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Best Training Practices
Will Kenny
3927 York Ave N
Robbinsdale, MN 55422

Going Overboard on

are JIT cost savings piling up risks that could threaten your business?

(reprinted from The Training Tipsheet)

You're probably aware of "just-in-time" (JIT) approaches to manufacturing and other businesses that rely on materials to deliver services. Instead of maintaining a large inventory of raw materials, parts, or supplies, the business runs very lean, with needed items arriving very shortly before they are used to produce product or service.

The benefit to the company is lower costs and better cash flow, because they aren't tying up their money in "storage," in the form of purchased, but as yet unused, materials. It also allows them to change product lines more quickly, for example, if they need to respond to changing conditions.

Some organizations have followed this approach into their training functions, with "just in time" training meaning that employees learn what they need to know, learn how to do various aspects of their jobs, only when the need arises. Rather than training them on a broad range of topics up front, some of which they will only use much later, a more modular approach is taken. Essentials are trained up front, and additional units of knowledge come into play as conditions warrant. Much of employee training is on a "need-to-know" basis, with a delivery system that allows smaller modules of training (often online) to be delivered quickly, as required.

Whether in training or creating physical products, if the supply chain is interrupted, everything grinds to a halt very quickly. In training, if the needed modules cannot be delivered in a timely fashion, an untrained employee may be handling critical business functions.

It is, then, a question of balance, of weighing the cost savings and efficiency of JIT against the risk of disruptions in delivery. And it is likely that many companies and departments have gotten so comfortable with JIT, or -- especially in the training world -- are so enthusiastic about the benefits JIT offers (particularly in terms of cost) that they are seriously underestimating the risks that come with this approach.

Things go awry when zealous application of JIT principles applies to everything, when all training is pushed in that direction. This is more common than you might think, because fads tend to sweep through training departments -- everything has to go online, or everything has to follow a certain mantra, whatever the latest "silver bullet," the latest "one size fits all" solution might be.

The problem is that critical knowledge and functions require redundancy, they need back-up. If people only learn the minimum that they need to know, at the last moment, it means that, say, an illness sweeping through a department, or coincidental loss of several employees to competitors, can wipe out your active knowledge base in the company. Suddenly, you have nobody who knows how to carry out a key practice, and you have to wait for someone to catch up to get back on track.

That suggests that instead of leaping on the JIT bandwagon, your organization will be better served by figuring out where JIT is most appropriate. And for the most basic functions, training someone else to be able to step in to handle or role, even though he or she doesn't usually tackle that function, can be crucial protection against disruptions in the way you do business.

From a risk management perspective, the short-term cost savings of an just-in-time training approach that is applied indiscriminately will be wiped out by the consequences of a catastrophic loss of knowledge -- a catastrophe that can occur with just a few people becoming unavailable at the same time.

To tell the truth, a lot of big companies have pushed JIT to the point where they are piling up risk, because they can't resist the short-term efficiency, the extra cash it puts into the business when everything is working well.

But everything doesn't work well forever. Make sure that your training efforts spread enough key knowledge among employees to protect you against a major disruption of your business when the usual players disappear.

© 2008 Best Training Practices -- Will Kenny

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