IBM: The Value of Training

IBM Training building skills for a smarter planet @IBMTraining
The Value of Training
Companies today need to drive performance from every aspect
of their IT investments. Find out how skills drive performance
results and how IBM is building skills for a smarter planet in
partnership with IBM Global Training Providers

2
IBM Training building skills for a smarter planet
Introduction
Top performing companies not only recognize the
importance of their people but also the need to
provide the right skills to enable their people. 71%
of CEOs cited human capital, ahead of products,
customer relationships and brands as the leading
source of sustained economic value. In addition
CEOs ranked “People Skills” in top 4 “External
forces impacting the enterprise”. 84% of employees
in Best Performing Organizations are receiving the
training they need compared with 16% in the worst
performing companies.
Source: “IBM Smarter Workforce (Kenexa) 2013 Survey
Today more than ever, companies need to maximize
their human capital by providing the right skills at the
right time for the right people. Embracing the right
level of IT training, enablement and engagement
can dramatically reduce attrition and safeguard the
investment made in hiring.
Employees who do not feel they can achieve their
career goals at their current organization are 12 times
more likely to consider leaving than employees
who do feel they can achieve their career goals. Even
worse, this number skyrockets to about 30 times
more likely for new employees. Considering the
amount companies invest in the recruitment process
and the time lost to filling the same role again, the
impact to performance and margin can be significant.
This paper outlines the gains your organization
can achieve in client success, project success and
adoption, product development, sales, risk manage-
ment and retention and how you can measure the
return on investment from a well designed skills
building program that links your solution to your
business needs.
In this document, we will point to market drivers
and perform a reality check in the skills some
organizations have and the market readiness to fill
the current and future skills gaps. We show research
where more than 65% of global leaders cite “talent
and leadership shortages” as their #1 business
challenge and with some skill areas, a full 90% of
organizations do not have all the skills they need
to be successful. We will look at the recommended
action that companies can take to drive the right skills
and look at how to link training to the business goals.
We will review the benefits of a skilled workforce and
techniques to help you measure the ROI of training.

3
Table of Contents
Introduction 2
Table of Contents 3
People and Skills:
What Organizations
Senior Management Think 4
The ROI of Training
within your Organization 6
Today’s organizations face
new problems 11
Recommended action:
Build skills internally 14
IBM Training: The New Model 17

4
People Skills Top 4 Focus
CEOs Rank People Skills in
top 4 “External forces impacting
the enterprise”
71% Of CEOs identified
human capital as a key source of
sustained economic value
People and Skills:
What Organizations
Senior Management Think
Today, companies need to do everything possible
to drive performance; people and skills are a strategic
part of this performance. The IBM C-suite Study
is a result of analyzing our conversations with
4,183 leaders in 70 countries. We spoke with a
cross-section of C-suite executives in more than
20 industries: This study offers insight into how
these leaders view the world, their priorities and how
they are preparing for the future. In the study, CEOs
rank People Skills in the Top 4 external factors that
will impact their business in the next 3 to 4 years.
Source: IBM C-Suite Survey 2013
In the prior year, 71% of CEOs cited human capital,
ahead of products, customer relationships and brands
as the leading source of sustained economic value.
Source: “Leading through Connections” IBM CEO Study, 2012
In fact from 2004 through 2013 across all of the
C-Level, people skills rank high on the list of
external factors that will impact performance.
Source: IBM Smarter Workforce 2013 Training and Tenure Report
The senior management inside organizations has
a clear idea that skills matter. In the next section we
look at the Return On Investment (ROI) for Training.
Perceptions of new employee training by
job level
It is clear senior management teams at successful
clients recognize the need for skills and training.
There is a disconnect however between what the
senior management believe is being delivered and
what is actually being delivered.
Perceptions of new employee training by job level
Source: Question E8–What are the most important external forces
that will impact the enterprise over the next 3 to 5 years?; n=4,009

