In its second-largest acquisition, Amazon buys the company for $970 million.
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More information leads to less turnover, Dixon maintains. And an online approach makes the additional information affordable. “The associates on the sales floor are crying out for consistent information that will help them serve customers, and this has had a positive effect,” he says. “That’s fewer people they have to hire and train at thousands of dollar per new hire. If retailers can start putting those numbers together, that really helps their return on investment.”
It’s hard to do online training without enough computers
Retailers such as The Brick Warehouse Corp. are set up to deliver training to associates online via computer terminals equipped to handle it, that already are on the sales floor in sufficient numbers. But the absence of the right hardware is one reason the U.S. division of Swedish home furnishings giant Ikea has yet to push the online training it offers its managers out to its store associates, who still receive their product training through booklets distributed by the company.
“It’s a hardware issue right now, pure and simple,” says Jeff Wilson, learning and development manager for Ikea’s U.S. operation, who explains that the computer terminals used on Ikea’s sales floor aren’t equipped for online access. While some of Ikea’s stores have established dedicated resource rooms housing web-enabled PCs for employees’ use, Wilson points out that those resources still aren’t enough to make online training for store associates practical on the scale that would be required. Ikea’s U.S. stores employ nearly 8,000 people, of whom about 5,500 are hourly workers, including sales floor associates. “Our Chicago store alone, for example, has 650 employees. You’d need a zillion PCs,” he says.
That’s not to say Ikea isn’t investigating the idea for possible implementation down the road. Ikea US is installing a new system, already used in its European stores, that may allow it to push training out to store associates by adding Internet access to the terminals on the sales floor. “It would be a couple of years down the road before that could happen,” Wilson says.
In the meantime, Wilson says Ikea’s U.S. operation is seeing gains from the online training it has offered to its 2,500 managers for the past three years. Ikea US uses two off-the-shelf, web-based training packages from provider Element K LLC, one that trains managers in the use of various Microsoft desktop applications such as Excel and another that offers training in basic management skills. Wilson says this replaces a training system in which Ikea sent managers off site to local technology vendors to learn desktop skills and to a store classroom for what he describes as “Management 101.” Ikea augments that with an internally-developed online training program built specifically around managing at Ikea, which resides on the company’s own servers. Unlike the online training it offers from Element K, Ikea requires managers to take this training, which takes about 20 hours spread over 16 modules.
Wilson didn’t disclose what Ikea pays for the two programs from Element K, but says the company measures ROI in terms of the convenience of putting the training online. “When we have new managers and new stores coming in, we can’t wait to hold a class. The manager needs to have a skill at that time. When we listed the basic training we wanted our managers to have, it was pretty easy to go with Element K because we didn’t have to develop the content. The timeliness of the training really meets our needs much better than classroom training on most issues,” he adds.
Wilson adds that another plus Ikea US gets from its online manager training is that the format has led more managers to take skills classes than was the case when training was offline. Because Ikea doesn’t have a rigid set of prerequisites for manager positions, the need and focus of training required by managers varies. Ikea makes nearly 40 training modules available online. Some 300 to 400 managers per year take the desktop application program, and about 500 managers per year take the management training programs. “We wouldn’t otherwise get people to sign up for that many sessions on that many topics because that could require time away from the store and travel time and expense,” Wilson says. “We haven’t looked at any savings between online and classroom training, but the real benefit to us is that more managers are taking these programs than we would ever see in the classroom. It’s a vehicle for our managers to get whatever they need in the way of training whenever they need it.”