In your opinion, will similar training initiative be successful in the service sector Explain in the context of a few service industries that you are familiar with
In your opinion, will similar training initiative be successful in the service sector Explain in the context of a few service industries that you are familiar with
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SECTION
I: Solve any 2 Case Studies:
CASE – 1 Toyota Motor Company’s Toyota Technical
Training Institute in India
In August 2007, one of the
world’s leading automobile manufacturers, Toyota Motor Corporation (TMC),
announced that its joint venture in India, Toyota Kirloskar Motor Private
Limited (TKM) had set up a technical school called Toyota Technical Training
Institute (TTTI), on the outskirts of Bangalore, India. The company said that
TTTI was meant for those who had passed out of middle school (Class 10) but
could not continue their education due to financial or other constraints. TMC
projected the setting up of this institute as a corporate social responsibility
initiative that was aimed at benefiting a disadvantaged section of Indian
society by increasing their employability. At the institute’s opening ceremony
held on August 1, 2007, TMC’s Executive Vice President, Mitsuo Kinoshita, said,
“I am confident that the establishment of TTTI will contribute to the
betterment of Indian society by cultivating the power of the nation’s youth.”
The seeds of this institution
were reportedly sown in the year 2005, when Atsushi Toyoshima (Toyoshima),
Managing Director, TKM, visited a number of technical institutes in India. He
felt that the curriculum in these institutions was outdated and not in sync
with the requirements of the industry. Analyst noted that despite the 4,500-odd
technical institutes in the country, the kind of products they were churning
out were not of much use to the manufacturing companies. For a company like
Toyota, which had aggressive growth plans in the rapidly growing Indian
automobile market, this was a major hindrance as the company had little talent
to choose from. This prompted Toyoshima to ask the management at Japan to set
up a technical institute in India on the lines of Toyota Technical Skills
Academy (TTSA).
The company’s decision to
start the TTTI in India was first announced in March 2007. “In addition to
making automobiles, we believe in proactively contributing to society by
consolidating the knowledge and know-how within Toyota to develop capable human
resources and thus contribute to the development of a prosperous society,” said
Toyoshima. The company placed advertisements for a three-year technical skills
program in the local newspapers and started accepting applications from the
next month for the selection of the first batch of 60 students. The institute
would provide the courses, boarding, and lodging free-of-cost, and also pay
each trainee a stipend in the range of Rs. 1,800-2,200 per month. Promising
trainees would also be provided with fellowships (US$180 AND US$230) and a
chance to join the company after successfully completing the course. Around
5,000 applicants applied for the program. Subsequently in June 2007, an
admission test was held and 64 trainees were selected for the first batch.
The TTTI was established at a
cost of Rs. 220 million (US$5.6 million). The institute was spread across a
48,726 square meter area within the premises of the TKM facility at Bidadi,
Bangalore. It initially started its operations with a total staff strength of
25, including 17 teaching staff, headed by V Ramamurthy and T Somanath
(Somanath) as Dean and Principal respectively. Through the three-year
residential program, the company sought to provide the trainees with the skills
of Monozukuri. The institute offered four practical-oriented courses in painting,
welding, automobile assembly, and mechatronics. The courseware was similar to
that of TTSA, but was adapted keeping the Indian market in mind. The students
were also provided lessons in subjects such as English, and History,
self-improvement courses such as Yoga and Home Science, and lessons in
cleanliness, grooming and discipline.
In addition to academic
sessions, the trainees would gain significant exposure to the company’s famous
Toyota Production System and the Toyota Way. Toyoshima said, “We hope the
students will be able to appreciate various aspects of Monozukuri or skilled
manufacturing in the Toyota Way. They will not just learn but also practice
Monozukuri.
Though the company hoped to
employ all the trainees once they had completed the program, the trainees were
not under any compulsion to join the company. Somanath said, “It is a corporate
social responsibility initiative for us. Analysts too agreed that the company
was indeed making a positive difference in the life of the trainees. They were
not only getting a taste of a better life and had a better future to look
forward to, but were also in a position to send home a part of their stipend.
