I have just finished another trip to India and I return rather reassured that the training business is on an upswing. The great freeze that affected us - training providers - last October, seems to be lifting and the companies are looking to return to business-as-usual. Of course, my conversations revealed that it won't actually be business-as-usual, and the unfreezing will take longer than immediate term. My feeling is that this market will start to return to pre-recession levels in around April 2010, but with a number of important changes which may alter the industry landscape.
I have obviously met a number of industry veterans, who kept a brave face but betrayed a level of uncertainty. The balance is obviously shifting in the market, the cost cuts are still fairly severe and training managers in most corporations are still firmly on the firing line. The cosy relationships that sustained corporate training is under scanner, and increasingly, efficiency enhancing ideas, On-demand Learning, Measurement of Training Efficacy and Coaching, are on the agenda. This has caught some of the big players at a slight disadvantage: It is always more difficult for them to change course and try a new thing compared to the smaller, nimble rivals. On the other end of the scale, however, there is a trend of corporatization of the one-person trainer network, and a demand for standardized, value-additive training is rising. Besides, many companies are asking training companies to play a role that they are not used to assume.
That of a Training Business Partner, of some sort. The demand landscape is confusing at this time while the companies grapple with the idea what they want to do. However, I can possibly summarize the three common demand trends that I noticed clearly: (1) The companies with big trainer pools want to 'variablize' the costs, by moving the trainers on contractor payrolls and paying the contractors only on the basis of services provided; (2) The companies want contractors to assume greater responsibility of training outcome, and wants to do so by linking and measuring training outcomes in terms of hard evidence and data, if possible; (3) The retention seems to be a problem even in the middle of a recession, and companies are suddenly taking an opposite view of training in the context of retention: From being viewed as a waste of money on those who will invariably leave, training is viewed critically essential to create a compact yet efficient workforce.
Which should actually be a good news for the beleaguered training managers. The more work gets passed on to contractors, the companies will need more supervision and audit capabilities, and stronger management of training. The measurement fashion will also project these individuals, who were earlier seen as a drag on company resources, in a new light. And, as the companies have cut to the bones, they will suddenly discover a new love for training.
I must admit that this is still not enough to lift the spirits of the training managers I ended up speaking with. They continue to live in the fear of their old jobs disappearing. Considering that many of these training managers owe their jobs to internal change management initiatives of the companies in the first place, this is indeed a bit ironic. I only saw the market shifting to a new level of maturity, endowing the training professionals a more strategic responsibility. Indeed, the new level of responsibility comes with an enhanced accountability, and this is something the training professionals seem incapable of handling.
I must also say the same thing about training companies, particularly those involved in management training. Caught between the budgetary squeeze and the new level of accountability, they seemed a bit clueless, almost nostalgic about good old days and firmly entrenched in bad habits of yesteryear. The investor scepticism, to which I am no stranger, continue to be the spoiler if any party was beginning to start at the back of recovery and I think training companies need to do a much better job in assuming, and explaining, their new, enhanced roles.
I see this market evolving fast, but reaching a new level of maturity quite fast. I came across a lot of talk about pre-hire assessment and training, the theories of which pointed to waiving of the company induction process in favour of a candidate-sponsored, public one. I am still not buying into this, as I am unsure about two fundamental premises such talk stand upon. One, the assumption that the candidates would love to pay to become employable had its day, and despite recession, we are in a talent shortage space and the balances are still firmly poised in the candidates favour, only if s/he possesses even rudimentary skills needed in the workplace. Two, it is unlikely that the candidates would want to invest significant time in the pre-hire process and fund this through their own resources, when the economy is still growing and companies have started hiring. Campus recruitment may have vanished last year, but going by the trends, they are going to make a comeback this summer. In my mind, the pre-hire training theorists miss the important psychological dynamic of the recruitment process - candidates expect their academic institutions to do exactly that and would loath to pay a private operator an inefficiency tax. Besides, last time I was told about this 'big' opportunity was in 2004; suddenly, this is making a guest appearance at the back of the recession.
I actually think that the post-hire training will pick up now, and companies will up their spend on training - from the typical 2.5% of turnover to 5% to 6% of turnover in the period following post-recession. This will come bundled with a strategic shift in the role of training, and will mean less of catering and venue hire expenses and more of new content development and investment in measurement systems. This will come hand in hand with the introduction of training business partners, training providers which work with companies as strategic partners and assume greater responsibility towards the outcome of training, thus seeking and implementing efficient solutions themselves.
So, in short, I see more activity, not less. I see greater opportunity, but coupled with the need for new innovation. I see an enhancement of status of the training managers, who can make the transition from being mere trainers or training administrators to the strategic planning roles. I see many training companies faltering and trying to peddle old formulas in new garb, but few emerging with new products and ideas to create cool solutions. One thing for sure: It will be a whole new world for corporate training, post recession.
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