QUESTION 1

SABPP has approached you to present the following to a group of HR

executives;

1. The importance of the role of HRM in risk management.

THE ROLE OF HRM IN RISK MANAGEMENT

South African organisations need a more integrated approach to managing HR risks.

HR risks need to be considered in every major business decision like opening a
branch in a different province or country. Research has clearly shown that so-called
‘soft’ issues, like cultural incompatibility, have led to more major business failures
during mergers, acquisitions and international joint ventures.

People are a source of risk, e.g., shortage of employees, people doing sloppy work,
an employee refusing to take on additional responsibility, or a key employee leaving
two months after completion of a one-year training program. Needless to say,
handling people is one of the most difficult tasks in the world and human resource
department of any company has to handle them and other related issues every now
and then. Risk Management is not only about controlling or reducing the negative
effects of physical and financial threats to the organization. Rather it also includes
handling and controlling the risk arising from shortage of employees, their refusal to
work and many other issues.

People are important in handling risk, e.g., people using their ingenuity to solve
unexpected problems, employees going the extra mile for the good of the
organization, a key employee redesigning her own job to avoid unnecessary delays
in getting work done, or an employee persuading a talented friend to apply for a
position in the business. Orientation and training matter as much for one employee
as for 20 employees. People are one of the keys to success in risk management.
Employees are creative and an important source of new ideas.
Appreciated people will respond with dedication and loyalty.

To understand fully how human resource management and risk management are
interrelated, one must understand human resource management.

It is the staffing, training, development, motivation, and maintenance of employees to

help accomplish organizational goals. Effective human resource management also
helps employees accomplish their career goals. Human resource management is a
process that can be broken down into specific activities: job analysis, writing job
descriptions, hiring, orientation, training, employer/employee interactions,
performance appraisal, compensation, and discipline. 

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Understanding these activities helps explain the relationship between human
resources and risk. Failure to successfully carry out these activities increases risk
and penalizes the business by not taking advantage of what its people could be
contributing.

It’s human capital who can make or break the organization. It can take it to new
heights or can weaken it. It is, therefore, very challenging to handle and manage the
risk resulting from people of the organization. It is only human resource that helps
management in dealing with risk. The situation would be worst if they themselves
become a risk factor. People use their skills and intellect to solve expected or
unexpected problems. But what if when they themselves become the greatest
source of risk or other problems? This is when HRD plays a key role. Human
Resource Management is not only about making policies for the organization. In
today’s unpredictable environment, it is certainly the indispensable part of an
organization. The major function of HRD is to get the job done from employees and
that too ensuring the interest of both the parties - management and employees.
Managing the labour, handling their issues, proper and regular supply of human
capital, motivating employees to perform their task in a better way, avoiding
unnecessary conflicts and using people to handle risk are what HRD is supposed to
do.

When we talk about HR related risks, the subject includes problems related to
recruitment and retention, adjusting skill-confidence level of employees, stress
management, maintaining industrial relations and many more. All these risks can
threaten the smooth working of an organization. HRD and risk management are
inter-related as they both deal with expected and unexpected problems arising in any
organization.

Risk management plans are specially developed and implemented to manage the
risk and reducing its negative effect on the organization. It may or may not be a part
of HRD. If the company is facing financial or physical threats, the risk management
may not be a part of human resource department. But if it is related to people,
industrial relations, conflict management and stress management, it is definitely a
part of HRD. It always deals with crisis of human resources of the company.
Recruiting, training and retaining people are the major issues that need to be
addressed timely.

Managing HR risk is a key element of HR governance. Proper HR risk management

gives HR executives an opportunity to fulfil their fiduciary duties of care and sound
financial management. HR risk management flows directly from external and
internal stakeholder engagement. HR risk management addresses key HR risk
issues like reducing risk, HR due diligence, the role of HR committees, implementing
codes of ethics and fair labour practices.

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Companies should identify HR risks in different sites or countries and develop
proactive risk-reducing plans to deal effectively with these risks. Consulting with
different stakeholders is an important element of sound HR governance. The
purpose of the seamless interfaces between the different stakeholders is to reduce
the different risks and uncertainties that arise because of the interaction between
them. Inevitably, the HR practitioner needs to work closely with the risk manager and
risk committee to ensure that the overall risk management plan of the company
includes HR risks.

APPLYING RISK MANAGEMENT TO HR

HR ACTIVITY POTENTIAL RISK POTENTIAL

CONSIDERATIONS
Compensation and benefits Financial abuse Who has signing authority?
How many signatures are
required?
Are there checks and
balances?

Hiring Discriminatory practices Was a complete screening

Hiring unsuitable or unsafe
candidates
"Wrongful" hiring
completed on potential
applicants?
Were provincial human rights
laws observed?
Is there a set probationary
period?
Were promises made to the
candidate that cannot be
honoured?
Did the employee sign off on
the policies and contract of
employment before being
hired?

Occupational Health and Environmental, Do we provide safe working

Safety Personal injury or death conditions and do we conduct
safety checks regularly?
Do we provide adequate
training for staff?

Do we ensure the use of

Employee supervision Abuse
Reputation in the community
Release of personal
appropriate clothing and
safety equipment?
Do we have adequate
policies, procedures, and
committee in place?
Do we provide sufficient
orientation and training?
Do we provide adequate

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 information supervision (especially for
activities that occur off-site or
after hours)?
Do we have a performance
management system in
place?
Are personal information
protection guidelines
followed?

Employee conduct Abuse Do we have clearly written

Reputation in the community
Exiting employee Property
Reputation in the community
Compensation
position descriptions for all
positions?
Do we follow up when the
parameters of the job
description are not respected?
Do we provide thorough
orientation and training?
Do we provide an employee
handbook?
Do we have comprehensive
policies and procedures?
Do we provide ongoing
training about our policies and
procedures?
Do we retain written records
of performance issues?
Do we ensure that
organisational valuables are
secure?
Do we have cash
management procedures?
Do we have adequate
harassment policies and
procedures?
Do we retrieve organisational
information and equipment
that a dismissed employee
used (especially from home)?
Do we ensure that all access
codes, passwords, etc are de-
activated?
Do we conduct an exit
interview?
Do we record lieu time and
vacation balances?

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2. Discuss the skills that HR executives require for effective integration of risk
management.

SKILLS FOR EFFECTIVE INTEGRATION OF RISK MANAGEMENT AND HRM

Leadership responsibility

Every human resource manager has leadership responsibility. Even though

delegation of authority and responsibility and other tools for empowering employees
decrease the need for leadership, some leadership is necessary. No group of people
comes close to its potential without effective leadership.

Increased employee engagement

High levels of employee motivation can be linked to high levels of engagement, and
a highly engaged workforce can do wonders for your bottom line. If an employee
feels motivated to complete a specific task, they’re also likely to feel more engaged
while completing said task.

Higher productivity and performance

Highly motivated employees are often more productive and better performers than
their unmotivated colleagues. They tend to work harder and focus on completing
their tasks to the best of their abilities, which results in better output for their
organizations. When you understand the reason behind an employee’s actions, you
can use that insight to motivate them and ultimately improve business productivity,
performance, and efficiency.

Communication

Communication is an essential skill for effective human resource management.

Sending clear messages, listening and use if feedback is essentially important. HR
professionals must have impeccable communication skills. When the job is to deal
with people, it becomes paramount for any HR professional to have strong
communication skills. They constantly deal with people over the phone or email, draft
company policies, and conduct interviews. Therefore, any HR professional must
have excellent writing skills to avoid any miscommunication. They must actively
listen to understand others’ perspectives and bring a more honest discussion
between them and the managers. Effective communication helps HR managers to
handle employee grievances empathically and also manage any internal conflicts
effectively.

