When the board of Toronto Community Housing Corp. found out this year that its chief executive officer violated the agency’s corporate policies, it “sentenced” him to work with a management coach and take a university executive leadership course.
By contrast, at Canadian Imperial Bank of Commerce, John Silverthorn doesn’t see training as a sentence – but rather as a key to corporate well-being. The senior vice-president of talent management for CIBC sends people for training all the time, not as punishment but to boost the bank’s business.
Continuing education is an important business and retention tool for the bank, as well as its competitors in the financial sector, which collectively invest hundreds of millions of dollars a year in education and training. And it’s the same thing in other industries, too.
“We do a variety of things, which fall into two large categories – education, so employees know what’s required to perform the job, and things you should know to do your job even better,” Mr. Silverthorn says.
This can mean everything from training branch employees about the latest credit cards or savings accounts, to online learning, to leadership and strategy programs.
It’s not a fringe feel-good activity for the bank; there are required courses and tests. CIBC spent $69-million on staff education and training in 2013 for its more than 43,000 employees in Canada and around the world, up from $62-million in 2012 and $58-million three years ago.
The other big five banks spend comparable amounts on education and training. For example, Bank of Montreal has a full-service, 260,000-square-foot Institute for Learning in Toronto where it conducts programs.
Companies don’t send their workers to school just to give them a break, although for many firms, corporate training to encourage a happy workplace can be a part of the equation. At Four Seasons Hotels Inc., for example, new employees who complete a seven-part introductory course in their first 90 days get a free stay at a Four Seasons hotel.
The benefits of having well-trained employees are obvious for companies that engage directly with consumers, such as retailers or service firms. The famous Hamburger University of McDonald’s Corp. is perhaps the prototype – a program to teach managers the company’s ways.
“What’s key is understanding the development path, not just dictating to employees [what courses to take] but understanding what is important to that individual,” says Rhonda Klosler, a chartered professional accountant and chief operating officer at accounting firm Collins Barrow Toronto LLP.
“It might not necessarily be the role they’re in today,” she says, explaining why staff training and education are important to a company’s bottom line.
“If employees are not feeling like they’re growing professionally, you have to look at the investment it takes to train new ones.”
It isn’t easy, though. “Businesses have been trying – and mainly failing – to calculate the return on knowledge-management investments for more than a decade,” writes Dan Cohen in the Harvard Business Review.
“Early efforts to compute the total value of organizational knowledge were not only unconvincing but beside the point: They ignored the questions of how much of that knowledge was actually used to benefit the organization.”
Mr. Cohen says that, “Leaders of the knowledge-based organizations that have the most vibrant [company education] programs approach the measurement problem by accepting soft indicators that knowledge management is earning its keep rather than demanding hard numbers that may be misleading. … They realize that a telling anecdote is a better ‘measure’ than a precise but irrelevant number.”
Training doesn’t necessarily have to be long. In one of the most famous, sudden, examples of employee re-education, Starbucks Corp. CEO Howard Schultz closed 7,100 of the company’s U.S. stores for 3 1/2 hours in February of 2008, a month after returning to the company’s leadership.
The three-hour closure was used to retrain every one of Starbucks’s 135,000 in-store employees at the time to pour the perfect shot of espresso – but more importantly, it was an effort to reinvigorate staff engagement and morale.
Teaching and learning are critical “in maintaining our competitive advantage … and on efficiently managing costs and risk,” CIBC says in its annual Corporate Responsibility Report. The bank’s mandatory training and testing for employees covers topics that include risk management, privacy protection, money laundering, violence in the workplace and respect in the workplace.
CIBC also has a partnership with York University’s Schulich School of Business to teach selected senior managers strategic and leadership skills. It also engages about 600 outside vendors to offer work-related courses for its staff, and deploys SkillSoft, a web-based learning portal with more than 3,000 courses and 19,000 online books, so people can learn at their desks.
Consulting firm Deloitte runs its own in-house Deloitte University for its employees, with a campus in Texas and online and video courses, says Beth Tyndall, Deloitte’s national talent leader in its tax practice in Canada.
“When new [employees] come into our organization, we put them through formal training, expose them to different clients, connect them to different parts of the organization. The expectation is that everyone goes through some form of learning,” she says.
The volunteer factor
Do companies that help their employees volunteer do better than companies that don’t? There is a strong business case, Corey Diamond says.
“The trick is to do it strategically,” says Mr. Diamond, a Toronto-based partner at Realized Worth, a consulting firm that helps companies organize their volunteer programs.
“It has to go way beyond cutting ribbons.”
It doesn’t need to be complicated, Mr. Diamond says. For example, if employees express an interest in taking care of animals, a company can encourage volunteering with a local humane society.
It’s even better if a volunteer program aligns with long-term corporate objectives, Mr. Diamond says. He points to work his firm is doing with a U.S. nuclear company, Areva Inc., which also operates in Saskatchewan. Areva employees are encouraged to volunteer and mentor in classrooms that teach the “STEM” subjects – science, technology, engineering and math.
The reasoning is straightforward, and partly self-serving. “A huge portion of the [nuclear] industry is going to retire in the next 20 years, so you want young people to be engaged,” Mr. Diamond says.
Keeping younger workers interested is important, especially for industries and sectors that face a skilled worker shortage in the coming decades as populations age in developed countries. A 2011 study by Deloitte, the Volunteer Impact survey, compared millennials (people now 21 to 35) who volunteer frequently with those who do so infrequently or not at all.
The survey found that regular volunteers are more likely to be loyal to their company, satisfied with their work progress and to recommend their firms to friends than those who aren’t frequent volunteers.
Another 2008-09 study by Watson Wyatt, a human resources consulting firm, found that companies with engaged employees experience 26 per cent higher revenue per employee, 13 per cent higher total returns to shareholders, and a 50 per cent higher market premium.
It comes down to whether people are happy at work, says Jessica Pryce-Jones, chief executive officer and founder of a British consulting firm iOpener Institute for People and Performance.
She compiled research involving 9,000 workers from around the world, finding that those who report being happiest at work stay twice as long as their least happy colleagues, spend double the time doing what they’re paid for on the job, take an astonishing 10 times less sick leave and believe twice as much as their colleagues that they are achieving their potential.Report Typo/Error