How learning & development help in scaling-up business
Lord Janus, a Roman God had four eyes to look at both sides. Similarly, organizations have to be extremely proactive on focusing on current skill requirement and what are the skills required for future to remain competitive. Becoming ambidextrous is not easy, as most of us focus on the current requirement, with little care for what exactly will be required in the future. After all, it is a complex exercise involving many variables, therefore no one can predict with certainty about the future.
Learning is an ongoing process and in today’s challenging business environment it’s an important need, where either you need to learn a new skill to survive or upgrade yourself to take up a new role. Investment by the organization in skilling employees is a win-win proposition. In an SME kind of an environment, it’s not only important to recruit right talent but also to prepare the talent to meet the current and future challenges of business.
Indian mobile handset industry is not very old hence finding the right candidate for the job becomes challenging and in that case, L&D plays an important role wherein you hire someone who is close to the required profile and equip him with skills which are essential for the job.
In today’s startup culture, not all the SMEs are blessed with handsome funding or big investment, at the initial stage most of the SMEs focus on maximizing the profits and minimizing the cost, which often comes from cutting the budget from non-profit (immediate) making activities as L&D.
Few common challenges associated with SME’s Learning and Development function can be the following:
- Problems of limited financial resources: The SME’s are confronted with market imperfections like asymmetric information which often means that SMEs have limited access to capital markets. Hence cash flow volatility due to things like seasonal sales, for example, can cause working capital challenges. SME’s often find it difficult to obtain credit or capital, especially at the start-up phase.
- Problems in sending people off on training: Citing obstacles pertaining to financial resources and a lean workforce, a vast majority of small and medium enterprises are finding it difficult to invest in skills critical for the training of the employees.
- Identification of future skills needs: Anticipating skills needs require a strong dialogue between employers and workers. Future skills needs may vary among sectors, however, the most identified skills needed by firms includes customer and market orientation, working in cooperative and collaborative international work structures, and management skills.
- Lack of training programs and methods suited to the size and needs of such companies: Upgrading the skills of all types of workers, including managers, is central to a firm's performance in knowledge-based economies. SMEs find it difficult to organize in-plant training programs or arrange suitable institutional training programs outside the enterprise. Therefore, small companies, in general, incur a higher training cost and merit compensation for their extra training costs per worker compared to a large enterprise. Moreover, due to the small staff size and the nature of the technology adopted in SMEs, a worker generally has to carry out multiple roles and possess a broader range of skills. This makes it difficult for them to organize a suitable training course or to find one suitable for its capacity and resources.
- Lack of knowledge of training offer: Lack of employee training spells trouble for any company because it unfavourably impacts the company, internally and externally. Solid business relationships are built on trust and understanding. A well-trained and committed employee is likely to remain with the company. An employee who lacks proper training is unmotivated because she lacks the knowledge needed to serve the customers. This results in low productivity and inaccurate work, which hurts the company’s bottom line.
- Lack of motivation of workers for further training: Employee motivation is an issue that is usually overseen by most managers. The motivation factors are factors that relate to the job content and they are intrinsic to the job itself. When present, employees will be satisfied and thus motivation will increase. However, when absent, such being the case in the SME segment, employees will be in a neutral state of mind or no satisfaction.
- The risk that well-trained workers leave the company immediately after the training completion: The race for talents has become a reality for SMEs, mainly because human resources and the quality of staff skills play a key role in the innovation capacity, productivity, and competitiveness of small companies. Each time a firm employs an employee it must train him; the scope of training varies by employee and position. The success of any SME depends on how well the employees perform. However, there are certain risk factors attached to the process of training. A company is at the brunt of quality talents leaving the organization in search of a brand image or better working conditions.
Industry perspective and how does it help in scaling up?
Most of the mobile handset players are on a growth trajectory. The growth will continue at the same pace in the coming years as well. Availability of Talent will not be easy; therefore organizations will have to focus on the building policy rather than the buying policy.
Since the infrastructure (i.e. human resource) will be a key to success, therefore it is of paramount importance that organization start focusing on building a talent pipeline. Future will belong to only those organizations, which have employees ready to take up larger responsibilities.