: Based on Bureau of Labor Statistics, U.S. Department of Labor, “Employment projections: 2012-2022.“ N o u s R e l e a s e . D e c e m b e r l ‘>. 201 .V from
www.bls.gov/emp, accessed February 25, 2015.

put a greater burden on those rem aining in the w orkforce, p erhaps forcing th em to work
longer hours. E specially in occupations with functions less co n ducive to techn o lo g y -d riven
productivity innovations— m any jobs in health services and ed u catio n al serv ices, for
example— quality o f service m ay suffer and needs could go unm et u nless o ld e r w orkers ean
be retained or other sources o f workers can be found. Even in o c c u p atio n s in w hich tech-
nological innovations have produced relatively large productivity g a in s— m any o f the more
complex m achining jo b s in m anufacturing, for exam ple— the learning cu rv es often are
steep, m eaning that new w orkers need to enter these occupations soon, so they can becom e
proficient in the necessary skills by the tim e the baby boom ers begin leaving the lab o r force.
It is also im portant fo r co m p an ies to try to capture the v aluable k n o w le d g e that is leav-
ing.81 C onsider how A sian Paints and C onocoP hillips try to c a p tu re k n o w le d g e .82 Asian
Paints, a paint com pany in India, encourages em ployees to use th eir so cial n etw o rk to
share best practices and new w ays to support dealers. T he sales team uses th is in fo rm a-
tion to find and apply these practices to current ch allen g es they are facin g . T h is m eans
that when an experienced salesperson retires or leaves the c o m p a n y th e ir k n o w led g e is
not lost. C onocoPhillips, a m ultinational petrochem ical com pany, uses w ik is to capture
know ledge from all em p lo y ees including retirees. M any o f the c o m p a n y 's re tire e s com e
back to w ork part-tim e. T hey review the inform ation on the c o m p a n y w ik i, id en tify gaps
in m issing know ledge, and provide content. T heir experiences p ro v id e the “ how ,” “ w hat,”
and “w hy” that gives co n tex t to the wiki content. C o n o co P h illip s a lso u ses m ento rin g
program s pairing up less-ex p erien ced em ployees with m ore sen io r e m p lo y e e s to facilitate
know ledge sharing.

Skill Requirements
As the occupational structure o f the U.S. econom y has sh ifted , skill re q u ire m e n ts have
changed.83 The dem and for specific skills is being replaced by a n eed fo r cognitive
Chap ter 1 Introduction to Employee Training and Developm ent 29

skills— m athematical and verbal reasoning ability— and interpersonal skills related to be-
ing able to work in team s or to interact with “custom ers” in a service econom y (e.g.. pa-
tients, students, vendors, and suppliers). Cognitive and interpersonal skills are important
because in the service-oriented economy, em ployees m ust take responsibility for the final
product or service. Variety and custom ization require em ployees to be creative and good
problem solvers. Continuous innovation requires the ability to learn. To offer novelty and
entertainm ent value to custom ers, workers must be creative. M ost com panies relate these
skills with educational attainm ent, so many firms use a college degree as a standard to
screen prospective em ployees. C om panies also need em ployees with STEM skills. S T E M
skills refer to skills in science, technology, engineering, and math.
However, new entrants to the w orkplace, as well as the unemployed, lack the skills
needed for com panies to com pete in the global economy. Several studies illustrate the skill
deficit that U.S. com panies are experiencing.84 Nearly half o f CEOs o f U.S. businesses
believe that a significant skills gap exists that will result in loss o f business, revenue,
decreased custom er satisfaction, or a delay in new products or services. A survey by the
Organization for Econom ic Cooperation and Development found that the United States
ranked twenty-one out o f tw enty-three countries in math and seventeen out o f nineteen
countries in problem solving. A study by the M anufacturing Institute found that 80 percent
of m anufacturers report a m oderate or serious shortage o f qualified applicants for skilled
and highly skilled production positions. Skill deficits are not just a problem facing U.S.
com panies.85 In Italy and Spain nearly three out o f ten adults perform at or below the low-
est level of proficiency in both literacy and numerical ability. Countries with developing
economies such as India and Russia, as well as Japan and Western Europe, are experienc-
ing difficulties in finding workers for the skilled trades, sales, technicians, engineers, and
managers.
Although many businesses plan to hire new em ployees, they are concerned that they
will not be able to find the talent needed to capitalize on investments they are making in
new technology and other strategic capabilities. Skill deficits are not lim ited to any one
business sector, industry, or job. As result, com panies are partnering with unions, elem en-
tary and secondary schools, and colleges and universities to develop these skills in the
workforce. For example, an upturn in the construction industry following the recession
has resulted in contractors having a difficult time finding the skilled workers they need.86
As result, local trade unions are advertising apprenticeship program s, which can help train
m uch-needed electricians, plumbers, iron workers, roofers, and pipefitters.
Consider the efforts that Intel, Siemens, and M icrosoft are m aking to develop STEM
skills.87 Intel dedicated $300 million to sponsor classes in schools and universities, with a
focus on underserved regions. The money is part of an effort to boost diversity in its work-
force and fund recruiting, training, and investments in fem ale and m inority start-up busi-
nesses. Siemens AG, an engineering company and m anufacturer of m edical equipment,
wanted to expand its energy plant in Charlotte, North Carolina, which would require hir-
ing an additional 1,500 employees. Although over 10,000 jo b applications were received,
most did not have the required STEM skills. As a result, Siemens partnered with a com-
m unity college in the area to develop a specialized course to prepare potential employees
for jobs in the energy plant. Siemens put 3,500 o f the 10,000 job applicants through the
program. Four hundred were em ployed by Siemens and the others were encouraged to use
30 Part 1 The Context for Training and Development

their new STEM skills to find jobs with other com panies. M icrosoft is ties c lo p in e STEM
skills through efforts to ensure that teachers are trained to use tcch n o lo u s ill the classroom
and using M icrosoft employees as part-time co-teachers. M icrosoft IT A cad em y provides
teachers and students with opportunities to becom e certified in d ifferent ty p es o f softw are,
such as M icrosoft Office. The exposure the program ex poses stu d en ts to S T E M careers
that they might not have considered.

Developing Leadership
Com panies report that the most im portant talent m an agem ent c h a lle n g e s they face are
identifying em ployees with m anagerial talent and training and d e v e lo p in g th em for m an-
agerial positions.88 This is attributed to the aging o f the w o rk fo rc e , g lo b a liz a tio n , and
the need for m anagers to contribute to em ployee engag em ent. E x ecu tiv e, a d m in istrativ e,
and m anagerial occupations will experience the greatest tu rn o v er d u e to d e a th o r retire-
m ent.89 Also, many com panies do not have em ployees w ith the n e c essa ry c o m p e te n -
cies to m anage in a global econom y.90 To successfully m an ag e in a u lo bal econom y,
m anagers need to be self-aw are and be able to build in tern atio n al tea m s, c re a te iilobal
m anagem ent and m arketing practices, and interact and m anage e m p lo y e e s from d iffer-
ent cultural backgrounds. M anagers contribute to em ployee e n g a g e m e n t by p erfo rm in g
basic m anagem ent functions (planning, organizing, co n tro llin g , lea d in g ) but a lso through
using good com m unication skills, helping em ployees develop, and w o rk in g c o lla b o ra -
tively with em ployees.
A num ber o f surveys suggest that m ille n n ia l are interested in o p p o rtu n itie s for career
progression, including becom ing m anagers and leaders, and they are sig n ific a n tly m ore
likely to want form al leadership developm ent opportunities than e m p lo y e e s from other
generations.91 Em ployees from all generations have strengths and w e a k n e sse s in m an ag e-
ment skills. M ille n n ia l are strong in adaptability and cu sto m e r focus. T h ey are sim ilar
to Generation X ers in im portant leadership and interpersonal skills, in c lu d in g dev elo p in g
others, gaining com m itm ent, and com m unication. To be effective m an g e rs and leaders,
m illennials need to develop decision-m aking and planning and o rg an iz in g sk ills and learn
how to set high w ork standards.
As result, m any com panies including General E lectric and S h e rw in -W illia m s are
taking steps to retain talented m illennials and develop th eir m an a g e m e n t s k ills.92 For
example, General E lectric provides jo b rotation for m anagers, w hich h elp s th em gain ex -
perience w orking with different senior m anagers and different b u sin e ss units. T h is m eets
m illennials’ needs for grow th experience and netw orking w hile d e v e lo p in g sk ills needed
to successfully respond to different types o f custom ers and jo b c h a lle n g e s. Sim ilarly,
Sherw in-W illiam s, a com pany that m anufactures paint and sells it th ro u g h its retail Stores,
recognized that it had been losing its m anager trainees at a high rate. U sin g d a ta co llected
from surveys and interview s, they found that trainees did not feel in clu d e d an d engag ed .
To solve this problem , S herw in-W illiam s developed a new c a re e r-p ro g re ssio n m o d el. Per-
form ance reviews with m anager trainees will occur every six m o n th s in ste a d o f o n ce at
the end o f the year, w hich helps provide them with m ore feedback and the o p p o rtu n ity to
receive pay raises every six m onths. A lso, district m anagers w ill c o n d u c t re g u la r career
discussions with trainees to discuss th eir long-term goals. D urin g th e ir in itial tw o -y ear
training period new em ployees will have m ore opportunities to try d iffe re n t ro le s in the
company, including w orking with sales representatives and d ifferen t ty p es o f sto re s, such
Chapter 1 Jnrrodi<cnon to Employee Training and Development 31

as those specializing in floor coverings and providing commercial services for building
contractors.

Custom er Service and Q u a lity Emphasis


A com pany’s custom ers judge its quality and performance. As a result, custom er excel-
lence requires attention to product and service features, as well as to interactions with
customers. Customer-driven excellence includes understanding what the custom er wants,
anticipating future needs, reducing defects and errors, meeting specifications, and reducing
complaints. How the com pany recovers from defects and errors is also important for
retaining and attracting custom ers.
Due to increased availability o f knowledge and competition, consumers are very
knowledgeable and expect excellent service. This presents a challenge for employees who
interact with custom ers. The way in which clerks, sales staff, front-desk personnel, and
service providers interact with custom ers influences a com pany's reputation and financial
performance. Em ployees need product knowledge and service skills, and they need to be
clear about the types o f decisions they can make when dealing with customers. Custom er
service as a strategic training and developm ent initiative is discussed in Chapter Two.
To compete in today’s economy, whether on a local or global level, companies need to
provide a quality product or service. If companies do not adhere to quality standards, their
ability to sell their product or service to vendors, suppliers, or customers will be restricted.
Some countries even have quality standards that companies must meet to conduct busi-
ness there. Total Q u ality M a n ag e m en t (T Q M ) is a companywide effort to continuously
improve the ways people, machines, and systems accomplish work.93 Core values of TQM
include the following:94•

• M ethods and processes are designed to meet the needs o f internal and external
customers.
• Every employee in the company receives training in quality.
• Quality is built into a product or service so that errors are prevented from occurring
rather than being detected and corrected.
• The company promotes cooperation with vendors, suppliers, and custom ers to improve
quality and hold down costs.
• M anagers measure progress with feedback based on data.

