Now it is possible to explore the circles on the inner ring of Figure. All will be approached in a strategic way. It is worth mentioning that this is not the way in which most organisations currently think about HR issues, although research by Harbridge Consulting Group shows that an increasing number of organisations have adopted this view. The concept for management development is shown in Figure. The argument is that the philosophy for management development should put emphasis on corporate needs, in addition to the traditional view which looks at individual needs in the context of what the organisation is willing to spend.
In order to make this effective, those drawing up the management development plans and programmes must have an intimate knowledge of the corporate strategy, and the ability to get behind the strategy to the management development actions needed to support it. This may require the actions to survey senior managers as mentioned in the first part of this chapter, additional analysis by human resource specialists who have an appreciation of the firm’s strategy as well as a knowledge of their own craft and a large supply of common sense. Management development and training people who expect to be able to find a company book with all the answers will be disappointed. It is they who have to be proactive and write the book!
My experience suggests that once a company begins to adopt this model, it will find that it also has to change how it assesses individual needs. One possibility is the use of company-relevant competencies, which can be used as a basis for assessing needs. These have value in many methods of assessment, including assessment centres. Some brief thoughts on a strategic approach to competencies will be given later. The assessment of individuals remains an important element of the mix, but a strategic view may well lead to different ways of making that assessment.
Matrices should be developed to help relate individual needs to corporate needs. Figure provides a starting point, and the following hypothetical example shows how the corporate need for training in specific skills and knowledge might be derived from the data in this figure. Only the items listed under strategy are considered for the purposes of the example, although in reality all of the strategic sources would be covered. I make no claim that the example covers all that the organisation might require from its managers, nor that the answers would be the same for other companies following a similar strategy.
Such matrices would need to be developed for various levels of management, and possibly for different areas of the organisation, and in some cases for specific jobs. It should also be clear that these matrices are a starting point. Each item needs to be looked at in more detail to specify exactly what the need is, and what subtopics would also have to be covered. Another box on the diagram is the audit of current management development provision. All the researches already quoted, and other studies with which I have been involved, suggest that cost–benefit analysis is not a regular feature of management development management, and that there is a tendency to hold on to training programmes, and the resources which deliver them, even when there is a high level of dissatisfaction with the providers.
A framework for auditing all current management development activities, of which the majority will be training programmes, is offered in Figure. Many organisations find it surprisingly difficult to answer these simple questions, which suggests that the management of the function has been less than professional.
Figure suggests three groups of training needs that might be defined from such a study. Without trying to be dogmatic, because the decisions will vary by company, I have indicated on the diagram possible proportions of corporate effort that should be devoted to each group. Initially I should like to discuss each circle on the diagram as if it were a watertight entity, but later will try to show how initiatives that fall in the overlap areas of the circle may enhance the value of the initiatives, by killing two or more birds with one stone.
By direct priorities I mean initiatives that contribute directly to corporate aims and objectives, such as training events designed to implement a strategy or structural change, formulate strategy, deal with an issue from the business environment, implement a policy change, change culture to enable a strategy to succeed, or provide solutions to a specific problem or issue. By their nature these needs are likely to be met by initiatives that are action oriented, have bottom line objectives, and have a high degree of urgency.
In turn this affects the solutions, which may well be courses that cascade through several levels of an organisation, are entirely run in company and have a high degree of tailoring. Only if they have these characteristics can these initiatives deal with the type of issue that is identified as a direct need. Indirect priorities may be equally important for the company, and many of the initiatives will be more long term in both their objectives, and the time over which personnel are involved in an initiative.
However not all will be lengthy initiatives. Under this heading I include induction training, career development programmes, and actions to improve personal performance. I believe that the policy here should be to tie to long-term objectives where appropriate, to be very clear about the aims of and target population for the initiative. Here there may be a balance between in-company and external initiatives, and a mix of training and development actions. Many in-company courses under this category would benefit from being tailored, but the depth of tailoring may often be less than for a course dealing with a corporate issue.
Creative thinking can help an organisation obtain much more from management development than the three-circle diagram may initially suggest, but the value of the planned approach cannot be over stressed. This approach does not mean that organisations should never do any training that can only be looked at as an act of faith. It is a question of balance. Just as it is poor management for the total management development strategy to be built from the bottom up, so it would be equally poor if it were to be totally built from the top down.
There should be a switch from a purely cost-based decision on available options to one of cost–benefit analysis. It is common practice for training managers, for example, to take an out-of-pocket expenses view of training initiatives. The cost of participants’ time in attending training initiatives is rarely considered, and almost nobody adds in the real economic factor, the opportunity cost of this time. As a result many current decisions on training matters are aimed at reducing the cost of the initiative rather than increasing the benefits. This has led to many decisions which are wrong for the companies concerned.
A different slant to assessing individual needs
It may be of interest to record that Tovey found that all of her sample of large UK companies used a performance-appraisal method to establish needs, and for 40 per cent it was the only method. Only 10 per cent used competency assessment, and assessment centres, where used, were on a selective basis (which is sensible). Other methods such as surveys and assessments by training managers were used by the 60 per cent that did not rely solely on assessment centres. The annual appraisal interview is a notoriously poor way of assessing development needs, as it depends on two levels of perception, the subordinate and boss, both of which could be erroneous. Greater use of the competency approach can ensure that the right questions are asked, but does not remove the bias.
I have found that bottom-up assessment is particularly good at identifying needs that may have otherwise remained hidden, but I have only used this method for looking at management and interpersonal skills. On a confidential basis questionnaires are completed by the subject manager and by at least three Sub ordinates and/or peers. These are aggregated and the individual reports are not revealed to the subject. What is of value is the ‘photograph’ of management behaviour, which is often different from the self-perception. This method can be used in a general way, although there are also approaches which are related to researched topics, such as the management of innovation, leadership, and organisation climate.
Surveys can be a valuable periodic tool, and can be focused on the competencies that are important to the firm. We have found it useful to obtain ratings on perceived abilities and the perceived importance the person places on them. This is particularly useful in a change situation, when management sees the need for new skills and this view of relevance is not shared by those below them.
The use of assessment centres is well known. What might be less well known is the way in which they can be designed to mirror the strategic requirements of the organisation, both in ensuring the selection of the right people for a particular situation and in identifying the strategically oriented training needs. Most experts in assessment centres come from the industrial psychology route and they give more emphasis to the individual than to the firm.
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