Training in the New (read: current) Cost Cutting Era
Or, the ROI of Not Training

It is very interesting to me that there are a plethora of articles and huge amounts of energy extended on measuring the ROI of training. During economic slowdowns it is beneficial to know what to cut.

However, one thing I want to know is “Has anyone ever conducted a study that actually measures the cost of unproductive work relationships, unresolved conflict or the inability to influence or negotiate effectively?” If they have, I have been unable to find it. After all, how do you measure the costs of:

Two peers avoiding talking to each other for six months?
A manager who never conducts productive performance reviews?
Top performers who bully internal support staff?
Direct reports who consistently resist any change the company makes?
Workers who have been made scapegoats and become depressed?
People afraid of what the future holds?
Technical experts who prefer computers to people?
Project Managers who think organizational politics should just be ignored?
Answering the same question ten times? One hundred times?
Resolving the same error ten times? One hundred times?

I think you get the point. We don’t quantify many of these things because it is just too hard to measure the cost of negative behaviors. Intuitively, we know it is costing us money. We never know how much. It just costs money so we attempt to train people to be behaviorally correct in the hopes of increasing productivity.

The flip side of this is that “no one has come up with a generally accepted definition of productivity in any knowledge profession, let alone across these professions.” A majority of the work currently done in the USA is just that – knowledge work.

Why are we trying to measure the ROI of training when we can’t measure productivity or the lack thereof?

The reason is because we have to try to measure productivity. We approximate it all. We need to have some way to justify the existence of training.

Consider a small portion of the results of a change project conducted by Lockheed Martin with the design and assistance of VitalSmarts. They found significant correlations between improvement in specific behavior items and three performance metrics – Efficiency, Productivity and Quality. (Efficiency is a measure of time per unit, standardized by size of unit. Productivity reflects the percent of possible work actually accomplished. Quality is measured by amount of rework required, standardized by size of unit). For example, they found that when supervisors were slow in responding to employee needs and employees spoke in a way that got results (the improved behavioral item), there was a 53% correlation with an improvement in efficiency, 52% correlation with an improvement in productivity and a 49% correlation with an improvement in quality.

This is the closest I have found to a specific correlation between a soft behavior and an improvement in productivity or results! Perhaps I need to keep looking… But this was manufacturing – as I said we do measure what is measurable.

While thinking about how to make people more productive in the workplace (again I am assuming this is the main reason we train people) think about this statement by Cialdini: “Few of us would be surprised to learn that, as a rule, we most prefer to say yes to the requests of people we know and like. “

Okay, we just need to train everyone to be likable! While I am not a supporter of Cialdrini’s recommendations about how to influence people his statement is compelling.
Irwin Rubin states:

“While at M.I.T., I was fortunate to have had Douglas McGregor, the father of the Theory X versus Theory Y of human motivation, as a colleague. During one of the skill sessions Doug held periodically with younger faculty members, he talked of a double bind he felt in his own professional career. In order to get the attention of the CEO's with whom he consulted, in order to "motivate them" to treat their people well, he would cite the many research studies he and others had conducted linking these efforts to reduced turnover, increased morale, and-under certain circumstances- increased productivity.

In other words, he [and virtually everyone else like him] relied on hard logic and extrinsic linkages to make his point: treat your people well and your organization will do well "So what's the point?" you wonder. The problem, as he admitted with considerable embarrassment and hesitancy, was that—in his heart--he believed that the real reason to treat people well was intrinsic.

In other words, the reason why you should empower your people by treating them with respect and trust [all the "soft stuff" our theories remind us about] is because they are human beings. And that is how human beings deserve to be treated. For their intrinsic, not extrinsic worth. Period. As a result of doing so, and if you had faith-an unwavering belief that you were doing the right thing-more often than not, you [the organization] will be rewarded. When the going gets tough, people who are "unconditionally cared for" in this way will put out the extra effort to care in return.”

So perhaps that is why we have training programs. So we can teach everyone to treat each other well and then productivity will be high.

Going back to Cialdini … people like to do things for people they like. It is true, we pave they way, do back flips, put in extra time, smooth the path, make connections and introductions … in short, we help. Can you imagine if we treated every single person that we worked with in this manner? Can you imagine the efficiency, quality and productivity that would result from everyone treating everyone else in this way?