According to the company,
TTTI was still in the testing phase and the first batch would be like a test
case for the future. The institute would train approximately 180 trainees
across three academic years. The management at the company felt that keeping
the future growth of the Indian market in mind, setting up the TTTI in India
made good business sense. India was one of the world’s fastest growing car
markets and was poised to grow at an astounding 14.9 percent through 2010,
according to Frost & Sullivan. According to some estimates, by 2010, the
number of cars sold in India annually would double to 3 million, compared to
2007. In such a scenario, TKM had to quickly ramp up its presence in the
market. As of 2007, TKM had a mere 4 percent market share in India.
Analyst noted the company was
lagging far behind its competitors and felt that this initiative would TKM
become more competitive in the future. They expected TTTI to play a key role in
the development of human resources at the company and to help bolster the
company’s production operations in India in the future. Some industry watchers
also pointed out that between 2002 and 8 Monozukuri is a Japanese word
consisting of two words mono (products) and zukuri (process of making). But the
meaning of the word goes beyond the combined meaning of the two words to
encompass ‘excellence, skill, spirit, zest, and pride in the ability to make
things very well.’ (Source: Kozo Saito, “Development of the University of
Kentucky – Toyota Research Partnership: Monozukuri: PART I,” Energia,
Vol.17.No.4, 2006.)
2007, TKM had suffered due to
labor unrest in its facilities in India, and viewed this initiative as an
attempt by the company to breed loyalty on the shop floor. Business Week noted,
“Another, ulterior motive was ensuring labor loyalty. For the past five years,
Toyota India has suffered a series of strikes and a lockout, with labor unions
protesting in support of better wages and against the dismissal of two of their
members. Training youth in-house helps build loyalty for Toyota on the assembly
line.
Questions
1.
Describe
the probable reasons for the setting up of the TTTI in India. Describe the
direct and indirect benefits accruing to TKM by running the TTTI. What,
according to you, are the short-term and long-term benefits to the company?
2.
The
TTTI trainees were not under any compulsion to join the company (TKM) once they
had completed the training program. What are the possible advantage(s) and disadvantage(s)
of such a policy?
3.
In
your opinion, will similar training initiative be successful in the service
sector? Explain in the context of a few service industries that you are
familiar with.
CASE – 2 Dealer Training Programs – A New Trend
In India, the corporate
training market was pegged at Rs 25 billion (by the end of 2004) and was
growing at a rate of 30% annually. Though sales training was not new concept in
Indian industry, the trend of extending sales training initiatives to business partners
was slowly catching up. The automobile companies were among the first to
implement dealership training programs. For example, when Maruti Udyog Limited
(Maruti) got the highest rank in customer satisfaction in the JD Power Asia
Pacific India customer satisfaction index (CSI) study in 2000, it launched
‘Project Hat Trick’ in consultation with NIS Sparta, a leading training and
consulting organization. The project aimed at creating excitement among the
service staff (of the dealers) and also imparting the knowledge and know-how
required to satisfy the customer. As part of the project, the service
supervisors were trained on the aspect of customer delight and managers were
trained on leadership and business planning aspects. The service mechanics were
given training in the areas of self-empowerment and behavioral interventions.
This also helped to bring about attitudinal changes in the dealer segment to
meet the demands of customers. Consequently, Maruti received the award for the
next two consecutive years. In 2002, it topped in four out of five factors of
the customer satisfaction index (CSI) and received the highest score of 124 as
against the industry of 118.
Speaking on the issue of
training in the automobile sector, Vijay Kohli, Vice-President, NIS Sparta,
said, “Training in this sector is also quite different from others as here the
customer expects sales executives to know the features, advantages, and
benefits of each and every part of your vehicle. Not only that, the customer
also expects the executives to know the technical side and the product
advantages over others to make his/her decision.
Consumer appliances
manufacturers were also focusing on these areas in light of cut-throat
competition, increased customer expectations, and the increased complexity of
the product line. For example, Philips India Ltd. (Philips) a leading consumer
appliances company, launched a dealer training program in 2000 called ‘Unique
Selling Program’ (USP) aimed at creating awareness about its products among the
dealer sales personnel as well as to enhance their softselling skills. The
training program consisted of the following elements – role play,
presentations, hands-on-demos, and group working. The role plays enabled the
participants to comprehend the features of the products thoroughly. The
hands-on demos trained the participants on conducting product demonstrations to
the customers. In the group working module, participants were allowed to team
up with other members and conduct demos without the help of the trainers.