There is no universal definition o f quality. The m ajor differences in its various defini-
tions relate to whether the customer, product, or manufacturing process is emphasized. For
example, quality expert W. Edwards Deming emphasizes how well a product or service
meets custom er needs. Phillip C rosby’s approach em phasizes how well the service or
m anufacturing process meets engineering standards.
The em phasis on quality is seen in the establishm ent of the M alcolm B ald rig e N ational
Q u a lity A w ard and the IS O 9000:2000 quality standards. The Baldrige award, created
by public law, is the highest level of national recognition for quality that a U.S. company
can receive. The award is given annually. To become eligible for the Baldrige, a company
m ust com plete a detailed application that consists of basic information about the firm and
an in-depth presentation o f how it addresses specific criteria related to quality improve-
ment. The categories and point values for the Baldrige award are found in Table 1.5.
32 Parti The Context for Training and Development

TABLE 1.5 Leadership 120


Categories
and Point The way senior executives create and sustain vision, values, and mission;
Values for promote legal and ethical behavior; create a sustainable company; and
the Malcolm communicate with and engage the workforce
Baldrige Measurement, Analysis, and Knowledge Management 90
National
Quality Award
The way the company selects, gathers, analyzes, manages,
and improves its data, information, and knowledge assets
Examination
Strategic Planning 85
Source: Based on
“2013-2014 Criteria The way the company sets strategic direction, how it determines
for Performance action plans, how it changes strategy and action plans if required,
Excellence” from
the website for the
and how it measures progress
National Institute of
Standards and Tech-
Workforce Focus 85
nology, www.nist/gov/ Company's efforts to develop and utilize the workforce to achieve high
baldrige.
performance; how the company engages, manages, and develops the
potential of the workforce in alignment with company goals
Operations Focus 85
Design, management, and improvement of work systems and work
processes to deliver customer value and achieve company success and
sustainability
Results 450
Company's performance and improvement in key business areas
(product, service, and supply quality; productivity; and operational
effectiveness and related financial indicators)
Customer Focus 85
Company's knowledge of the customer, customer service systems,
current and potential customer concerns, customer satisfaction and
engagement
Total Points 1,000

The aw ard is not given for specific p ro d u cts or serv ices. O rg a n iz a tio n s c a n c o m p e te for
the B aldrige aw ard in one o f six categ o ries: m an u fa ctu rin g , s e rv ic e , sm a ll b u s in e s s , e d u -
cation, health care, and nonprofit. All ap p lican ts fo r the B a ld rig e A w ard u n d e rg o a rig o r-
ous exam ination process that takes from 3 00 to 1,000 h o u rs. A p p lic a tio n s a re rev ie w e d
by an independent board o f ab o u t 4 0 0 e x a m in ers w h o c o m e p rim a rily fro n t th e p rivate
sector. Each applicant receives a rep o rt c itin g c o m p a n y s tre n g th s a n d o p p o r tu n itie s for
im provem ent.
The B aldrige Award w inners usually excel at h u m an re so u rc e p ra c tic e s , in c lu d in g tra in -
ing and developm ent. For ex am ple, c o n sid e r P ric e w a te rh o u s e C o o p e rs P u b lic S e c to r P ra c -
tice (Pw C PSP), a 2014 aw ard w in n er and M E S A P ro d u c ts In c., a 2 0 1 2 a w a rd w in n e r.95
Pw C PSP provides risk, m an ag em en t, and tec h n o lo g y c o n s u ltin g to s ta te , lo c a l, a n d fed -
eral governm ents. C o n tracto r p erfo rm an ce a sse ssm e n t rep o rts h av e b e e n n e a rly 100 per-
cent “exceptional” o r “ very g o o d ” from 2 0 1 0 to 2 0 1 4 . P w C P S P s c o re s o n a to o l u se d to
Ch ap t er 1 Introduction to Employee Training and Developiiient 33

assess custom er engagem ent and loyalty has been equal to or better than scores from other
U.S. consulting com panies. An im portant reason for its custom er satisfaction and loyalty
is that PwC PSP makes extensive use o f know ledge m anagem ent to help em ployees learn
and to serve clients. It collects know ledge through the Know ledge Gateway where it is
reviewed by knowledge m anagem ent team m em bers and content experts. The knowledge
is then shared through a w eb-based tool designed to help em ployees collaborate with each
other. Em ployees use this tool to share and find knowledge, exchange ideas, and seek
developm ental opportunities. Senior leaders at PwC PSP identify high-perform ing opera-
tions and invite them to present their practices at m anaging partner meeting. The practices
are also shared on the Know ledge Gateway. M ESA Products Inc. installs protective sys-
tems that control metal erosion in underground and submerged pipes and tanks. M ESA s
culture supports em ployees in developing or changing their career path. Em ployees are
cross trained, providing them with opportunities to change jobs. M ESA’s m anagers place
a large em phasis on w orkforce learning and development.
The International Organization for Standardization (ISO), a network o f national stan-
dards institutes that includes 160 countries and has a central governing body in Geneva,
Switzerland, is the w orld’s largest developer and publisher o f international standards.
The ISO develops standards related to m anagem ent as well as a wide variety o f other
areas, including education, music, ships, and even protecting children. ISO standards are
voluntary, but countries may decide to adopt ISO standards in their regulations; and as
a result, they may become a requirem ent to com pete in the market. The ISO 9000 is a
family of standards related to quality (ISO 9000, 9001, 9004, and 10011). The ISO 9000
quality standards address what the company does to meet regulatory requirem ents and
the custom er’s quality requirem ents while striving to improve custom er satisfaction and
continuous improvement. The standards represent an international consensus on quality
m anagement practices. ISO 9000:2000 has been adopted as the quality standard in nearly
100 counties around the world, meaning that com panies have to follow these standards to
conduct business in those countries. The quality m anagem ent standards o f the ISO 9000
are based on eight quality m anagement principles, including custom er focus, leadership,
people involvement, a process approach, a systems approach to m anagem ent, continuous
improvement, using facts to make decisions, and establishing m utually beneficial rela -
tionships with suppliers. ISO 9001:2008 is the most com prehensive standard because it
provides a set of requirem ents for a quality m anagement system for all organizations,
both private and public. The ISO 9001:2008 has been implem ented by m ore than 1 m il-
lion organizations in 176 countries. ISO 9004 provides a guide for com panies that w ant
to improve.
Why are standards useful? Customers may want to check that the product they ordered
from a supplier meets the purpose for which it is required. One of the most efficient w ays
to do this is when the specifications of the product have been defined in an international
standard. That way, both supplier and custom er are on the same wavelength, even if they
are based in different countries, because they are both using the same references. To-
day, many products require testing for conform ance with specifications, com pliance w ith
safety, or other regulations before they can be put on many markets. Even sim pler p ro du cts
may require supporting technical documentation that includes test data. W ith so m uch
trade taking place across borders, it is more practical for these activities to be carried
out not by suppliers and customers, but by specialized third parties. In addition, national
34 Part 1 The Context for Training and Develolmnent

legislation may require such testing to be carried out by in d ep en de n t b o d i e s, particularly


when the products concerned have health or en v ironm en tal i m p l i c a t i o n s . ( )ne exam ple of
an ISO standard is on the back cover o f this book and nearly every o i l i e r b o o k . O n the back
cover is som ething called an International S tandard B ook N u m b e r ( I S B N ). P u b lish ers and
booksellers are very fam iliar with ISBN num bers, since these n u m b e rs are the m ethod
through which books are ordered and bought. Try buying a b o o k on the In t erne t , and you
will soon learn the value o f the ISBN n um ber— there is a u n iq u e n u m b e r for the book you
want. And it is based on an ISO standard.
In addition to com peting for quality aw ards and seekin g I S O c e r t i f i c a t i o n , m any com -
panies are using the Six Sigm a process. T he Six S ig m a p ro c e s s r e f e rs to a p ro c e ss o f m ea-
suring, analyzing, im proving, and then controlling p ro cesses o n ce t hey hav e been brought
within the narrow Six Sigm a quality tolerances or stan d ard s. T h e o b j e c t i v e o f S i x Sigma
is to create a total business focus on serving the cu sto m er: that is. to de liv er w hat custom -
ers really want when they want it. For exam ple, at G eneral H l e c t r i c ( G H ) . in tro d u cin g the
Six Sigm a quality initiative m eant going from ap p ro x im ate ly 3 5 ,0 0 0 d e fe c ts per million
operations— which is average for m ost com panies, in clu d in g G E - —to few e r than 4 defects
per m illion in every elem ent o f every process G E b u sin esses perf orm — f rom m anufactur-
ing a locom otive part to servicing a credit card account to p ro c e ssin g a m o rtg a g e applica-
tion to answering a phone.97 T raining is an im portant c o m p o n e n t of the p ro c e ss. S i x Sigm a
involves highly trained em ployees known as C ham p ions, M a ste r B lack B elts, B lack Belts,
and Green Belts, w ho lead and teach team s that are fo cu sin g on an e v e r -g r o w i n g num ber
o f quality projects. The quality projects focus on im proving ef ficien cy and red u c in g errors
in products and services. The Six Sigm a quality initiative has p ro d u c e d m ore than $2 bil-
lion in benefits for GE.
Training can help com panies m eet the quality ch a llen g e by te a c h in g e m p lo y e e s a con-
cept known as “lean thinking.” L e a n th in k in g is a w ay to do m o re w ith less e ffo rt, equip-
ment, space, and tim e, but still provide custom ers w ith w hat they n eed and w ant. Part ot
lean thinking includes training w orkers in new skills or te a c h in g th em how to apply old
skills in new ways so they can quickly take over new re s p o n s ib ilitie s o r use new skills
to help fill custom er orders. B aylor H ealth C are S y stem w a n te d to d e c re a s e w aste and
improve patient satisfaction and outcom es throug h im p le m e n tin g lean th in k in g and pro-
cess im provem ents in several o f its h o spitals.98 T h is in clu d e d tra in in g e m p lo y e e s to r how
to m ake changes to work processes. Lean thin k in g and p ro c e ss im p ro v e m e n t supported
by training provided significant value. For ex am p le. T h e C o rp o ra te S u p p ly M an ag em ent
team elim inated tw o-thirds o f the tim e for c o m p le tin g c o n tra c ts , d e v e lo p e d a decision
tree for different types o f projects, and red uced e rro rs sav in g $ 1 0 m illio n . A h o spital re-
adm ission team redesigned the patient d isch arg e p ro ce ss to re d u c e the c h a n c e s o f patients
returning within thirty days. They realized a 4 4 p ercen t d e c re a s e in ré a d m is s io n s over a
six-m onth period, which im proved the qu ality o f life for p a tie n ts a n d B a y lo r's ability to
receive M edicare/M edicaid pay m ents from the g o v e rn m e n t.
A group within the ISO has d rafted a stan d ard for e m p lo y e e tra in in g . IS O 10015 is a
quality m anagem ent tool designed to e n su re th at tra in in g is lin k ed to c o m p a n y need s and
perform ance. ISO 10015 has tw o key fea tu re s.99 F irst, c o m p a n ie s h av e to d e te rm in e the
return on investm ent o f training to co m p an y p e rfo rm a n c e. S e c o n d , IS O 10015 requires
com panies to use appropriate design and effectiv e learn in g p ro c e sse s. IS O 10015 defines
Chap t er 1 introduction to Employee Training and Development 35

