| STRATEGIC ANALYSIS |
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| Problems that managers and companies have faced in the last five years (I) |
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What happened in 2007
At the beginning of last year I wrote an article about the trends I foresaw for 2007. Now it’s time to have a look at what really happened. Along the year I talked with many people who run training companies, either large or small, with people working in the specialized media and of course with many of our clients. Here are my reflections about what I wrote then:
Trend: “...Those companies which spent the last three years consolidating their reputation and credibility will be those to offer an incomparable higher value...”
I believe the investments made in brands, in diverse forms, have proved to be profitable. Brand promises are clearer now, and training companies attract projects according to their profile and strategy. I think those who chose to survive or to stabilise were perceived by their clients as opportunistic, one-time-suppliers, and not as actual long-term partners for strategic development.
Trend: At the beginning of 2007 I noticed two types of successful companies. “...One category will focus on delivering individual sessions in large volumes. Another category will enhance their training programs into consultancy and development processes...”
I also added: “...since 2006 I’ve been noticing a real explosion in the demand for programs that teach real management abilities to middle and front line managers, and this tendency will continue in 2007!...”
In 2007 the “star programs” were the multi-modular ones, spread over 6 to 9 months and involving between 100 – 500 managers. For these programs the professionalism in logistics and organisation made as much difference to the success as the quality of the training sessions themselves.
Trend: “...In 2007 managers of training companies will have to make a sustained effort to retain their best trainers and consultants, to invest in their development, and also to insure a high level of their energy and satisfaction!...”
Most training companies chose an attractive compensation and benefits program as their main retention instrument. This meant a switch from having employees to having associates, a kind of exclusive free-lance trainers with low or null fixed income, though with a substantial variable income. It’s worldwide practice in our industry, and it has been used in Romania ever since 2000, but never became a popular business model till this year. I’ve only heard of investments in developing the employee’s potential and improving internal management practices from the very top of the companies!
Trend: “...Several companies have started to make open courses an important direction for 2007...”
I have seen that there has been an unprecedented increase in the offers of open courses: small or large companies, with a solid reputation or completely unknown, tested the market’s potential with a variety of topics! Some chose a low price strategy, others focused on a specific consumer target, while others even increased their usual fees. It has certainly been an invasion of offers, many of them also launched to support an increased visibility.
I believe that those companies which kept their promises – those that delivered the expected quality, that did not cancel or postpone sessions and had a good communication with the participants – gained a solid credibility. Those that only managed to deliver a “one-time-shot” will have very few customers for their courses in 2008.
The fees of 2007
2007 is also the year that showed a stabilisation of fees. For in-house sessions to develop specific abilities the top companies billed between 150 – 350 Euros/participant/day (VAT excluded), depending on the volume, brand, tools used and the trainer’s seniority. Smaller or less known companies rarely exceeded 120 Euros/participant/day.
The group daily fees have been between 1.800 – 3.000 Euros/group/day (VAT excluded) for the top companies, depending on the above mentioned criteria, while less known companies worked from 800 Euros to a rare 1.500 Euros/group/day. Freelance trainers work for 500 – 800 Euros/day (VAT excluded).
News in 2007
Only a handful new international companies appeared, and they just start to gain recognition from the Romanian professionals in the area: I’m thinking specifically about Zig Ziglar Romania and Covey Romania, to name those well known abroad. Other internationally renowned companies that are present in Romania and have recently consolidated their portfolios are Dale Carnegie, Wilson Learning, Tack Romania and Develor.
Human Invest was successful in launching the open version of Situational Leadership® II, and at the end of November NEXTEP – a multi-modular management development program. Ascendis Experiential signed a partnership with the Canadians from “Experience it”, and Trend Consult reorganised its activity in four companies part of the same group. TMI organised this summer the international congress of their network, while Achieve Global brought to Romania new editions of its professional sales programs.
I’ve also seen new local entrepreneurial initiatives, mainly built by people with a background in the industry, who switched from employees to entrepreneurs. Other companies disappeared, mostly due to lack of experience or managerial intuition and inflexibility in adapting to the new business context.
As conclusion, 2007 has been a better year in financial terms, compared to 2006. But some companies had their horizon set for the end of the year, while others prepared from time for 2008 and even 2009! Depending on the strategy the companies chose, they can expect a similar year, or a springboard in their development! The perspectives I see for 2008 are to come in a Part II.
Viorel Panaite
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Human Invest is a Premier League company in the arena of training and
organizational development consultancy services, present on the Romanian market since 1998.
We are recognized for conceiving and implementing programs which offer managers an authentic experience towards improving their leadership
performances, and thus we support companies in becoming more and more engaged in delivering excellent services for their clients.
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