Training and Development Term Paper

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Training and Development

Case Summary

Arthur C. Kaplan is one of the first six largest accounting companies in this industry and its activity is expanded at international level. The company hires almost 20,000 employees and its clients come from 31 nations, ranging from small companies to Fortune 500.

The current market trends are very optimistic. In the next 5 years, a.C. Kaplan is planning to expand its activity by a lot and in terms of human resources it seems that the company will need 900 new managers and 200 new partners. This is going to be very challenging because the company's policy is focused on promoting employees from within, rather than bringing them from outside and the average time span for a young professional to get to the partner position is 10 years.

Auditing and accountability are very demanding for employees that most of the times work 60-70 hours per week, whereas the salaries are in the mid-$20,000 a.C. Kaplan's benefit package is average for a company of its size, which is why many of the entry level employees leave the company after a short while without getting to the manager of partner level.

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The company emphasizes the role of training and development. This is one of the reasons that led the management to build top in-house training and development centers. The most important of them is the Corporate Education and Development Center (CEDC) in Rye, NY. Every new Kaplan employee receives a two-week training in this center before starting a three-month on-the-job training in one of the corporate offices. The entry level training is focused on providing the employee with knowledge about processes and systems needed to perform its task, without trying to sharpen its interpersonal skills. However, lately it has been suggested that these latter skills should be trained as well, but many senior partners consider that the company is already spending too much money on training and development and in the end many of the employees that benefit from this program are leaving anyway. Given the new conditions of expanding workforce, the CEDC program represents a great challenge for the multinational company.

Term Paper on Training and Development Assignment

Problem Identification

The CEDC is seen by many managers as a high financial burden, but in the same time the center is envied by many of the company's competitors as a.C. Kaplan's new employees are supposed to be better prepared than the average new employees in this industry. The center is training the beginners and developing their skills for those to perform their tasks better in increase the company's overall performance. However, given that the company is expecting increasing waves of new employees, this will require even more financial resources and because the expansion is done at international level, the financial resources are expected to grow exponentially.

Anthony Blaine, one of the training directors questioned the CEDC stating the following: "For years we've been throwing tons of training at these people, but we aren't sure if it's the right kind, if it's too much, or even if they're catching what we're throwing!." This suggests that even though the company has made large efforts for the center, especially financial, to some extent, its efficiency and efficacy it's still unknown for the management.

A.C. Kaplan is spending in average $1,200 per year per employee in training activities and quite a large part of the new employees are leaving the company before getting to the manager of partner level, which translates into high attrition rate. The company needs a better strategy to retain its personnel, because every employee that leaves the company implies that one new has to be brought in and trained. This involves a financial effort and a time span in which the new employee gets accustomed to all processes, systems and dealing with clients.

A.C. Kaplan has maintained a policy of promoting people from within the company, but the time span of reaching the partner level is in average 10 years. Given the increasing growth rates in the accounting/audit industry, the company forecasted a necessity of 900 new managers and 200 new partners in the 5 years to come. Taking under consideration high attrition rate and maintaining the 10-year average time span condition to reach partner position, the company will be hindered from reaching the above mentioned objectives with respect to managers and partners, as the company is not capable to retain many of the entry level employees long enough for those to reach top positions.

The CEDC is not focused on the new employees' interpersonal skills. It has been observed that some clients had discontinued business with a.C. Kaplan and in a lot more situation, the aggressiveness of fresh employees has come across a good relationship with some of the clients coming mainly from health care and real estate industries. It is likely that entry-level employees lack interpersonal acumen, given that most of them don't have a prior work experience, and these skills are usually acquired in time. Professional in-door training focused on developing those skills would help the new employees acquire the needed skills a lot faster, but the management is thinking that the company's is already allocation too many resources to the CEDC program. Introducing the new feature in the actual condition, would imply allocating even more resources to the training and development program, which is why major restructuring is needed.

Discussion of Alternatives

The CEDC is seen by many managers as a high financial burden

Set training sessions in the office buildings, instead of organizing those in special centers.

The advantages of this alternative are:

reduced rent-related costs - a.C. Kaplan doesn't have to pay rent for a special place dedicated to training only, such as the Rye center.

A the new employees have the opportunity to watch how the auditing/accounting activity takes place in reality, by being trained in the same office building where they will work after the training period is over.

The disadvantages of this alternative are:

Office buildings training rooms are smaller than CEDC like training rooms, which means that new employee interaction is reduced. The entrants will be divided into smaller groups to fit the new conditions.

The office buildings may get too crowded in some circumstances, as training rooms are also used as conference or meeting places.

The office buildings may loose some of the professional aspect with so many untrained employees around, in case clients pay visits to their accountants/auditors when training sessions are organized.

Reduce CEDC's costs would be to set virtual environment classes taught by remote managers. Also, some of the classes should be taped and used over and over again.

The advantages of this alternative are:

Fewer managers have to rotate at once to provide training for the new employees, as virtual classrooms are larger than physical ones and some of the classes can be recorded, which means that these classes are held only once with the recording occasion.

Virtual classrooms avoid the potential crowd effect that would show up if training is provided in the office building's conference rooms.

The disadvantages of this alternative are:

Virtual classrooms reduce the personal touch of face-to-face training sessions. People interact better when facing each other. Having to communicate through a microphone may be inhibiting for those new employees that are not so familiar to the new technologies.

Also, because some of the new employees are not very familiar to new technologies, the effect of the training sessions for them would be reduced than for all other attendees.

Virtual classroom training sessions reduces the interaction between attendees because everybody has to wait for its turn when talking and the online discussions may go to different directions than face-to-face ones.

Relocate the training and development centers to cheaper locations.

The advantages of this alternative are:

Lower rents paid for training and development centers.

Potential government support, if the new location is in an emerging country and the a.C. Kaplan commits to hire a part of the new employees from the host country.

The disadvantages of this alternative are:

large initial investment is required to relocate the old training and development facilities.

Not all the trainees may be available to relocate, which implies that only some of the company's managers will rotate for this activity and that would create an uneven distribution of training activity among managers, which could lead to employee frustration.

To some extent, CEDC's efficiency and efficacy is unknown to the management

The impact of the training and development programs needs to be measured to determine its efficiency. The company has to set measurable indicators for this activity.

The advantages of this alternative are:

The company has a clear picture of the impact of the training and development activities.

The company can determine which activities are more efficient and which are less efficient and based on that it can choose to expand or eliminate some activities to improve overall efficiency.

The disadvantages of this alternative are:

The company has to allocate new resources for the analysis activity - hire business analysts, provide those… [END OF PREVIEW] . . . READ MORE

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