An explanation on why training is important to an organization

Recommendations, what a specific training and development programme should include for an organization in such a competitive industry as car manufacturing.

Essay, 2009
14 Pages, Grade: 72


Table of Contents


Executive Summary

2. Reasons Training and Development
2.1 Business Strategy
2.2 Employment Strategy
2.3 Employment Strategy and Business Strategy

3. Overview of Methods
3.1 Categorization
3.2 Non-Management Training and Development
3.3 Management Training and Development

4. Examples of Automobile Companies
4.1 BMW
4.2 Daimler
4.3 Volkswagen
4.4 Chrysler
4.5 Toyota
4.6 Others
4.7 Conclusion

5. Critical Evaluation of Alternatives
5.1 Business Strategy of Automobile Manufacturers
5.2 Possibilities for Automobile Manufacturers
5.3 Evaluation of Common Measures in the Automobile Industry

6. Recommendations




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Curtin University of Technology

Curtin Business School

Human Resource Management 200

Individual Assignment

Report to be presented to industry leaders, explaining why training is important to an organization and recommendations, what a specific training and development programme should include for an organization in such a competitive industry as car manufacturing.


Daniel Markus Jueterbock

2,300 words

Executive Summary

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To achieve its objectives a company needs a business strategy. It can choose between innovative prospector, quality enhancer or cost-defender strategy. According to that the firm has to apply an appropriate employment strategy. This can be the economic or the relational approach. The economic approach relies on hard skills whereas the relational approach focuses on behavioural skills. Depending on the employment strategy different ways of training and development come to mind for workers and managers. This report will explain the mentioned business strategies as well as the resulting employment strategies. Furthermore, means for training and development for non-managerial employees and for managers are explained. This report aims at giving recommendations for the automobile industry. Therefore, the successful automotive companies BMW, Daimler, Volkswagen, Chrysler and Toyota are examined according to their training and development opportunities. Further, it will be proven that the automobile industry applies the innovative prospector strategy and has the possibilities to invest heavily in human resources. This report shows that beside traditional training and development measures, corporate universities and e-learning support the innovative prospector strategy. The size of automobile companies enables them to invest in these costly measures. In the end, they will be critically evaluated and finally recommended.

1. Introduction

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The need for training and development in today’s business is obvious. Organizations have to ask themselves, whether or not to invest in an employee. Is that person able to improve and is training necessary? If so, what is the best training to achieve these objectives? Companies have to direct their investments where it is most effective (Capps and Capps 2005). Top evaluated jobs are important for the future of the organization. In fast-changing industries like the automotive industry, employees need training and development to remain competitive. Furthermore, high-performing employees need development as a reward (Capps and Capps 2005). According to Herzberg’s two factor theory this is important. Reward of responsibility and advancement is a motivator that determines the employee’s job satisfaction and – more important to the company – performance (Stone 2002, p.405).

2. Reasons Training and Development

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2.1 Business Strategy

Companies, such as automobile manufacturers, can apply three different types of business strategies – innovative prospector, quality enhancer or cost-defender strategy (Porter 1980; Miles and Snow 1984). If doing so, they have to orientate their human resource training and development due to their business strategy.

2.2 Employment Strategy

Depending on the business strategy, two employment strategies are possible. First, the economic approach is based on “hard” facts. It involves employing staff according to their performance level, quantifying this performance level and finally linking compensation to the quantified performance. Second, the relational approach involves social components. They are hard to measure and include job security, employee power and responsibility (Aggarwal and Bhargava 2009). These two approaches in combination with the business strategy explain which kind of training and development suits which company.

2.3 Employment Strategy and Business Strategy

Innovative prospector companies seek new markets and produce new innovative quality products for reasonable prices. Fostering innovation is crucial to their success. Therefore, they have to provide an environment that ensures hard work, loyalty and creativity from their employees. It uses a combination of the economic and relational approach. To achieve this trainings are necessary for innovation and promotions for motivation (Aggarwal and Bhargava 2009).

The quality enhancer practice continuous improvement, produce high-quality goods and create a climate of service. Here a focus on continuous training and a system for quality orientated rewards (Aggarwal and Bhargava 2009).

Cost-defenders focus on operational excellence, efficiency and cost-reduction. Here can be found performance-orientated appraisal systems, market-orientated compensation and a minimum level of training and development (Aggarwal and Bhargava 2009).

3. Overview of Methods

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3.1 Categorization

Companies can use different ways for training and development. Training aims at improving the immediate performance on a current job. Development prepares the employee for future job responsibilities. However, training does not exclude benefits for future promotions (Stone 2002, p.323). Depending on the objective, either training or development is necessary. Training and development measures can be distinguished between location, timing and presenter (Stone 2002, p.327). With respect to location, staff can get training on-the-job or off-the-job, in-house or out-of-house training. Varying by time, training can be in-hours or out-of-hours as well as spaced or massed learning. Due to the presenter, the coach can be in-house or external (Stone 2002, p327).

3.2 Non-Management Training and Development

The following training methods are appropriate for non-managerial employees. On-the-job training provides the employee with hands-on experience under normal working conditions and builds the relationship between new colleagues. Though this is the most commonly used training method, on-the-job training has disadvantages if implemented poorly. First, the workplace is not a well-structured training environment and misses learning efficiency. Second, the supervisor is not a trained coach, so he lacks supervisory training skills. Third, it might occur that job performance criteria are not well-defined. Finally, in case of contact with customers there might be customer dissatisfaction due to mistakes by the trained employee (Nankervis, Compton and McCarthy 1999, p.324). On-the-job learning is usually in-hours training provided by in-house senior employees.

Off-the-job training can vary respectively the before mentioned differentiation. It covers conference or discussion methods, classroom training, computer-based training (CBT), the internet or simulation methods (Nankervis, Compton and McCarthy 1999, p.325-327). The conference or discussion method involves communication and encourages employee participation. It supports discussing ideas or procedures. The classroom method is supposed to train a maximum number of trainees by a minimum of instructors. It mainly provides information from the lecturer to the employee. CBT or e-learning is interesting for large companies. CBT provides the employee with material and finally checks the learning or tests the employee, determines a skill and performance level and directs the trainee to the appropriate study material. The internet – as a modern form of distance-based learning – complements CBT as it uses computer networks to connect employees and coaches over large distances. Both, CBT and the internet provide cost efficient training as travel expenses and accommodation costs are reduced. Finally, apprenticeship training is a mixture of on- and off-the-job training. It includes practical and theoretical aspects, and is usually a cooperation of companies and TAFE institutions (Nankervis, Compton and McCarthy 1999).


Excerpt out of 14 pages


An explanation on why training is important to an organization
Recommendations, what a specific training and development programme should include for an organization in such a competitive industry as car manufacturing.
Curtin University of Technology  (Curtin Business School)
Human Resource Management 200
Catalog Number
ISBN (eBook)
ISBN (Book)
File size
531 KB
Human Resource Management, organization, training, development, car, car manufacturing
Quote paper
Daniel Markus Jueterbock (Author), 2009, An explanation on why training is important to an organization, Munich, GRIN Verlag,


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