Invest in Training – it’s not an expense
Executive Summary: Your vision to invest in training is one way to optimize your investment in human capital and improve your bottom line.
Many business owners refuse to invest in training. They don’t see the real return on investment that it can bring and how it can reduce turnover, reduce payroll costs, reduce the number of employee performance issues, reduce stress, reduce the amount of time spent managing employee activities.
ROI BIZBUZBLOG ‘s recent White Papers by Jon Denney, PEOPLE PROBLEMS and PUTTING YOUR PAYROLL ON A DIET, took a look at some tough “people” issues and their impact your bottom-line. Taking Jon’s suggestions one step further, if you seriously invest in training and you’ll drive dollars directly to your bottom line, improving the book value of your business en route. When you decide to sell your business, would you proudly announce to the prospective buyer that you haven’t spent a nickle on training any of your staff or would you boast that every employee is fully trained to do their job whether you are there or not? Where would you put your money?
Verne Harnish, author of Mastering the Rockefeller Habits, states that every business owner must make 3 basis decisions:
1. Do we have the Right People?
2. Are we doing the Right Things?
3. Are we doing Things Right?
Using these questions as a guideline, you can begin to develop a human capital strategy of leading people and managing activities. As business owners, we have two simple options when it comes to leading people – 1. Set ourselves up for success, 2. Set ourselves up for failure. The former takes vision, fore-thought and planning and excellence in human capital strategy execution. The later happens by default.
Recently, I spoke to a group of business owners about their business visions. [Please note that I am purposely not including the word “statement” in the last sentence because I want them to verbalize it, own it, be passionate about it, not hand me something they peeled off of the lobby wall.] I took a poll of the participants to see how many have developed their vision. Only 15% of the group had a vision and half of them couldn’t recite it. So my fierce question followed: How do you know where you are going if you can’t envision your ultimate goal, or have a plan to get there? QUICKLY imagine yourself driving down a busy expressway at 100 Km (60 MPH) with your eyes closed. I’ll bet your stomach flinched just thinking about it. Why would you consider doing something like that with your biggest single lifetime investment: your business? Verne Harnish hit the nail on the head when he stated: “A vision is a dream with a plan.”
So, why should you invest in training?
A CFO asks the CEO: “What happens if we invest in developing our people and they leave us?”
The CEO answers” “What happens if we don’t, ………and they stay?”
Training is an investment in yourself, your clients and your employees. It starts with training to hire effectively, to manage and measure activities, to set accountabilities, to develop proper On-boarding methods and systems, Performance Management, Team Building, Leadership Development and Effective Communications. Training in the form of required Continuing Education also adds value to your existing investment. It boosts employee capacities and abilities resulting in vastly improved employee morale. It improves customer service because employees know more and have the client’s best interest at heart. It improves productivity because employees work better as a team with all the tools and resources they need to succeed. All of these inevitably drive a better bottom line.
Be open and vulnerable
Training yourself to seek open, honest feed back and be open to suggestion and input from your team at every level will ensure that you get the bad news first and have an opportunity to fix it before it becomes a train wreck. You want to find the gaps in your processes and systems which ultimately affect the achievement of your vision.
You need to spend 1% of your time developing your vision and 99% of your time relentlessly driving it to completion.
Throughout your training strategy development, your company’s vision should be on every employee’s mind at all times. It needs to be posted at every desk and work station. You need to have every brain in the game. Employees see many things that you don’t. Your full team needs to continually be focused on your vision by achieving the short-ranged goals on a daily, weekly and monthly basis. As most of us don’t like to think more than 90 days out, a quarterly plan that supports the vision keeps your business moving forward.
Part of my role while working for a major non-profit performing arts related charity in Toronto included overseeing the human resources management of several departments with several hundred employees. When I started, I discovered that no one who reported to me knew the company vision or mission. No one was using them to guide their hiring decisions. The results: poor hires, high turnover, excessive training costs, staff unrest, poor customer service, lack of loyalty and a great sense of entitlement (read: employee theft and abuse of privileges). Taking the tack that happy, well-treated and respected employees resulted in happy, well-treated and respected clients, the implementation of sound training strategies helped to turn the ship around. While a few went overboard (a.k.a. being freed up to industry) in the process , those who led their teams by defining and managing their activities achieved tremendous success. The huge drop in the number of complaints proved that training was a wise investment for the company.
The ROI Extended DISC Behavourial Assessment is a tool that will enable you to fully optimize your investment in training. Get the RIGHT people in the RIGHT seat, doing the RIGHT thing at the RIGHT time today.
All the best