training design as analyzing, planning, doing, and evaluating (recall the discussion of the
Instructional System Design m odel earlier in this chapter).

N e w Te chnology
Technology has reshaped the way we play, com m unicate, plan our lives, and work. Many
com panies’ business m odels includes e-com m erce, which allows consum ers to purchase
products and services online. The Internet is a global collection o f com puter networks that
allows users to exchange data and inform ation. Roughly 84 percent of U.S. households
have a com puter (desktop, laptop, tablet, or sm art phone) and 75 percent have Internet
access. A total of 60 percent o f A m ericans visit Google during the week, and 43 percent
have a Facebook p ag e.100 Using Facebook, Twitter, Linkedln, and other social netw ork-
ing tools available on the Internet accessed through smart phones, notebooks, or personal
com puters, com pany m anagers can connect with em ployees and em ployees can connect
with friends, family, and co-w orkers.

Influence on Training
Advances in sophisticated technology along with reduced costs for the technology are
changing the delivery o f training, m aking training more realistic, and giving em ployees
the opportunity to choose where and when they will work. New technologies allow train-
ing to occur at any time and any p lace.101
Technological advances in electronics and com m unications software have m ade pos-
sible mobile technology such sm art phones, notebook com puters, and iPads, and enhanced
the Internet through developing the capability for social networking. Social netw orking
refers to websites such as Facebook, Twitter, and Linkedln, wikis, and blogs that facilitate
interactions between people, usually around shared interests. Table 1.6 shows how social
networks can be used for training and developm ent.102
In general, social networking facilitates com m unications, decentralized decision
m aking, and collaboration. Social networking can be useful for busy em ployees to share
knowledge and ideas with their peers and m anagers, with whom they may not have m uch
time to interact in person on a daily basis. Em ployees, especially young workers from
the m illennial or Gen-Y generations, have learned to use social netw orking tools such as

TABLE 1.6 Potential Uses of Social Networking for Training and Development

Issues Uses
Loss of expert knowledge due to retirement Knowledge sharing, capturing, and storing
Employee engagement Collect employee opinions
Identify and promote employee expertise Create online expert communities
Promote innovation and creativity Encourage participation in online discussions
Reinforce learning Share best practices, applications, learning, points,
links to articles and webinars
Employees need coaching and mentoring Interact with mentors and coaching peers
Sources: Based on P. Brotherson. “Social Networks Enhance Employee Learning" T+D (April 2011): 18-19; T. Bingham and M. Connor. The New Social Learning
(Alexandria. VA: American Society for Training & Development. 2010); M. Weinstein. “Are You Linked In?" training (September/October 2010): 30-33; S. Gilbert &
A. Silvers. “Learning Communities With Purpose". TD (January 2015): 48-51.
36 Part 1 The Context for Training and Development

Facebook throughout their lives and see them as valuable to o ls for b o th th e ir w ork and
personal lives.
D espite its potential advantages, m any co m p an ies are u n c e rtain as to w h e th e r they
should em brace social n etw o rk in g .103 T hey fear, p erh ap s c o rre c tly , th at so c ia l n e tw o rk -
ing will result in em ployees w asting tim e or offending o r h a ra ssin g th e ir c o -w o rk e rs . But
other com panies believe that the benefits o f using social n e tw o rk in g for h u m a n reso urce
practices and allow ing em ployees to access social n etw o rk s at w o rk o u tw e ig h the risks.
They trust em ployees to use social netw orking produ ctiv ely and are p ro a c tiv e in d e v e lo p -
ing policies about personal use and training em p lo y ees ab o u t p riv acy s e ttin g s an d social
netw ork etiquette. They realize that em ployees will likely c h e ck th e ir T w itte r, F aceb o o k ,
or Linkedln accounts, but they ignore it unless produ ctiv ity is d e c re a s in g . In so m e w'ays,
social netw orking has becom e the electronic sub stitute for d a y d re a m in g at o n e 's d e sk or
w alking to the break room to socialize with co-w orkers.
R obotics, com puter-assisted design, radio-frequency id e n tific a tio n , a n d n a n o te c h n o l-
ogy are transform ing w o rk .104 Technology has also m ade it e a sie r to m o n ito r e n v iro n m e n -
tal conditions and operate equipm ent. For exam ple, c o n sid e r w o rk in g a g ra d e r c o n stru c tio n
vehicle (which is used to sm ooth and level dirt on ro ad w ay s and o th e r c o n s tru c tio n pro j-
ects). O lder vehicle m odels required operating as m any as fifteen lev ers in a d d itio n to a
steering wheel and several foot pedals. As a result, w ork in g the g ra d e r u s u a lly left o p e ra -
tors with sore backs and shoulders at the end o f the day. C a te rp illa r's la te st v e rsio n o f the
grader includes redesigned controls that use only tw o jo y stic k s and e lim in a te the phy sical
dem ands o f pushing pedals and turning a steering w heel. B e sid e s re d u c in g the ph ysical
dem ands, the redesign o f the grader w ithout a steering w heel re s u lte d in o p e ra to rs having
better visibility o f the steel blade, and sw itches for lights, w in d s h ie ld w ip e rs , a n d th e p ark -
ing brake could be grouped together in one place in the cab. A J a p a n e s e c o m m e rc ia l farm ,
Shinpuku Seika, relies on com pu ter readings from m o n ito rs p la c e d o u t in th e field s that
report tem perature, soil, and m oisture levels to the fa rm e rs .105 C o m p u te r a n a ly s is o f these
data alerts farm ers w hen to start planting or identifies sp e cific c ro p s th at m ay g ro w best
in each field. Farm ers can use cam eras in the fields to e x a m in e c ro p s. F a rm w o rk e rs can
also use their m obile phones to take pictures o f potential d ise a se d o r in fe c te d c ro p s th at are
uploaded to the com puter for diag nosis by crop experts. T h e w o rk e rs ' p h o n e s a ls o in clud e
a global positioning system , allow ing the com pany to d e te rm in e if w o rk e rs are ta k in g the
m ost efficient routes betw een fields or slacking o ff on the jo b .
Technology has m any advantages, including red u c e d trav el c o s ts , g r e a te r a c c e ssib ility
to training, consistent delivery, the ability to access e x p e rts an d sh a re le a rn in g w ith others,
and the possibility o f creating a learning e n v iro n m en t w ith m an y p o s itiv e fe a tu re s such
as feedback, self-pacing, and practice exercises. W h ile tra in e r-le d c la s s ro o m in stru ctio n
rem ains the m ost popular w ay to d eliver train in g , c o m p a n ie s re p o rt th a t th e y plan on
delivering a large portion o f training th ro u g h lea rn in g te c h n o lo g ie s s u c h as in tra n e ts and
iPods. For exam ple, con sider how train in g at V erizon, the te le c o m m u n ic a tio n s co m pany ,
has ch an g ed .106 Som e training pro g ram s at V erizon still in c lu d e fa c e -to -fa c e in stru c to r-le d
courses. But to im prove both e m p lo y e e s’ acce ssib ility to tra in in g a n d c u s to m e r service,
Verizon has deployed tablets to retail store e m p lo y e es. E m p lo y e e s c a n u se th e s e ta b le ts to
get access to inform ation about devices, serv ice p lan s, p ro d u c t p ro m o tio n s , p ro c e s s e s , and
procedures. They can share this in fo rm atio n w ith th e c u s to m e r d u rin g th e ir in te rac tio n s.
The tablets are also used to deliv er e-learn in g . L e a rn in g an d d e v e lo p m e n t at V erizon is
Chapter 1 Introduction to Employee Training and Development 37

evaluated based on its contribution to both em ployee and business performance. Verizon
also uses social netw orking tools to train em ployees to support new products and devices.
Device Blog, Device Forum, and Learning C om m unities help to ensure that em ployees are
ready to support custom ers w hen new products and devices are introduced to the market,
engages Verizon’s m ultigenerational w orkforce, and facilitates peer-to-peer learning. De-
vice Blog makes available inform ation and updates on w ireless devices (such as DROID),
FAQ’s (frequently asked questions), how -to-videos, and troubleshooting tips. Device Fo-
rums enable retail em ployees to learn from peers and product manufacturers. Em ployees
can ask each other questions, share issues, post tips, make suggestions, and access product
experts. Learning com m unities are accessed through the Device Blog. They include video
blogs, m essage boards, links to online training modules, and product demonstrations. In
addition to these tools, em ployees have access to My Network for collaborating with their
peers, knowledge and docum ent sharing, and creating working groups. Some trainers also
use it for posting supplem ental content for learners’ use.
Technology is pushing the boundaries o f artificial intelligence, speech synthesis, w ire-
less com m unications, netw orked virtual reality and adaptive learning.107 Realistic graph-
ics, dialogue, and sensory cues can now be stored onto tiny, inexpensive com puter chips.
For example, Second Life is an online virtual world that allows members to develop fic-
tional lives. In Second Life, m em bers can run a business, take a date to a dance club, or
visit a training center. Virtual sensations (vibrations and other sensory cues) are being
incorporated into training applications. For example, in medical training, m achines can
replicate the feeling o f pushing a needle into an artery and use sound and motion to sim u-
late different situations such as a baby crying or a patient in pain.