5
Decision-makers — senior leaders and HR professio
nals seem to be a little more optimistic. Seven out of
10 HR professionals believe employees are getting
the training they need and that figure rises to eight
out of 10 among senior leaders. Clearly a disconnect
exists between decision-makers and training
recipients, perhaps resulting in under-investment
in training in many organizations.
One solution for this disconnect may be a lack
of objective training performance metrics. According
to Dr. Donald Kirkpatrick, Professor Emeritus at
University of Wisconsin and Honorary Chairman
of Kirkpatrick Partners, there are four ways to evaluate
training: reaction, learning, behavior and results.
Perceptions of new employee training by HR role
or department
For example, an introductory sales course could
be evaluated by giving students a survey about
the training quality (reaction), by testing students
on the content taught in the sales course (learning),
by observing whether students actually end up
using the sales tactics they learned (behavior), or by
measuring changes in sales volume before and after
training (results). By evaluating training effectiveness
and sharing those results across the company,
organizations can close the gap between perceptions
of managers, HR professionals and the rank-and-file.
Working with the management team to bridge the gap
The Authorized IBM Global Training Providers have the
ability to work with IBM Clients to address all the needs
of the senior management team and client HR teams.
• Linking training to business needs
• One stop shop — our IBM Global Training Providers
are not limited to just IBM Training, offering other
IT technology training, project management and
other related training
• Skills gap analysis
• Driving training effectiveness metrics and performance
• Hosting Learning Management Systems and integration
into existing

6
The ROI of Training
within your Organization
Best performing companies invest
in training
In a recent IBM Smarter Workforce study IBM
looked at best performing companies and worst
performing companies to see if skills had a part to
play in performance. The results we found are not
surprising: 84% of employees in Best Performing
Organizations are receiving the training they need,
a full 68% better than worst performing companies.
Relationship between number of hours
of training and project success.
The amount of training does not need to be massive.
When preparing for a project, teams receiving
40 hours of training per member met their significant
project objectives three times as often as teams
that received 30 hours of training or less.i
Relationship between number of hours of training
and project success.
Source: IDC’s Training Impact on Projects Survey, 2011
Relationship between team skill and
stakeholder objectives
Training helps stakeholders win: Objectives
will be met 90% more often by increasing team
skills. Increasing team skills by 1/3 increases
likelihood of stakeholders meeting their objectives
from 10% to 100%.ii
Relationship between team skills and
stakeholder objectives

7
Benefits of a skilled workforce
The benefits of a skilled workforce and a learning
solution are significant and measurable, and they
affect all areas of the organization from sales and
marketing to customer service and support.
They include:
• 16% increase in customer satisfaction among
companies using learning technologyiii
• Skill levels linked to business value, $70,000 in
annual savings and 10% increase in productivity
when teams are well trainediv
• 35% reduction in time spent searching for
sales contentv
• 22% faster rollouts of products and processes
• 75-80% of managers believe effective training
is critical to project success and meeting
project deadlinesvii
“75-80% of managers believe
effective training is critical to project
success, skill levels linked to
business value yield a 10% increase
in productivity”
Building skills for a smarter workforce
It pays to work smarter not harder. According
to a 2010 study by the IBM Institute for Business
Value, organizations that are significantly outper-
forming their industry peers also happen to be
making more headway on newer approaches to
work. They are using dynamic, collaborative and
connected ways of working to get things done
effectively within a constantly changing environment.
How can organizations work smarter? Through
IBM’s interactions with clients around the world,
we have witnessed a number of practices that are
making organizations more agile. These approaches
to how work gets done fall into three main categories
which make their organizations more:
• Dynamic — adjusting rapidly to changing
business conditions
• Collaborative — bringing together resources,
both internal and external, to share insights and
solve problems
• Connected — enabling access to information
regardless of time, distance or organizational silos
Source: “IBM Institute for Business Value — A New Way or
Working” 2010.
The IBM Institute for Business Value (IBV)
research revealed several interesting findings:
• Outperformers use smarter working practices far
more extensively than their lower-performing peers
and they are doing so to fuel growth, not just
drive efficiency.
• For most organizations, the ability to adapt to
a constantly changing environment is hampered
by capability gaps in three primary areas: process
and skill reconfiguration; broader and more
embedded collaboration and integrated, real-time
information for decision-making.
• The most dynamic, collaborative and connected
companies have widely adopted certain technolo-
gies that make smarter working practices viable.
Smarter working practices provide organizations
with greater agility.

