TalentLearning & DevelopmentCutting L&D budgets in 2021 a ‘big risk’

Cutting L&D budgets in 2021 a ‘big risk’

"Companies need to double down"

Organisations looking to slash overheads in response to worsening economic conditions should avoid scaling back on learning and development (L&D) or risk creating a significant learning gap, according to Slavina Pancheva, senior consultant at learning solutions provider StratX ExL.

“Businesses have tight budgets right now, and their kneejerk reaction is ‘we’ve just got to cut as much as possible and learning and development is the easiest option’. People still need development in a crisis so I don’t think that’s a wise reaction.

“In doing this you’re risking creating that gap which will then have an impact on the future of the organisation. If anything, it’s at times of crisis that companies need to double down on L&D, to equip their people with the competencies they’ll need to succeed in a such a challenging environment.”

Another familiar challenge at present is conducting effective L&D initiatives whilst many companies are remote. Pancheva explains that, for this reason, an approach known as ‘experiential learning’ – learning in a more active, practical manner – will be the way forward.

The approach is founded on what’s referred to as ‘the 70:20:10 model’ – the idea that the most effective learning processes are comprised of 70 percent on-the-job experiences, 20 percent peer interaction, and 10 percent traditional training courses and readings. Experiential learning is designed to replicate the 70 and 20 percent as much as possible.

A paper published by StratX ExL last month expands on this idea, saying that “the result is deeper” and that it brings “much longer-lasting changes in knowledge and behaviour”. It also cites “motivation, “teamwork” and “creativity” as key benefits.

Pancheva echoes this, describing standard L&D programs as “passive”.

“If you’re learning to cook, do you think it’s more effective to just read a recipe, or if you actually attempt to make it?” she says.

Pancheva cites StratX ExL’s business simulations as a key example of this. She explains that, for instance, a group of learners will be divided into smaller teams, with each team being responsible for ‘running’ fictitious companies for a given period of time. Employees will be in direct competition with each other throughout the process, and will then be given a debrief on how they performed.

“Sometimes they do well, sometimes they do badly, but that kind of competitive spirit coupled with the time pressure to finish the simulation is something that creates a range of emotions. And when you ask people what they remember, they tend to be emotional experiences.

“It’s fun, it’s engaging, it’s interactive, and all of that makes for much better retention.”

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Measuring success

One of L&D’s key challenges is that its effects are qualitative, and therefore often not tangible enough to measure. Pancheva acknowledges that with an even more practical, hands-on approach such as experiential learning, this risk is still present.

However, StratX ExL overcomes this, she explains, with a model known as ‘the Kirkpatrick approach’. This measures four levels of learning: ‘were you happy?’; ‘did you learn things?’; ‘did it have a clear impact on behaviours?’; ‘did it have a clear impact on business results?’.

Crucially, this model is introduced to the employees prior to the beginning of the program, so the process of reflection is pre-empted.

“Start with the end in mind – that’s one of the mottos we use. And that’s one of the best things about experiential learning: it’s designed with the long-term goal at heart.

“You’re teaching these behaviours in a way that allows them to be applied directly to the company’s vision.”

The StratX ExL experiential learning user’s guide offers some further detail on this, outlining the four-step approach to experiential learning: “Assessment”, “development”, “delivery” and “measurement”.

“We must also look at application at the end of the initiative to make sure that there is a bridge between the fictitious world of the simulation and the participant’s real-life job,” it says.

“Everything is bespoke”

One of the most unique and valuable aspects of these initiatives, Pancheva says, is the fact that every step is tailor-made for the needs of the organisation.

“We typically partner with L&D functions, and the word ‘partner’ is important. We consider ourselves more than just a vendor or supplier.

“We’re there right from the beginning. We help our clients design the initiatives, and that includes a phase of interviewing key stakeholders and learning about their needs.”

The paper also touches on this, stating that one of the company’s key mantras is to “avoid using a one-size-fits-all approach to every organisation”.

Similarly, it explains that things like technology are key to this, as different tools must be selected for different organisations and environments.

“We don’t really do things off the shelf,” Pancheva says. “We want to create business impact and fulfil key objectives, and the best way to do that is to build a good relationship with those stakeholders and get to know the business.”

Download a free copy of the StratX ExL guide on the impact of experiential learning.

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