Flexibility in Where and When Work Is Performed


Advances in technology, including more powerful com puter chips and increased process-
ing power of PDAs, notebooks, and iPhones have the potential for freeing workers from
going to a specific location to work and from traditional work schedules. One estim ate is
that 9.5 percent or 13.4 million U.S. employees are working at home at least one day a
w eek.108 One in four hom e-based employees are working in management, business, and
finance jobs and half are self-em ployed. Em ployees in health care and installation, m ainte-
nance, and repair occupations are the least likely to work from home. Telecom muting has
been shown to increase employee productivity, encourage fam ily-friendly work arrange-
m ents, and help reduce traffic and air pollution.109 Em ployees at Salesforce.com Inc. can
work from home and use Chatter, a Facebook-type application, to coordinate projects.110
M anagers can m onitor w hether employees working at home have answered clients’ ques-
tions and finished reports.
At Delta Air Lines, more than 570 of the 5,000 agents work from home full tim e.11 To
strengthen their com m itm ent and understanding of the company, each agent works in a call
center for six m onths before working from home. W hile working at home, they can con-
tact a team leader with questions. They also have m onthly meetings. Delta spends $2,500
to purchase a com puter and software for each reservation agent who works at home. The
costs are offset by the lower hourly wage these agents receive compared to agents who
work in the office. However, working at home reduces the agents’ costs for gasoline and
gives them more flexibility to balance their work and personal lives. The company has
realized savings in rent and upkeep of office space, and the offsite agents have helped
38 Part 1 The Context for Training and Development

m eet custom er service dem ands due to bad w eather by v o lu nteering lo r m ore overtim e
than agents w orking in offices.
T echnology also allow s com panies greater use o f alternative w ork arran g em en ts.
A lternative w ork arrangem ents include independent co n tracto rs, o n -call w o rk ers, tem -
porary w orkers, and contract com pany workers. T he B ureau o f L ab o r S ta tistics estim ates
that alternative w ork arrangem ents m ake up l 1 percent o f total e m p lo y m e n t.11: There are
10.3 m illion independent contractors, 2.5 m illion on-call w orkers. 1.2 m illio n tem porary
help agency w orkers, and approxim ately 813,000 w orkers em p lo y e d by co n tra ct firms.
U se o f alternative w ork arrangem ents allows com panies to adjust stal ling levels m ore eas-
ily based on econom ic conditions and product and service d em an d . A nd w hen a com pany
dow nsizes by laying off w orkers, the dam age to the m orale o f full-tim e e m p lo y e e s is likely
to be less severe. A lternative work arrangem ents also provide e m p lo y e e s w ith flexibility
for balancing w ork and life activities. For exam ple. Verigy. a s e m ic o n d u c to r m anufacturer
in C alifornia, em ploys only a small num ber o f perm anent e m p lo y e es, and n o n e sse n tia l jobs
are outsourced. W hen dem and for its products increases, e n g in e e rs and o th e r high-tech
em ployees are hired through staffing com panies or as in d ep en d en t c o n tra c to rs .11' Also,
the use o f alternative work arrangem ents has resulted in the d e v e lo p m en t o f co-w orking
sites w here diverse w orkers such as designers, artists, freelan cers, c o n s u lta n ts , and other
independent contractors pay a daily or m onthly fee for a g u a ra n tee d w ork s p a c e ." 4 The
co-w orking site is equipped with desks and w ireless Internet, and so m e p ro v id e access to
copy m achines, faxes, and conference room s. C o-w orking sites h elp fac ilita te independent
contractors, em ployees w orking at hom e, traveling, or te le c o m m u tin g , c o m b a t th eir pos-
sible feelings o f isolation, give them the ability to co llabo rate and in te rac t, p ro v id e a more
professional w orking atm osphere than coffee shops (and sim ila r p u b lic lo ca tio n s where
such em ployees often w ork off-site), and help to decrease traffic and p o llu tio n .
A key training issu e that alternative w ork a rra n g e m e n ts p rese n t is to p re p a re m anag-
ers and em ployees to c o o rd in ate their efforts so that such w ork a rra n g e m e n ts do not
interfere w ith cu sto m e r serv ice or product quality. T h e in cre ase d use o f a lte rn a tiv e work
arrangem ents m eans th at m an agers need to und erstand how to m o tiv ate e m p lo y e e s who
m ay actually be em p lo y e d by a third party such as a te m p o ra ry e m p lo y e e serv ice or
leasing agency.

H igh-P e rfo rm a n c e M od e ls o f W ork Syst e m s


New technology causes chang es in skill requirem ents and w ork ro les an d o fte n results in
redesigned w ork structu res (e.g., using w ork te a m s).115 For e x a m p le, c o m p u te r-in te g ra ted
m anufacturing uses robots and com puters to autom ate the m a n u fa c tu rin g p ro cess. The
com puter allow s the m anufactu re o f different products sim ply by re p ro g ra m m in g the com -
puter. As a result, laborer, m aterial handler, operator/assem bler, and m a in te n a n c e jo b s may
be m erged into one position. C o m p uter-in tegrated m an u factu rin g re q u ire s e m p lo y e es to
m onitor equipm ent and tro u b lesh o o t problem s w ith so p h isticated e q u ip m e n t, sh are infor-
m ation w ith oth er em ployees, and understand the relatio n sh ip s a m o n g all c o m p o n e n ts of
the m anufacturing p ro c e s s .116
T hrough technology, the in fo rm atio n needed to im prove c u s to m e r s e rv ic e and product
quality becom es m ore accessib le to em p loyees. T his m eans that e m p lo y e e s are expected
to take m ore responsibility for satisfy in g the custo m er and d e te rm in in g how they perform
their jobs. O ne o f the m ost p o p u lar m ethod s for in creasing e m p lo y e e re sp o n sib ility and
Chap ter 1 Introduction to Employee Training and Development 39

control is work teams. W o rk te a m s involve em ployees with various skills who interact to
assem ble a product or provide a service. W ork team s may assum e many o f the activities
usually reserved for m anagers, including selecting new team m em bers, scheduling work,
and coordinating activities with custom ers and other units in the company. To give teams
m axim um flexibility, cross training o f team m em bers occurs. C ro ss tra in in g refers to
training em ployees in a wide range o f skills so they can fill any o f the roles needed to be
performed on the team.
Consider the high-perform ance work system at the Chrysler Dundee Engine Plant in
Dundee, M ichigan.117 C om pared to m ost engine plants, this plant is more autom ated and
has fewer em ployees— 709 com pared to 600-2,000. The goal o f the plant is to be the
most productive engine plant in the world. The plant’s hourly employees rotate jobs and
shifts, giving the com pany greater flexibility and em ployees more family time. The plant’s
culture em phasizes problem solving and the philosophy that anyone can do anything, any-
time, anywhere. Every em ployee is either a team m em ber or a team leader. By rotating
jobs, the plant keeps workers m otivated and avoids injuries. Team leaders and engineers
don’t stay in their offices— they are expected to work on the shop floor as part o f six-
person teams. Contractors are also seen as part o f the team, working alongside assem bly
workers and engineers and w earing the same uniforms. The plant gives em ployees ac-
cess to technology that helps them m onitor productivity. Large electronic screens hanging
from the plant ceiling provide alerts o f any m achinery parts that are ending their lifespan
and need to be replaced before they m alfunction. A perform ance m anagem ent system ,
available on personal com puters as well as a display board, alerts em ployees to delays or
breakdow ns in productivity. This is different than in most engine plants, where only the
m anagers have access to this information. The technology at the plant em pow ers all em -
ployees to fix problem s— not ju st m anagers or engineers.
Use of new technology and work designs such as work team s needs to be supported
by specific hum an resource m anagem ent practices. These practices include the following
actions:118 &
• Em ployees choose or select new em ployees or team m em bers.
• Em ployees receive formal perform ance feedback and are involved in the perform ance
im provem ent process.
• Ongoing training is em phasized and rewarded.
• Rewards and com pensation are linked to com pany perform ance.
• Equipm ent and work processes encourage m axim um flexibility and interaction be-
tween em ployees.
• Em ployees participate in planning changes in equipm ent, layout, and work methods.
• Em ployees understand how their jobs contribute to the finished product or service.

W hat role does training play? Em ployees need job-specific knowledge and basic skills
to work with the equipm ent created by the new technology. Because technology is often
used as a m eans to achieve product diversification and custom ization, employees must
have the ability to listen and com m unicate with custom ers. Interpersonal skills, such as
negotiation and conflict m anagem ent, and problem -solving skills are more important
than physical strength, coordination, and fine-m otor skills— previous jo b requirements
for m any m anufacturing and service jobs. Although technological advances have made it
40 Part 1 The C ontext for Training and Development

possible for em ployees to im prove products and services, m a n ag e rs must em p o w er em -


ployees to m ake changes.
B esides changing the way that products are built or se rv ices are p ro v id e d w ithin com -
panies, technology has allowed com panies to perform w ork using v irtu a l team s. Virtual
team s refer to team s with m em bers that are separated by tim e, g e o g ra p h ic distan ce, cul-
ture, and/or organizational boundaries and that rely alm ost ex c lu siv ely on technology
(such as e-m ail, Internet, and video conferencing) to interact and c o m p le te th eir projects.
Virtual team s can be form ed within one com pany, w hose fac ilitie s are sc attere d through-
out the country or the world. A com pany may also use virtual tea m s in p a rtn e rsh ip s with
suppliers or com petitors to pull together the necessary talent to c o m p le te a project or
speed the delivery o f a product to the m arketplace. T he su c ce ss of v irtual team s requires
a clear m ission, good com m unications skills, trust b etw een m e m b e rs that they will meet
deadlines and com plete assignm ents, and an u n d erstanding o f c u ltu ra l d iffe re n c e s (if the
team s have global m em bers).
For exam ple, A rt & Logic softw are developers all w ork rem o tely f rom a c ro ss the United
States and C anada from hom e offices, rented office space or at a c o -w o rk in g facility.119
T heir clients represent a diverse set o f industries, including e d u c a tio n , a e ro sp a c e, music
technology, consum er electronics, entertainm ent, and financial se rv ic es. T h e project teams
w ork on the m ost unusual and difficult problem s that d e v e lo p e rs at o th e r c o m p a n ies have
failed to solve. Art & Logic tries to accom m odate the u n iq u e s c h e d u le and w ork-style
requirem ents o f its developers, but its work is highly c o lla b o ra tiv e w ith in p ro ject teams.
Every project consists o f at least a project m an ag er/d ev elo p er and has a m ax im u m of five
to seven developers. Team s use G oogle A pps for B u sin ess for sh a rin g d o c u m e n ts and
com m unicating (both w ithin the team and with clients).