8
Outperformers are already positioning for growth today.
Working together with an IBM Global Training
Provider, IBM Clients gain access to skills maps
developed for roles and solution areas, a dedicated
client team that will work with the client to identify
any potential skills gaps and a dynamic plan to
address these gaps.
The skills gap is not just about technical ability and
driving process efficiencies, nor is it just about
engaging employees to make them more productive
and to reduce attrition costs. Companies who are
significantly outperforming within their industries are
already positioning for growth. They are far less
worried about operational efficiency, perhaps
because they have already addressed the skills
gap to outperform in these areas. Instead, they are
concentrating on innovation and expansion. Their
focus revolves around introducing new (and adapting
existing) products and services and addressing
regulatory requirements, which also relates to their
expansion into new geographies and markets.
Source: “Study by the IBM Institute for Business Value – A New Way
or Working”
IBM Training and our IBM Global Training Providers
understand the need to leverage the client’s
solution combined with the talent of the organization,
linking this to the business needs and smarter
working practices.
Compared to other companies, outperformers are
more than three times as likely to have adopted
smarter working practices.
Source: “Study by the IBM Institute for Business Value — A New Way
or Working” 2010.
Where outperformers lead
Outperformers are developing capabilities that
allow them to adjust and react more rapidly.
Compared to their less adaptable peers, more than
twice as many outperformers can:
• Easily identify individuals with needed skills
• Display and deliver information to meet the
needs of various audiences
• Quickly build skills to address changing conditions
Extensive adopters of smarter working practices*

9
Our IBM Global Training Providers offer traditional
offerings of public and private training but this is
significantly augmented by “Smarter Skills Services”
such as:
• Skill Gap Analysis
• Business Transformational Services
• Content Customization to make the learning fit
• Collaborative and Connected Learning Sessions
and tools
• Learning Coaching
• Boot Camps and Re-Skilling Sessions
• Enterprise Learning Licensees — where clients
that have invested in their own competency
centers can leverage IBM and IBM Global
Training Provider Content with a right to use
or right to modify license
They are also offering many more dynamic services
that adapt to the business and learning needs of
today. IBM and its Global Training Providers are
also establishing work methods that facilitate and
encourage collaboration by leveraging the collective
strengths of our customer’s organizations.
New Employee Turnover Intentions by Training
Cost of losing your staff investment
Organizations should consider the cost of recruitment
and attrition. Although this paper does not attempt
to quantify the differing costs of recruitment within
a client’s organizations, it is imperative to look at
the impact of training on new hire recruitment and the
impact of skills on career development and retention.
“New Employees are 42% more
likely to stay when receiving the
training they need to do their
job properly”
Training and an investment in developing a skills
building culture dramatically impacts employee
retention. Only 21% of new hires intend to stay at
companies that do not offer training for their current
jobs. However, the study reveals that 62% of new
hires intend to stay when training is provided. This
nearly three-fold increase is a powerful example of
the positive impact of training on new hire retention.
Source: “Study by the IBM Institute for Business Value – A New Way
or Working” 2010.

10
Turnover Intentions by Ability to Achieve Career Goals
by Organizational Tenure
Employees who do not feel they can achieve their
career goals at their current organization are 12 times
more likely to consider leaving than employees who
do feel they can achieve their career goals. Even
worse, this number skyrockets to about 30 times for
new employees.
The importance of career development, especially
to new employees, again highlights the importance
of having an onboarding process and learning
management system (LMS). While onboarding and
learning management have focused traditionally on
job training, IBM Global Training Providers can work
with clients to develop processes and systems to help
new employees facilitate informal mentoring, foster
collaboration across jobs and business functions and
identify subject matter experts within the organization.
In addition they can provide linkage to training in
the right modality to facilitate development, access
to IBM, third party and company repositories to share
technical knowledge.
An IBM Global Training Provider can work together with
clients to create an always-learning paradigm that can
drive solution success and address retaining the right
resources in your organization with the right tenure.

