Home > T+D > Special > Nov 08 Intelligence


E-dition	Email	PDF	Podcast	Print

T+D November 08 //Intelligence//

Customer Care Remixed

Organizations spend more on training sales partners than employees

By Michael Laff
T+D November 2008

A large pharmaceutical company planned to use a robot to dispense medication at retail outlets. To cut costs, the company decided to forgo formal training and provide stores with a simple user’s guide. The plan backfired. Six months later, Doug Harward spoke with panicked executives from the pharmaceuticals company whose customers were unhappy with the product, being unsure how to use it. The company decided to reverse course and send a professional for three days to a large retailer to train employees.

Customer training—offering training outside a company’s walls to representatives of partner companies or to buyers of a product or service—is distinct from employee training, which refers to a company’s own employees. Organizations that sell technology products or services are more likely to emphasize customer training for reasons of complexity, according to Harward, CEO of Training Industry.

“One of the problems in the industry is that we don’t talk about customer training, we talk about employee training,” he says. Statistics support that contention, as recent research indicates companies spend 52 to 58 percent of training dollars on customers, according to Harward. Training Industry and Expertus completed a recent survey regarding customer training efforts. Most survey respondents expect the budget for customer training to stay the same, with slightly more reporting that the budget will increase versus those who anticipate it will decrease in the next year. “In a recession economy, customer training is going up while employee training is going down,” says Gordon Johnson, vice president of marketing for Expertus.

A lot of companies spend more on training channel partners, entities that sell the company’s products, than on employee training. A classic example is auto manufacturers, Johnson says, who focus their training on dealers and not on buyers whom they reach only indirectly. Analysts are aware that as corporations are clutching their pocket-books, increased training even for departments that generate revenue does not guarantee greater results.

“If the economy is in the tank, the question is: how much value do you get out of every dollar for sales training?” says Tom Kelly, a California training consultant. “You’ll have trouble selling in this market no matter how good your sales force is. Organizations won’t stop training, but they’re not going to invest heavily.”

As a preferred means of training delivery, webinar technology has far outpaced any other form of training delivery. The only caveat with webinars is that they cannot hold participants’ attention longer than one hour. Beyond that point, Johnson says, viewers may get distracted or disinterested. “Every training department uses webinars now,” Johnson states. “It’s an incredibly cheap way to reach a lot of people.” Two-thirds of survey respondents are in the technology sector. The second-highest industry participants were business services such as banking and telecommunications. Company size ranged from 100 to more than 5,000 employees. Another distinction in the field is how organizations categorize their training departments. Among respondents, 42 percent operate training as a cost center while 58 operate it as a profit center.

Kelly views customer training as a branch of marketing and customer loyalty, and not a direct source of revenue. Oftentimes, organizations hope to reduce customer calls regarding a product or service with increased training. Kelly says such aims are difficult to measure. Customer training might help customers become more independent, eliminating the basic service calls, but more complex calls often continue to rise. “I don’t know of any organization whose number of calls is going down,” he says.

Harward identified a crucial benefit of customer training aside from the obvious as reduced sales calls and increased customer satisfaction: liability. Companies want protection from liability claims by customers that they did not prepare or train them on a product in the event of a failure. “It comes down to the cost of failure to use my product is greater than the cost of success,” Harward says. “It doesn’t show up in advertisements, but it is being talked about in boardrooms.”

There are other mechanisms for offering training to customers. When Oracle sells its software to a client, the package includes training credits “All CLOs want to make money off training, but the revenue from it is not as important as generating future sales,” Kelly says. As might be expected, much of the customer training is handled through the marketing or sales departments and not through training departments.

Michael Laff is senior associate editor for T+D; mlaff@astd.org.

