Research has shown that companies that invest more in training produce improved financial results in terms of higher net sales, gross profits per employee, stock growth, and ratio of market to book value (Blanchard and Thacker, 2013). The only real and sustainable advantage any organization has over its competitors lie in the combined knowledge, skills and experience of its employees, known collectively as its human capital. Therefore, it makes sense that organizations would want to maintain that competitive advantage by continuing to invest in learning and development to ensure that its workforce is equipped with the relevant skill sets to meet the present and future needs of the organization. However, in a meta-analysis conducted by Arthur et al in 2003, it revealed that only 6% of companies conducts systematic learning needs analysis prior to implementing training activities.
There are many reasons why this may be the case, especially for many Small and Medium Enterprises (SME) where they may not have adequate in-house resources or expertise to conduct a detailed learning needs analysis. Then there are those who might have the false impression that learning is the panacea for all their organizations performance issues and thus place an over reliance on training as being a quick fix or band aid solution.
In today’s context, where companies are operating in increasingly challenging macroeconomic conditions, where training resources and budgets are being squeezed and there is increasing demands on return on investment for learning and development interventions, the value of a systematic learning needs analysis cannot be emphasized enough.
Whilst there is no lack of learning needs analysis literature in academia, it is the intention of this particular article to focus on demystify the learning needs analysis process and to introduce a simple and practical method to help non-learning professionals, small business owners and any HR professionals for that matter who may be wearing multiple hats (including learning) in the organizations they serve, in ensuring the right learning solutions are implemented to meet the strategic needs of their business.
Step One – Understanding Business Objectives
In its 2015 Learning and Development annual survey results published by CIPD, it was reported that only a quarter of all organizations had their L&D strategy closely aligned with the needs of the business. A common barrier between alignment was the lack of clarity by L&D professionals around business strategy and resources as well as a lack of interest or understanding of the purpose and capability from business leaders.
We are living in a VUCA world where the only constant is change. As such, there is greater imperative to ensure that whatever limited organizational resources we have are continually being adapted to meet current and future needs. Having a clear understanding of the business objectives helps the learning team to organize themselves and the resources at its disposal to support the business.
Communication is key and the clearer the goals are articulated, recorded and tracked, the greater the likelihood of those goals being met. After all, what gets measured gets done.
Let me illustrate this principle with an example of a company that wishes to market its range of products using an e-commerce channel with a view of bringing it to profitability within the next 18 months. Typically, the HR function will have to come together and formulate a human capital plan encompassing the recruitment, learning & development, rewards and performance management strategies to ensure the business has the adequate human capital to meet its strategic objectives.
Learning is a key enabler by ensuring the organization’s workforce has the right skill set and knowledge to implement the initiative. At this step, it is about ensuring a common understanding of the key business objectives and what the learning and business needs to be accountable for to make it a success.
Step Two – Identifying Competencies Required
After we have obtained a thorough understanding of the business objectives, the next step from a would be to consider the knowledge and skills required to meet the business objectives. This information can only be obtained after there is sufficient clarity around the business goals and strategic intent of the organization highlighted above.
Going back to the example of the e-commerce channel, we know from logical deduction and general knowledge that some form of web administration and search engine optimization (SEO) skill sets might be called into play. Besides these two, there might be other requirements and they would need to be captured as comprehensively as possible. The key question that the organization needs to ask next is whether they have the skill sets internally to be able to carry out such a business initiative. In other words, we need to understand what we need to get to and what good looks like from a competency perspective. These are typically classified as Knowledge, Skills and Attitudes (KSAs).
Step Three – Measuring Current Performance
At this step, we do an in-depth analysis of the company’s internal capabilities to examine whether it is able to measure up to the requirements detailed in step two above. There are several ways in which companies can obtain this information – assessment centres, customer feedback, manager observation, performance appraisals and levels of productivity just to name a few. This helps us to understand where we are at in terms of competency levels.
For the e-commerce project example, the company would need to understand whether its staff has the necessary knowledge, skills and experience in managing such a channel of distribution. Once we are clear about what “good” looks like in terms of skillsets (in step two) and we know exactly what our current levels of competencies are, we can look at bridging any gaps in terms of knowledge and skills through the relevant learning interventions.
Step Four – Identifying Root Causes of Performance Gaps
Gaps in capabilities may need to be further classified into technical areas, soft skills, leadership or managerial skills, or there might be other areas incidental to the task at hand. Having a clear understanding of where the gaps are would facilitate a more accurate application of solution. At this stage, it is worth delving deeper in the what is the root cause of the gaps. A critical issue that needs to be asked include “Is it a problem of Skill or is it a problem of Will”?
Whilst learning interventions can help alleviate or tackle some skills related issues, problems relating to “will” usually require a much more comprehensive and holistic set of solutions from an Organizational Development perspective (OD), which is out of scope at the moment for this discussion.
There are many variables which can contribute to performance issues – structural issues in the organization, right fit of the employee, rewards and remuneration, performance management systems just to name a few. Spending some time to identify the root cause will help reduce the chance of wasting both time and resources on the wrong solutions. For instance, no amount of team building activities or training will help in enhancing collaboration between team members if the rewards system is based on individual performance and competition rather than the overall team performance.
Looking at the e-commerce example once again, a quick analysis of the situation revealed that the company would need to upskill its workforce in terms of its knowledge in e-commerce. The company have decided to invest in a new web based software which is integrated to the company’s supply chain system to manage the operational aspects of this new initiative. In addition, a web administrator would need to be hired but the rest of the existing staff would need to be familiar with the new system that is being implemented. Thus, this is a “Skills” gap that needs to be and can be addressed by training in the use of the new software. The management might also need to spend some time communicating on the benefits of this new direction and business approach to staff so as to obtain their buy-in and to allay any fears to staff as part of the change management process.
Step Five – Identifying of Right Solutions
Once we have filtered out all the issues that are non-learning related and we have satisfied ourselves that the issue can be tackled through skills upgrading alone, we can then think about the type of intervention that would be needed. Is the solution already in place internally or does it have to be built from scratch? Can we purchase it off the shelf, as in are there ready-made solutions available in the market or does it have to be further customized by a learning consultant for our internal requirement? Do we have the expertise to design the programme internally? More importantly, who will do the learning delivery and what would be mode of delivery? Will we embark of a blended learning approach? What about developing champions through train the trainers approach? These are just some of the questions that may be brought up for consideration at this step of the process.
To adequately address these questions, we will need to delve deeper into the Design and Development phase of the ADDIE cycle, which will be covered in another article. Meanwhile I hope the walkthrough of the above e-commerce scenario and the application of the steps above would give you a much clearer picture of what needs to be done with regards to the learning needs analysis process.