Emotional intelligence has become very popular because the only way to get people to treat each other well thereby increasing productivity, would be to get everyone to like everyone else. So get your inner child off your sleeve, get beyond your dysfunctional family of origin, and find a way to like everyone in your dysfunctional organization. Simple really.

Consider what Meg Wheatley has to say about those difficult and non-productive types of relationships:

“And we need to be able to talk with those we have named “enemy.” Fear of each other also keeps us apart. Most of us have lists of people we fear. We can’t imagine talking with them, and if we did, we know it would create more anger. We can’t imagine what we would learn from them, or what might become possible if we spoke to those we most fear.

I hope we can reclaim conversation as our route back to each other, and as the path forward to a hopeful future. It only requires imagination and courage and faith. These are qualities possessed by everyone. Now is the time to exercise them to the fullest.”

The most elegant process I have seen for managing the emotional self is laid out in the book Crucial Conversations. According to the authors, one of the keys to having crucial conversations is our ability to manage our own stories. In their description, we observe something happening or have a set of facts and then we fill in the blanks with our own story. We take action based on our interpretation of the facts or our story often with negative consequences. So the real message is to manage your assumptions and the stories you make up before you have a crucial conversation.

Okay. So where are we? Training and organizational development exists because we know that happy, satisfied, rewarded people are more likely to have emotional intelligence and they go above and beyond the call of duty, which equals higher productivity.

In the mid 1970’s, David Berlew and Roger Harrison created a training program called Positive Power & Influence in response to the increase in matrixed organizations. People needed to get work done (read: productivity) through the use of their personal power as they may not have any positional power. It was one of the first programs to incorporate videotaped feedback in the training process. They believed the product would have a shelf life of ten years. It is still going strong today and has been translated into 15 languages and has been delivered to hundreds and thousands of people worldwide.

Why? The reason is because the program works on the behavioral level with people. It gives them tools to have those crucial conversations with others, which ... you have got it – increases productivity.

There is one more side to the puzzle though. If people can manage themselves emotionally, if they can apply effective influence skills then they are two thirds of the way to success. Every psychological model involves looking at self, others and also at the context of the situation. People need to be Organizationally “Street Smart” as well…. understand how to navigate the organizations within which they work.

There are two elements to being Organizationally “Street Smart”. One element involves knowing the structure, how decisions are made, how to get things done, unspoken rules, etc. The other element is the ability to have and use the power of politics. Positive politics. Many in this country see Positive Politics as an oxymoron but it does go back to the stories we tell ourselves, and treating others well.

In order for people to be successful, to be happy and committed they need to be emotionally intelligent so they know how to approach having important conversations. They need the influence skills to manage the face-to-face portion of the conversation. They also need Organizational “Street Smarts” to help them manage the context of the conversation. Very few of these things can be measured for their impact on the job. I cannot imagine setting up that research project not to mention the Hawthorn effect!

So why do we train people? In summary, training people to be behaviorally effective is important for reasons we can’t accurately measure but intuitively know – it increases productivity. We need to know that we are training the right people to build competence in the right skills. We need to know that what we are training people to do is in line with our business objectives. We need to have hardcore justification that we are not simply throwing dollars at the “flavor-of-the-month” training intervention. Today, we just cannot afford to waste money. It is important to make sure that the training is supporting the business.

The ROI of not training people is immeasurable. Right now we need to be investing in the people we have decided to keep. These last few years have been hard. Most organizations have cut costs, restructured, developed new products, and held their customers close. Diligence is key but an over-reliance on the ROI of training could end up costing us more.

There are a lot of ways that money is drained from the organization. Some ways are easy to spot. The quality movement helped us to increase productivity. Now we need to be able to talk to each other with dignity and respect while paying careful attention to what the other is saying as a way to increase productivity.

The productivity impact of every person having a constructive conversation with one person with whom he/she has a difficult relationship could erase the national debt in one year.

Prove me wrong!

Sherri Malouf, President of SMS, Inc., has been a consultant, coach and entrepreneur for almost two decades. She brings a light touch, a sense of humor, and a great deal of business experience to her work with clients helping them to look at situations from a different vantage point.