11
Today’s organizations face
new problems
The Dynamics of the Modern Workforce
The dynamics of the modern workforce are making
it difficult for companies to find and keep talented
workers. Here are some startling statistics:
• A full 90% of organizations do not have all the
skills they need to be successfulviii
• More than 65% of global leaders cite “talent and
leadership shortages” as their #1 business
challengeix
• The 74 million next-generation workforce of
15- to 24-year-olds who are unemployed are not
skilled to fill the skills gapx
Knowledge Leak
Knowledge leak is another critical problem. How do
you keep the intellectual capital you have? Most
research on retention suggests nearly 30% loss
of skill annually for skills that are not routinely
reinforced, though significantly less when skills are
routinely (and correctly) performed. The starting skill
of an organization can range anywhere from nearly
100% after extensive organizational training to as
little as 50% or 60% after several years of little
investment in training and normal turnover in the
IT environment.xi
Changing dynamics in the workforce, where
employees have little sense of loyalty for their
employers, compounds the problem. Employees
who do not feel they can achieve their career goals
at their current organization are 12 times more
likely to consider leaving than employees who
do feel they can achieve their career goals. Even
worse, this number skyrockets to about 30 times for
new employees.xii
People under the age of 35 are twice as likely to
be looking for new work as older workers. What’s
more, the total costs of replacement can reach
200% of an employee’s annual salary.xiv
Generations of Learning
With the mix of generations within an organization,
businesses must ensure that they are addressing
the learning styles that work for that generation
from the traditionalist with public training to the
Millennial who wants to have just-in- time training
available on his/her mobile device.
Source: IBM Tech Trends Report

12
An IBM Global Training Provider is able to leverage the
high quality, up-to-date Authorized IBM Content with
smart and connected delivery engines to address the
learning needs of today’s enterprise.
Market Drivers
Technology is changing everything: The “four pillars”
of the 3rd Platform — mobile, cloud, social, and
Big Data — are impacting current job roles and
driving demand for new roles and skills.
• Mobility is an important driver of enterprise
innovation, requiring broader technical skill sets to
support users in their day-to-day work and ensure
that a myriad of device and software combinations
work optimally. According to IBM’s Tech Trends
Report, 70 percent of respondents say they plan
to increase spending in mobile in the next two
years. The shift toward BYOD is even more
pronounced in growth markets like Brazil, Russia,
India, China and South Africa, where 41 percent of
those surveyed will allow employees to connect
their own computing devices to their network with
in two years, bringing the total to 83 percent in
those countries.
• Cloud is both a delivery model and a consumption
model for IT, creating a shift in internal roles from
IT builders and managers to brokers, strategists and
business supporters.
• Social media, as a core part of IT’s next growth
platform, brings with it the problem of data privacy,
driving demand for expertise in that area.
• Big Data comprises a set of genuinely new
technologies and a convergence of more mature
technologies. Organizations must be prepared to
embrace a more information-led culture.
These shifts in technology will redefine the roles
which are important for an organization to succeed
and require companies to hire or retrain employees.
Community managers, mobile developers and Big
Data analysts will take on increasing importance as
other roles, such as desktop application support,
will decline.
The world does not stand still, and neither have we.
The technologies underpinning Smarter Planet —
Big Data analytics (including IBM Watson), mobile,
cloud, and new systems of engagement — are
converging and the transformation they are
unleashing is accelerating. Working together with
IBM Global Training Providers, clients can harness
the power of IBM solutions to drive business success.
It is important to understand the new IBM Training model
in partnership with carefully selected IBM Global Training
Providers. It offers not only the high quality content direct
from IBM but also content that is aligned to business
needs and is not limited to the IBM technology. The IBM
Global Training Provider is able to offer training in 3rd
party products, project management and many other
aspects of solution success.
Source: IDC’s 2013 CIO IT Staffing Survey, August 2013

