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.
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.
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Corporate Training
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outdated and not in sync with the requirements of the industry.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?
 |
| 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. |
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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