InsideIntelligence

//work life//

Gen Y Checkout
Organizations seek out new ways to retain Gen Ys

//Talent Management//

Coaching Crunch
Coaching succumbs to time crunch

//trends//

Robots in the Room
Robots take over training

//fast fact//

Ethical Impulse
Ethical company practices top some new grads’ wants list

//Info Graph//

Nonprofit Staff Skills Decline
Quick stats on the skills deficiency

T+D November 08 //work life//

Gen Y Checkout

Time is money for many corporations, and in today’s workplace, time is also talent. Employers are racing against the clock in an attempt to retain their best Gen Y talent. In a survey of more than 2,500 senior human resource executives, 78 percent of employers reported that they have six months or fewer to retain millennial employees.

“Impatience is hardly a new phenomenon among employees in their 20s,” says Tim Vigue, executive consultant for Novations Group, which conducted the survey. “But HR departments are seeing unusually rapid turnover among Gen Ys, and they’re not sure what to do about it.”

The survey asked participants, “In your experience, how much time do employers have to ‘prove’ to employees in their 20s that the company is the best place for them?” Fifty-one percent of respondents said they have between one and six months to gain the trust of younger employees, and 26 percent reported they have less than one month.

Vigue believes that millennial employees “job hop” because of attitudes and ideals shaped by their upbringing. “Gen Y parents taught them they’re special, that they can do anything, and as such should not settle for less than what they deserve,” he says.

“Technology has also helped contribute to their impatience,” Vigue says. “Gen Ys are the most technology-savvy generation and grew up with immediate access to whatever they needed such as information or connections. They tend to be impatient when told they have to wait and pay their dues.”

So what can employers do within the first six months to retain top talent, many of whom are still learning to find their way around the office? Instead of making major changes to cater to the needs of any one generation, organizations can apply simple tactics to improve overall retention.

First, employers should provide every job candidate with a realistic portrait of what to expect from the job and how his work fits into the overall strategy. Millennial employees want to understand the larger meaning behind their job tasks. Communication and relationships are also important to many Gen Y employees. Engaging with the new hire from the day he accepts the offer and then connecting him with other co-workers will help the employee establish a sense of belonging, according to Vigue.

In addition, employers should immediately disclose the existing channels for the new employee’s professional learning and growth, which is more important to most Gen Y talent than any organization or job.

Finally, employers can create innovative processes to satisfy young employees’ desires for a variety of challenging experiences.

“Rather than focus on how to stop job hopping, organizations can create processes such as job rotations or shifting job assignments that provide employees with the benefits of job hopping without losing key talent,” says Lindsey Schantz, project consultant for Novations Group. “Gen Y talent will not have a need, or a reason, to shift jobs if they are being challenged and engaged in their current work.”

Ann Pace is editorial assistant for T+D; apace@astd.org.

T+D November 08 //fast fact//

Ethical Impulse

When making a choice about where to work at the beginning of their careers, for today’s students, the ethics of an organization is a critical factor much more so than for graduates of a previous generation. A new study conducted by the National Association of Colleges and Employers indicates that the current crop of graduates has a more pronounced ethics gene than graduates from 1982. Recent graduates are more likely than their forebears to decline employment with organizations they believe to be unethical.

“We found that there was a great deal of agreement between both groups of graduates on what was and wasn’t ethical. However, in most instances, current graduates had a stronger reaction to unethical behavior and were much more likely to say they would not work for an organization if it engaged in such behavior,” says Marilyn Mackes, NACE executive director.

For example, 98 percent of both 2008 and 1982 graduates identified “producing a harmful product” as unethical. However, in terms of their reaction to that behavior, 59 percent of 2008 graduates said they would not work for such an organization, while 42 percent of 1982 graduates took that stance. Another point of contrast was allowing one’s spouse to use company resources. Among current graduates, 16 percent believed the practice unfavorable, compared with just 5 percent of 1982 graduates. The two generations differed significantly over salaries for minorities, with 46 percent of current graduates viewing lower pay for minorities as unethical, versus 28 percent of 1982 graduates.

T+D November 08 //Talent Management//

Coaching Crunch

Supervisors across the United States perceive coaching to be a threatening and time-hungry monster that demands perfection and eats away at their schedules.