Through this program, Philips aspired to enhance the salesperson’s selling
skills, communication skills, and sales closing techniques. The company
conducted 40 such training programs covering 25 cities across India. The
program was a success as it helped the company to improve its market share in
big stream audios and CD-VCRs segment by 80% and in the Walkman market by 20%.
Speaking about the success of the program, Rajeev Karwal, Philips India senior
vice-president (consumer electronics), said, “The company has benefited from
this exercise as the USPs have helped in reinforcing the superiority and
product differentiation of Philips products in the dealer salesman’s mind,
resulting in increased confidence in the Philips brand.” Buoyed by the success of
the program, Philips decided to make USP a regular feature and conduct the
program twice every year.
Dealer training programs were
also being increasingly adopted by FMCG product companies. Sensing the need for
training its business partners, HLL, the leading FMCG company in the country,
launched an ambitious sales training initiative aimed at distributors’
salesforce called ‘Project Dronacharya’
in 2003. Under this program, HLL planned to train nearly 10,000 retail
stockists’ salespeople spread across 70 cities in a phased manner. The training
program covered various aspects of the sales process including merchandising,
route planning, cross-selling, and upselling. The training job was entrusted to
leading training organization NIS Sparta. The training program involved 139
trainers called ‘Dronacharyas’ accompanying the retail sales stockists’ men
(RSSM) on the field and explaining what their shortcomings were and how they
could improve their skills. Within eights months of the launch of the program, HLL
saw good results. The total lines sold per day (TLSD) and sales target improved
by 15%. Some distributors achieved sales above Rs 10 million.
Another prominent example in
the FMCG sector was the Gujarat Cooperative Milk Marketing Federation (GCMMF)
(the brand owner of Amul), India’s largest food products marketing
organization. GCMMF also undertook a similar initiative called ‘Amul Yatra’.
Under this program, the company trained all its 3,000 distributors and their
sales force on various aspects such as the Federation’s philosophy and culture,
procedures, and operational systems. The training program also aimed at
improving their selling skills.
Commodity product
manufacturers like Tata Chemicals too focused on training their business
partners. In 2002, the company conducted a training program for its business
associates aimed at strengthening the brand equity of Tata salt, the largest
selling iodized salt brand in India. Tata Chemicals initiated these training
programs as a part to its strategy to develop a long-term relationship with
marketing and distribution partners, to improve the synergy between the company
and the channel members, as well as to leverage on the resources effectively
and efficiently. During the first phase of this initiative, the company
conducted a five-day training program called ‘owner management program’,
wherein the channel members and distributors were provided training in
marketing and strategy skills. The objectives of this program were to :
·
Equip
participants with marketing concepts, techniques, and functional inputs.
·
Help
them comprehend organizational decisions and responses in the face of evolving
markets and consumers.
·
Help
identify opportunities and successfully manage an enterprise.
·
Enhance
value propositions in transitional markets.
·
Make
informed and progressive decisions based on the marketing mix.
In the next phase, the
company conducted an intensive sales training program for the sales force of
Tata Salt channel members and distributors. In this program, participants were
trained to get a better focus of the market with a suitable sales strategy. It
also helped the participants in managing markets for profits and growth.
Questions
1.
Indian
companies, which used to focus mainly on sales training programs for their own
sales force, are now extending these initiatives to their business partners.
What are the major reasons behind the increasing prominence of such initiatives
among Indian companies? Also throw light on the advantages and disadvantages of
outsourcing the training activities to third parties.
2.
Behind
every successful dealer is a smiling and efficient dealer salesperson. Explain
the relative importance of dealers in the consumer durables industry over and
above those in the FMCG industry. How have consumer durable players improved
the performance of their dealers through training?
 |
| In your opinion, will similar training initiative be successful in the service sector Explain in the context of a few service industries that you are familiar with |
CASE – 3 Enhancing the Credibility of the Training
Function: Involving Line Managers in Sales Training
“Rakesh let me make it clear to you that
I can’t allocate any more money for training. I can understand why you want to
conduct a training program on coaching skills for the line managers, but I
can’t help you in this regard. Not for another year at the very least. In fact,
I may have to curtail your training budget for next year as we are going
through a lean phase,” said Sanjay Shah (Shah), the CEO of Dirc2U, a direct
sales company that dealt in a range of consumer appliances. From his tone, it
was clear that he would not entertain any further discussion on this topic.
