Changes in financial status have impact on undertaking training programs; A multi-organizational case study

Global economy witnesses dramatic changes both in structure and operation of various corporate entities resulting in varied functional styles as well as performance of organizations. This also affects the way companies focus on grooming their manpower. The technology, content and way of training their manpower have taken a different look now days. “Training and development” is an essential wing of every organization, which converges theoretical concepts to practical application for organizational benefits. It helps to bridge the gap between theoretical ideas and practical needs. Designing “training and development” programs require an integrated approach including financial allocations. Corporate realizes that training is the future investment although expensive but the organisation should design to embed it in their long term strategy (Nyerere, 1973). Training has been an important variable in increasing organizational productivity. Most of researchers including Colombo and Stanca (2008), Sepulveda (2005) and Konings & Vanormelingen, (2009), showed that training is a fundamental and effectual instrument in successful accomplishment of the firm's goals and objectives, resulting in higher productivity. Research output indicates a strong correlation between financial fluctuation and hitherto changes in designing “Training and Development” programs. Refer a research done in 1999 it is seen that organisations spend less than 50% of their pre-allocated budget for training. (Mkawe, 1999). Of course other factors are present those lay impact on training design like financial fluctuation. This paper work is a sincere endeavor to understand the impact of financial fluctuations on designing & setting proper “Training and development” programs for their respective employees.

Corporate are always boasting of conducting such programs irrespective of their financial status. While analyzing such practicality and rationality was the base purpose of this research but the result appears somewhat different. Result of organizational performance and status interpretation in this research displayed a dismal state of affairs as far as the HR function is concerned.

Four organizations were taken into consideration. Tata Steel Jamsedpur, NALCO Damanjodi Odisha, FACOR Balasore and Visa Steel of Kalinga Nagar in Odisha were considered as sample organisations. Descriptive analysis were done to assess the profitability ratio of these companies by taking ratio analysis from their annual reports of five years from 2009 to 2013. Data were collected regarding their training programs conducted both in-house and out-house. A statistical observation was done to see the relationship between the profitability and no of training programs conducted.

Changes in financial status has no impact on undertaking Training Programs. This null hypothesis was taken considering the relationship between the financial status and the no of training programs conducted in the companies.

The sampled corporate are conscious by absence of coherence in the training programs. The four organizations that are under study in this working paper are showing more or less same pattern in way of their attitude towards the financial allocations in HR areas especially in area of training and development. It is evident out of the research that when there is a financial stability the focus on training is more but when risk is imminent or the profitability is less the training performance is low. This is certainly going against the notion that the companies should integrate it as their long term strategy using their reserve and surplus funds. This research focused on the relationship between the cited two working variables and used the qualitative as well as the statistical analysis to satisfy the pursued objective. A strong direction is found in this relationship ignoring the impact of well stocked reserve and surplus funds in bigger corporate houses.