SNAPSHOT OF TRAINING PRACTICES


Training can play a key role in helping com panies gain a c o m p e titiv e a d v a n ta g e and suc-
cessfully deal with com petitive challenges. B efore you can learn how tra in in g can be used
to help com panies m eet their business objectives, and b efo re you can u n d e rsta n d training
design, training m ethods, and other topics covered in the text, you need to b e c o m e fam iliar
w ith the am ount and type o f training that occurs in the U n ited S ta te s. A lso , you m ust un-
derstand w hat trainers do. The next sections o f this c h a p te r p rese n t d a ta reg a rd in g training
practices (e.g., how m uch com panies spend on training, w hat type o f tra in in g is occurring,
and w ho is being trained), as well as the skills and c o m p e te n c ie s n e e d e d to be a trainer.

Tra in ing Facts and F igures


T he snapshot o f training practices provided in this section is b a sed on d a ta and collected
from a num ber o f sources, including surveys co n d u cted by Training m ag a z in e and the
ATD. (A ssociation for Talent D evelopm ent, previously know n as the A m e ric a n Society
for Training and D evelopm ent).120 For several reasons, these d a ta s h o u ld be view ed as
reasonable estim ates of practices rather than precise facts. O n e is th at the sam p les may
not be representative o f all size or types o f co m p an ies. F or e x a m p le , the Training survey
was conducted by a research firm that e-m ailed invitations to su b sc rib e rs to participate in
an online survey. The response rate ranged from 31 percen t for large firm s to 28 percent
Ch ap t er 1 Introduction to Employee Training and Development 41

TABLE 1.7 Investment and Distribution of Expenditures


Questions
and Answers
Q: How much do U.S. organizations spend on employee learning and development?
about Training
A: Approximately $161.8 billion
Practices
Q: How much is spent per employee?
A: $1,208
Source: L. Miller. Q: What is the percentage of dollars spent on training and development as a percentage
“20 14 State of the of payroll?
Industry*’ (Alexandria.
VA: Association for
A: 3.4 percent
Talent Development. Q: How much is spent as a percentage of profit?
2 013) ; “2 0 14 Industry A: 7.5 percent
Report.” training
(Novembcr/December Q: How much time do employees spend in formal training each year?
2014) : I6-29. A: 31.5 hours
Q: Who receives most of the training?
A: 40 percent of training budgets and dollars are spent on nonexempt employees, 26 percent
on exempt employees, 24 percent on managers, and 10 percent on executives
Efficiency
Q: What percent of total expenses go to tuition reimbursement?
A: 10 percent
Q: How many training staff members are there for each employee?
A: 16 staff members for every 1,000 employees
Q: What is the average cost for providing one learning hour to one employee?
A: $74
Q: What is the average cost of producing one hour of formal training?
A: $1,798
Q: What is the ratio of learning hours used to learning hours available?
A: 46 to 1
Delivery Methods
Q: How is training delivered?
A: 47 percent by a instructor in a classroom, 29 percent via blended learning (including
both face-to-face and technology delivery), 29 percent online, 1 percent mobile
devices, 4 percent social learning
Q: What percentage of direct learning expenditures are allocated to outside providers
(i.e., outsourced)?
A: 28 percent

for small firms. The ATD annual State o f the Industry Report includes hundreds o f orga-
nizations across all m ajor industries grouped into three categories: com panies who have
received awards for training, ATD BEST Award w inners, Fortune G lobal 500 com panies,
and consolidated responses.
You may be asking yourself questions such as, “How m uch tim e and money do com pa-
nies spend on training?” or “Is instructor-delivered training obsolete?” Table 1.7 provides
a snapshot o f trends in w orkplace learning. U.S. organizations continue to invest large
am ounts o f m oney in learning initiatives. Here is an overview o f some key trends in these
investments:

• D irect expenditures, as a percentage o f payroll and learning hours, have rem ained sta-
ble over the last several years.
42 P a rti The Context for Training and De vehement

• There is an increased dem and for specialized learning that in c lu d e s m an ag er, profes-
sional, and industry-specific content.
• The use o f technology-based learning delivery has in creased from .V* p e rcen t in 2010
to 39 percent in 2012.
• Self-paced online learning is the most frequently used ty p e <>f tech n o lo gy-b ased
learning.
• Technology-based learning has helped im prove learning efficie n cy , as sh o w n by de-
crease in the reuse ration since 2010. (The "reuse ratio" is d e fin e d as how m uch learn-
ing content is used or received for every' hour o f c o n te n t.» T h e reu se ratio d rop ped by
6 percent to 48 hours in 2013. This m eans that every h o u r o f lea rn in g c o n te n t available
was received by about 46 em ployees. This d ecrease m ean s that e a c h h o u r o f content
was delivered fewer tim es. A low reuse ratio m eans new c o n te n t is b ein g created but
not distributed.
• Technology-based learning has resulted in a larger e m p lo y e e lea rn in g sta ff m em ber
ratio.
• The percentage o f services distributed by external p ro v id e rs (e g., c o n s u lta n ts , work-
shops, and training program s) has rem ained about the sam e sin c e 2 0 1 0 .
• A high ratio indicates program s being used by m ore e m p l o y e e s , but th ere are fewer
new courses.
• Traditional, instructor-led classroom training c o n tin u e s to be the m ost p o p u la r method.
O f the $61.8 billion spent on training, 63 percent is for in tern al c o sts such as training-
staff salaries and course developm ent, and 27 percent is for s e rv ic e s bv e x te rn a l providers
(such as consultants, workshops, or training program s o u tsid e the co m p an y ) and 10 percent
on tuition reim bursem ent. A fter several years o f increases in co st p e r lea rn in g h o u r it fell
in 2013, suggesting that com panies are m ore effectively d istrib u tin g tra in in g to em ployees.
Figure 1.4 show s the different types o f training p ro v id e d by c o m p a n ie s . Profession
or industry-specific content, m anagerial and supervisory, and m a n d a to ry and com pliance
account for 34 percent o f learning content. The least a m o u n t o f le a rn in g c o n te n t concerns
basic and other skills.

Training Inv estm e n t Le a d e rs


The ch apter’s opening vignette illustrates how train in g can be u sed by c o m p a n ie s to gain
a com petitive advantage. H ig her investm ent in tra in in g by c o m p a n ie s in the U n ited States
is related to use o f innovative training practices and h ig h -p e rfo rm a n c e w o rk practices
such as team s, em ployee stock o w nership plans, in ce n tiv e c o m p e n s a tio n s y ste m s (profit
sharing), individual developm ent plans, and e m p lo y e e in v o lv e m e n t in b u s in e s s decisions.
This spending (along w ith the use o f h ig h -p e rfo rm a n c e w o rk p ra c tic e s ) h as b e e n shown
to be related to im proved profitability, c u sto m e r and e m p lo y e e s a tis fa c tio n , and the
ability to retain em ployees. For e x am p le, c o m p a n ie s in c lu d in g G ra n t T h o rn to n LLP,
W ipro Technologies, S teelcase, and In te rC o n tin e n ta l H o te ls G ro u p h a v e re c o g n iz e d that
training contributes to their c o m p etitiv en ess. T h ey m ake a s u b s ta n tia l fin a n c ia l invest-
m ent in training and use it to drive p ro d u ctiv ity , c u s to m e r s e rv ic e , a n d o th e r results
im portant to business. C h ap ter Tw o d isc u sse s how tra in in g can h e lp c o m p a n ie s meet
their business goals.
Chapter 1 Introduction to Employee Training and Development 43

FIGURE 1 .4 Different Types of Training Provided by Companies

Content Area
Note: Data from consolidate d responses (companies that submitted their annual data as part of ASTD's benchmarking programs).
Source: Based on L. Miller. “2014 Stale of the Industry" (Alexandria. VA: Association for Talent Development. 2014).

How do the training practices o f com panies that have recognized training’s importance
in gaining a com petitive advantage differ from other com panies? ATD’s Stare o f the Indus-
try Report, 2013 com pares the training practices of com panies that were part of the ATD
Benchm arking program with com panies that received ATD BEST Awards (recognizing
com panies that show a clear link betw een learning and perform ance).121 Benchmarking
program com panies provided ATD with a standard set o f information on their training
practices (e.g., num ber o f hours spent on training); these included 340 companies with an
average o f 16,719 em ployees. Table 1.8 shows the characteristics o f BEST Award-winning
44 Part 1 The Context for Training and Development

TABLE 1.8 Alignment of business strategy with training and development


Characteristics
of BEST Award
Learning is valued as part of the culture and supported by executive leaders and top
managers
Winners
Effectiveness and efficiency of learning is measured
Source: L. Miller, Investment in training and development
“2014 State of the Different learning opportunities are provided and all employees have access to them
Industry“ (Alexandria,
VA: Association for Measurement of effectiveness and efficiency of training and development activities
Talent Development, Non-training solutions for performance improvement used, including organization
2014). development and process improvement

TABLE 1 .9 Comparison of BEST Award Winners and Benchmark Companies

Benchmark Company BEST Award Winner


Amount of training received per employee 32 hours 36 hours
Average cost per learning hour available $1,798 $1,459
Amount spent on training per employee $1,208 $1,296
Ratio of learning hours used to learning 46.0 78.3
hours available (reuse ratio)
Source: L. Miller, “2014 State of the Industry” (Alexandria, VA: Association for Talent Development. 2014)

com panies. As will be discussed in C hapter Two, the B E S T A w ard w in n e rs are engaging in
strategic training and developm ent— training and d ev elo p m en t that su p p o rts the business’s
strategies and has m easurable outcom es. The B E ST Aw ard w in n e rs in clu d e d thirty-three
com panies with an average o f 51,809 em ployees. Table 1.9 c o m p a re s the B E ST Award
winners with the Benchm ark com panies. As the table show s, c o m p a n ie s that w ere BEST
Award winners were able to m ore efficiently deliver train in g (less co st, h ig h e r reuse ratio)
than Benchm ark firms. Also, at BEST A w ard -w in n in g c o m p a n ie s e m p lo y e e s on average
engaged in m ore learning hours than em ployees at B en ch m ark c o m p a n ie s.