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In many instances, effective communication can help solve problems or stop them
from developing in the first place. Employees turn to the HR department when there
is a problem with their job or they have a personal problem that could affect their job
performance. In these situations, an HR executive must know what questions will
draw out responses that paint the full picture and how to communicate a possible
resolution to the problem.

If there is a problem between two employees, it is up to HR to negotiate a solution.

Skilled negotiation takes excellent verbal and nonverbal communication skills.
Employees feel comfortable opening up when they sense that they are speaking to
someone who cares and listens thoughtfully. When HR professionals exude
trustworthiness, it puts employees at ease and helps them feel confident that their
concerns will be resolved. Likewise, special sensitivity and tact are required during
employee performance evaluations or layoffs.

Of course, good communication involves good listening. To bolster productivity,

workplace morale and employee engagement in a corporation's overall goals, human
resources personnel need to foster an environment of open communication and
active listening. It is vital that staff members feel their concerns and ideas are really
being heard. Plus, through establishing a company culture built on trust and open,
ongoing communication, HR can help employees navigate the challenges of
organizational change, thus playing a pivotal role in leading that change. It is up to
HR professionals to make sure that written communication of all kinds is clear,
professional and easy to understand, being essential to the multimodal
communication channels relied upon by today's hybrid workforces. The more
proficiently HR professionals can communicate through all channels, the more they
will be able to successfully help manage these workforces.

Training

Training is helping people learn and effective training requires teaching skills, an
understanding of how adults prefer to learn, patience, communication, a systematic
approach, and evaluation of whether the training has been effective.

When it comes to developing and implementing effective risk management

strategies, organisations can sometimes overlook the significant impact that
investing in quality training have on that process, particularly when there are
competing organisational and financial pressures. However, courts and tribunals are
increasingly examining the extent and effectiveness of training provided by
employers in determining liability in employment-related claims, particularly in areas
such as equal employment opportunity and work health and safety. As such,
overlooking this crucial investment in training cannot continue if risk management
processes are to be truly effective.

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There is a myriad of risks to people or property in an employment context, which can
ultimately lead to negative legal, financial or reputational outcomes for an
organisation and, in turn, liability for the organisation and individuals within that
organisation. In a workplace context, systematically and proactively identifying risks
and taking steps to address those risks in accordance with what is known as the “risk
management cycle” are the best protection that an organisation can afford itself. The
risk management cycle consists of well-defined steps that, when taken in sequence,
lead to informed decisions about how best to avoid or minimise the impact of these
risks. Broadly speaking, the risk management cycle has five stages-

 identifying risks;
 assessing and analysing those risks;
 planning and implementing a risk management plan;
 monitoring and evaluating the risk management plan; and
 reviewing and adapting the risk management plan based on the monitoring
and evaluation.

It is important to note that while the risk management cycle has clearly defined
stages, risk management is, and is intended to be, a continuous process. The reality
is that an organisation will likely be at a different stage of the risk management
process for all actual and potential risks it has identified. The organisation is
therefore best- placed by acknowledging and embracing continuous risk
management as this will ensure risks are identified and addressed at the earliest
opportunity and in the most cost-effective manner, and that there is continuous
improvement in the management of that risk and in risk management within the
organisation more generally.

There is no “one size fits all” approach to training in a risk management context. The
circumstances of your organisation at the relevant time will largely dictate the training
framework that is implemented. However, there are critical matters that every
organisation needs to consider in reviewing or developing its training framework in
support of its risk management strategy. These include-

 What are the immediate areas of risk for the organisation, including areas in
which it is obliged to provide training under relevant legislation or regulations?
 Does the organisation have a heightened vulnerability in one or more risk
areas that need to be addressed and, if so, what training is required to
address those risk areas?
 What is the organisation’s current training framework (including policies and
procedures) and what, if any, of that framework is directed to managing the
immediate areas of risk? Are there any gaps?

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  Are the organisation’s policies and procedures up to date? Do those policies
and procedures need to be reviewed in light of any recent legal or other
developments (including organisational or technological developments)?
 What resources does the organisation have available for training? How are
those resources going to be most effectively utilised?
 What does the training need to cover in terms of content? Is it necessary to
develop and rollout different training for different levels within the
organisational structure?
 How is the training to be delivered? Is there internal capability for developing
and delivering the training, or would an external provider be preferable?
 When should the training occur (for example, at induction or on promotion)
and how often? Is refresher training required, and, if so, how often and in what
form?
 What steps are being taken by or on behalf of the organisation to record
accurately, and retain records of, the training that is provided?

Motivation

Motivation of employees challenges every manager. Employee motivation helps the

organisation accomplish its goals while also helping workers accomplish their career
goals. Every business owner should strive to have a highly motivated workforce. A
company that focuses on motivating its employees and enhancing the employee
experience will see the below benefits from doing so.  Every manager struggles to
keep employees motivated from time to time, but great managers know that
employee motivation is key to overall success. While there is no single way to
ensure that your employees will stay engaged and inspired, there are a few specific
and effective techniques that, when implemented, can have major, lasting effects on
workplace motivation and productivity. The below strategies are the best-known
ways to motivate employees-

1. Foster Open Communication

Having open communication with your staff is crucial to maintaining employee

motivation. No one wants to work under a boss he feels uncomfortable approaching.
Applying methods of establishing effective communication with your team will do
wonders for your staff’s motivation.

Show them you care

A staff member that is invested in her work will naturally have questions, comments,
or concerns. Having an open-door policy and creating consistently accessible lines
of communication will help your staff to feel as though their input matters (which it
should!).

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Always follow up

Following up with your employees regarding their input is equally important as asking
them for it. While you may not be able to answer every question, or fix every
problem, following up at least demonstrates to employees that you took the time to
consider their remarks, rather than ignoring them or sending them on to someone
else. Your staff will know that you’re listening to them, and won’t be afraid to come to
you again in the future.

2 Create an Agile Work Environment

Another extremely powerful way to uphold employee motivation and engagement is

by creating an agile work environment.

Pick up the pace

In psychology, there is a concept known as the “Pleasure Principle,” which

predisposes us as human beings to desire instant gratification over long term
rewards. In agile work environments, managers can exploit this facet of human
nature by having employees work on projects with the goal of delivering results as
quickly and efficiently as possible. A fast-paced environment is exciting and inspiring,
and employees will naturally be much more engaged in a project that will fulfil this
psychological desire for gratification sooner rather than later.

Encourage innovation

Within an agile work environment, producing both high quantity and high quality work
requires a ton of creative thinking. It is important to motivate your staff to take risks
and be innovative, even if it means they will make a mistake now and then. One of
the virtues of an agile work environment is that when your employees aren’t afraid to
fail, they will become more daring, making them more apt to generate work that
could potentially set your organization apart from the competition.

3. Get to know your team

Having a one-on-one relationship with your staff members will make you more
personable in their eyes, and will help you better understand your team to find what it
is that motivates each person individually. Having individual relationships with staff
members will also help dissolve the barrier in their minds that separates you from
them. When your staff members feel they have a personal connection with you, they
will be motivated to not let you down.

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4. Incentivize the Workplace

Providing incentives or rewards for completion of certain goals is a great way to get
your staff to go above and beyond with their work. Making their jobs both gratifying
and fun is sure to boost employee motivation.

Reward people for hard work

Rewarding your employees for hard work is decisive in how motivated they will be.
Recognizing them for their achievements can be cost effective, too --- you don’t have
to use monetary rewards or even spend money on a prize. Deloitte turned to a
software that helps incentivize workplace tasks by providing employees the
opportunity to appear on leadership boards or earn badges in exchange for
completing a task. Providing your staff with ongoing opportunities to be recognized
for their onerous efforts will keep them motivated over longer periods of time. 