This misconception, however, could cost managers one of their most rewarding and effective leadership experiences. When asked, “What is the biggest challenge you face in coaching others,” one-third of supervisors surveyed said that coaching is too time-consuming. Another 30 percent reported that they shy away from coaching encounters because they feel they don’t have all the answers, according to a survey of 710 North American managers by consulting group BlessingWhite. “Despite a broad commitment by managers to coach their employees, there’s growing concern that the process may take up too much valuable time and compete with other priorities,” says Cathy Earley, senior consultant and coaching practice leader at BlessingWhite.

Earley thinks that coaching, when executed properly, would not be such a burden to managers, many of whom hold common misconceptions of what coaching is and is not. Coaching is not an event, nor is it a tactic to be used when handling performance problems. Coaching is not a “one size fits all” approach, and it is not advice, Earley says. “Coaching is an effective way for managers to lead and communicate with their direct reports,” she says. “It is not about having all the answers, but involves helping team members think through situations and formulate their own solutions.”

If supervisors learn to turn routine office interactions into coaching interactions, they could tame the coaching beast and eliminate extraneous outsourcing costs. In addition, supervisors can use the coaching process to build positive relationships with their direct reports, therefore improving employee engagement and retention. “Our research indicates that employees need and want a coaching relationship—a way of working together that is based on trust, communication, collaboration, and encouragement to try new things,” says Earley. “Managers need to learn how to establish coaching partnerships by understanding each employee’s unique motivators and having regular, honest conversations with them more often.”

Finally, organizations need to enable their leaders by establishing a coaching culture, Earley says. Organizations that set clear expectations and offer rewards tied to managers’ coaching will foster a culture that encourages managers to teach colleagues.

Ann Pace is editorial assistant for T+D; apace@astd.org.

T+D November 08 //Trends//

Robots in the Room

What if you just started a new job, and you find out your trainer is a robot? But not even a real-life robot, a robot avatar on Second Life. “If you wanted to teach a class in the past, the instructor and all the trainees needed to be in Second Life at the same time,” says Dr. Alex Heiphetz, CEO of AHG Inc., an e-learning software development company. “What we decided to do is create robotic avatars that look exactly like regular avatars except they operate by a computer program.”

First things first, you should probably show up to orientation on time since there’s nothing more punctual than a computer simulation—but wait. It gets better. Robot avatars don’t sleep; so technically, you could do your orientation at three in the morning. Employers can utilize these computer- automated staff trainers to help with new hire onboarding as well as routine training sessions. “Our technology allows instructional designers to create robotic avatars who have ‘expertise’ in certain areas,” says Heiphetz. “For example, you can create a robotic avatar that can carry out communications training, work as a guide, or conduct new hire orientations all in a three-dimensional immersive environment.”

Does it all sound too good to be true? Think again and strap on your space suit while you’re at it because the future is calling. Corporations are wising up to what Generation Y wants in the form of flexible learning solutions. Though given the user friendly nature of these programs, employees of any age can hop onboard. One dynamic and potentially lifesaving use of this technology is in hospitals where medical students could observe a robot doctor talking to a robot patient. Students would then give a report composed of feedback and analysis based on the demonstration.

“I think the ability to use this kind of technology is almost limitless,” Heiphetz says. The benefits of using robot avatars in Second Life training exercises are multifold. As the virtual environments emulate an actual workplace such as a lab or a processing plant, they can help orient employees. They also provide a place for new hires to meet with robot avatar company representatives who are well-versed in standard organizational policies and procedures.

Interactive simulations using robot avatar trainers also teach valuable soft skills including time management, communication, leadership, and working under pressure. Opportunities for teamwork exercises and group problem solving also exist since robot avatars could be created to simulate other classmates, or multiple users could use the robot avatar training simulation simultaneously. “Trainees can run the simulation and it targets a certain part of their job, and the program is smart enough to give them feedback and a feedback score,” notes Heiphetz. “The [human] instructor also has access to all of the results. You receive a really good return-on-investment in terms of being time-efficient.”

Aparna Nancherla is an associate editor for T+D; anancherla@astd.org.

T+D November 08 //Info Graph//