Importance of employee training and development on organizational profits
Discuss about the Management Training Program To Improve Communication.
Training and development sessions provided by management of the organization to new candidates as well as to existing candidates plays vital role in terms of accomplishment of goals and objectives. Training and development sessions incorporate interest of organization and workforce. It is the most effective tool which helps the organization to enhance its employees’ efficiency and effectiveness which ultimately results in enhancing organizational performance. Performance of an employee is dependent over various factors and training is one of those factors which carry huge weightage in terms of enhancing performance. [1]Training and development is essential for both experienced as well as for new candidates because until and unless candidates will not have appropriate knowledge about the job roles and responsibilities which they need to perform at workplace, organization would not be able to perform in an effective manner. Thus, it increases both skills and competencies amongst the employees and there is a direct relationship between organizational performance and employee’s performance. Training is the only measure through which an employee’s skills, capabilities, knowledge, talent, and all other attributes could be moulded as per the organizational requirements. This helps the organization to uplift its performance along with the attainment of desired goals and objectives. According to research conducted by various business experts, it has been found that training and development sessions plays vital role in enhancing employees’ performance which ultimately affects organizational performance irrespective of the type of organization in positive manner.
Human resources are the essential asset for an organization because they are people who convert plans made by top level management into reality. In relation with this, it is crucial for the organization to design its training structure in an effective manner so that the new hired candidates as well as existing employees of the organization could be groomed as per organizational policies, standards as well as requirement basis. An employee cannot perform well at workplace without appropriate training and it is proven that trained employees act as an asset for the organization, thus, organization is required to provide appropriate training measures to its employees so that the overall organizational goals and objectives could be attained. Training and development process is a costly process and it increases overall cost of the organization but in the long run, training measures provides valuable benefits to the organization which acts as an advantage through which overall goals and objectives could be attained along with attaining effective position in the competitive business environment.
Human resources as an essential asset for the organization
Impact of training and development measures on organization is of both positive as well as negative form. Positive impact of training and development for employees is that it helps in increasing performance; it grooms employees and makes as per requirement of organization. Apart from this, training and development also provides sufficient information to the employees regarding organizational working structure, policies and standards which plays effective role in enhancing an employee’s performance. Ultimately, increased employees’ performance leads to uplift organizational performance through which organization could be able to make its effective position in the competitive business environment.
Above figure shows the impact of training and development on organizational performance which shows that organizational performance is a dependent variable and training and development is independent variable. This is proven that training and development has positive impact on organizational performance and it leads to generate several benefits for the organization. Training could be provided to the employees through two methods i.e. on the job training method and off the job training method. [3] Amongst these two methods, on the job training method is more significant as it helps the employees to gain adequate knowledge about the job in a better way. This is because various business experts says that practical experience is much effective and efficient technique to train employees as compared to the off the job training method where an employee is given bookish knowledge. Apart from this, there are several other benefits linked with the one the job training method as it is cost effective and also saves time. This shows that on the job training method creates positive effect on organizational performance which leads to enhance organizational performance.
Workplace environment is changing rapidly and though measures of training and development are also changing. Organizations are required to consider cost of training and development in order to manage all the functions in an appropriate manner so that the profit margins of the organization could not get affected. With the growing business environment, workplace learning measures are also increasing. There are lot of innovative and informal approaches in relation to the workplace learning which could directly impact on the budget of the organization.
Every organization creates a budget in relevance with meeting up with all expected and unexpected expenses so that appropriate funds could be raised along with segregating a decent profit margin. With regards to this, organization is require to determine hiring cost and hiring cost involve taking into considerations the investment done towards training and development program to enhance employees’ learning and to ensure they move towards the part of enhanced productivity.[4] In order to take care of budgetary consideration, the following cost kept to be analysed:
- of hours required for training: training hours provided to the new and existing employees in relevance with improving their performance is a cost in short term and profit in long term for organization. Trained employees will be able to generate positive outcomes to the organization after completing the training period. [5]
- of manpower required for training: Trainers’ salary is also a cost for an organization as it is not affecting organizational performance.
- Opportunity cost of the loss time: Training is provided to the employees for a certain period of time in a day but trainer is paid for the whole month which becomes an unnecessary cost for the organization.
- Cost of material, publications etc.: All those things which are required to train new hired candidates are also a cost for the organization.
- Cost of external or internal trainer: Appointment of internal trainer will lead to generate positive results but it will affect organizational efficiency whereas appointment of external trainer could be cost effective and it could also affect organizational productivity.
- Cost of visual inventory such as projector, screen, LCD and so on: These are required for providing training to the employees which leads to increase cost of training.
Impact of on-the-job training method on organizational performance
Above mentioned costs should be considered while hiring an employees and in relation with providing training to them, trainer cost should also be considered. For instance, an existing experience employee with high productivity is moved to the training and development department to give training to new hired candidates. This will reduce organizational productivity because he was a high productive in operations and on the other hand, it is also affecting organizational performance. Whereas, organization could have hired an experienced trainer in the same field rather going for the option of internal trainer in order to provide appropriate training to the new hired candidates along with maintaining the productivity of the organization.
In the initial days of a new hired candidate, organization invests a certain amount to make the employee as an asset for the organization in the long run. If an organization will not invest in the newly appointed candidates, performance and efficiency of organization as well as of employees cannot be enhanced. Apart from this, organization will not be able to accomplish its desired goals and objectives through which organization would not be able to gain competitive advantage in the workplace. With regards to this, organization requires to invest in the training and development programs so that the in the long run, organization could be able to enhance its performance. In this manner, it is required to maintain budgetary consideration in human resources so that the cost of training could be worthwhile for the organization.