Rakesh Sharma (Sharma) had been working
as the training manager (TM) in Dirc2U for the past three years. During this
period he had single-handedly taken care of all the training and development
(T&D) activities of the company. Of late, he felt that despite a contemporary
training program, the sales force was unable to internalize the training due to
lack of support from the line managers in the field. Sharma, who had ample
experience in sales and sales force management before getting into the training
function, understood the significance of the role of line managers in
reinforcing the class room training. His repeated proposals to conduct a
training program on coaching for the line managers had fallen on deaf ears. But
Sharma knew that he could not let the situation drift any longer. The company
had failed to achieve its revenue targets in the previous year. This year too,
it was struggling to reach 75 percent of the projections. Since it was
difficult to measure the return on investment (ROI) of training, the training
budget tended to get the chop during tough times. In such a situation, Sharma
could expect some cuts in his budget for the next year. Yet he knew that in
tough times there was a greater need for T&D interventions. He also knew
that if things got even tougher, and the company decided to cut costs even
more, the job of the TM would be one of the first to go.
Sharma was almost certain
that he would convince Shah regarding the importance of this specific T&D
plan for the line managers. But no amount of persuasion could budge Shah.
Sharma’s hope of involving the line managers in making sales training more
effective seemed unlikely, at least in the short term. Now he had to find dome
other way to make the sales training more effective. He also decided to look at
ways to project the importance of training to the top management.
Before joining as the TM in
Dirc2U, Sharma had worked in another direct sales company for ten years in
various capacities – sales representative (SR), area manager (AM), and then
regional manager (RM). During his tenure there, he had developed an interest in
T&D. Three years ago, when he saw the advertisement for the post of
training manager in Dirc2U, he immediately applied for the post. Though he did
not have any formal qualifications for the job, his ten years of experience in
the sales function saw him through the interview process. Sharma was in the
habit of regularly updating himself on issues related to this job and his other
interests. In addition to his experience of providing on-the-job training
(OJT), the interview panel headed by Shah was impressed by his understanding of
different issues related to the training function.
A lot had changed since then.
Sharma had conducted about 50 training programs in three years. He had conducted
basic sales training courses for new entrants as well as refresher courses for
all sales people on an annual basis. His long stint in the industry helped him
to design very contemporary and, at times, innovating training courses. During
implementation of the training programs, Sharma generally avoided the over-used
lecture method as much as he could. His training programs had lots of scope for
interaction, experience-sharing, feedback and practice. He facilitated
understanding of key issues through the use of real life stories and anecdotes.
This made his sessions informative as well as interesting. Many of the trainees
were attracted towards his personality due to his cheerful countenance and as
he was very approachable. He used a lot of role-plays to reinforce the learning
points and skills, and assess the transfer of learning/skills. He also made it
a point to visit key customers with the SRs whenever there were no training
programs. This helped him to understand important operational issues and be in
sync with the changing requirements of the industry, and uncover training
needs. Sharma believed that the training programs were quite contemporary and
the quality was better than the industry average. But despite this, Sharma was
left with the feeling that the organization was not getting the best results
out of the training programs.
During his field visits with
some of the SRs he had trained, Sharma observed that the SRs were not
practicing what they were taught in the classroom. One of the SRs who had done
very well in the training program explained, “The training was very informative
and I learnt a lot from the program. However, real world situation require us
to adapt our knowledge according to the situation. My boss told me that we have
to be more practical in our dealings with the customers.”
Sharma was aware that most
line managers had this attitude. He knew how important line managers were for
reinforcing initial training, but it was often these people who could also
unknowingly do a lot of harm. It was not uncommon for a line manager to
comment, “Congratulation! You have done exceptionally well in the training
program. Now, let me show you how things are done in the real world.” Comments
like this could prevent the trainees from obtaining the optimal benefits from
the training program. Sharma made a mental note to discuss the issue with Shah.
“I get your point. Such
things happen in every organization. But, you have to find out the best way to
solve your problem,” said Shah.