13
Recommended action:
Build skills internally
To meet the challenges, leaders must look within
their organizations to improve employee engagement,
unlock lost productivity and develop the skills of their
existing base. They must also evaluate the best
methods to build skills and create an environment
where intellectual capital is easily shared and
diffused through the organization and they must
measure the real value of skills to the organization
to justify the costs and meet “spend to save” criteria.
Best practices from
leading organizations
Leading organizations adopt the following best
practices to create a culture that fosters continuous
learning — practices which lead to better and faster
business results:
• Fully training the team. The most important
factor in reducing the effect of knowledge leak
is fully training everyone
• Provide ongoing training/access to reference
resources. The obvious method to reduce leakage
is to provide “refresher training” continuously
• Document processes. Documented processes
or routines can mitigate the absence of
individual skill.
• Train consistently. Training new hires, promotions
and transfers, regardless of their “source,” is
important to ensure consistent application of policy
and ultimate system successxv
• Train efficiently. The acclimation of new users
is exacerbated when positions turn over quickly,
as in the case of medical centers where residents
temporarily work as part of their clinical rotations
or IT organizations in urban areas where turnover
is higher than in more rural locationsxvi
• Train globally. Training on a global basis is
a never-ending cyclexvii
• Train conveniently. Technology-based training,
including informal or search learning, supports
delivery as closely as possible to the time when
the employees will use the new system or new
procedure, ensuring the most value of the training
and the most value of the systemxviii
• Explain thoroughly. Users may not always
have access to mentors and may need access
to reference material, search tools or expanded
training to address areas of need whenever
problems arisexix
Aligning your skills program with
your business needs
Like any other business decision, you must build
a business case and cost justification for the
investment you make in skills development and
you must align this initiative with your business
objectives. Towards Maturity, an independent
research organization, recommends four key areas
for your action plan:
1. Quantify the potential impact of your solution
Do not just concentrate on the technology and
features. Top learning organizations have used
learning technologies to deliver average
improvements of:
• 19% in staff satisfaction/engagement
• 24% in ability to change procedures or products
• 14% in increased productivity through
learning interventions
• 17% in customer satisfaction
• 12% reduction in time to competence
• 22% in reduction in delivery timexx
What difference would these key performance
indicators make to the bottom line in your
organization? Use the data to help you justify
your spend! Use the relevant indicators important
to your organization to shape and create a business
case for spend to save.xxi

14
2. Align your learning strategy with the business
Be proactive in understanding and supporting both
tactical and strategic organizational goals. Top
companies are driven more by business priorities than
others and involve business leaders directly. They:
• Analyze the business problem before recommend-
ing a solution
• Work with senior managers to identify specific
business metrics to be improved
• Recognize that learning is aligned with the
overall business plan
• Demonstrate value back to the business by
revisiting objectives with senior managers and
reporting on the goals/resultsxxii
3. Leverage the experience and results of others
Top learning companies are more likely to invest
in the process of benchmarking to help avoid
re-inventing the wheel to continually improve
performance. External comparisons also help
to justify the business case.xxiii
4. Position yourself for success
Timing is everything. Understand learner behavior
upfront to accelerate change. Link to other initiatives
in the organizations to make it relevant — do not
teach people to shovel snow in the summer.xxiv
The need for you to measure your ROI
To measure the value of training, you must set
objectives and then isolate the impact training
has on achieving those objectives. You will need
to determine a value in units for each area of
improvement. For example, reducing tech support
calls by 50% will have an associated business value in
wages and sales. Here are a few recommendations:
1. Test before and after
Perform a test to measure knowledge and job
satisfaction before the training event, then test
afterwards to compare the results.
2. Examine your service logs
Measure the impact to customer service, tech
support and compliance before and after. Determine
a value in units.
3. Measure sales performance
How does a skilled workforce, from administrators
and engineers to web developers, affect your sales
by producing a better experience for customers? If
you are providing sales training, measure the change
in sales for trained employees. In addition, measure
the amount of time spent looking for information by
administering a questionnaire before and after the
training event.
4. Examine time to completion
How long do you estimate it will take to complete
a project? Quantify the value of the difference
between the completion rate for trained employees
versus untrained employees. Salaries are one
measurement; opportunity is another. If you are
producing a product for a client, what is the value
in completing the project 10% faster?
5. Examine costs
Training reduces waste of valuable assets. For
example, employees who are trained to use a
shared cloud hosting service for data will dramatically
decrease the amount of storage needed overall in
the organization. What is the value achieved from
asset reduction?
The benefits you attain — and the training costs to
achieve them — should be measured over a 12-month
period to provide a realistic value of improvement.
IBM is solving the skills challenge: Join us — The value
of technology is realized through its implementation
and that implementation requires people who are
effectively trained with the necessary skills to
make the best possible use of information
technology solutions.
An IBM Global Training Provider can help drive not only the
dynamic plan around your learning requirements but can
also help you measure consumption and performance
of the resulting skills against your business, making it
easier for you to build long term always learning models
that will drive significant success to your business.