Greater levels of creativity and innovation

Motivated employees handle uncertainty more easily, are better problem-solvers and
have higher levels of innovation and creativity. When an employee is motivated to
achieve a certain goal, they won’t let an obstacle stop them; instead, they willingly
think outside the box to create a new solution. A flexible workforce that rolls with the
punches is key to a successful company. A team that’s motivated is going to be
more likely to innovate.

Improved manager-employee relationships

Many employees quit their jobs due to bad managers. If you want to retain your
employees long term, you need to foster positive manager-employee
relationships throughout your organization. Managers can build positive relationships
by learning what motivates their team members and offering them work opportunities
based on those motivators. This not only encourages employees to work harder, but
it also demonstrates that their managers truly care about their needs, which can lead
to better relationships and retention.

Better customer service

When an employee is motivated to perform well in a customer-facing role, it often

translates to better customer service. This can create higher levels of customer
satisfaction and ultimately increase sales down the line. In an era where customer
satisfaction and online reviews are paramount, it’s crucial to maintain a positive
customer experience. Highly motivated employees can help you achieve that.

Great company culture

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Employee motivation is great for driving collaboration and company culture. When
employees feel motivated and connected to their job and the company, their
positivity and hard work can rub off on their co-workers. This is a great way to build a
positive company culture full of employees who feel motivated to perform well and
work together to reach company goals.

Positive company reputation

A workforce full of happy and motivated employees can improve your overall
company reputation. Motivated employees are more likely to speak highly of your
organization, which is great for attracting new talent. When employee motivation
improves customer service, it can also improve your reputation in the eyes of your
consumers.

Lower employee absenteeism and turnover

Motivated employees tend to show up to work on time and accomplish their tasks
when they’re supposed to. Additionally, motivated employees usually stick with the
organization longer, improving overall employee retention.

Conflict

Conflict is inevitable among employees, between employees and the management

team, and among the management team. Managers must learn to deal with conflict
rather than avoid it. Low level conflict is connected with decreased productivity, and
large blow-ups from unresolved disputes can wreck greater havoc on companies and
organizations.  This makes it clear that unresolved conflict indeed puts a company at
risk.  From sudden and widespread turnover to retaliation from disgruntled
employees conflict creates liabilities that could likely be avoided. Well managed,
productive conflict helps uncover weaknesses and oversights that might have
otherwise gone unnoticed. Conflict in the workplace is not always preventable. If an
issue should arise between members of your staff, you want to be available to your
employees so they can bring it to your attention promptly. Being unbiased and fair
when dealing with two employees will help you resolve the issue quickly, and will
help your staff redirect their focus away from the drama and back to what’s
important.

Evaluation

Employees have a fervent desire for evaluation i.e., information about their
performance and managers find it extremely difficult to share performance
evaluations in an honest and helpful manner. Both supervisors and employees need
training in evaluation for it to be useful and pleasant for both parties.

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Relationship-building

Building relationships between the HR group and other departments is one of the

critical components to bring business together. This helps in maximizing the potential
of the organization and its success. Relationships in the workplace often need a
great vendors and dealers who deliver goods to your workplace) that need attention.
Therefore, HR professionals must emphasize building relationships among every
department so that they can thrive together. HR professionals must listen and
respond to the concerns of the other departments and act as a glue to keep them
stick together. Since a workplace has diverse individuals, HR professionals must
introduce inclusive policies, and everyone feels welcomed in the workplace.

Adaptability Skills

The world of business is changing every day. And you cannot get too comfortable
but adapt yourself to the changing times. These will allow HR managers to rethink
their current company policies and curate new ones that are more relevant and
effective. Since HR managers actively participate in decision-making and business
strategies, they need to forecast the need for changes. For fostering a healthy work
environment, HR Professionals must develop new tactics to keep the employees
engaged and actively invest themselves in finding ways to retain them.

Technological Skills

With the whole world going increasingly digital, HR managers need the ability to
adapt to new technology. HR managers are expected to handle a variety of duties
that includes-

 Recruiting talented employees.

 Managing onboarding and training for new hires.
 Tracking payroll.
 Handling employee grievances.
 Retaining good employees.

Technological skills give HR professionals an edge while managing the above duties
and more.

Critical Thinking

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Linder Elder, a prominent scholar, describes Critical thinking as “Self-guided, self-
disciplined, thinking which attempts to reason at the highest level of quality in a fair-
minded way. Critical thinking is one of the most essential attributes for anyone in HR.
Whether you are hiring a new candidate, negotiating pay rises, or deciding how to
deal with employee grievances, it is imperative to critically analyse the situation and
make decisions. Critical thinking helps bring a rational perspective and help HR
professionals to deal with a difficult situation with ease. Either it is conflict resolution
or addressing an issue with the employees, and critical thinking helps reconstruct or
put forward views and ideas that work best for the work environment.

Interpersonal skills

Interpersonal skills are the soft skills that hold great value to HR professionals.
These skills include active listening, verbal and non-verbal communication, social
awareness, self-management, accountability, and so on. People with high
interpersonal skills are intuitively good communicators and efficient managers. They
show the right attitude and aptitude while communicating. Interpersonal skills allow
one to communicate successfully with others at work and in the broader community.
Some people are born with this kind of ability, but they can all be enhanced with
practice. Expressing respect, settling conflicts, and hearing well are all interpersonal
skills worth learning for any HR professional.

Analytical skills

Risk managers need analytical skills to collect data and make important decisions
using that data. They also need to spot holes and weaknesses that others may have
missed in the systems, infrastructure and other areas.

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3. The types of HR risks that HR executives need to be made aware of.

Types of Human Resources Risks

Compliance with relevant legislation

 The typical HR risk here is non-compliance.

 HR managers should have a clear understanding of what each piece of
legislation requires for compliance.
 Violating any regulatory or statutory compliance could cost your entire
business. Again, it all comes down to processes and policies. Human
resource department is accountable to work in tandem with the compliance
people to ensure that every employee in the organisation is well-versed of all
the potential risks of a statutory compliance breach. Thus, ensure that your
training modules and programmes entail adequate and necessary information
on compliance related issues.
 HR managers need to be aware of local labour regulations and ensure they
are always compliant. As businesses expand in this mobile world, third-party
resources become more popular, exposing the business to international
labour laws and regulations.
 To avoid these risks, HR managers should-
o Understand local and the relevant international labour laws to follow
the basic principles correctly.
o Regularly audit your HR processes to ensure you comply with these
laws.
o Report on finances quarterly.

Dearth of Critical Skills

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 o Not having the right talent with the right expertise and proficiency required to
compete, grow or innovate can severely hamper a company’s future.
o These are stuffs that HRs do all the day. In fact, it’s their bread and butter. HR
department is the one that looks after workplace planning when it comes to
risk management. Nevertheless, there is a growing need to render that to the
rest of the organisation as well.
o HRs need to gather data and analyse to build a convincing case for adding it
to the company’s risk map. Also, it is advisable to focus on getting the same
on the organisation’s agenda, if not already.