As per my opinion, training and development is an essential requirement for the organization as it helps in improving organizational performance along with generating positive outcomes for the organization. I’m working in Apple Inc. as training supervisor and there I have realised that even trainers require training to get updated regarding innovations and advanced measures adopted by the organization for the motive of uplifting organizational performance. Apple Inc. is a multinational corporation engaged in producing high-tech mobile, laptop and computer devices. To make their devices efficient and effective, organization has invested a huge amount in research and development team with regards to enhancing organizational performance.
I have realised that training and development has majorly positive impacts on organizational. There is small negative impact which increase is in cost for organization in short term but if this cost is treated as an investment, organization would be able to uplift its performance in the long run. Requirement for employee training in Apple Inc. is quite high because it is a technology based corporation and technological requirements are increasing rapidly.
Budgetary considerations in human resources
Requirement for training and development programs are huge for every organization in relation with uplifting organizational performance as well as for the purpose of gaining an effective place in the competitive business environment. [8] With the use of trending training measures, organizations are being able to enhance their employees’ performance as per organizational requirements. It has been recommended to the organizations to improve their existing training and development programs in order to match up with the dynamic business environment. Certain crucial measures which could be adopted to improve training and development programs are:
- Setting up benchmarks against competition
- Survey program and feedbacks from employees
- Training alignment as per organizational objectives and goals
- Create training programs as per organizational culture
- Inventing new ideas and measures to improve employees’ performance
- Comparing the outcomes with the previous outcomes. [9]
With the help of above mentioned techniques, organization would be able to enhance the impact of training and development programs. This would ultimately affect organizational performance in positive manner along with gaining positive outcomes.[10] Training is the only measure through which an employee’s skills, capabilities, knowledge, talent, and all other attributes could be moulded as per the organizational requirements. This helps the organization to uplift its performance along with the attainment of desired goals and objectives.
Bulut C, and Culha O, ‘The Effects of Organizational Training On Organizational Commitment’ (2010) 14(4) International Journal of Training and Development
Butali P, and Njoroge D, ‘Training And Development And Organizational Performance: The Moderating Effect Of Organizational Commitment’ [2017] International Journal of Scientific Research and Management
Karim, MR, Huda KZ, and Khan RS, ‘Significance Of Training And Post Training Evaluation For Employee Effectiveness: An Empirical Study On Sainsbury’S Supermarket Ltd, UK’ (2012) 7(18) International Journal of Business and Management
Karlan, D and Valdivia M, ‘Teaching Entrepreneurship: Impact Of Business Training On Microfinance Clients And Institutions’ (2011) 93(2) Review of Economics and Statistics
Paul, T, ‘Organizational Training Modalities: Investigating The Impact Of Learner Preference On Performance’ (2016) 6(3) International Journal of Learning and Development
Rehman, A, ‘Role Of Training And Development In An Organization’ [2014] SSRN Electronic Journal
Rigby, CS and Ryan RM, ‘Self-Determination Theory In Human Resource Development: New Directions And Practical Considerations’ (2018) 20(2) Advances in Developing Human Resources
Sachdeva, S and Singh AK, ‘Interpersonal Behaviour – Significance And Training And Development Programme Assessment’ (2017) 8(2) Training & Development Journal
Tahir, N et al, ‘The Impact Of Training And Development On Employees Performance And Productivity A Case Study Of United Bank Limited Peshawar City, KPK, Pakistan’ (2014) 4(4) International Journal of Academic Research in Business and Social Sciences
Tschannen, D, ‘Development Of A Virtual Crew Resource Management Training Program To Improve Communication’ (2017) 48(11) The Journal of Continuing Education in Nursing
[1] Dean Karlan and Martin Valdivia, ‘Teaching Entrepreneurship: Impact Of Business Training On Microfinance Clients And Institutions’ (2011) 93(2) Review of Economics and Statistics.
[2] Scott Rigby and Richard M. Ryan, ‘Self-Determination Theory In Human Resource Development: New Directions And Practical Considerations’ (2018) 20(2) Advances in Developing Human Resources.
[3] Neelam Tahir et al, ‘The Impact Of Training And Development On Employees Performance And Productivity A Case Study Of United Bank Limited Peshawar City, KPK, Pakistan’ (2014) 4(4) International Journal of Academic Research in Business and Social Sciences.
[4] Abdul Rehman, ‘Role Of Training And Development In An Organization’ [2014] SSRN Electronic Journal.
[5] Peter Butali and David Njoroge, ‘Training And Development And Organizational Performance: The Moderating Effect Of Organizational Commitment’ [2017] International Journal of Scientific Research and Management.
[6] Tyechia Veronica Paul, ‘Organizational Training Modalities: Investigating The Impact Of Learner Preference On Performance’ (2016) 6(3) International Journal of Learning and Development.
[7] Cagri Bulut and Osman Culha, ‘The Effects Of Organizational Training On Organizational Commitment’ (2010) 14(4) International Journal of Training and Development.
[8] Mohammed Rejaul Karim, Kazi Nazmul Huda and Rehnuma Sultana Khan, ‘Significance Of Training And Post Training Evaluation For Employee Effectiveness: An Empirical Study On Sainsbury’S Supermarket Ltd, UK’ (2012) 7(18) International Journal of Business and Management.
[9] Dana Tschannen, ‘Development Of A Virtual Crew Resource Management Training Program To Improve Communication’ (2017) 48(11) The Journal of Continuing Education in Nursing.
[10] Shefali Sachdeva and Ajay Kumar Singh, ‘Interpersonal Behaviour – Significance And Training And Development Programme Assessment’ (2017) 8(2) Training & Development Journal.
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