Roles, Com pe tencies, and Positions o f Tr a in in g P ro f e ssio n a ls


Trainers can typically hold m any jobs, such as instructional d esig n er, tec h n ica l trainer, or
needs analyst. Each jo b has specific roles or functions. T able 1.10 p ro v id e s exam ples of
the roles that training and developm ent professionals m ight tak e in th e ir jo b s. T hese roles
are included in jobs such as organizational change agent, c a re e r co u n selo r, instructional
designer, and classroom trainer. Training departm ent m an ag ers d ev o te co n sid erab le time
to the roles o f business partner and learning strategist. T rain in g d e p a rtm e n t m anagers may
be involved in the project m anagem ent role, but, becau se o f th eir o th e r responsibilities,
they are involved to a lesser extent than are specialists w h o h old o th e r jo b s. H um an re-
source m anagers may also be required to com plete m any o f the tra in in g roles, although
their prim ary responsibility is in overseeing the hum an reso u rc es fu n ctio n s o f the divi-
sion, departm ent, or company (e.g., staffing, recru itin g , c o m p e n sa tio n , b en efits). Special
know ledge, skills, or behaviors— also called c o m p eten cies— are n e e d ed to perform each
role successfully.
C h ap ter 1 introduction to Employee Training and Development 45

TABLE 1.10 Training and Development Roles

L e a rn in g S tra t e g is t D e t e rm in e s h o w w o r k p la c e le a rn in g c a n b e b e st use d t o h e lp m e e t th e
c o m p a n y's b u sin e ss s t r a t e g y
Busin e ss P artn er Uses b u sin e ss a n d in d u stry k n o w l e d g e to cre a t e t r a in in g t h a t im p ro ve s
p e rfo rm a n c e
Pro je ct M a n a g e r Plans, o b t a in s, a n d m o n it o rs th e d e live ry o f le a rn in g a n d p e rfo rm a n c e
so lu t io n s t o s u p p o r t th e b u sin e ss
Pro fe ssio n a l Sp e cia list D e sig n s, d e v e lo ps, d e live rs, a n d e v a lu a t e s le a rn in g a n d p e rfo rm a n c e
so lu t io ns.

Source: Based on M. Allen and J. Naughton. "Social Learning: A Cal! to Action lor Learning Professionals," T+D (August 2 0 11 ): 50-55.

FIG U RE 1.5
T he ATD
C om petency
M odel

Source: From J. Change Performance


A meson, W. Rothwell. Management Improvement
and J. Naughton.
“Training and
Development
Competencies.
Knowledge Instructional
Redefined to Management Design
Create Competitive
Advantage.” T+D
(January 2 0 13):
42-47.
Coaching Training
Competencies Delivery
for the Training
& Development
Profession

Integrated Talent Learning


Management Technologies

Managing Evaluating
Learning Learning
Programs Impact

Foundational Com petencies

The m ost com prehensive study of training professionals has been conducted by the
A T D .1— Figure 1.5 shows the ATD com petency model. The model describes what it takes
lo r an individual to be successful in the training and developm ent field. It includes spe-
cific areas ot expertise and foundational com petencies. The areas o f expertise include
know ledge and behaviors required by different roles (e.g., change m anagem ent, learning
46 Part 1 The Context for Training and Development

technologies, training delivery). A lthough training p r o f e ssi o n a ls sp e n d most ot th eir time


designing learning (instructional design), d eliv ering tr a i n i ng , m a n a g i n g learn in g pro-
gram s, identifying, selecting, and using learning t e c h n o l o gi e s, and c o a c h i n g ( w o r k i n g one-
on-one with em ployees to help them develop), they do spe nd t i m e in othet a t e as as well.
The m odel recognizes that perfo rm ance im prov em en t (d e s ig n i n g and d e v e l o p i n g solutions
to close perform ance gaps), talent m anag em en t (i n c l u d i n g talent a c q u is i t i o n , develop-
m ent, and retention), and know ledge m an ag em en t are o t her im p or t a n t ar e as ot expertise.
The foundational com petencies an ch o r the co m p eten cy m odel. I he fo u n d a tio n a l com -
petencies include interpersonal skills, business skills, p erso n al sk ills, g lo b al m ind set, in-
dustry know ledge, and technology literacy. T he fo u n d atio n al c o m p e te n c ie s are im portant
regardless of a train er’s area o f expertise or role but are used to a d iffe re n t e x te n t in each
role or specialization.
Traditional narrow jo b s in the training depart men t f o c u s i n g on one typ e of expertise
(e.g., instructional design er and technical w riter) are c h a n g i n g , h a v i n g m u l t i p l e areas of
expertise becom es m ore necessary for training and d e v e l o p m e n t to c o n t r i b u t e to the busi-
ness. Project m anagem ent requires the know ledge of new t r a i n i ng t e c h n o l o g i e s (e.g., web-
delivered learning, m obile learning, and know ledge m a n ag e m e n t sy s t e m s) an d the ability
to m anage m anagers, engineers, scientists, and oth ers w h o m a y h av e m or e experience,
knowledge, or technical savvy than the trainer.
To provide you with an idea o f the variety o f re sp o n sib ilitie s and e x p e rtise required
for training professional jo b s, Table l.l l provides an e x a m p le of an in stru c tio n a l system
designer job that was posted on the ATD w ebsite.
Table 1.12 show s m edian salaries for training p ro fe ssio n a ls. K eep in m in d that very
rarely does anyone hold the highest-paying jo b s (train in g m an a g e r, e x e c u tiv e -le v e l m an-
ager) w ithout having developed co m p etencies in a n u m b er of tra in in g ro les.

W ho Provid es Tra in ing?


In m ost com panies, training and developm ent activ ities are prov id ed by tra in e rs, m anag-
ers, in-house consultants, and em ployee experts. H ow ever, as the sn a p sh o t ot training
practices suggests, training and developm ent activ ities are a lso o u tso u rc e d . O u tsou rcin g
m eans that training and developm ent activities are p ro v id e d by in d iv id u a ls o u tsid e the
company. Training providers outside the co m p an y in clu d e c o lle g e s an d universities,
com m unity and ju n io r colleges, technical and v o catio n al in stitu tio n s , p ro d u c t suppliers,
consultants and consulting firm s, unions, trade and p ro fe ssio n a l o rg a n iz a tio n s , and gov-
ernm ent organizations. O utsourcing is discu ssed in g re a te r d e ta il in C h a p te r Tw o.

W ho Is in C h a rg e o f Tra in ing?
Training and developm ent can be the resp o n sib ility o f p ro fe s s io n a ls in h u m a n resources,
hum an resource developm ent, or o rg an izatio n al d e v e lo p m e n t.1“' C o m p a n ie s m ay also
have entire functions or d epartm ents called h um an re so u rc e s, h u m a n re so u rc e develop-
m ent, talent m anagem ent or d ev elop m en t, o r o rg a n iz a tio n a l d e v e lo p m e n t that provide
training and developm ent.
In small com panies, training is the resp o n sib ility of the fou nd er an d all th e em ployees.
W hen organizations grow to 100 e m p lo y ees, ty p ic a lly so m e o n e w ith in th e c o m p a n y is in
charge o f hum an resources, eith er as part o f that p e rs o n ’s jo b o r as his o r h e r so le responsi-
bility. At this point, training becom es one of the re sp o n sib ilitie s of th e e m p lo y e e in charge
Chap ter 1 Introduction to Employee Twining and Development 47

TABLE 1.11 Instructional Systems Designer/Developer/Trainer


Example of
Role Overview: The job incumbent serves as a consultant and provides hands-on exper
Jobs Posted
tise in the areas of adult education methodologies, leadership development, leadership/
on the ATD
management training, course design, e-learning, and organizational development. The
Website
incumbent of this position is responsible for the performance of duties involved in carrying
out the functional responsibilities.
Responsibilities
• Design, develop, and deliver instructor-led, e-learning, or blended training programs,
courses, seminars, workshops, and presentations on leadership and management.
• Provide training expertise related to topics such as leadership development, manage
ment skills, supervisory training, performance and productivity, conflict management,
team building, project teams, business communications, career planning, diversity and
inclusion, and interpersonal effectiveness.
• Conduct stand-up training, facilitate learning activities, employ adult learning prin
ciples, deliver sessions, provide resources, and advise students.
• Research, design, and evaluate programs, courses, and activities, including selection of
media products and animation.
• Design new courses and update existing course designs and training programs.
• Contribute actively to a standard of excellence in carrying out our mission of promoting
learning and self-development.
• Serve as facilitator and consultant.
• Lead talent to the highest level of performance and productivity through the creation
and use of innovative best practice training and professional development systems,
policies, processes, and procedures.
Desired Qualifications
• Master's degree in Instructional Technology, Education, Organization Development,
Human Resource Development, Adult Learning, or other related areas.
• Knowledge of and experience in applying Adult Learning Principles.
• Certification and experience in applying one or more assessments (e.g., 5 Dynamics, Myers
Briggs, DiSC, StrengthsFinder, Thomas-Kilmann) are highly desired.
• Membership and/or certification in professional organizations are highly desired (e.g.,
ATD, SHRM, NBCC)
Skills
• Proficient using Adobe tools— eLearning Suite and Master Collection, Camtasia, Adobe
Catalyst, Captivate, Photoshop, Illustrator, Macromedia Flash, Premier Pro, and Open
Source tools.
• Develop e-learning programs that are SCORM /AICC/Section 508 compliant.
• Experience developing Microsoft SharePoint sites and administration.
• Proficient working with most LMSs and LCMSs.
• Advanced working knowledge using Microsoft Word and PowerPoint, Publisher, Excel,
and Outlook.
Experience .
• Five plus years of related experience. Diverse work experiences including small and
large employer work environments are essential.
• Experience in designing courses, modules, and workshops that incorporate adult edu
cation principles and experiential learning techniques; delivering training on supervision
and performance management; delivering multiday training programs on leadership
48 Part 1 The Context for Training and Develofmxent

and management topics; writing course designs, course materials, student resource
materials, educational aids, and similar educational materials; facilitating discussions,
meetings, and training group activities; actively collaborating and contributing to effec
tive teamwork as part of a training team.
Desired Personal Characteristics
• Must be able to function in a multitask environment, as part of a team and individually.
• Must have integrity and high level of interpersonal skills to handle sensitive and
confidential issues involving all internal and external customers.
• Work requires continual attention to detail in creating and proofing materials, establish
ing priorities and meeting deadlines.
Source: From ATD Job Bank hltp://jobs.td.org/jobs/. accessed M.irch V 2 0 1*