Behaviour and Ethics

o Hardly a day goes by without another business hitting the news headlines for
all wrong reasons. A lot of scandals that we see or hear originate from some
or the other unethical behaviour. According to business experts, the topmost
risk for a business is ethical violation. In fact, reports show that ethical
violations are the most challenging to deal with in terms of brand damage.
o This is the reason why HR ought to nurture a work culture that encourages
ethical behaviour. Simply put, it’s all about doing things the right way. Don’t
forget that any brand or reputation damage could also impact employee
engagement, retention and recruitment negatively.
o Here, it is advisable to draft a code of conduct followed by establishing an
ethics panel or community in the organisation.
o People don’t quit jobs, they quit their bosses. Even though this statement is
not always true, many have cited their superiors as the reason they leave a
company. Because of this, professional ethics and leadership skills are critical
to maintain employee productivity. HR managers must take the responsibility
to educate all employees of the company’s culture, beliefs and values, while
training those who manage others in their leadership skills.
o Mitigate risks of ethics and leadership by-
 Ensure business leaders display necessary leadership skills while
being approachable.
 Educate leaders and managers of the business’ values and ensure
they pass these values down to their teams.
 Create the right culture and set the tone with new recruits from the
outset.
 Edelman's 2020 barometer reveals that despite a strong global
economy and near full employment at the end of 2019, none of the four
societal institutions that the study measures; government, business,
NGOs and media, are trusted. The cause of this paradox can be found
in people’s fears about the future and their role in it, which offer a
serious wake-up call for our institutions to embrace a new way of
effectively building trust: balancing competence with ethical behaviour.

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 Given the current global pandemic, trust is being tested in extremis and
the next 12 to 18 months will provide some very interesting results on
the trust continuum. Find out more about the importance of trust and
transparency here.

Violation or Loss of Intellectual Property

 If your business deals with customer information, then losing data by your
employees is something that can drown your business. Cases of data loss
have witnessed a steep surge in the last decade than ever. Remember that
customer data is irreplaceable as well as highly sensitive thus, demanding
extreme caution.

 If your employees are responsible for handling sensitive data, then HR ought
to ensure that employees are engaged in the same via giving them training
and proper induction. Further, it is also expected from the HR to make sure
that they don’t hire a potential fraudster.

Mergers & Acquisitions (M&A) Risks

 Yes, mergers & acquisitions bring in a fistful of problems especially in terms of

employees. This is certainly of great importance especially for a service-
oriented firm where human capital is almost everything. This is one of the
key reasons a CEO should never ignore employee feedbacks during M&A.
 Lot of risks pertaining to M&A can backfire to HR in the long-run. Any risks or
threats related to employment law, diligence, etc., would bounce back at the
human resource department. However, one cannot neglect other concerns
such as ensuring that the newly hired people feel engaged and cared,
induction and training programmes are executed appropriately etc. ought to
be taken into consideration as well.

Understanding trends in the business environment and being able to convert

them into business and HR strategies and policies.
 The typical HR risks here are the inability of senior managers, including HR
managers, to analyse the internal and external business environment and
understand what the key drivers of change are and the inability to convert
them into business strategies.

People and corporate culture drive the implementation of the business’

strategies
 Typical HR risks here are-
o Not having the right talent in the right places
o Not attracting and retaining key talent

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 o Performance that does not meet predetermined standards
o Training and development interventions that do not improve performance
o Absence of a constructive company climate.

Implementing business strategy

 Typical HR risks here are that the business does not have a strategic or
business plan that converts into different strategic objectives or projects and
that the business has not spelt out the demands on, or implications for HR
practitioners in terms of talent, policies, practices and procedures.

Carrying out operations – converting business or project plans into executable

operations or tasks.
 Typical HR risks here are not having clearly defined operations and tasks or
the right staff to execute them.

Digital Transformation (or Lack Thereof)

 In fact, 'digital transformation' became one of those overused phrases that

many people talked about but not everyone took seriously. Then most of the
people who work in offices across the globe were forced to work from home
and it suddenly became very clear just how important it was to be digitally
enabled.
 You might have been able to get away with managing your employees that
way before the global pandemic. But if recent circumstances have taught us
anything, it’s that the adaptability of your business (and in some cases its
capacity to survive) is directly related to how digitally enabled your employees
and your business systems are. Essentially, your capacity to pivot quickly in
response to rapidly changing economic, social and health conditions correlate
with how far down the path of digital transformation your organisation has
progressed.
 Looking through the lens of the first half of 2020, it has never been more
important to have the tools you need to be able to digitise, automate and
optimise your employee lifecycle. If you want to be able to run an agile
business that can bend and flex with whatever circumstances demand, you
need the right tools to be able to do so.

Pay and compensation

 Aside from good leadership, people are motivated to stay in an organisation

and perform better if they can be rewarded well for it. Poor compensation
packages or errors in goal setting and performance measures will demotivate
employees and reduce productivity, and will only hinder the company from
achieving its organisational goals.

17
  Manage risks caused by compensation by-
 Keeping compensation and benefits packages as simple as possible.\
 Build reward programs that link performance to pay.
 Make sure employment contacts for employees and contractors are up
to date and legally sound.
 Avoid any discrimination – ensure all rewards are awarded based on
performance and contribution to the business’ goals.

Training and Development

 Keeping the right employees in an organisation requires more than just good
pay. Driven employees seek to build their careers which means your
organisation must provide opportunities for them to grow their skills and
progress within the company. However, creating career paths that are well
communicated and understood by employees is not something most
companies do well. And therefore, one of the main reasons employees quit is
that they don’t see any potential for growth in the organisation.
 To avoid these risks, you should-
 Provide opportunities for your employees to grow through training and
skills development programs.
 Encourage learning and organise for employees to set aside time
weekly to learn.
 Incorporate skill development into the regular performance appraisal
process.
 Hold managers accountable for outcomes.

Succession planning

 Only 32% of companies actually have a full CEO succession plan in place
(according to SHL). With 43% of UK companies admitting to having
experienced an unexpected change in leadership in the last 12 months, that’s
a pretty big risk. Not having a future leadership plan in place can cause share
prices to plummet and even leave organisations at risk of hostile takeover if a
CEO leaves unexpectedly.
 HR plays a critical role in leadership development and should be investing
time and money in the leadership pipeline of the future. Getting involved with
CEO and senior-role succession planning can also mitigate the occasional
‘old boys club’ mentality of the C-suite.

All in all, the focus ought to be on the HR strategy. Understand that we are
witnessing a volatile and ambiguous business ecosystem that is undergoing changes
at the speed of light. Thus, it is important that human resource people and

18
businesses keep abreast with all the changes and revive their HR strategy on a
periodic basis to keep up with the fast-moving business ecosystem.

QUESTION 2
According to the article, poorly carried out employment practices are the
reason for an organization to experience loss.
(a) For training to be successful HR executives need to be aware of an
important legislation. Discuss the importance and purpose of this legislation
to HR executives.

The main purpose of the legislative framework for training and development in South
Africa is to control, fund, and oversee the improvement of skills levels in South Africa
in a structured way. A second broad goal is to regulate the standard of
education/training. For these purposes, a National Qualification Framework (or
“NQF”) was established. The NQF is a framework that classifies the levels of
occupational qualifications. It is designed so that people can choose from various
options how they qualify for a career, and also carry training and experience over
those qualifications. NQF also gives people a chance of obtaining recognized
qualifications in education and employment.

The following legislative frameworks were created at different times to manage the
training and development programs in South Africa-

 South African Qualifications Authority (SAQA) Act (Act 58 of 1995),

 Basic Conditions of Employment Act (Act 75 of 1997 as amended Act 11 of
2002),
 Skills Development Act (Act 97 of 1998 as amended Act 37 of 2008),
 The Skills Development Levies Act (Act 9 of 1999), and
 The BBEEE (Broad-Based Black Economic Empowerment) Act (Act 53 of
2003).

South African Qualifications Authority (SAQA) Act (Act 58 of 1995)

This framework was created to provide for the development and implementation of a
National Qualifications Framework and for this purpose to establish the South
African Qualifications Authority (SAQA) and to provide for matters connected
therewith. The South African Qualifications Authority (SAQA) Act creates a new
framework for education and training in South Africa by-

 Creating a single, unified system for education and training qualifications in

the country; and
 · Creating the institutions to ensure that these qualifications are of a high
quality.

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The SAQA Act set up ways of ensuring that the quality and training in South Africa is
high quality and that it provides many different entry, exit and re-entry points.

