11. Costs and Benefits of HR Development Programs

Organizations in Europe, the United States, and Asia spend billions each year on employee training—more than $125 billion in the U.S. alone. At the level of the individual firm, Google is exemplary. It offers each employee 100 hours of professional development training per year.¹ These outlays reflect the cost of keeping abreast of technological and social changes, the extent of managerial commitment to achieving a competent and productive workforce, and the broad array of opportunities available for individuals and teams to improve their technical skills and their social skills. Indeed, the large amount of money spent on training in both public and private organizations is likely to increase in the coming years as organizations strive to meet challenges such as the following:²

• Hypercompetition: Such competition, both domestic and international, is largely due to trade agreements and technology (most notably, the Internet). As a result, senior executives will be required to lead an almost constant reinvention of business strategies/models and organizational structures.

• A power shift to the customer: Customers who use the Internet have easy access to databases that allow them to compare prices and examine product reviews; hence, there are ongoing needs to meet the product and service needs of customers.

• Collaboration across organizational and geographic boundaries: In some cases, suppliers are colocated with manufacturers and share access to inventory levels. Strategic international alliances often lead to the use of multinational teams that must address cultural and language issues.

• The need to maintain high levels of talent: Because products and services can be copied, the ability of a workforce to innovate, refine processes, solve problems, and form relationships becomes a sustainable advantage. Attracting, retaining, and developing people with critical competencies is vital for success.

• Changes in the workforce: Unskilled and undereducated youth will be needed for entry-level jobs, and currently underutilized groups of racial and ethnic minorities, women, and older workers will need training.

• Changes in technology: Increasingly sophisticated technological systems impose training and retraining requirements on the existing work force.

• Teams: As more firms move to employee involvement and teams in the workplace, team members need to learn such behaviors as asking for ideas, offering help without being asked, listening and providing feedback, and recognizing and considering the ideas of others.