Sharma had come prepared for
the meeting. For the last six months, he had been working on a project to
prepare some training modules for the line managers. The course was on coaching
skills for line managers. Sharma contended that though coaching was a vital
part of a line manager’s responsibility, many of them didn’t actually know how
to do it. He argued that if a formal coaching system was put in place, the line
managers could reinforce the classroom training; this would lead to the overall
development of the sales force. After Sharma’s presentation of the detailed
training proposal, Shah said, “I am impressed. But to tell you the truth, we
won’t be able to implement such a program for another one or two years. We have
to really ramp up our presence in the market and I can’t afford to bring the
managers out of the market for a training program at this juncture. Moreover,
we are in the process of cutting costs to meet the profit budget, as we are
struggling to meet the revenue budget. We have to wait till things get better before
we can do this.”
“But all our expenditure on
training is being wasted, without the support of the line manager. What so you
suggest we do about that in the mean time?” Sharma asked.
Shah retorted, “Well, you are
the training manager. You have to make the most of the resources you have.
Speak to the line managers, persuade them to see things your way.”
“Don’t you think they should
be the ones to approach me with their problems?” asked Sharma.
Shah replied, “If they are
not doing so, you should give them a reason to approach you. Just because you
are a training manager does not mean that they will approach you. They have to
see that you are a useful resource for them. They have to see results.”
“We are not getting the
optimum results out of our training programs due to the non-involvement of the
managers. You are saying they have to see results before getting involved…it’s
a chicken-and-egg story…let us initiate some thing from our side…this training
program could be the first step,” said Sharma.
Shah replied, “You can forget
about this training program for the time being…If you ask me, the answer would
be to conduct fewer training programs and focus more on ensuring that the
programs are effective in increasing the sales…and believe me, there will be
fewer training programs now, as the training budget is going to be cut.”
Sharma was very disappointed.
He said, “Sir, I understand we are going through a lean phase. But, don’t you
think there is a greater need for training in such a situation?”
“I will be happy to allocate
you the money. Show me some results. I should know what is the ROI from
training,” said Shah. Sharma could detect a hint of sarcasm in Shah’s words.
Both the men knew how hard it was to ascertain the ROI from training.
The discussion went on for a
few more minutes, but no amount of persuasion could change Shah’s position.
From the time he joined
Dirc2U, Sharma had dreamed of putting a training organization in place about
five years, with a team of at least three more training managers. The meeting
with Shah had made him realize that the very credibility of the training
function in the company was at stake now. With his job on the line, Sharma,
personally, had even more at stake.
Sharma now had to figure out
how to get the line managers more involved in sales training. He also had to
work towards earning more credibility for the training function in the eyes of
the various stakeholders.
Sharma understood that
getting the involvement of the line managers was easier said than done. There
wee many conflicts of interest. He recalled that the line managers had not been
very responsive to the overtures made by him on earlier occasions. Many did not
feel that training was helpful to them. He had even heard some line managers
complaining about how man-days were lost due to training. They felt that their
team members were better off in the field doing some work rather than attending
a training program on a “vacation paid for by the company.” Some managers even
felt that a person who was not born with the skills to be a salesman could not
be trained to become one. Line managers were also heard saying that on-the-job
training (OJT) was the best form of training a person can get. In fact, during
the lunch break at an earlier training program, a newly appointed AM had told
Sharma, “My take on training is ‘push them off the cliff, and they will learn
how to fly’. I feel that classroom training is a waste of time and
money…on-the-job training is sufficient.”
Sharma wouldn’t have had any
issue with such an attitude if the line managers were indeed concerned about
training their team members. In his earlier company, he had trained many SRs in
the field as he perceived that the quality of formal classroom training was
poor. But often, OJT was merely teaching the SRs some thumb rules and shortcuts
that did more harm than good in the long run.
To make his case that
training was useful, Sharma began by collecting the pre-training and
post-training sales data of the SRs. Although he had to follow up a number of
times with some RMs before he received the data, once the data was tabulated
and analyzed, Sharma felt that the effort had been well worth it.