In order to achieve this, the National Qualifications Framework (NQF) was

formulated. The NQF provides a framework within which all learning can be quality
assured - whether it takes place at school, at work or at home and by whomever, be
they young or mature learners. Education and training are recognised as different
forms of learning with the same status. All learning now has to be recognised
through national standards and qualifications. The recognition of prior learning (RPL)
is an acknowledgement that skills acquired outside the context of a formal course
equally deserve recognition and goes some way to redress the disregard of informal
learning in the past.

The SAQA Act looks towards a future where skills development extends throughout
the entire working life of a person and endorses the concept of life-long learning for
all citizens. The SAQA Act states that-

 All skills must be written as learning outcomes. These outcomes will be

recognised through national standards and qualifications.
 A qualification is made up of standards, each of which carries a number of
smaller parts called credits.
 People can earn credits without going to a formal course if they can show that
they already have the skills and knowledge required in the standards and
qualifications (RPL).

Basic Conditions of Employment Act (Act 75 of 1997 as amended Act 11 of

2002)

This framework mainly deals with the conditions for employment in South Africa as
regards the relationship between the employee and the employer. This Act was
made to correct the exploitation and abuse of labourers in the domestic sector and to
protect their rights, which are infringed upon by their employers.

The BBEEE (Broad-Based Black Economic Empowerment) Act (Act 53 of 2003)

The Broad-Based Black Economic Empowerment (BBBEE) Act provides the

legislative framework for Broad-Based Black Economic Empowerment in South
Africa. Its main purpose is to address the legacy of apartheid and promote the
economic participation of black people in the South African economy.

Skills Development Act (Act 97 of 1998 as amended Act 37 of 2008)

20
This framework was aimed at improving the skills of workers by promoting education
and training in the workplace. The Act also saw to the establishment of Sector
Education and Training Authorities (SETAs).

The Skills Development Levies Act (Act 9 of 1999)

The Skills Development Levies Act of 1999 was launched to oversee the collection,
administration, disbursement, and regulation of the monies in the Fund. This Act
sees to it that there is money available to pay for the training of people as is
stipulated by the Skills Development Act. This Act makes skills development training
affordable. The Skills Development Levies Act provides ways of making training
affordable by-

 Implementing payment of skills levies

 Implementing payment of grants
 Requiring the appointment of Skills Development Facilitators (SDFs)
 Requiring Workplace Skills Plans (WSPs)
 Requiring Annual Training Reports (ATRs)

This Act ensures that all employers in South Africa who are registered with the South
African Revenue Services (SARS) and have an annual payroll of over R500,000
have to pay the skills development levy, which is usually 1% of the payroll, to the
South African Revenue Services (SARS). SARS refers to this payment as the
“leviable amount” and also gives clear guidelines on what amounts are included or
excluded from the skills development levy. However, not all organizations must pay
the skills development levy (SDL). Some employers are exempted from paying a
levy based on the following-

 Companies whose annual payroll does not exceed R500,000,

 Public Service Employers (PSEs) in national and provincial governments.
Rather than paying to SARS, these employers must earmark 1% of their
payroll for the training and education of their employees;
 National and provincial entities if 80% or more of their expenditure is paid
from funds voted by Parliament. Rather than paying to SARS, these
employers must earmark 1% of their payroll for the training and education of
their employees;
 Any municipality that received a certificate of exemption from the Minister of
Labour.

The Role of SETA

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Skills development training, referred to as learnership, is managed by the Sector
Education and Training Authorities (SETAs). There are 21 of these SETAs and they
all manage and oversee the registration of learnerships to meet the needs of skills
development training across the sectors. These bodies also set out the basic
requirements for the applicable learnership program.

The Skills Development Act (No. 97 of 1998) (SDA)

Of all the legislative frameworks, the Skills Development Act is the most recent and
the most concerned with skills training and development. The Act was created when
the South African government realized that the short supply of skilled personnel is a
serious obstacle to the competitiveness of industries.

The Skills Development Act was promulgated by the South African government in
1998 during the high levels of unemployment, low levels of investment in the South
African labour market, pronounced disparities in income distribution and inequality of
opportunity as a result of apartheid and poverty. The Act was made to support the
further development of skills within the South African workforce. The Act encourages
firms and places of work to become active learning environments and make
provisions for ongoing education and skills development. The Skills Development Act
(No.97 of 1998), makes provision for a new approach to skills development that
compliments the formal education, to ensure that the country develops a strategic
human development approach to improve its human capital. It links skill formation to
the requirements of a growing economy and extends education and training to
people both within and outside formal employment. In tandem with the Skills
Development Levies Act (No. 9 of 1999), the Skills Development Act places a legal
obligation on all employers to improve the competency levels of their workforce.

The Skills Development Levies Act (No. 9 of 1999) imposes a skills development
levy on most employers, and imposes government departments to allocate a
percentage of their budget to skills development. As part of South Africa’s national
skills development strategy, the Skills Development Act (No.97 of 1998) was
enacted.

Through this Act, the government aimed to address two main priorities, which are-

 The need to improve skills and increase productivity to compete successfully

in the global economy, and
 The need to reverse apartheid imbalances and to create a more inclusive and
cohesive society.

22
The Skills Development Act aims at expanding the knowledge and competencies of
the labour force to improve employment and productivity. The aims of the Skills
Development Act are-

 To develop the skills of the South African workforce.

 To improve the quality of life of workers, their prospects of work and labour
mobility;
 To improve productivity in the workplace and the competitiveness of
employers;
 To promote self-employment; and
 To improve the delivery of social services;

 To increase the levels of investment in education and training in the labour

market and to improve the return on that investment

 To encourage employers to-

 Use the workplace as an active learning environment;

 Provide employees with the opportunities to acquire new skills;

 Provide opportunities for new entrants to the labour market to gain work
experience and;

 Employ persons who find it difficult to be employed.

 To encourage workers to participate in learnership and other training

programmes

 To improve the employment prospects of persons who were previously

disadvantaged by unfair discrimination and to redress those advantages
through training and education

 To ensure the quality of education and training in and for the workplace

 To assist-

 Work-seekers in finding work

 Retrenched workers in re-entering the labour market and

 Employers in finding qualified employees and

 To provide and regulate employment service.

It was hoped that the Act would help in addressing the issue of shortage of skills that
the country was facing at the time. It was expected that increased investment in skills

23
development via the Skills Development Act would translate into greater returns on
investment (ROI) for employers, while simultaneously generating a more competent
workforce with improved future employment prospects. Through providing access to
further training and education in a controlled environment, the Skills Development
Act sought to empower employees while enticing employers to participate with
promises of increased profits.

The aims of the Act are to be achieved by establishing an institutional and financial
framework called the National Skills Development Strategy. This is a framework for
skills improvement created to-

 Provide for the participation of the government, organized business, and

organized labour.
 Encourage good quality training in the workplace
 Indicate how Sector Education and Training Authorities (SETAS) should use
the money allocated for the skills development levy.
This framework led to the establishment of different institutions, which included the
National Skills Authority (NSA), the National Skills Fund (NSF), the Sector Education
and Training Authorities (SETAs), and institutions in the Department of Labour.

Those purposes are to be achieved through-

 an institutional and financial framework comprising-

 the National Skills Authority;
 the National Skills Fund;
 a skills development levy-financing scheme as contemplated in the Skills
Development Levies Act;
 SETAs;
 provincial offices of the Department;

24
  labour centres of the Department;
 accredited trade test centres;
 skills development institutes;
 the Quality Council for Trades and Occupations;
 a skills development forum for each province;
 a national artisan moderation body;
 and Productivity South Africa;
 encouraging partnerships between the public and private sectors of the
economy to provide learning in and for the workplace; and
 co-operating with the South African Qualifications Authority.