TABLE 1.12
Average
Executive-Level Training/Human Resource Development M anager $112,245
Salaries for
Executive-Level Manager 129,053
Training
Training Department M anager (1-5 trainers report to you) 88,658
Training Department Manager (more than 5 trainers report to you) 91,287
Professionals
One-Person Training Department 68,858
Source: Based on Classroom Instructor/Trainer 68,482
“Going Up!” training Instructional Designer 71,901
(November/December
2014): 34-41.
CBT/Web/ Multimedia Programmer Designer / Manager 75,432
Management /Career/ Organization Development Specialist 81,137
Human Resource Manager/Specialist 75,048

o f hum an resources. In m id -sized to large o rg a n iz a tio n s, tra in in g c a n he the responsibility


o f hum an resource p ro fessio n als, o r it can c o m e from a se p a ra te fu n c tio n know n as hu-
m an resource developm ent, talen t m an a g e m e n t, d e v e lo p m e n t, le a rn in g , o r organizational
developm ent.
Human resource development refers to the in te g ra te d u se o f tra in in g and develop-
m ent, organizational d ev elo p m en t, and c a re e r d e v e lo p m e n t to im p ro v e in d iv id u a l, group,
and organizational effectiven ess. H um an re so u rc e d e v e lo p m e n t p ro fe s s io n a ls m ight be
involved in jo b and task an aly sis, in stru ctio n a l s y s te m s d e s ig n , o n - th e - jo b train in g , and
individual perform ance im provem en t. O rg a n iz a tio n a l d e v e lo p m e n t p ro fe s s io n a ls might
focus on training as w ell as team bu ild in g , c o n flic t a v o id a n c e , e m p lo y e e developm ent,
and change m anagem ent. T alent m an a g e m e n t p ro fe s s io n a ls m ig h t fo c u s on identifying
the top talent in the com pany and e n su rin g th at th ey g e t th e tra in in g and developm ent
needed to prom ote them or prepare th em for new p o s itio n s. L e a rn in g p ro fe s s io n a ls might
focus on form al training and d e v e lo p m en t a c tiv itie s as w ell as e n s u rin g that informal
learning and know ledge sharing o ccu rs th ro u g h use o f s o c ia l n e tw o rk in g to o ls. As you
can see from these descriptio ns, tra in in g and d e v e lo p m e n t a c tiv itie s c a n be the responsi-
bility o f hum an resource m an ag em en t, h u m an re so u rc e d e v e lo p m e n t, a n d organizational
developm ent professionals or d e p a rtm e n ts. K eep in m in d th a t re g a rd le s s o f w hat indi-
vidual, departm ent, or function is re sp o n sib le , fo r tra in in g a n d d e v e lo p m e n t to succeed,
em ployees, m anagers, training p ro fe ssio n a ls, and to p m a n a g e rs all h a v e to tak e ow nership
Ch a p t e r 1 Introduction ro Employee Training and Development 49

for them. T hroughout this book, the point is m ade that although training m ay be a form al
responsibility o f som eone s jo b , em ployees at all levels o f the com pany play a role in the
success o f training. A lso, regardless of w hich function or departm ent is responsible for
training and developm ent, it m ust be aligned w ith the business strategy and m ust support
business needs. Professionals w ho are responsible for training and developm ent may have
specialized areas o f expertise, such as change m anagem ent for organizational develop-
m ent specialists, but they m ay also have training and developm ent responsibilities. As
shown in Figure 1.5, to perform w orkplace learning and perform ance roles successfully,
professionals m ust understand the business and m ust m aster the com petencies and areas
o f expertise.
As com panies grow and/or recognize the im portant role o f training for business suc-
cess, they form an entire training or learning function (how training functions can be
organized is discussed in C hapter Two). The training function may include instructional
designers, instructors, technical training, and experts in instructional technology.
The reporting relationship betw een hum an resource m anagem ent and the training
function varies across c o m p a n ie s.124 Som e organizations include training as part o f the
hum an resource function, believing that this provides strategic partnerships w ith o th er
business functions and co n sisten t com pany w ide training. For exam ple, at Life C are C en -
ters of A m erica, a T ennessee-based com pany that operates eld er care facilities, training
is included in the hum an resource departm ent because the com pany believes that train -
ing is part o f hum an resource expertise, including the ability to w rite training curriculum
and evaluate learning. B eing centrally located in the hum an resource departm ent m akes
the best use o f resources and helps com m unicate a com m on m anagem ent culture.
O ther com panies separate training from the hum an resource function because it allow s
the training function to be decentralized to better respond to unique needs in different
business units. The training and developm ent departm ent at A. G. Edw ards has a learning
center and develops training program s for its financial consultants and em p lo y ees.125 R ep-
resentatives of the training departm ent regularly m eet with the com pany's m anagem ent
com m ittee at corporate headquarters, as well as with regional officers and branch m anag-
ers to help them understand how training can support business objectives. A new branch
m anager certification program succeeded because the branch m anagers were involved in
identifying skill gaps and their suggestions were used in the program design. The branch
m anagers took ow nership o f the program and helped develop the program proposal that
they then presented to corporate m anagers to receive funding and approval for the pro-
gram. Regardless of the organizational approach used for the training function, it m ust
help meet the training needs o f the business.

Preparing to W ork in Training


Everyone is a trainer at som e point in his or her life. C onsider the last time you had to
teach som e skill to a peer, sibling, spouse, friend, or even your boss. A lthough som e
people learn to train by trial and error, the best way is to take courses in training and
developm ent, or even choose an academ ic m ajor related to training. For exam ple, tra in -
ing and developm ent courses are usually found in education, business and m anagem ent,
and psychology departm ents at colleges and universities. Business schools m ay offer
undergraduate and graduate degrees in hum an resource m anagem ent with courses in
50 P a rti The Context for Training and Development

traininc and development, talent management, and organizational de\ eh >pmcnt. Education
departments may have undergraduate and graduate degrees m h u m an resource devel-
opm ent and learning. Courses offered with such degrees include instructional design,
curriculum development, adult learning, evaluation, and o n -the-job training. Psychology
departments offer courses in training and developm ent as well. T hese c o u rses can he part
of a degree program in industrial and organizational p s y c h o lo g y It u n i are lortunate
enough to be at a large university, you may have the opportunity to take courses from
education, business/management, and the psychology d e p a rtm e n ts that relate to training
and development. Also, you should consider the com petencies you want to locus on and
think about how you will master them (courses, work experience. A I D certification).
To be a successful training professional requires staying u p -to-date on current research
and training practices. The primary professional organizations for p e rso ns interested in
training and development include ATD. the Academy ot H um an R e source Development
(AHRD), the SHRM , the Society for Industrial and O rganizational Psychology (SlOP),
the Academy of M anagement (AOM), and the International Society for Performance
Improvement (ISPI). The web addresses for these organizations are listed inside the Iront
cover of this book. Articles about training practices can he found in the following jour-
nals: T ra in in g , T + D , T r a in in g a n d D e v e l o p m e n t . C h i c / !.e a r n i n g OJ fic e r. W orkforce
M a n a g e m e n t , H R M a g a z i n e , A c a d e m y o f M a n a g e m e n t E x e c u t i v e . and A c a d e m y of M a n -
a g e m e n t L e a r n i n g a n d E d u c a t i o n . Training and d evelopm ent research can be found
in the following journals: H u m a n R e s o u r c e D e v e l o p m e n t Q u a r t e r l y . H u m a n R e s o u r c e
D e v e l o p m e n t R e v ie w , P e r f o r m a n c e I m p r o v e m e n t . P e r s o n n e l P s y c h o l o g y . J o u r n a l o f A p -
p l i e d P s y c h o l o g y , A c a d e m y o f M a n a g e m e n t J o u r n a l , and H u m a n R e s o u r c e M a n a g e m e n t .

K e y T e rm s
competitiveness, 6 training design Total Q uality Management
competitive advantage, 6 process, 1 0 (T Q M ), 3 1
human resource Instructional System M alcolm B aldrige National
management, 6 Design (ISD), I I Q uality Award, 3 1
stakeholders, 7 offshoring, / 7 ISO 9 0 0 0 :2 0 0 0 , 3 1
learning, 7 intellectual capital, 1 8 Six S ig m a process, 3 4
training, 8 social capital, JR lean thinking, 3 4
human capital, 8 customer capital, IR ISO 10015, 3 4
development, 8 knowledge alternative work
formal training and workers, 1 9 a rra n g e m e n ts, 3 R
development, 8 employee w ork team s, 3 9
informal learning, 8 engagement, 2 0 cross training, 3 9
explicit knowledge, 9 change, 2 1 virtual team s, 4 0
knowledge learning organization, 2 / o u tso u rc in g , 4 6
management, 9 talent m anagem ent, 2 6 h u m a n resource
tacit knowledge, 9 STEM, 29 d e v e lo p m en t, 4R
Ch a p t e r 1 Introduction to Employee Training and Development 51

D isc ussi o n Q u est i o ns


1. D escribe the forces affecting the w orkplace and learning. H ow can training help com -
panies deal w ith these forces?
2. D iscuss the relationship betw een form al training and developm ent, inform al learning,
and know ledge m anagem ent. H ow are they related to learning and creating a learning
organization? ^
3. W hat steps are included in the training design m odel? W hat step do you think is m ost
im portant? W hy?
4. W hat are intangible assets? H ow do they relate to training and developm ent?
5. How are com panies using training and developm ent to benefit them in today’s econom y?
6. Training professionals continue to debate w hether the ISD m odel is flawed. Som e aigue
that ISD should be treated as a project m anagem ent approach rather than a step-by-step
recipe for building training program s. O thers suggest that ISD is too linear and rigid a
process— that it is the prim ary reason training is expensive, and that it takes too long to
develop. ISD focuses on inputs; m anagem ent wants outputs. Businesses want results,
not the use o f a design technology. D o you believe that ISD is a useful process? W hy or
why not? A re there certain situations w hen it is a m ore (or less) effective w ay to design
training?
7. W hich o f the training pro fessio n als’ roles do you believe is m ost difficult to learn?
W hich is easiest?
8. H ow m ight technology influence the im portance o f training p ro fessio n als’ roles?
C an technology reduce the im portance o f any o f the roles? C an it result in additional
roles?
9. D escribe the training courses that you have taken. H ow have they helped you? Provide
recom m endations for im proving the courses.
10. H ow does training differ betw een com panies that are considered B E ST Award w in-
ners and those that are not?
11. W hat are the im plications o f generational differences in the w orkforce? W hat strate-
gies should com panies consider from a training and developm ent perspective to cope
w ith generational differences and use them to benefit the com pany?
12. H ow has new technology im proved training and developm ent? W hat are som e o f the
lim itations o f using sm art phones o r notebooks for training?
13. E xplain how training relates to attracting new em ployees, em ployee retention, and
m otivation.
14. W hat is the relationship betw een talent m anagem ent and em ployee engagem ent?
W hat role can training and developm ent practices play in keeping em ployee engage-
m ent high? E xplain.
15. H ow can training, inform al learning, and know ledge m anagem ent benefit from the
use o f social co llaboration tools like Tw itter and Facebook? Identify the social co l-
laboration tool and explain the potential benefits gained by using it.
52 P a rti The Context for Training and Develcjjment

