Many organizations view learning and development as overhead, or a luxury, leading to it being one of the first things to go when companies look to cut costs. Corporate spending on learning and development, like anything, is an investment. During times of uncertainty and budget cuts, the question is inevitably raised as to whether spending on people development makes sense.

In good times and bad, the global shipping and transportation industry faces common challenges relating to people development. What are these challenges? Although there are many perspectives available, three common themes typically exist among leading players in this space - Talent Retention, Skill shortage and Knowledge shortage.

Do these challenges go away in an economic downturn? Likely not. One could argue that addressing these challenges becomes significantly more important and remain a critical area for investment for serious industry contenders. Why? The following are achievable benefits from investing in learning and development:

Increased employee job satisfaction, morale, motivation and productivity

Increased ability to adapt to change

Increased innovation among individuals

Increased image and goodwill of the company

The alignment of learning and development with business strategies can help companies improve business results. Investing in the right people development is proven to increase productivity, improve employee retention, improve job satisfaction, improve sale performance and customer service.

If learning and development is so beneficial, why is it seen as a luxury or as overhead? Often the case exists where previous experiences or investments made have not achieved any real value. How can companies overcome this?

The key is to ensure that learning and development initiatives are specifically tied to business strategy and results while at the same time are measurable.

Whether working internally or hiring externally, evaluate all your options and get creative. A good provider should be flexible and respond to your needs as well as provide alternative solutions that meet both learning and budget requirements.

In short, the investment in learning and development is critical even in lean times, but making sure you are able to get the maximum benefits and impact from the investment is more important than ever. In challenging markets, we need to do more, with less - learning and development is an important of achieving this objective.

Amanda Rasmussen

CEO, Rasmussen & Simonsen International

EXCO Member, Supply Chain Asia

As the financial crisis continues to dominate the news and the fear of recession looms, many companies are pondering before they enter into a phase of cash flow crunch, whether they should consider finding a buyer. An incident of a retail company decided to take the plunge and was surprised to find several potential suitors. However, that’s where the good news ended.

One potential buyer sent in a consulting firm to perform due diligence; looking at their financials, facilities, manufacturing, employee benefits, labor issues and lastly their inventory.

This retail company had a huge inventory which was naturally listed as assets. However, the due diligence soon found that the inventory was several years old; much of it had been superceded and basically unsaleable. Subsequently the retail company has to decide whether to accept a substantially lower offer for their company or try to ride out the financial storm.

The financial crisis will have extensive repercussions to assets-heavy companies today. Those who owned heavily financed infrastructure may find their path ahead strewn with potential financial land-mines. The supply chain industry would be in for another round of consolidation should there be a heavy sell-off of these infrastructural assets.

Paul Lim

Founder/President