The Skills Development Act 97 of 1998 intends-

 to provide an institutional framework to devise and implement national,

sector and workplace strategies to develop and improve the skills of the South
African work force;
 to integrate those strategies within the National Qualifications Framework
contemplated in the South African Qualifications Authority Act, 1995; 
 to provide for Iearnerships that lead to recognised occupational qualifications;
 to provide for the financing of skills development by means of a levy-grant
scheme and a National Skills Fund;
 to provide for and regulate employment services; and 
 to provide for matters connected therewith.

The Skills Development Strategy is based on the National Qualifications Framework

Act (No. 67 of 2008), which makes provision for the National Qualifications
Framework (NQF), established by the South African Qualifications Authority (SAQA).

This body of skills development legislation has fundamentally changed the face of
education and training in South Africa. The implications of these Acts for Human
Resource Development (HRD) is important to provide guidelines for designing and
implementing relevant organisational strategies.

The Skills Development Act made many changes to traditional skills development
by-

 Creating new structures for training;

 Creating new funding incentives to encourage more training;
 Creating new forms of learning programmes; and
 Proposing new ways of helping all people get skills and employment.

The National Skills Development Strategy

25
The Minister of Labour has adopted the National Skills Development Strategy
(NSDS). The NSDS is driven by, and around, the needs of the population. It is
focussed on a number of priority areas for which five objectives and twelve specific
targets have been proposed. These are-

 Developing a culture of high-quality life-long learning;

 Fostering skills development in the formal economy for productivity and
employment growth;
 Stimulating and supporting skills development in small businesses;
 Promoting skills development for employability and sustainable livelihoods
through social development initiatives;
 Assisting new entrants into employment.

By implementing the NSDS the government, in partnership with employers, workers

and communities, aims to improve the employability of the country's workforce.
The Skills Development Act, which provides the legal underpinnings that support the
National Skills Development Strategy (NSDS), seeks to establish a high quality skills
development system that is: cost effective and accountable; meets skills needs; and
promotes employment generation and economic growth. The Act has made
provision for the formation of the National Skills Authority (NSA), which in
collaboration with the Department of Labour and other stakeholder organisations will
monitor progress on the implementation of the NSDS. Procedures for planning and
the execution of interventions around the strategy are devolved and decentralised to
each Sector Education and Training Authority (SETA) and this in turn is driven by the
needs of individual firms in each sector. Responsibilities for skills planning and
interventions are also devolved to the provinces, which will oversee skills
development through social development and micro-enterprise programmes within
their areas of jurisdiction.

Sector Education and Training Authorities (SETAs)

SETAs have the function to monitor the quality of education and training in their
sectors. They have to liaise with Employment Services, the NSA, and the provinces.
A SETA must develop and implement a sector skills plan, within the national skills
development strategy, by establishing sector workplace skills plans by means of the
skills development grants. It has to promote learnerships by identifying workplaces
for practical work experiences. One of the functions of a SETA is to establish a
learnership that has a structured learning program and a practical work experience
of a specified nature and duration. The learnership must lead to a qualification that is
recognized by the South African Qualifications Authority (SAQA). A SETA has to
report to the Director-General of the Department of Labour on the implementation of
its sector skills plans and its income and expenditure. The SETAs are financed for

26
the levies collected from its sector and monies paid to it form the National Skills
Fund.

While the Skills Development Act of 1998 as well as the Skills Development Levy Act
of 1999 set the bar for focused skills development programs, SETAs were
implemented to monitor skills development efforts and ensure that energies spent
were in line with the overall Sector Skills Plans. There are various SETAs that have
been established to cater for each national economy sector and these institutional
bodies are expected to perform the following functions:

 Strategic functions
 Implementation functions
 Communication and reporting functions
 Quality assurance functions

The main tasks of the SETAs are-

 To compile sector skills plans that states who is employed where in the sector
and what the strengths, weaknesses and opportunities in the sector are;
 To determine where learnerships are needed, designing, marketing and
registering the learnerships;
 To act as an Education and Training Quality Assurer for standards and
qualifications in the sector;
 To disburse money from the National Skills Development Levy; and
 To provide information about the sector.

Learnerships and Skills programmes

A substantial amount of the SETAs time is spent in handling matters relating to

learnerships. A learnership is a mechanism to link structured learning with work
experience, leading to a qualification registered on the NQF as a reliable indicator of
work readiness. The structured learning part of a learnership has to include the unit
standard categories required to make up a qualification-
 Fundamental learning
 Core learning
 Specialisation

Skills programmes are another form of learning intervention to achieve the objectives
of the Act, and is described as unit standard-based programmes that are

27
occupationally based and presented by an accredited provider, and when completed,
constitute a credit towards a qualification registered on the NQF).

Workplace Skills Plan (WSP)

A WSP is a strategic plan, approved by the SETA, which outlines the training and
development requirements for an organisation for a minimum period of one year.
The HR department needs to follow certain steps when developing and
implementing a WSP.

Guidelines for developing a WSP-

Step 1: Proper workplace planning

Step 2: Analysing jobs as an input to the workplace planning process
Step 3: identifying and defining the organisation’s skills requirements
Step 4: conducting a skills audit to determine the organisation’s current skills profile
Step 5: defining the organisation’s skills training priorities
Step 6: Identifying the appropriate skills programmes to address the organisation’s
identified training needs
Step 7: Implementing the WSP
Step 8: Monitoring, evaluating and reporting on the WSP

Step 9: Establishing a quality assurance system to ensure effective and value-added

skills training and development.

This training legislation in South Africa affords all key stakeholders the platform and
opportunity to participate in a meaningful way in the rebuilding of South Africa.
Through this training legislation, a positive transformation can be made in the
business sector.

28
(b) Complete a report for HR executives at a company you have joined,
discussing the importance of training and discuss how training of employees
can be beneficial to HR executives in reducing ‘human error''.

INTRODUCTION

The company I joined is NAMCOR. NAMCOR (National Petroleum Corporation of

Namibia) is the national oil company of Namibia with the mission to create value to
all its stakeholders across the oil and gas value chain. NAMCOR’s world class
exploration and production database and oil license blocks form some of the major
attractions to Namibia’s hydrocarbon potential.

It could be argued – and rightly so – that employees are a company’s greatest asset,
and, therefore, investing in their training and development is key to sustaining
business growth and success. This commitment would make sense to NAMCOR
when they consider the lengthy processes carried out to recruit and hire qualified
staff. In my submission of this report, I will highlight to NAMCOR’s HR executives
how imperative training is to the organisation and how it contributes positively in
reducing human error. I will also share a myriad of benefits that training brings about
to the organisation as well as to the staff.

DISCUSSION

Studies show that organizations engaged in employee development see increased

sales and doubled profits double compared to organisations not committed to
employee engagement. Dedicated training and development fosters employee
engagement, and a more efficient, competitive, and engaged workforce is critical to
your company’s financial performance. Furthermore, 93% of employees will stay
longer when a company invests in career development. Training and development
help companies gain and retain top talent, increase job satisfaction and morale,
improve productivity and earn more profit. Additionally, businesses that have actively
interested and dedicated employees see 41 percent lower absenteeism rates, and
17 percent higher productivity.

