Development (HSC SSCE Business Studies): Revision Notes
Development
Introduction
Development programs play a crucial role in retaining experienced and talented staff within a business. These programs improve employee motivation and commitment by offering promotion opportunities over the longer term. Research demonstrates that employees who feel skilled in their roles and receive recognition for their achievements show higher motivation, job satisfaction, and performance levels.
Development focuses on enhancing employee skills through:
- Further professional learning
- Mentoring or coaching
- Performance appraisal and management to enable career progression within the business
Training and development needs evolve throughout an employee's career:
- Early career: Focus on gaining qualifications and experiencing various roles to identify interests and talents
- Mid-career: Development of specialist or managerial competencies as employees advance to senior positions; talented staff may need fast-tracking
- Later career (employees over 40 years): Emphasis on knowledge upgrades, mentoring, training, work-life balance management, and retirement planning
Modern enterprise agreements increasingly focus on improving functional flexibility through multiskilling, job rotation, removal of restrictive work practices, reduced work classifications, job enlargement, and job enrichment. Ongoing training and development are essential ingredients in this process.
A major responsibility of human resource managers is to establish effective training and development programs, train managers to implement them, and evaluate whether these programs successfully improve performance.
Induction
What is induction?
An effective induction program is a carefully planned process that introduces a new employee to their job, coworkers, the business, and its culture. Supervisors, coworkers, and the human resource department (in larger businesses) typically participate in this process.
Why induction matters
Most employees who leave a business depart within the first three months. This makes the support provided during this initial period critical for retention. The first few months represent the highest-risk period for employee turnover.
Benefits of effective induction
A well-prepared induction program:
- Creates a positive attitude towards the job and the business
- Builds a new employee's confidence in their role
- Emphasises major safety policies and procedures and explains their application
- Helps establish good working relationships with coworkers and supervisors
Case Study: Telstra turns to TOBI
Telstra retail stores serve as major customer interaction points across Australia. Retail workers need expertise in diverse technology areas to assist customers with purchasing equipment and resolving service issues.
When implementing a new induction program, Telstra partnered with training company Be Learning to develop the Telstra OnBoarding & Induction (TOBI) program. TOBI is a 90-day learning app provided to all new employees.
The app features:
- A one-stop dashboard allowing workers to track their induction journey
- First 30 days: Directed learning covering job essentials
- Remaining 60 days: Learner-initiated content including videos, games, and on-the-job activities to develop highly competent sales consultants
Training
Purpose of training
The aim of training is to create long-term change in employees' skills, knowledge, attitudes, and behaviour to improve work performance. Training is essential for:
- Overcoming business weaknesses
- Building on strengths
- Maintaining staff commitment
Focusing on acquiring new skills and knowledge helps businesses adapt to change and stay ahead of competition. Multiskilled employees can better adapt to rapidly changing technological environments, demonstrate higher productivity, and gain opportunities for promotion.
Current training landscape
Most businesses today offer training in some form—either as a competency requirement or as a tool to develop and expand workers' skills. Around half of employees who have worked for their employer for more than one year receive some education or formal training. The majority of employees attending formal courses or studying for educational qualifications receive employer assistance.
A business's competitive ability is affected by the extent of training offered. Lack of training can damage businesses long-term by resulting in higher turnover rates as staff seek development elsewhere.
Benefits of training for employees
- Opportunity for promotion and self-improvement: Training opens pathways for career advancement
- Improved job satisfaction: Better job performance leads to greater satisfaction
- Challenge: Provides opportunities to learn new things
- Adaptability: Greater ability to adapt to and cope with changes
Benefits of training for businesses
- Higher productivity: Better job performance and more efficient use of human resources
- Goals and objectives more effectively met: Skilled employees achieve business targets
- Reduced costs: Less labour turnover and absenteeism, fewer errors and accidents
- More capable, 'mobile' workforce: Employees can adapt to different roles and responsibilities
Five steps of an effective training program
Step 1: Assess the needs
- Individual needs: Skills, knowledge, attitudes (both long and short term)
- Job needs: Competencies required for the role
- Business needs: Culture, goals, standards, service levels
Step 2: Determine the objectives Define clear training program objectives for the business, job, and individual. Management input and support at this stage is critical for success.
Step 3: Consider internal and external influences
- Internal influences: Employee attitudes to training, staffing levels, financial and physical resources available
- External influences: New research on training issues, government programs or support for training
Step 4: Determine the process
- Content: What will be taught
- Learning principles: Participation, repetition, demonstration, feedback
- Learning methods: Simulation training, lectures, online modules
- Location: On-site, off-site, or online
- Participants: Employees, supervisors, human resource manager, external consultants
Step 5: Evaluate the training program Evaluation strategies include:
- Tests and surveys (before and after training)
- Performance appraisal
- Observation
- Benchmarking key indicators (defects, customer complaints, accident rates)
- Changes over time in cost of sales, sales volumes, labour turnover
Soft skills development
Soft skills are non-technical skills that apply in the workplace and are increasingly seen as key to an employee's future career. Though often implied, many employers expect these skills to be displayed across various contexts.
Soft skills include:
- Listening
- Emotional intelligence
- Adaptability
- Communication
- Teamwork
- Interaction
- Creativity
- Problem solving
- Critical thinking
Organisational development
Flatter organisational structures
Modern organisational structures are less hierarchical and flatter. Team- and project-based structures, including virtual teams, are widely used. Flatter structures enable businesses to benefit from employees' ability to develop shared ideas and solutions to problems, improving efficiency, effectiveness, and customer response.
