Since the financial crisis of 2007-8, companies have faced an increasingly unpredictable operating environment, while demand for employees with the right skills and aptitudes has soared.
A growing number of companies have turned to learning and development (L&D) as a solution, figuring that by investing more in training they can prepare themselves for looming challenges, such as the digital revolution, an increasingly competitive business landscape and growing regulatory complexity.
But while spending on training was climbing before the pandemic, coronavirus has forced many companies to review their priorities, even as the need for new skills has jumped. According to a survey by the Chartered Institute of Personnel and Development (CIPD), in the 12 months to January, a third of firms reported a decline in their training budgets while only 6 per cent saw a rise.
That was while demand for improved workforce agility, line management capability, relationship management and digital systems climbed as workers shifted en masse to working from home. Some 84 per cent of firms reported using digital virtual classrooms more often in the last year, according to the CIPD’s research.
Complexity and paradoxes
Andy Lancaster, head of learning at the CIPD, believes “performance and productivity is on the mind of all corporate leaders as they try to survive the pandemic” and most realise L&D drives those things.
But while some consider it an investment, others see it as a budgetary spend that is easier to cut back. “Insightful organisations recognise that investment in learning is vital for the organisation at a time like this. But there will be others that see all expenditure in terms of survival,” he says.
One firm determined to prioritise L&D despite the challenges of COVID is Unilever, the consumer goods giant. According to chief learning officer Tim Munden, there is no sign of the “ambiguity, complexity and paradoxes” of business life abating and lifelong learning would be key to dealing with challenges such as digitalisation once the pandemic subsided.
“We’re realising there are two sets of capabilities needed for this digital age,” he says. “There are technical abilities and there are some human abilities, like agility and emotional intelligence. And we are going to need to continue to deepen and deepen those, partly because the unpredictability of the world is going to grow.”
Online versus face-to-face learning
Lancaster thinks L&D will play a central role as firms rebuild after the pandemic, but that the crisis has permanently changed the way it is delivered. With the rise of remote working, there has been a big increase in demand for pure online courses and personal coaching using tools like Zoom, he says.
At the same time, demand for face-to-face training has dropped massively due to social distancing, a trend he believes is now “baked in”.
Not everyone is so sure, though. Take London Corporate Training, which ran exclusively face-to-face courses for business and the public sector before the crisis, but has had to move its entire operation online during the pandemic.
Sales and marketing director Praveen Mathews says organisations and individuals may well decide to stick with virtual training after the crisis because it is more “convenient, time efficient and cost effective”. But he says the pandemic has also exposed the limitations of this model.
“Some of the less tangible benefits of face-to-face learning, on motivation, cross-fertilisation of ideas and perspectives, for example, are now much clearer and therefore we could see a decisive shift back towards good-quality face-to-face or blended learning.”
A strong rebound for learning budgets
For Dean Corbett of Avado, an online learning company that has delivered training for the likes of BT, Barclays and AXA Insurance, firms are going to have to make L&D more flexible after the pandemic. This is because there is now a greater acknowledgement of the different pressures people face in their lives outside work as a result of the crisis.
“That emphasis will continue and businesses will look for flexible L&D options that work for their people, not just in terms of ‘place’ of the learning, but time as well,” he says. “On top of this, flexibility of delivery that supports individual ways of learning, which can be driven by artificial intelligence, for example, will absolutely be worth the investment.”
CIPD’s Lancaster is confident there will be a strong rebound in corporate investment in training as soon as company finances are back on an even footing.
Firms don’t just stand to gain a stronger workforce by having good L&D programmes, it also helps to attract and retain talent, boost employee engagement and build stronger corporate brands.
Of course, employers could always be ruthless and just hire in the skills they need, getting rid of existing workers. But this is not a good strategy financially or morally and would leave firms without proper talent pipelines, says Unilever’s Munden.
Corbett believes the biggest driver of L&D spending in future will be digitalisation because the pandemic has shown digital skills can no longer be ignored or seen as a nice to have, no matter the industry.
“Nobody could have predicted the impact of the pandemic, but some businesses were better able to respond because they had the right skills in-house,” he says. “As we look to the future, that lesson will definitely make L&D a higher priority than ever before.”