By John J. Toman, June 2009
One of the many challenges businesses face in an economic downturn is how to stay innovative and relevant without breaking budgets and over-extending already-stretched staff. Historically, corporate training budgets and staff are substantially reduced in tough economic times so there is a strong possibility that 2010 will see additional cuts or, at best, flat budgets. Evidence of this trend has already surfaced. In fact, Enterprise Learning, Recruiting and Talent Management 2009, a Bersin Associates research report issued in December 2008, identifies cutting cost as the number one training issue for 2009. Corporate training budgets, which decreased by eleven percent in 2008, are expected to decrease an additional seventeen percent in 2009.
Don’t Ignore Training in Tough Times
During the last several years, high-impact organizations have increasingly aligned training with corporate strategy. Tight budgets are not a reason to reverse, but rather to accelerate this trend. Organizations that align their workforce with shifting objectives bent toward innovation and education during a downturn gain a competitive advantage that multiplies in the inevitable recovery. Progressive organizations do not 
eliminate leadership development, but instead strategically select staff candidates for strategically oriented training programs.
The current recession has temporarily stabilized the pool of qualified midlevel executives. Talented people who may seek other opportunities in better times are reluctant to move and 401(k) losses and diminishing asset values have caused many Baby Boomers to put off retirement. The result is that the very serious recruiting and retention problems experienced in recent years have been temporarily relieved, but hopefully not forgotten.
When the economy recovers, talent management and succession planning problems will return, and Baby Boomers who reluctantly postponed retirement will hasten to move to the beach or golf course. This scenario will cause a knowledge and talent drain that could be disastrous, just when organizations are trying to rebuild revenue and market share. Generations X and Y will be tapped to fill the talent gap. Will they be ready? Younger workers have different career aspirations and expectations of their employers from those of the Boomer generation. Their learning preferences differ as well, not only from Boomers, but from each other. To lead effectively they will need job-related competencies and leadership skills supportive of the organization’s strategy and culture.
However, according to Bersin’s report, seventy percent of the organizations surveyed believe they are behind in meeting the learning needs of younger workers.
The current economic crisis presents an opportunity to build bench strength by setting talent development objectives and strategically positioning training to meet those objectives. How do you accomplish this in a time of diminishing budget dollars and staff? The first step is for learning executives to take the initiative and work with human resources and business owners to structure a training program designed to achieve maximum business impact. This involves selecting courses that teach core competencies and leadership skills while eliminating the nice-to-have courses that take up valuable budget resources. Adopting an invitation-only capability development model, based on specific organizational needs, rather than a university model (i.e., one where leadership training is open to all), is key.
What is the most effective method to teach your future leaders? With four generations and their very different learning styles in the workforce at the same time, offering a variety of delivery methods is essential. A blend of instructor-led, electronic and web 2.0 training, supported by coaching and mentoring is necessary to accommodate all four generations.
Strategically Employ a Combination of Training Methods
• Coaching and mentoring by competent staff executives have been proven to be very effective, with staff time being the only expense incurred. This can be minimized by pairing future and experienced leaders on projects. Increasing coaching and mentoring programs will pay dividends in effective succession planning.
• E-learning and podcasts provide on demand access and are relatively inexpensive, but effective in certain learning situations. Webcasts, when the facilities are available, are also effective.
• Conferences and seminars provide time-tested training opportunities. They provide access to current information, innovative thought and recognized and engaging experts. The possibilities for networking at these events are an added bonus. The key in this climate of tight travel budgets is to select events that are directly related to job performance and presented by reputable and quality organizations.
• Given a sufficient audience to be cost-effective, bringing training in-house accommodates reduced travel budgets. Some questions to consider:
o Are experts available on staff?
o Are talented and experienced presenters?
o Do they have time to research and develop the material?
Outsourcing can be an effective way to accomplish in-house training. While putting the whole session in the hands of a qualified developer/instructor is the most efficient approach, some organizations are concerned with cost and customization. One solution is to purchase technical content from a well known and respected vendor. Trade and professional associations, such as the American Institute of Certified Public Accountants (AICPA), that provide a blend of learning and training solutions are good sources. In-house staff can then customize and deliver it. This approach allows an organization to acquire technically accurate, current and relevant content and reduce travel and instructor costs, as well as the hidden expense of executive time.
We are living and doing business during a time of acute economic crisis, which can present both great danger and great opportunity. When it comes to training, the danger is cutting budgets indiscriminately and the opportunity is to use this time of employment stability to strategically position training to prepare future leaders for the next crisis — economic recovery.
John J. Toman is Principal of JJT Consulting Group Inc., a business development strategy and training consulting firm. He is the former Vice President of Sales and Conferences for the American Institute of Certified Public Accountants.