Achieving these impressive and important benchmarks starts with top executives,
and the strength of a business’s Human Resources professionals. Therefore, the HR
executives, and managers of NAMCOR with strong leadership skills are being called
upon to help frame strategic planning, which almost exclusively involves robust
employee training and professional development initiatives. At individual level,
training can assist the company to-

 Help diagnose present problems and future challenges;

 Improve individual performance or fix up performance deficiency;

29
  Help in anticipating future skill-needs and prepares employees to handle more
challenging tasks;
 Helps in preparing for possible job transfers;
 Trained employees can cope with any changes in technology easily;
 Training makes employees become hyper efficient;
 Trained employees advance in their career faster;
 Growth opportunities – Training programmes upgrade employees’ knowledge,
develop their skills and prepare them for higher responsibilities. It enables
employees to take challenges and thus have better growth opportunities;
 Higher income – Training improves employees’ skills and help them to
manage activities effectively leading to improved performance. This gives
them opportunities to earn higher salaries or incentives;
 Increases efficiency and reduces risks – Training helps employees to learn
the most effective ways of handling machines and jobs assigned to them. This
increases their efficiency and reduces the risks of accidents;
 High morale and job satisfaction – Training helps employees to complete the
jobs assigned to them in an effective and efficient manner. This increases the
job satisfaction and develops high morale among employees;
 Makes new employees comfortable in new environment – Training is a mode
to familiarise newly appointed employees not only with the organisation but
also helps them to acquire knowledge and skills required to perform the duties
assigned to them. It helps new employees to start their work without any
hindrance.

At organisational level, training brings about the below changes-

 Trained workers are more productive;

 Trained workers do not need strict supervision;
 Trained employees provide quality performance;
 Training programs are well appreciated by employees as well as trade unions;
 Systematic learning process – In the absence of proper training employees
use hit and trial methods to perform the tasks assigned to them which lead to
wastage of resources and effort. With the help of training, employees learn
the systematic way of doing specific jobs;
 Enhances productivity – Systematic processes help employees to perform
tasks efficiently and effectively leading to increased productivity and improved
performance;
 Develops future managers – Training improves managerial skills amongst
employees enabling them to manage enterprise in case of emergency;
 Higher Profits – The systematized learning helps employees to perform tasks
most effectively and efficiently. This not only improves the employee
performance but also increases the quantity and quality of work done in the

30
 organisation. The improved performance leads to higher profits and better
growth prospects for the organisation;
 Lesser wastage and reduced risks of accidents – Proper training enables
employees to use resources in the most optimal manner and operate
machines with proper technical and operating skills. This leads to lesser
wastage of resources and reduced risks of accidents;
 Reduces absenteeism and employee turnover – With effective training
employees are able to improve their performance. This gives them job
satisfaction and increases their confidence. Satisfaction in work not only
reduces absenteeism but also keeps employees’ content leading to reduced
turnover;
 Helps to adapt changes in business environment – Training programmes aim
to upgrade employees’ knowledge and skills enabling them to respond
positively to the economic and technological changes in the business
environment.

It would be beneficial for NAMCOR to constantly train, develop and educate its
employees to ensure that each employee is able to perform the assigned duties
most effectively and efficiently. Training is a process, which aims to incorporate or
improve the attitudes, skills and abilities amongst employees to perform specific
jobs. It aims to improve not only the current performance of an employee but also
prepares him/her for other responsibilities. Education is the process of increasing the
knowledge and understanding of employees. It develops a logical and rational mind
that helps employees to understand basic principles and phenomenon to be able to
analyse and synthesise the information. Development is a process of helping
employees grow. It involves all such activities, which aim to provide opportunities to
improve job performance, bring growth in the personality, help to realise true
potential and be better individuals.

There are different types of training and these types can be utilized depending on
whether the company is training a new employee or upskilling an existing employee-

On-the-job training

On-the-job training allows an employee to learn new skills with hands-on experience
from a more experienced staff member. NAMCOR may choose to use this form of
training for new company employees during the orientation and onboarding process.
This opportunity allows the individual to learn job-specific skills or upgrade their skills
in a new position or department. Businesses can carry out several different types of
on-the-job training-

 Coaching - An experienced member of staff will work through a task step-by-

step with an employee. The experienced member of staff or ‘coach’ will

31
 support the employee through the learning process by passing on their
knowledge and skills;
 Role play - Role play involves acting out a scenario to see how an employee
would perform under certain conditions. This will allow the employee to
practise appropriate ways to deal with situations that may occur in the
workplace.
 Job rotation - Members of staff can be rotated or moved through different jobs
within the organisation so they acquire a range of skills from each department
or job role.
 Shadowing - Shadowing is when an employee observes another employee
working to gain a better understanding of how they do their job. This is usually
for a set period of time such as a few days.
 Demonstration - Demonstration is when an employee watches a task or a
particular process being carried out and then attempts the task/process
themselves.

On-the-job training has a number of advantages and disadvantages-

Advantages Disadvantages

Quality of training may not be as

Training is specific to the company’s needs
good

Work is not interrupted by staff attending training May pick up bad habits from other
courses out from the office workers

May be cheaper as internal training does not need Concentration may be poor due to
to be paid for work interruptions

Employees will feel more at ease

In-house training

An organization's internal training and development department provides in-house

training programs. NAMCOR can offer these programs on general or specific topics
and include a wide range of options. For example, HR can require all new
employees to complete a formal orientation program. Other classes can include
product knowledge, manufacturing procedures, or company-specific software

32
training. Typically, staff from the training and development team or particular
employees in specialist positions conduct these trainings.

Mentoring

Mentoring as a training program pairs two individuals together and comprises one
person as the mentor with advanced skills in an area that the mentee desires to
learn about. NAMCOR can offer this style of training throughout the complete life
cycle of an employee. Both parties receive significant benefits from mentoring. The
mentee receives valuable feedback and advice from someone with expertise and
knowledge. The mentor can perfect their leadership skills and solidify their
knowledge by teaching someone else what they know.

Personal study

Personal study training allows an employee to conduct their learning at their own
pace and at the best time for them. HR can offer personal study during the work
environment or provide a learning portal that employees can access from home or
remotely. A personal study program offers a style of learning that many people enjoy
and respond well to. It also puts the responsibility for learning directly on the
employee. This type of training is ideal for top performers who want to take on more
responsibility or for employees who want to expand their skills in a particular area.

Technical training

Technical training provides specific hard skills required for their job or profession. For
example, technical training includes industry-specific software knowledge, equipment
or machinery classes, or profession-specific updates, such as engineering, gas and
oil technical training, or IT. This can also include certification or recertification for
certain programs or registration requirements. HR can provide technical training
using their current in-house training and development team or with third-party
companies.

Sales training

Sales training provides sales department employees with learning opportunities

specific to sales and customer service. The positions this training supports can
include sales administration, customer service representatives, and territory account
managers.HR can teach employees to serve their customers better, create a more
positive client experience, and become more persuasive as a salesperson.

Management training

When NAMCOR chooses management training to employees, they would create a

clear career path for them to follow. Teaching individuals how to take on added

33
responsibility and improve areas for supervising and leading others gives them a
chance to improve their skills and move up in their organizational structure. Topics
within management training can include leadership skills, how to have difficult
conversations, and effective time management.

METHODS OF TRAINING

There are different ways to train staff and each method has its own costs and
benefits. Different methods include-

 apprenticeships;
 graduate training schemes;
 corporate training schemes;
 work-based qualifications;
 continuing professional development;

Apprenticeship

Apprentices gain formal qualifications while learning on-the-job. An apprenticeship is

a method of paid on-the-job training that combines learning practical skills with
theoretical knowledge. Formal qualifications are gained while working and learning
on-the job combined with days at college as required.

Costs Benefits

Involves a high degree of supervision from

Professional qualifications can be
experienced staff members which can be time
gained
consuming

Apprentices may make mistakes while they are

Training is specifically tailored to
training which may harm the reputation of the
suit the firms needs and job role
company

Less costly as training takes place

Apprentices are paid a wage while they are training
while performing the job

No guarantee of job security once apprenticeship is

completed

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Graduate training schemes

Graduate training schemes are programs offered by companies to people who have
recently gained a degree qualification from university. They normally last between
one and two years and allow the graduate to experience different aspects of the
business throughout their training.

