Every learning professional knows that the struggling global economy has caused considerable distress in the past year. Organizations have been forced to find ways to cut costs, with more pressure than ever.
Have learning functions been targets or have they developed ways to adapt?
In fact, many organizations are now looking to the learning function for solutions when they face difficult economic conditions.
This finding was confirmed in a new study by ASTD and the Institute for Corporate Productivity (i4cp) that examined how organizations manage learning in a down economy. Specifically, the "Organizational Learning in Tough Economic Times" study looks at budget reductions, process improvements, effectiveness of the learning function, efficiency changes, and other lessons learned in reaction to market downturns.
The study found that organizational leaders realize that increased pressure from the economy can actually create a need for learning. The processes and focus of corporate learning may change as leaders navigate through difficult conditions, but if the specific goals for learning programs are in place and the drivers for reorganization or adjustment of content are clear, organizations can still rely heavily on learning.
However, respondents to the study's survey cited many pressures on learning, with some activities, such as leadership development, in most critical need during a recession.
Key findings
Reduction of learning budgets. Not surprisingly, reductions in learning budgets have occurred frequently during economic difficulty. When asked about their organizations' reactions to previous downturns in the economy, 43 percent of survey respondents indicated that the learning budget was reduced to at least some degree.
However, 31 percent said their investments in the learning function were not affected in previous downturns. Among the firms that did previously reduce the investment in learning, there appeared to be a silver lining: 68 percent reported that the cuts did not stick. Once the economy rebounded, funds were channeled back into learning for most of the organizations that had suffered.
How the economic downturn will shape the learning function. When asked how the current economy would shape the content and focus of the learning function within their own organizations, survey respondents indicated some shifting in priorities.
"Emphasizing leadership development" ranked the highest, with 54 percent reporting an increased focus to a high or very high extent as a result of the economic downturn. Comparatively, just 37 percent anticipated seeing "greater focus on such soft skills as listening and ability to motivate." Roughly a third of respondents predicted a "greater learning emphasis on training technology in software and online use," and another third pointed to a "greater emphasis on customer service training."
Apparently the need for employees to build on their soft skills is only of moderate importance to organizations during tough times. Even fewer stressed the importance of "greater focus on retraining displaced workers" (17 percent).
Despite the weakened state of the current economy, survey respondents reported better effectiveness for their learning efforts in recent times. More than three-fourths indicated their learning function has either the same amount of or more effectiveness than it did two years ago. Only 4 percent of respondents reported that their organization's learning performance is worse now than it was two years ago.
Practices to adapt to a down economy. The survey also assessed specific learning practices that attempted to improve effectiveness in response to the downturn. Of all the practices listed, none were used by a majority to a high or very high extent. However, every item was rated higher for "should use" than "in place." This suggests that a number of practices could be used more to help adapt to the current shaky economic climate.
For example, only roughly 23 percent of respondents said that their firms currently "use more mentoring and peer coaching" to a high or very high extent. But more than two-thirds (67 percent) of participants said their organizations should use such mentoring and coaching to a high or very high extent. Other practices with a large gap between the rating for current use and recommended use included "encourage greater usage of informal learning," "encourage more communities of practice," and "boost employee morale by expanding training opportunities."
Although many organizations often turn to technology-based solutions in the face of restricted budgets, these responses suggest that some hands-on, personal practices might have an effect as well.
Conclusions
The "Organizational Learning in Tough Economic Times" study found that reduced resources is driving restructuring in many organizations, in part because of a greater demand for learning. Finding new ways to do more with less has become a reality for most learning professionals. However, the results support the increasing importance of learning in the workplace.
Despite a down economy, many organizations recognized the learning function as a significant strategic component and implemented many processes and efficiencies to ensure that it remains vibrant. As the global economy continues to sputter, organizational learning has a variety of methods to stay vigilant and responsive while evolving in the face of new challenges.T+D