How Training Supports an

Organization’s Strategy

What is a Business Strategy?• A plan that integrates the company’s

goals, policies, and actions.• The strategy influences how the company

uses:– physical capital (plants, technology, and

equipment)– financial capital (assets and cash reserves)– human capital (employees)

• The business strategy helps direct the company’s activities to reach specific goals.

Review...

Strategy Formulation•Mission•Goals•External analysis•Internal analysis•Strategic choice

Review... S W O T Analysis•Internal Strengths•Internal Weaknesses•External Opportunities•External Threats

Strategy impacts training by influencing:• The amount of training devoted to

current or future job skills.• The extent to which training is

customized for the particular needs of an employee or developed based on the needs of a team, unit, or division.

• Whether training is restricted to specific groups of employees or open to all employees.

Strategy impact on training (continued)• Whether training is:

– planned and systematically administered, or

– provided only when problems occur, or– spontaneously as a reaction to what

competitors are doing

• The importance placed on training compared to other human resource management practices such as selection and compensation.

Organizational Characteristics That influence Training• Roles of Employees

and Managers

• Top Management Support

• Integration of Business Units

• Global Presence

• Business Conditions

• Other HRM Practices

• Extent of Unionization

• Staff Involvement in Training and Development

The Strategic Training and Development Process:

Business StrategyBusiness StrategyBusiness StrategyBusiness StrategyStrategic TrainingStrategic Trainingand Developmentand Development

InitiativesInitiatives

Strategic TrainingStrategic Trainingand Developmentand Development

InitiativesInitiatives

Training andTraining andDevelopmentDevelopment

ActivitiesActivities

Training andTraining andDevelopmentDevelopment

ActivitiesActivitiesMetrics that ShowMetrics that ShowValue of TrainingValue of Training

Metrics that ShowMetrics that ShowValue of TrainingValue of Training

Diversify the Learning Portfolio

Improve Customer Service

Accelerate the Pace of Employee Learning

Capture and Share Knowledge

Use Web-Based Training

Make Development Planning Mandatory

Develop Websites for Knowledge Sharing

Increase Amount of Customer Service Training

Learning

Performance Improvement

Reduced Customer Complaints

Reduced Turnover

Employee Satisfaction

Mission

Values

Goals

Chesebrough-Ponds

Discussion Question 4Noe, page 69

Summary•Expand product lines•Repackaging Vaseline Petroleum Jelly in pocket-size squeeze tubes called Vaseline Lip Therapy

•Strategic emphasis on developing markets

Summary - 2• Knew customers already using

product in original container to prevent chapped lips

• Managers reasoned that market could be expanded significantly if product were repackaged to fit conveniently in customers’ pockets and purses

What business strategy is Chesebrough-Ponds using?

•Concentration•Internal growth•External growth•Disinvestment

What training needs result from this strategy?•Concentration•Internal growth•External growth•Disinvestment

Implications of Business Strategy for Training(1 of 2)

Strategy Emphasis How Achieved Key Issues Training Implications

Concentration

Increased market shareReduced operating costsCreate or maintain market niche

Improve qualityImprove productivityCustomize products or services

Skill currencyDevelopment of existing work force

Team buildingCross-trainingSpecialized programsInterpersonal skill trainingOn-the-job training

Internal Growth

Market developmentProduct developmentInnovationJoint ventures

Add distribution channelsExpand global marketsModify existing productsCreate new productsJoint ownership

Create new jobsCreate new tasksInnovation

Communication of product valueCultural trainingConflict negotiation skillsManager training in feedback and communicationTechnical competence in jobs

Implications of Business Strategy for Training (2 of 2)

Strategy Emphasis How Achieved Key Issues Training Implications

External Growth (Acquisition)

Horizontal integrationVertical integrationConcentric diversification

Acquire firms for new market accessAcquire firms to supply or buy productsAcquire any firm

IntegrationRedundancyRestructuring

Determining capabilities of acquired employeesIntegrating training systemsTeam building

Disinvestment RetrenchmentTurnaroundDivestitureLiquidation

Reduce costsReduce assetsGenerate revenueRedefine goalsSell off all assets

Efficiency MotivationGoal settingStress managementTime managementLeadership trainingOutplacement assistanceJob-search skills training

What are the training implications of this decision for1) manufacturing?2) the sales force?

The Broadening of Training’s Role

Focus on Teaching Skills and Focus on Teaching Skills and KnowledgeKnowledge

Link Training to Business Link Training to Business NeedsNeeds

Use Training to Create and Use Training to Create and Share KnowledgeShare Knowledge

Cognitive Knowledge(know what)

Advanced Skills(know how)

System Understandingand Creativity(know why)

Self-MotivatedCreativity(care why)

Intellectual Capital