15
IBM Training: The New Model
To make our training more impactful, we developed
a new approach. With a new partner-led model,
we believe our training will be accessible in more
countries, available in more formats, better mapped
to our clients’ business goals and focused on skill
development across a range of disciplines.
IBM has grown the IBM Training ecosystem to
enhance our training capabilities and extend reach
into new cities and countries by partnering with
highly qualified IBM Business Partners who provide
high quality, authorized training for IBM clients,
IBM Business Partners and IBM employees. IBM
continues to provide authorized training curriculum
and content and also maintains overall ownership
of the IBM Training ecosystem. We believe that we
have created a more robust solution that will benefit
our clients and IBM Business Partners.
The IBM network of Global Training Providers can
help you get the right training for new hires and
existing employees. Our network will help you
accelerate the growth of skills and training in your
organization to improve your business. Our Global
Training Providers only provide training using
authorized content from IBM.
To learn more about how training and skills
development can help you generate revenue,
improve productivity and save costs, please visit
ibm.com/training.
Then contact a Global Training Provider to find out
how to get started.

16
Please Recycle
© Copyright IBM Corporation 2014
IBM Corporation
Software Group (or appropriate division, or no division)
Route 100
Somers, NY 10589
Produced in the United States of America
May 2014
IBM, the IBM logo, and ibm.com are trademarks of International
Business Machines Corp., registered in many jurisdictions
worldwide. Other product and service names might be
trademarks of IBM or other companies. A current list of IBM
trademarks is available on the web at “Copyright and trademark
information” at www.ibm.com/legal/copytrade.shtml.
This document is current as of the initial date of publication and
may be changed by IBM at any time. Not all offerings are
available in every country in which IBM operates.
THE INFORMATION IN THIS DOCUMENT IS PROVIDED “AS
IS” WITHOUT ANY WARRANTY, EXPRESS OR IMPLIED,
INCLUDING WITHOUT ANY WARRANTIES OF
MERCHANTABILITY, FITNESS FOR A PARTICULAR
PURPOSE AND ANY WARRANTY OR CONDITION OF
NON-INFRINGEMENT. IBM products are warranted according
to the terms and conditions of the agreements under which they
are provided.
i
Training Impact on Project Survey, IDC, 2011
iii
Bridging the Gap: Integrating Learning and Work, Towards Maturity
Benchmark Study, 2012-2013
iv
Impact of Training on ERP Project Success, IDC 2012
v
IBM Case Study - AMD, 2013
vi
vii
IDC MarketScape: Worldwide IT Education and Training 2013 Vendor
Analysis, IDC, 2013
viii
The 2012 IBM Tech Trends Report, Fast Track to the Future, IBM Center
For Applied Insights, 2012
ix
Bersin & Associates TalentTrends®, Fall 2012
x
The Great Skills Gap Concern Hi-Tech, Benchmarking Data and Summary,
Brandon Hall Group report. © 2013 Brandon Hall Group
xi
Knowledge Leakage: The Destructive Impact of Failing to Train on ERP
Projects, IDC 2013
xii
WorkTrendsTM report, Kenexa High Performance
Institute, 2013.
xiii
Bersin by Deloitte, November 2012
xiv
Towers Watson July 2012
xv
Projects, IDC 2013
xvi
Projects, IDC 2013
xvii
Projects, IDC 2013
xviii
Projects, IDC 2013
xix
Projects, IDC 2013
xx
xxi
Marnie Threapleton, “Building the Case for ‘Spend to Save”, Towards
Maturity, 2014
xxii
Maturity, 2014
xxiii
Maturity, 2014
xxiv
Maturity, 2014

IBM: The Value of Training

Recommended

More Related Content

What's hot (20)

Similar to IBM: The Value of Training (20)

More from Virginia Fernandez (20)

Recently uploaded (20)

IBM: The Value of Training