The challenge of flatter structures
While flatter structures improve employee autonomy and efficiency, they reduce promotional opportunities. Human resource managers must therefore use strategies to motivate and retain talented staff.
Strategies for organisational development
Job enlargement involves increasing the breadth of tasks in a job. This provides variety and challenges for employees.
Job rotation (multiskilling) involves moving staff from one task to another over a period of time to develop multiple skills across different areas.
Job enrichment involves increasing the responsibilities of a staff member, providing opportunities for growth and development.
Job sharing occurs when two people share the same job, allowing flexibility for both the business and employees.
Self-managing teams are teams in which roles and decisions are determined by their members, promoting autonomy and ownership.
Mentoring and coaching involve a leader or more experienced staff member providing advice and support to another person developing skills in an area.
Mentoring and coaching
Mentoring
Mentoring is a mutually agreed role suited to experienced staff who want to transfer knowledge and skills through succession planning. It focuses on building a personal relationship that encompasses the life experience of both parties. Those being mentored often select their mentors and are free to accept or reject advice offered.
Coaching
Coaching focuses on improving skills and performance, helping individuals manage specific work roles more effectively. Coaches may be provided by the business or sought by individuals seeking further development.
Key differences between mentoring and coaching
Understanding the distinction between mentoring and coaching is crucial for selecting the appropriate development strategy:
| Feature | Mentoring | Coaching |
|---|---|---|
| Focus | Individual life development, preparation for future roles | Performance enhancement by building skills and capabilities, overcoming weaknesses, resolving specific issues |
| Role | Facilitator and guide based on sharing advice and experience; personal relationship similar to a friend | Specific to employee's work function; assists employee in setting goals and finding solutions |
| Function | Provide advice that may assist in improving how someone manages issues and situations | Share skills, knowledge, styles and techniques relevant to employee needs |
| Time frame | No set time frame | Specific time frame |
| Structure | Unstructured | More structured |
| Benefits | Individual benefits through personal growth and potential performance improvement; may also benefit business; enhances morale | Business benefits through improved teamwork, performance and productivity; may enhance morale |
Performance appraisal
What is performance appraisal?
Performance appraisal is a systematic process of analysing and evaluating employee performance for strengths, weaknesses, and opportunities for development. It also assesses an employee's suitability for promotion (as a future leader or manager) and their potential value to the business's success.
Many businesses use a mix of appraisal strategies for different circumstances and levels of seniority.
Common appraisal methods
Essay method: A manager keeps a journal on each employee being appraised. Notes may focus on specific aspects of job performance, such as customer service, sales, personal presentation, and cash register use.
Critical incident method: Similar to the essay method, but the manager records only exceptionally good or bad aspects of work performance.
Comparison method: Each employee is ranked according to predetermined performance criteria. This often uses statistical values as measurement. For example, a rating scale of 1 to 5 may be employed (1 being poor and 5 being excellent). This scale can assess knowledge, speed, accuracy, communication, interpersonal skills, oral and written skills, personal presentation, and administration techniques.
The importance of feedback
Regardless of which technique is used, results should be discussed with the employee as soon as possible. The manager should:
- Explain both positive and negative aspects of performance
- Encourage continuation of positive behaviours
- Clarify what the employee needs to do to be recognised as more productive
- Identify training needs so the employee can improve in areas that may be lacking
Without performance feedback, appraisals become a pointless exercise.
Benefits and challenges of performance appraisal
Performance appraisal enables communication and allows positive relationships to develop between management and employees. Feedback helps employees improve their performance. However, the process can be time-consuming, particularly with shorter cycles (monthly or weekly), and can be stressful for both managers and employees.
Employees are more likely to value performance appraisal when they can discuss their performance and challenge their evaluation. When employees believe the process is constructive, fair, and will help improve future performance, they perceive it as more useful. This must be factored into the performance appraisal system.
If most employees continually perform below expectations, the business's recruitment and selection process may need changing, or extra training and development may be required. Although many managers feel uncomfortable evaluating employees, effective performance appraisal is a crucial function of good management.
Exam tip: Analysing development strategies
Exam Preparation
When exam questions ask you to analyse or evaluate development strategies, consider:
- How the strategy addresses specific business needs (e.g., skills gaps, retention issues)
- Both positive and negative impacts on employees and the business
- Whether the strategy is appropriate for the business context (size, industry, resources)
- Evidence of effectiveness (e.g., reduced turnover, improved performance metrics)
- Potential limitations or challenges in implementation
Remember!
Key Points to Remember:
- Development programs enhance employee skills through professional learning, mentoring, coaching, and performance management to retain talented staff and improve motivation
- Effective induction in the first three months is critical as most employees who leave depart during this period
- Training creates long-term changes in skills, knowledge, attitudes and behaviour, benefiting both employees (promotion opportunities, job satisfaction) and businesses (higher productivity, reduced costs)
- Flatter organisational structures require strategies like job enlargement, rotation, enrichment, sharing, self-managing teams, and mentoring to motivate staff despite fewer promotion opportunities
- Mentoring focuses on personal relationship and life development with no time frame, while coaching targets specific performance enhancement within a structured timeframe
Key Terms:
- Development - enhancing employee skills for career progression
- Induction - planned introduction of new employees
- Training - long-term change in skills, knowledge, attitudes and behaviour
- Job enlargement - increasing breadth of tasks
- Job rotation - moving staff between tasks to multiskill
- Job enrichment - increasing responsibilities
- Job sharing - two people sharing the same job
- Mentoring - personal relationship focused on life development
- Coaching - structured approach to improving specific work performance
- Performance appraisal - systematic evaluation of employee performance
- Soft skills - non-technical workplace skills