A p p lic a tio n A s s ig n m e n ts
1. Go to the Association for Talent Development (AT D) h o m e p ag e on the World Wide
Web. The address is w w w .ic l.o r g . Review the jo b s found u n d e r F’e a iu ie d Jobs. C house
a job that interests you and explain why. Based on the A I D c o m p e te n c y model pre-
sented in the chapter, discuss the roles, areas o f expertise, a n d c o m p e te n c ie s needed
in this job.
2. Go to w w w . n i s t . g o v / b c i l d r i g e / the website for the N ational In stitute of Standards and
Technology (NIST). NIST oversees the M alcolm B aldrige Q uality Award. Click on
“Learn the Value.” Watch the “Getting Results" video. How do c o m p a n ie s benefit
from winning the Baldrige Quality Reward? W hat value c o u ld a c o m p a n y get from
competing for the award even if they don t w'in it
3. NewBarista has created a barista skills training program . G o to w w w . n c w b o r i s u i . c o m .
Click on “About Us” to learn about New'Barista. Next click on f e a tu r e s , and watch
the video “Online Barista Training.” What technologies d o e s this prog ram use tor
training delivery and instruction? How do they contribute to help in g bat isins learn the
skills needed to make a great cup o f coffee?
4. Conduct a phone or personal interview with a m anag er o r training m anager. Ask this
person to describe the role that training plays in his or her c o m p a n y ; changes, it any.
they have seen in training in the past live years; and how they belies e it w ill change in
the future.
5. In January 2015, Training identified the Top 125 c o m p a n ie s for training. The top 10
ranked companies were;

1. Keller Williams Realty Inc.


2. Jiffy Lube International
3. Capital BlueCross
4. CHG Health Services
5. Blue Cross Blue Shield of Michigan
6. ABF Freight Systems
7. McCarthy Building Companies Inc.
8. Wequassett Resort and Golf Club
9. Capital One
10. Nationwide Mutual Insurance Company

Choose one of these companies to research. Visit the c o m p a n y s w ebsite, use a w eb search
engine, or look for references to the company in publicatio ns such as t r a i n i n g . T + D ,
W o r k f o r c e , or H R M a g a z i n e . Prepare a report (not to ex ceed three p ag e s) based on your
research (a) describing why you believe the com pany w as ra n k e d in the top 10, and (b)
explaining the relationship between training and the c o m p a n y s c o m p e titiv e n e ss, business
goals, and objectives. Your instructor will advise you on w h e th e r the rep o rt should be sub-
mitted electronically or on hard copy. (Hint; Possible reasons a c o m p a n y m ight be ranked
include the amount of money it devotes to training, the level o f e m p lo y e e involvement in
training, and the type of training used.)
C h a p t e r 1 Introduction to Employee Training and Development 53

Case
Zappos: Facing Competitive Challenges
Z appos, based in L as Vegas, is an online retailer. Its 7. B uild a P ositive T eam and F am ily S pirit
initial goal has been to be the best w ebsite fo r buy- 8. D o M ore w ith L ess
ing shoes, offering a w ide variety o f brands, styles, 9. B e P assio n ate and D eterm ined
colors, sizes, and w idths. T he zappos.com brand has
10. B e H um ble
grow n to offer shoes, handbags, eyew ear, w atches,
and accessories for online purchase. Z a p p o s’s vision
is that in the future, online sales w ill acco u n t fo r D eliv er W O W T hrough S ervice m eans that call
30 percent o f all retail sales in the U nited S tates, and c e n te r em ployees need to provide ex cellen t c u s-
Z appos w ill be the com pany w ith the best service to m e r service. C all cen ter em ployees en c o u ra g e
and selection. As a result, Z appos believes that it can callers to o rd er m ore than one size o r c o lo r b e c au se
becom e the online service leader, draw ing cu sto m ers shipping and return shipping are free. T hey are a lso
and expanding into selling other products. Z appos en couraged to use th eir im aginations to m eet c u s -
believes that the speed at w hich a cu sto m er receives to m er needs.
an online purchase plays a critical role in how that Z a p p o s’s em p lo y m en t p rac tic e s h e lp to p e rp e tu -
custom er thinks about shopping online again in the ate its com pany culture. F o r ex am ple, th e H R te a m
future, so it focuses on m aking sure that item s get uses unusual interview qu estio n s, such as “H o w
delivered to custom ers as quickly as possible. w eird are y o u ? ” and “W h a t’s y o u r th em e s o n g ? ”
In 2009, Zappos was acquired by the A m azon.com , to find em ployees w ho are creative and hav e stro n g
Inc. fam ily o f com panies, which share a strong pas- individuality. Z appos p ro v id es free b reak fast, lu n c h
sion for custom er service. In 2010, Zappos had expe- (cold cuts) and snacks, and a fu ll-tim e life c o a c h
rienced trem endous growth, resulting in the need to (em ployees have to sit on a re d v elvet th ro n e to c o m -
restructure the company. Zappos was restructured into plain). M anagers are en co u rag ed to sp en d tim e w ith
ten separate com panies under the Zappos fam ily um - em ployees o utside the office, and any e m p lo y e e c a n
brella, including Zappos.com , Inc. (the m anagem ent rew ard an o th er em ployee a $ 5 0 b o n u s fo r g o o d p e r-
com pany) and com panies devoted to retail, gift cards, form ance. M o st em ployees at Z ap p o s are h o u rly. A ll
m erchandising, and order fulfillm ent. Zappos has new hires c o m p lete fo u r w eeks o f tra in in g , in c lu d -
received m any awards for its w orkplace culture and ing tw o w eeks w orking the phones. N ew re c ru its
practices, including being recognized by Fortune m ag- are offered $2,000 to leave the c o m p a n y d u rin g
azine in 2013 as the #31 Best Com pany to W ork For. training— an unusual practice desig n ed to w e e d o u t
Z appos C E O Tony H eish has shaped the co m - individuals w ho w ill not b e happy w o rk in g a t th e
p a n y ’s culture, brand, and business strategy around com pany.
10 core values: To reinforce the im portance o f the ten c o re v a l-
ues, Z appos perform ance m an ag em en t sy ste m a s k s
1. D eliver W O W T hrough Service m anagers to evaluate how w ell e m p lo y e e b e h a v io r
dem onstrates the core values, such as a c tin g h u m b le
2. E m brace and D rive C hange
or expressing th eir personality. To e v a lu a te ta s k p e r -
3. C reate Fun and a L ittle W eirdness form ance, m anagers are ask ed to p ro v id e e m p lo y e e s
4. B e A dventurous, C reative, and O pen-M inded w ith regular status rep o rts on su ch th in g s a s h o w
5. Pursue G row th and L earning m uch tim e they spend on the tele p h o n e w ith c u s to m -
6. Build Open and H onest Relationships with ers. T he status reports and ev a lu a tio n s o f th e c o r e
Com m unication values are in form ational o r u sed to id e n tify tr a in in g
54 P a rt i The Context for Training and Development

needs. Zappos believes in helping others understand vibrant, CEO Tons Hsieh is spending $350 million
w hat inspired the company culture. The company to des'elop a neighborhood in d ow ntow n Las Vegas,
created the Zappos.com library, which provides which will be the hom e o f Z ap p o s.C o m new head-
a collection o f books about creating a passion for quarters. Hseih wants to provide em plo yees with a
custom er service, products, and local comm uni- great place to work as well as to live and socialize.
ties. These books can be found in the front lobby of Visit the Zappos website at u u w . z t t p p o s . c o m . Go
Zappos offices and are widely read and discussed by to the bottom o f the page under 'A bout" and click on
com pany employees. “about.” Review the videos, the m edia kit. and the
Zappos also believes that its culture is enhanced information provided about c u sto m e r service, the
through use of social media, including blogs and family story, the culture, and the sallies. Review
Twitter, that links employees with one another and the Tweets especially those toeusing on training,
with the com pany ’s customers. Also, Zappos takes learning, and development.
the pulse o f the organization monthly, measuring W h a t c h a l l e n g e s is Z a p p o s f a c i n g t h a t m u x d e r a il
the health o f the culture with a happiness survey. its a t t e m p t t o h e th e h a s t o n l i n e reta iler'.' H o w can
E m ployees respond to such unlikely questions as tr a in in g a n d d e v e l o p m e n t h e l p Z a p p o s m e e t these
w hether they believe that the company has a higher c h a l l e n g e s / D o y o n th in k t h a t e m p l o y e e s itt Z a p p o s
purpose than profits, whether their own role has h a v e h ig h l e v e l s o f e n g a g e m e n t ? W h y ? W hich oj
m eaning, whether they feel in control of their career Z a p p o s ' '.s ten c o r e v a l u e s d o v o n b e l i e v e tr a in in g a n d
path, w hether they consider their co-workers to be d e v e l o p m e n t c a n i n f l u e n c e th e m o s t :' 7 h e l e a s t . ’ W h y ?
like family and friends, and whether they are happy in
their jobs. Results from the survey are broken down Sources: Based on the Zappos website, wwiv.z a p p o s.c o m ,
by department, and opportunities for development O'Brien, "Zappos Knows How to Kick It," F o r t u n e (February 2,
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are identified and acted upon. For example, when it 2009): 55-66; M. Moskowitz and R. Levering, "The 100 Best
w as clear from the survey that one department had Companies to Work For," F o r t u n e (February 4, 2013): 85-96;
D. Richard, "At Zappos, Culture Pays," str a t e g y + b u sin e ss
veered off course and felt isolated from the rest of
(August 2010): 60, accessed from w w w . stra t e gy-busin ess,
the organization, a program was instituted that en- com , March 15, 2013; K. Gurchiek, "Delivering HR at Zappos,"
abled individuals in the group to learn more about HR M a g a zin e (June 2011): 44; R. Pynllis, "The reviews are in,"
how integral their work was. To keep the company W ork forc e M a n a g e m e n t (May 201 1): 20-25.

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