Companies must adapt or change their business strategies to take into account the new realities of intense global and domestic competition

Globalisation, drive for quality, cost containment, market volatility, workforce diversity, the importance of knowledge capital, and the speed of change resulted in a closer scrutiny of training and development expenditures, with the advent of new technology. Despite its relevance, it raised a number of questions about the return on the training and development investments. There was a decreasing willingness to spend money on faith and an increasing pressure to justify training and development costs. In this context, it became imperative for those in the field to focus on evaluation of training and development and to communicate to the management that training efforts are making worthwhile contributions.

In this economic crisis, corporate training budgets are being tightened. A research by Josh Bersin, CEO and president of Bersin & Associates, shows that in the second half of 2008, corporate training departments had cut their spending on L&D by 12 to 18 per cent. The number will certainly grow as the crisis continues. There is a need for performance-driven and talent-driven learning so that the senior management could be educated about the short- and long-term impacts.

The L&D budget typically represents a small fraction of a company’s total revenue. Indiscriminate budget cuts can have a major impact on development plans and programmes, and yet it barely makes a dent in the company’s bottom line. For example, if an organisation eliminates or dramatically reduces leadership development training, it will see a reduction in productivity and effectiveness of its leaders.

The signs of outstanding leadership appear primarily among the followers. Are the followers reaching their potential? Are they learning? Serving? Do they achieve the required results? Do they change with grace? Manage conflict? asks Max De Pree. Click here to read more..

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