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Executive Summary: Training and Development
Date: April 22 2007
U.S. employees are receiving more annual hours of training, according to the American Society for Training and Development's (ASTD) 2005 State of the Industry report, which found an increase in average hours of formal learning per employee from 2004 to 2005. Training and development professionals have also been gaining ground in achieving recognition of the impact of their work. Data from an Accenture survey of 285 executives shows that 20% of CEOs and COOs rate training and development as one of their organization's top three most important functions. Enthusiasm among employees is even higher: The American Management Association's 2005 Survey of Life-Style Trade-offs and Careers (with responses from AMA members and customers at 248 companies) found that most (66%) U.S. workers would prefer a job that requires continuous training.
Recognition of the importance of training and development is reflected in increased pay for trainers, though not in markedly higher training budgets. Pay for training professionals increased by an average of 9%, much above the average percentage salary increase for HR professionals in general, according to the 2004 Mercer Benchmark Database Human Resource Management Survey. However, training budgets overall remained relatively flat. Fifty-six percent of 1,223 respondents to Training magazine's 2005 Industry Report said their training budgets in 2005 would remain unchanged from 2004. The ASTD's report found that the average annual training expenditure per U.S. employee increased in 2004, although training expenditures as a percentage of payroll remained constant. Similarly, most respondents to IOMA's Training Managing and Cost Control survey reported only small budget increases: 0-2% for 45.7% of respondents, 2-5% for 28.3%, and over 5% for only 26.1%.
Some experts believe that companies aren't investing enough in training. They argue that training professionals must learn to describe the benefits of their programs in language that will resonate with executives and board members. "Terminology is absolutely critical - learning professionals must focus on business results and talk about sales, profits, and competitive advantage," says Thompson NETg's Joe Dougherty. This advice is reinforced by an Accenture survey, which concluded that "demonstrating the effectiveness of learning in business terms is the No. 1 challenge for learning executives." Similarly, IOMA's Managing Training and Development study recommends that training managers focus on communicating business value; being able to make a business case for training's worth can translate into obtaining management support in the form of a larger budget.
How are training professionals focusing their energy? According to the ASTD report, industry- or profession-specific content are the top areas taught, while managerial and supervisory skills, information technology, business processes, and compliance-related training are also high priorities. Meanwhile, Training magazine's report found that computer and technical skills, management skills and development, supervisory skills, personal growth, executive development, customer service, communication skills, and sales were the most common categories in which training was provided by its respondents. On the administrative front of training, IOMA's Training Management and Cost Control survey found that expanding training efforts is a top priority, as is getting more out of existing technology and purchasing new technologies.
Traditional training methods are still the most widely used, although there is interest in new delivery methods. The ASTD found that instructor-led classroom delivery is still the most common method of training (68.1% of delivery), although the use of technology-based delivery methods is projected to continue to rise, reaching an average of 32.5% of training in 2005. Training magazine's report came to a similar conclusion, finding that 70% of training overall is delivered by a live instructor in a classroom setting.
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The Institute for Corporate Productivity (i4cp, inc.) improves corporate productivity through a combination of research, community, tools and technology focused on the management of human capital. With more than 100 leading organizations as members, including many of the best-known companies in the world, i4cp draws upon one of the industry’s largest and most-experienced research teams and Executives-in-Residence to produce more than 10,000 pages annually of rapid, reliable and respected research and analysis surrounding all facets of the management of people in organizations. Additionally, i4cp identifies and analyzes the upcoming major issues and future trends that are expected to influence workforce productivity and provides member clients with tools and technology to execute leading-edge strategies and "next" practices on these issues and trends. i4cp is a for-profit company with offices in St. Petersburg, Florida.