Why more firms now train their own talent

• Research has shown that when basic work skills are trained in-house, there are impressive returns on investment in many ways

The Nairobi Intercontinental assistant director in charge of catering and events, Mr Fred Ogutu, speaks with a lot of contentment when the discussion involves his pet project – an in-house academy for training about 36 new talent every year.

The project boils down to ensuring a continuous supply of personnel who are trained to the desires of the company. He says he initiated it in 1997, and it was re-established in 2008 when he returned to the hotel after some absence.

It has since gathered momentum, and Mr Ogutu believes it is because the hotel has found that the six-week course is a favourable route for acquiring new talent and for building a reservoir of specially skilled personnel.

Those who do well in the training are engaged as a member of the support team that serves during events, such as conferences, seminars, workshops and so on.

They are not full-time employees, but they are kept busy enough with the many events that take place at the hotel, or which are served by the hotel in other venues.

When a chance arises for a full-time job, priority is given to individuals from this team, says Ogutu. He believes that the initiative, other than providing the hotel with the talent it needs, has played a big role in enhancing staff retention.

“Our experience is that a good number of those who leave often return,” says Mr Ogutu.

Many organisations have taken similar routes – investing in the training of basic skills to maintain a talent pipeline. Some are doing so in-house, such as the Nairobi Intercontinental and Nation Media Group (NMG), while others like Safaricom (a mobile services provider) have established special partnerships with higher learning institutions.

NMG has what it calls a Media Lab, which for about nine months each year, trains talented fresh graduates to become journalists. Safaricom Academy, which is hosted at Strathmore University, offers training in telecommunications technology, and also hosts an incubation centre used by software developers to create applications that could be useful to Safaricom.

Other organisations have set up their own institutions of learning specially designed to develop talent with skills of interest. Samsung Electronics is an example. In February, it unveiled Samsung Electronics Engineering Academy in Nairobi.

Your bet is correct. The engineers-to-be from this school will not escape training in the Samsung way of doing things. The company is making inroads into the continent, and wants to have a pool of engineers who are trained to handle their products.

It was the second engineering academy to be launched by the company in Africa, the first having been in South Africa, and a promise made that a third one was in the offing for West Africa.

While these initiatives are a response to the frustrations experienced by employers who have time and again complained that training institutions have failed to supply them with graduates with up-to-date skills, they come with additional benefits, such as the one cited by Mr Ogutu — staff retention.

These investments are a deviation from the traditional training support that sought to develop management and technical skills of serving employees. The more urgent need now, it suggests, is to invest in the training of basic skills.

A research done last year in the US, where employers have also experienced gaps between their needs and the skills that fresh job seekers show up with, takes the discussion further by quantifying some of the benefits.

The research was done by an organisation called Corporate Voices for Working Families (CVWF). It sought to establish the benefits of training own workforce, and came up with supportive results.

CVWF studied selected companies that had invested in such training, among them the globally known Johns Hopkins Hospital. The findings are contained in a report titled Why Companies Invest in ‘Grown Your Own’ Talent Development Model.

One of them quantifies return of investment (ROI) into such projects. It suggests that such “workforce readiness programmes” could start of with a “first-year loss of about 10 per cent” in ROI, but ultimately realise a net gain in upwards of 40 percent.