| STRATEGIC ANALYSIS |
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| The Training Market in 2007 and perspectives for 2008 (II) |
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In the first part of my article I talked about what happened in 2007 on the training market, and now I would like to share some of my ideas regarding the field of training in 2008. Although we are only at the start of the year, the stage is already set on the training market: the main clients have established their budgets and are about to finalize contracts with their suppliers; the main training companies have their “production plans” almost ready; there are very slim chances that any new contenders will somehow influence the market. For smaller companies, 2008 is a year of important decisions.
What’s happening inside consumer companies?
The companies that took the time to prepare their projects for this year since the fall of 2007 had enough space to choose the best suppliers and the best programs. This means that for them 2008 started with a clear plan for the next two or three years. And with such a large volume of activities these companies managed to obtain an efficient price from their suppliers. In many cases one of the companies that supplies these services also handles the management of the programs, a service which is very valuable when you have to integrate solutions from different training companies or when you are dealing with multi modular training programs.
Most of the consumer companies that didn’t have their training plan finalized by the end of 2008 will have to create and manage their own in house independent training teams to cover their need for training.
What’s happening with the suppliers?
Concerning suppliers things are both simple and complicated: simple – because the demand is getting higher and the costs of sales and marketing are decreasing; complicated – because there aren’t enough experienced trainers, and the expectations from consumer companies and participants are increasing.
If I were to go over a couple of older directions, that have become more obvious now, I would choose the following three:
The Premier League is consolidating its advantage
The year 2008 will enhance the positions of top companies, meaning that they will become more detached from those who haven’t had a clear strategy strengthened year after year. The companies that will exceed a turnover of more than one million euro in 2008 have built during the past years (and know how to maintain in the present) competitive advantages in at least one of the following aspects: a large production capacity, a high quality relationship with their clients or an innovative product that ensures an impact above expectations in client companies. Second league players that want to make it to the Premier League will have to consolidate at least one of the three attributes detailed above, in 2008.
At the same time I expect that some of the experienced trainers from less known companies will apply for similar positions in top companies or leave their workplace which is not offering them the success they are after and go for a job in the client companies or start their own business. There are a lot of people that started their own business in this field during these past three, four years. Being an independent trainer (freelancer) has no connection with the ambition of building your own company – there is a high degree of risk in behaving like a freelancer and wanting to develop your own business!
Personalized solutions have the upper hand
Seeing as the programs desired by consumer companies in 2008 are getting bigger and bigger, focusing on a larger population, it will be very difficult to deliver personalized solutions if the work processes, modules, sessions and instruments aren’t standardized. I think that this year the companies that will use their creativity to produce personalized solutions will be the winners, as opposed to inventing courses and agendas, instruments, manuals or activities.
The battle for the best
2008 continues to be intensely competitive when it comes to attracting the best people in this sector: first of all, in order to convince them to enter the field of training and consulting; secondly, in order to convince them to associate themselves with a certain company brand. It’s hard to say how much the financial aspect will weigh when it comes to deciding to change your workplace, because it will always be compared with the comfort with which you earn your salary and the degree of safety associated with obtaining it.
In the field of training the relationship with your employer becomes one of partnership, the trend being that of building networks of licensed collaborators, who work under the same brand and not employees on you payroll. But even with this status a senior with a good reputation in the field can have an income of more than 10.000 euro in a month.
A job which is becoming important in training companies, crucial in 2008, is that of Account Manager/Program Manager/Client Service Consultant. I’m talking about the title which ensures the design of the solution, proposing the solution to the client and being responsible for the quality of the implementation. I know a lot of projects on standby that were revived thanks to the abilities of the person in charge, and also projects which seemed successful and failed due to a lack of professionalism on behalf of the person handling it. Increasing the strategic role of this employee will make way for people with diverse business experience – a very healthy thing for the clients as well.
Tariffs
Companies will test their client’s reaction regarding the new tariffs which I talked about in the first part of the article. It is expected that some companies which do not have the arguments to support their new prices will have a lot to suffer.
Programs
2008 continues to be the year for programs concerned with management and leadership abilities with a strong focus on middle and top management.
Two programs are especially sought after: either multi modular, that train different management abilities (from leadership to financial and strategic management), or those that contain just one set of management abilities (like leadership), but which are going to be implemented at many levels of management.
Sales and customer service programs are increasingly being delivered by in-house trainers, and team building programs (especially in the area of local companies) will maintain their high request quota.
High quality offers for programs like negotiation abilities, presentation abilities and “train the trainers” will continue to be a scarce presence on the market (although the demand is very high).
New companies on the market
For international companies that came to Romania in the last two, three years, 2008 will be yet another year for strengthening and stabilizing. New comers have difficulties in attracting and keeping their trainers. This is one of the most sensitive aspects in building such a company and has direct consequences on the strategy and speed of development of the company. You also have Romanian companies that started around the same period and which are going through the same process, but the entrepreneur’s local network and the freedom he/she gives has in his/her strategies will make the process a little bit easier.
I don’t expect this year to bring any new renowned international players on the market: some local companies rival or even surpass training companies in Europe dimension wise and for the U.S.A. the local market is still too small and too far away to be worth the management effort. On the other hand most of the leading international companies are already here: Dale Carnegie, Zig Ziglar, Covey, TMI, Wilson Learning, Achieve Global or Ken Blanchard.
Open courses will play two important roles in the strategy of the companies that offer them in 2008. Those that are renowned will continue to provide increased profitability: as time goes by, they become more established, and sales and marketing costs will transform into a good investment! But in 2008 the majority of open courses will play the role of promoting the company that implements them: online promotion is from a financial point of view relatively accessible to a lot of training companies, and open courses represent a very good opportunity for communicating your products on the market.
In conclusion I will say, just as I have at the beginning, than in this market the battle is fought for attracting the best!
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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