On analyzing the pre-training
sales figures and comparing them with sales figures after three months and six
months of training, some patterns began to appear. Sharma found that in most
cases individuals or teams who had received training along with their first
line managers were more likely to have performed better than those individuals
or teams whose managers did not attend the training program. He also found that
SRs whose managers were more enthusiastic about training were doing better than
SRs whose managers were skeptical. He also found that some of the teams who
were doing exceptionally well had line managers who were true champions of
training. They used to consult him regarding sales training-related quite
regularly. They were also the ones who regularly provided feedback and
suggestions to him on how to make the training program more effective. The
problem was that such managers were few and according to Sharma this was, in
part, responsible for the poor sales performance of the company.
Though this information was
significant, Sharma knew that it would not be enough to convince Shah. He had
very little data to support the conclusion he had reached and Shah would
probably dismiss his findings as flawed. It was difficult to attribute the
sales to training alone, as there are so many other factors that impacted
sales. Moreover, he felt that it would be too early to go back to Shah. He
decided to do some further groundwork before approaching the CEO. He decided to
go with these findings to the national sales manager (NSM), Sanjeev Rao (Rao),
instead.
Rao had been heading the
sales function at Dirc2U ever since the inception of the company five years
ago. Though he was not a big champion of training, Rao understood the
importance of training.
After going through the
report, Rao said, “Very interesting…Managers do have a role in helping
reinforce classroom training. So, how can I help you?”
“I wish we had greater
involvement of the line managers in sales training,” said Sharma.
Rao said, “If the line
managers feel that their objectives are in alignment with your objectives, they
will definitely work with you. Why don’t you talk to them, and show them this
report?”
“I will do that right away.
But I also expect you to speak up for this initiative with your team,” said
Sharma.
“You can count on me.”
It was six months since
Sharma had that interaction with Rao. In addition to setting up open lines of
communication with the RMs and AMs, Sharma, had also started involving them in
designing the training programs. Trainees came to programs with an assessment
of their strengths, weaknesses, etc., from the line managers; after training
they went to the field with assessment of the training manager and individual
development plans to be followed up by line managers. That Rao championed the
cause also helped attain this breakthrough. Now, more line managers have started
approaching Sharma with their problems or suggestions.
“They (the line managers) are
so involved because you have involved them in training process. Most of all, as
they have understood that your objectives are no different from their
objectives and that training helps them in achieving their objectives. Some
line managers have witnessed a positive change in their sales figures that they
attribute to training. The stature of training has grown in the eyes of the
line managers,” said Rao.
“Thanks to you. Do you think
we can take this partnership to the next level with a formal training program
on coaching skills for the line managers?” asked Sharma.
“Suits me,” Rao replied.
During the period, Sharma had
also accumulated data to project the direct (such as new skills learnt),
indirect (such as before and after analyses of improvement in closing sales
calls) and long-term benefits of training (such as improved customer
relationship). He felt that this data would be helpful in linking training to
the bottomline results. He had also started networking with other T&D
professionals in the industry. Insights gained from such networking helped him
forge better partnerships with the sales force as well as explore ways to
project the benefits of training to the top management. With more line managers
approaching him with their problems, it had become necessary for him to
continuously upgrade his knowledge.
Sharma believed that after
another three months he would be in a position to put forward a strong case for
a training program for managers in front of Shah.
Questions
1.
Discuss
the importance of line managers in reinforcing initial classroom training. What
are the issues and challenges faced by training managers in partnering with the
line managers? How can these be overcome? In your opinion, how did Sharma
succeed in forging a partnership with the line managers?
2.
Training
is viewed as a cost. Although experts opine that training is needed the most
when a company is going through tough times, it is in such situations that
training budgets are most likely to be slashed. What are the problems in
ascertaining the ROI of training? How can training link training to bottom-line
results?
SECTION II: Solve any 4 questions.
- If you
were going to use online technology to identify training needs for
customer service representatives for a web-based clothing company, what
steps would you take to ensure that the technology was not threatening to
employees?
- What
could be done to increase the likelihood of transfer of training if the
work environment conditions are unfavorable and cannot be changed?
- Why
would a company use a combination of face-to-face instruction and
Web-based training?
- What
does “managing diversity” mean to you? Assume you are in charge of developing
a diversity training program. Who would be involved? What would you
include as the content of the program?
- Why
should companies be interested in helping employees plan their careers?
What benefits can companies gain? What are the risks?
- Discuss
how new technologies are likely to impact training in the future
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