Training important during recession

Custom, in-house programs can deliver ‘bang for your buck’
By Shannon Klie
|Canadian HR Reporter|Last Updated: 06/02/2009

As part of its leadership development process, Enbridge used to send a few executives each year to take part in a three-week, residential, executive development program at the Queen’s University School of Business in Kingston, Ont.

In 2007, the Calgary-based oil and gas company began to clamp down on expenditures and Brian Rabinowitz, manager of learning and leadership with Enbridge, began looking for ways to maximize his training budget.

The training program at Queen’s University had three components — leadership, operations and marketing. In talking with executives who had participated in the program, Rabinowitz found they got the most value out of the leadership component.

“We decided we would get more value for the dollar if we took that money and did leadership education on a much broader scale,” he said.

The company partnered with the school to develop a custom leadership program that could be delivered in-house, which saved on the residential costs. Instead of five senior executives taking part in the program every year, the new program allowed Enbridge to offer leadership training to about 130 senior leaders just below the executive ranks.

The goal was to offer the two-phase program to four groups of employees over four years. The first two groups completed the first phase in 2007, which was repeated for groups three and four in 2008. The second phase of the training was to be delivered to the four groups in 2009 and 2010.

The first phase, offered over three days, focused on general leadership skills, developing the individual as a leader and how to build and lead teams.

The second phase, also three days, focused on strategy execution, decision-making skills, negotiating skills and building and maintaining collaborative relationships.

With the economic downturn and the first group set to take the second phase of the training this month, Rabinowitz fully expected the company to cut the program.

“My training budget has not been cut by a dollar,” he said. “It’s a high priority. It’s a pretty deeply held value because we have a strong emphasis on leadership succession and development.”

In addition to being able to provide training to more senior leaders, Enbridge’s custom leadership program is improving employees’ engagement and their perception of leadership, said Rabinowitz.

However, one-fifth (21 per cent) of 138 companies surveyed by Watson Wyatt in November 2008 planned to reduce or eliminate training programs in the coming year because of the recession.

It can be tempting for organizations to cut training budgets during tough economic times but that will only hurt an organization in the long run, said Barbara Dickson, director of custom programs at the executive development centre at Queen’s University’s School of Business.

“You’ve got to make sure that you’ve got people who are trained and ready to respond to the challenges ahead of them. You can’t just shut down the doors because the economy is bad. When it does turn around, you’ve got to be positioned to respond and you’ve got to be able to be fairly nimble in your response and geared up and ready to go,” she said.

“Now is a terrific time for people to actually take stock of what they’ve got in their organization and develop skill sets for tomorrow.”

And with layoffs a part of the new economic reality, those employees left behind will need extra training to ensure the organization can meet its business goals, said Lynn Johnston, president of the Canadian Society of Training and Development.

“We all know that we’ll need flexibility and innovative thinking in those employees who will remain in the workplace,” she said.

While some organizations have taken a wait-and-see attitude when it comes to training budgets and the recession, more and more are starting to deal with the new reality and trying to figure out how to deliver “big bang for your buck” training, said Johnston.

To ensure training still takes priority in organizations, training professionals need to demonstrate the return on investment, do a solid needs analysis so they’re only doing training that will really make a difference to the business and align training with organizational goals, she said.

“Everybody is looking to be creative and meet the needs of the organization,” said Johnston.

None of Dickson’s clients have cancelled training in light of the recession but some, including Shoppers Drug Mart, have taken the same route as Enbridge and brought programs in-house to save on the residential costs. Others, such as law firm Miller Thomson and engineering firm Jacques Whitford, have begun delivering training through video conferencing, said Dickson.

“We’re starting to see a bit of a setback for fall registrations (in open enrolment) but, all in all, that’s more than taken care of by an increase in our custom programming side. It seems that customers are still very interested in tailoring solutions for their needs,” she said. “The news is so gloomy we’ve been sitting, waiting for the other shoe to drop.”

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