Cultural Insights Blog
When we want to increase the value of culture training by using hard metrics, the McKinsey Quarterly survey report1 provides some valuable insights. The report states that of the participating organisations which were spending resources to develop highly capable employees, 90% said that ‘building capabilities’ was a top-ten priority for their organisations. Only 25% of survey respondents said that their programs were effective at improving performance and only 8% tracked their programs’ return on investment.
So how do we increase the ROI of organisational training programs, and how does this relate to training which builds capability in the area of Cultural Intelligence? Many requests for cultural training begin with the broad need to ‘increase cultural awareness’. This might come about, for example, because employees might work in multicultural teams, are required to work with overseas located clients, are posted overseas to an office in another country (e.g. on secondment/transfer), or are part of the off-shored business. In all instances, staff are required, in some capacity, to work with people from different cultural backgrounds.
Often the managers responsible for sourcing cultural training services lack the time or skill to analyse the aspects of performance which really need improvement within their organisation e.g. intercultural communication, leadership across cultures, operating in multicultural or virtual teams, and instructing staff from other cultures.
As intercultural learning and development specialists, we come across cases where managers know too little about their cultural training needs to make a truly informed training choices for the area that requires improvement. Recognising that their staff, clients or partners might differ in skin colour, race, religion, accents and language fluency – is simply not enough information on which to design an effective cultural training program.
To increase the value of cultural training, organisations need to define and follow a process, and set clear objectives with measurable metrics. Identifying which part of performance needs improvement, defining the key performance-enhancing skills and competencies required, and linking these to specific learning outcomes is key to the success of any program. Careful selection of people who would benefit most from skills enhancement to improve performance is also critical. By applying this type of process, learning objectives guide the design of the training and increase the effectiveness of training outcomes.
According to McKinsey, “Picking the right metrics is the key to creating real value from training.” This means that performance needs to be clearly defined in order to put a value on training. Questions that will assist include:
To measure the value and ROI of cultural training it also important to evaluate hard metrics that impact on other areas of the business. These include e.g. customer satisfaction, customer relationships, staff turnover, sick leave, team productivity/output, quality assurance, career advancement, sales, and quality of decision making.
Training which raises cultural awareness is an excellent tool to map some cultural differences but is often seen as ‘a nice to have’. In case organisations want to really improve performance and develop the intercultural competence, training programs need to go beyond basic cultural awareness. To actually bridge cultural gaps and integrate cultural differences requires training which incorporates developing specific intercultural competencies and regular practice of new skills. Therefore implementing culturally effective work practices are an essential part of the intercultural competence set of a manager or professional who works across cultures. Integrating cultural differences through the development of effective work practices (for example, through (team) coaching) can be an important step in the process of making the investment of cultural training effective and measurable.
We were approached by a multicultural health organisation experiencing high staff turnover, high rates of sick leave, and low employee satisfaction. Based on anecdotal feedback and patient/client complaints, cultural differences were highlighted as a key issue. Therefore we designed an online Training Needs Analysis to explore the cultural challenges, concerns and experiences in more depth. In this way we were able to identify what was missing in terms of cultural performance-enhancing skills and competence for both staff and management.
Specific outcomes were defined and the organisation’s HR department identified the metrics to evaluate training effectiveness. The effectiveness was measured by achieving a reduction in percentages points for staff turnover, sick leave, customer complaints, and a specific percentages point in the increase in employee satisfaction. We facilitated training for 220 staff and management of one subsidiary over three weeks. On completion of this pilot project, all of the identified objectives were successfully achieved. Interestingly, the number of customer complaints dropped significantly and complaints related to cultural challenges were down to zero! So successful were the results that the other subsidiaries of the organisation have requested that their staff and management complete the same training.
This example illustrates the value in setting clear objectives to maximise the effectiveness of training outcomes which can have an inspiring positive organisational change.
Cermak J & McGurk M, 2010, ‘Putting a value on training’, McKinsey Quarterly (the business journal of McKinsey & Company),see Visitor Edition.
Joost Thissen, Partner & Interculturalist