Whatever the claims made by politicians of a ‘recovery’, we remain mired in the most serious financial crisis for a hundred years. My experiences of living through several recessions have convinced me that three characteristics typify survivors. First, a high-trust culture that inspires engagement and resilience. Second, remaining true to the organisation’s core values. Third, a passion for learning, innovation and change. In short, employers that sustain high engagement and a learning culture despite having to make difficult decisions are more likely to survive and, indeed, emerge stronger than before.
The problem is that, as someone once said, the only thing we learn from history is that people don’t learn from history. For example, with reference to learning, in the first year of this recession, according to the Chartered Institute for Personnel and Development, no less than 67% of employers cut their training and development budget. Clearly, many CEOs and HRDs have not learned from history. What’s wrong here?
Having been involved in the learning sector for many years I believe the key issue is that developing people is generally perceived in UK Boardrooms as an ‘overhead’ and not a ‘wealth creator’, as ‘nice to do’, not ‘need to do’. This attitude means that, when things are going well it’s an expense line that can be tolerated, but when things start going not so well, it can be cut with supposed impunity.
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How do we fix this absurd delusion? First, we need a stronger lead from the. The CIPD, following the takeover of the Institute of Training & Development by the Institute of Personnel Management in 1993, has portrayed learning and development as an adjunct of HR and an L&D career as somehow second-class. Even today, one cannot become a full member of the Institute without taking generalist HR modules – to a dedicated L&D professional that is not only a waste of their time and resources, it is an insult to their chosen profession. As a result of this short-sightedness, the number of L&D folk in the CIPD’s membership has dramatically fallen since 1993. Where there is no vision the people perish.
Next, we need heads of organisational L&D functions to professionalise their approach. Raising service quality and ensuring business alignment provably delivers positive ROI to senior management. That’s the only way to change negative perceptions – and you don’t ‘cut’ what you perceive adds value in a time of recession, you invest more.
Third, as a society we must address the short-termism that is so endemic in the UK. Uniquely in the Western world, the majority of UK businesses are financed by bank overdraft, technically repayable ‘on demand’. This short-term mentality does not encourage investment in the skills development needs of tomorrow, the attitude being “just train people to do what we need today”. For publicly quoted companies, often primarily driven by today’s share price, this short-termism can be even more pronounced. It is a potent inhibitor of investment in developing people.
Admittedly these are ambitious changes, but nothing is as certain as change!
Nick Mitchell is Chief Executive of The Training Foundation, an organisation focused on workforce training and development. He has established himself as a thought leader in HR strategy and employee engagement, authoring white papers on workforce engagement and its competitive advantages. Mitchell has contributed analysis and opinion pieces to HRreview on topics including training budget management during economic downturns and employee engagement strategies. His work emphasises the importance of engaged workforces as a competitive advantage for organisations and addresses practical HR challenges faced by employers during periods of economic uncertainty.