Costs Benefits

No guarantee of a job at the end of Gives graduates experience of a working

the training scheme environment

Can be time consuming to carry out Graduates can gain the skills required to work
the on-the-job training required permanently for the organisation

Graduate might leave once training is Graduates can experience different departments
completed and gain a range of skills

Organisation can decide where best to employ

graduates at the end of the training scheme

Corporate training schemes

Corporate training schemes are offered by organisations to employees within the

company. The employees will participate in training courses to further develop their
skills within the organisation. It ensures employees can learn new skills to enhance
the quality of their work or to advance within the organisation. The training can take
place at college, external training providers or within the organisation. Some
corporate training schemes can include ICT, leadership/management, time
management, communication or customer service.

Costs Benefits

Can be time consuming to carry out the training Standard of work can improve
required through training

Can be costly for the organisation to provide training Employees will be more

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Costs Benefits

and subsequent wage rises motivated

Work-based qualifications

Work-based qualification are formal qualifications that can be gained while working.
Employees will learn the skills required to gain the qualification while carrying out
their job.

Costs Benefits

Qualifications can take a long time if Training is specifically tailored to suit the firms
completed on a part-time basis needs

Employee may leave the organisation Training takes place in the work place so
once qualification is gained minimal cost to the organisation

Costly to pay for people to carry out the

Employees can gain a recognised qualification
training

Standard of work can improve through training

Employee has a better chance of promotion or a

wage rise when qualification is gained

Continuing professional development (CPD)

Continued professional development is training that takes place through a career to

ensure that employees stay up to date with the knowledge and skills required to do a
job or advance in their career. CPD can take the form of on-line training,
conferences, events, workshops or meetings.

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Costs Benefits

May take people away from their Improves the skills of staff which can lead to better
work in order to complete training quality goods or service

Motivates staff as they are better able to do their

Can cost the organisation money to
job and feel the company is investing in their
send workers on training courses
training

Ensures the organisation keeps staff up to date

with mandatory training requirements

Training and development are the corner-stone of sound management. It makes

employees more productive and effective. It is actively and intimately related to all
the personnel or managerial activities. It is an integral part of the whole management
program with all its many activities functionally inter-related. Training would also be
important to NAMCOR in order to take advantage of changes, techniques and
improvements.

Training and development are important for the following reasons-

 It enables employees to develop and rise within the organization, and

increase their market value;
 It enables management to resolve sources of friction arising from
parochialism;
 It brings home to the employees the fact that the management is not divisible;
 It moulds the employee’s attitudes and helps them to achieve a better co-
operation with the company and a greater loyalty to it;
 It helps to achieve higher standards of quality;
 It reduces human error;
 It assists build up a satisfactory organizational structure;
 Assists in the delegation of authority and provides stimulus or progress
applied to employees;
 Heightens the morale of employees as it reduces dissatisfaction, complaints,
grievances and absenteeism, reduces the rate of turnover;
 Training employees make a better and economical use of materials and
equipment;
 It helps in reduction of wastage and spoilage;
 Reduces the need for constant supervision.

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BENEFITS OF TRAINING AND DEVELOPMENT

1. Retains Employees

Retention is a major challenge for employers but retaining strong workers can be
achieved through career development. In fact, training and development has become
so centralized within businesses that it is often used as a competitive advantage
when hiring. Offering career development initiatives helps employees establish a
sense of value within the company and fosters loyalty, ultimately resulting in
increased staff retention and a 59% lower staff turnover rate.

2. Develops Future Leaders

Targeting employees with the skills for future leadership can be vital in establishing a
business for growth and evolution. Leadership talent can be acquired through new
hires, or HR professionals can select current employees as managerial candidates.
According to the Society for Human Resources Management (SHRM),
having professional development programs ensures an organization is focused on
future business goals by preparing promotable talent.

3. Empowers Employees

Leaders who feel empowered within the workplace will be more effective at
influencing employees and gaining their trust. Consequently, those employees will
feel a greater sense of autonomy, value, and confidence within their work. SHRM
defines employee autonomy as the extent to which an employee feels independent
and can makes their own decisions about the work they do.

4. Boosts Workplace Engagement

Finding ways to bolster the consistent engagement of employees can diminish

boredom in the workplace, which left unchecked can create feelings of
dissatisfaction and negative working habits. Regular training and development
initiatives can prevent workplace idleness and in turn will help businesses establish
regular re-evaluation of their employees, skills and processes. Furthermore, it will
influence company culture by instilling an emphasis on planning and can prompt
company analysis and planning as it requires employers to review existing talent and
evaluate growth and development opportunities internally, rather than via
recruitment.

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5. Builds Workplace Relationships

Providing opportunities for employees to explore new topics, refine their skills and
expand their knowledge can help your team members bond with each other. During
these training and development sessions, they will tackle new challenges together.
They can also lean on one another for various learning opportunities by collaborating
with colleagues who have specific areas of expertise. Research has shown that peer
collaboration is actually their preferred method of learning. Learning from each
other’s strengths not only leads to a more well-rounded workforce, but those bonds
can also improve retention and engagement.

6. Creating a Highly Skilled, Motivated and Enthusiastic Workforce

The existing workforce is trained to increase their productivity, and motivated to

contribute their best towards the organization. The employees will be more confident
about themselves and enthusiastic about their job. They will adapt to technological
changes and innovations more readily.

7. Increase Productivity

Knowledge about usage of sophisticated machinery and new technology is imparted

to employees which will enable them to use the equipment more efficiently and
thereby increase productivity.

8. Build Team Spirit

Training often takes place in groups where the trainees are encouraged to interact
with each other and discuss organizational issues. This helps to create team spirit
among the employees.

9. Healthy Work Environment

Training and development programmes help to modify the thought and behaviour
process of the employees in such a way that is conducive to building a healthy work
environment.

10. Personal Growth of Employees

Development programmes provide opportunities to the employees to enhance their

skills and knowledge and help them to achieve better career growth.

11. Promote Learning Culture

The employees are encouraged to continuously learn new concepts and update their
talents. This helps to promote a learning culture within the organization which would
greatly help in its future sustenance and growth.

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12. Improve Employee Morale

When employees are trained to become better performers, they feel a sense of
accomplishment. They realize that they are effectively contributing towards
organizational goals and thus get a morale boost.

13. Better Managerial Skills

Training and development programmes inspire the employees to think, plan, solve
problems and take important decisions. This hones up their managerial skills.

14. Reduce Employee Turnover

A well-trained employee will take more interest in his job and will be a more efficient
worker. He will get more job satisfaction. People who love their jobs are more loyal
towards the organization.

CONCLUSION

The above report to the executives of NAMCOR highlighted the importance of

training. Providing training to employees is an important element to a successful
organisation. It offers the vital chance for employees to develop and improve their
expertise and abilities. Providing training programs for employees demonstrates the
organisation’s willingness to invest in their success and growth. When employees
feel that the company invests in their growth and development, it improves morale,
productivity, and employee retention as mentioned previously. In addition, as the
company provides ongoing training opportunities, employees learn new skills,
develop existing ones, eliminates human error and take on greater responsibilities,
providing a win-win situation for the organisation. When an organisation provides
training to employees about an organisation’s specific procedures and policies, they
significantly improve the use and consistency work processes.

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BIBLIOGRAPHY

Meyer, M. et. al. (2012). Managing Human Resource Development. Lexis Nexis
Noe, R.A. et al. (2016). Human Resource Management: Gaining a Competitive
Advantage. 10th edition. McGraw Hill.

Noe, R. A., Hollenback, J, Gerhart, B, Wright, P. Human Resource Management:

Gaining a Competitive Advantage, International Student Edition

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