Learning and development budgets have been an easy target during the recession, but cutting spending now will have long-term implications, delegates at the CIPD’s HRD conference were told.
“The easy thing is to cut L&D, but I’m quite keen on spending more,” said Richard Cuthbert, chief executive of FTSE-250 consulting and business services group Mouchel. “It will give us the competitive benefit we need in this environment. If you stop spending now you will probably see the result in 18 months and I don’t want to be here in 18 months thinking ‘damn I wish I’d spent more’.”
Although the benefits of training and development may not be immediately measurable, ultimately “the value of L&D goes straight through to the share price”, he said. “The best short-term measure for us is in staff turnover and if our annual engagement surveys give us good feedback. But it is a slow burner. It is an investment for the future.”
Wayne Clarke, managing partner at Best Companies, the name behind the Sunday Times Best Companies to Work For lists, pointed out that their research has shown that engagement definitely has an impact on performance and “organisations that have lower levels of engagement spend a lot less on L&D”.
The importance of both L&D and HR getting close to the chief executive was also discussed. “It is important that they are completely aligned with the business strategy,” said Cuthbert. “It is really important that you have the right people with the right relationships who are prepared to go out on a limb.”
Mouchel has grown rapidly over the past few years, he added, so it was important to have an HR director that was good both operationally and strategically.
“We wanted the best of both worlds. It took us a long time to find an HR director we were comfortable with. But my HR director has grown as we’ve grown. We’ve had lots of bust ups along the way, but we are able to be honest and open with each other.”