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Amway

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Training and development is a field of human resource management that aims at maximizing the output of employees and management. Marketing, advertising, and distributing industries all require training and management to foster good performance as well as promote customer satisfaction. Human resource management deals mostly with the issue of training and developing unsurpassed performance from junior employees or potential candidates for more challenges positions.

Human resource management is the highest yet the closest department of any organization to the employees. By highest, I mean that every employee has to go through this department for interviewing in spite of their application standards. By closest, I mean for the application of training and development, there must be constant conduct between management and the employees. For this matter, the purpose of this research would be to investigate the role that training and development plays with the organizational setting. The units of measurement will be the level of effect brought by training and development. Then, this will be analyzed and proposed to human resource managements across the marketing industry and other related industries to foster understanding and performance growth rate. The research aim and purpose is not to give heads up to for-profit organizations only reasons for using training and development, but also to encourage not for-profit organizations to put up mechanism that would enhance their output.

The rationale for choosing training and development as the topic for this paper is to sensitize marketing strategies to the interested lot, while educating the human resource management on the issues that they may be overlooking. Considering the credit crunch of 1929 and the financial crisis of 2000, the paper draws purpose to investigate the reason some organizations are hard hit by economic crisis than other and the role played by training and development.

Statement of the Research Question

If training and development is a mechanism of bettering the performance of individuals and groups in industrial and organizational setting, does the level of training and development have a direct effect to the general performance of the organizations?

Research Objectives

The objectives of this research would be to:

  • Investigate the importance of training and development in marketing industry;
  • Measure the level of application and effect training and the development has on performance;
  • Investigate the methods and means used for training and development and the reasons for their choice;
  • Link the benefits of training and development with general performance of a sample organization and highlight why training and development should or should not be used by human resource management.

Outline of the Proposed Research Methodology

The research is done to search for relevant journal articles:

  • Online (e.g. Google, Yahoo)
  • Library (e.g. books)
  • Databases (e.g. EBSCOhost Business Source)

Company Background

Amway characterizes one of the largest direct selling company and manufacturer in the world, which employs strategic marketing, network marketing to sell a variety of products, primarily in the beauty health, and home care markets. Amway was founded in 1959 by Richard DeVos and Jay Van Andel (Amway, 2012). The company and its subsidiaries under Alticor reported a growth in sales of 2.3%, translating to US $ 8.4 billion for the year ending December 31, 2009. Amway product lines include personal care products, home care products, jewelry, Nutrilite dietary supplements, electronics, water purifiers, air purifiers, cosmetics and insurance (Amway, 2012). In 2004, beauty & health products accounted for 60% of worldwide sales. Amway markets its products through a number of affiliated companies in over ninety countries and regions around the world.

While observing marketing approach employed by Amway, it is critical to factor in the company’s significant branch in India. Hence, it is evident that, Amway promotes and encourages individual entrepreneurship using its innovative direct selling approach of its consumer products. Amway India is the embodiment of a leading direct selling FMCG-company, which sells and manufactures world-class consumer products (Amway, 2012).  Given that, Amway sources all its products from within India, it provides, thereby, a stimulus to the locally based manufacturing industry.

Amway India is a 100% owned subsidiary of the US Amway Corporation, Ada, Michigan, USA, which was established in 1995. Amway India began its commercial operations in 1998 and has proved to be the largest and most successful Direct Selling Company. Amway’s investments are in excess of US $ 35 million in India of this US $ 6 million is dedicated to direct foreign investment (Amway, 2012).           

Amway has provided income generating ventures to over 450,000 active independent business owners. Amway India provides unlimited and free training to all its distributors in an attempt to aid them in growing their business. Amway India conducted over 29,000 training and development sessions with an attendance of over 1.5 million business owners and prospects. Amway India is a significant member of the Indian Direct Selling Association (Amway, 2012). The IDSA acts as an industry regulatory body, and has several significant international and Indian Direct Selling companies as its integral members.

Training and Development Methods Employed

The identification for the training need is a tool used to identify what activities or educational courses should be availed to employees in an effort to improve their productivity (Rae, 2000). Therefore, focus should be emphasized on needs as opposed to employee desires for a constructive outcome. While, emphasizing the importance of training need focus on pinpointing if training will make a difference in the bottom line and productivity; and deciding the training each employee needs; these aims at improving job performance (Moskowitz, 2008). Therefore, differentiating between the need for organizational issues and training; hence facilitate a match between organizational goals and individual aspirations. Identification of training needs provides the basis on which all other training activities can be organized and considered. Hence, careful analysis and thought are critical since the process should to be carried out with sensitivity in given the significance of learning and the organizational objectives at stake.

Hence, identification of training needs is important for both the individual perspective and organizational point of view. In the organizational perspective, it is significant in lieu of organizational objectives that it wants to achieve for the benefit of all Stakeholders including customers, employees, owners, and suppliers. Organizational objectives can be achieved through harnessing the input and abilities of its human resources, releasing potential and maximizing opportunities for development (Rae, 1999). Therefore, employees should be aware of what they need to learn in order to realize organizational goals. On the one hand, if seen from an individual's point of view, people have aspirations, which they want to develop through learning and utilizing their acquired new abilities, opportunities, resources, and conducive working conditions. On the other hand, in order to meet people's aspirations, the organization should provide efficient and effective learning resources and conditions. Therefore, it is critical to ensure that there is a suitable match between achieving organizational goals and providing attractive learning opportunities.

Training and Development as Source of Competitive Advantage

Companies like Amway derives significant competitive advantage from employee training and development, more so in its marketing efforts. Training and development initiatives help remove performance redundancies and deficiencies in employees (Hale, 2006). This is particularly true when the deficiency culminates from the lack of ability rather than the lack of motivation to produce or to perform results. On the one hand, the marketing employees have involved the ability and motivation needed to learn how to do the job better, while, supervisors are supportive of the expected or desired behaviors.

Therefore, training and development provides competitive advantage to an enterprise by removing performance deficiencies; minimizing accidents, making employees stay long; reducing scraps and damage, while meeting future organizational and employee needs. While observing Amway’s strategic marketing trends, it is evident that, there is greater flexibility, stability, and capacity for growth in any organization. Training is a critical contributor to employee stability in a number of ways. For instance, employees become more efficient after undertaking training. Therefore, efficient employees contribute to the overall growth of the organization (Wick, Pollock & Jefferson, 2009). Hence, organizational growth renders stability and job satisfaction to the workforce. Further, it is common for trained employees to feel secure and stay with the organization. Thus, they rarely leave the company. It is evident that training has the tendency of making the employees significantly versatile in operations; hence, all round employees can be assigned to any job. Therefore, flexibility is ensured, whereas growth acts as an indicator of prosperity, as reflected in increased profits on a yearly basis.

Amway’s approach to direct selling requires critical training of its marketing employees, therefore, ensuring that future needs of employees are met through training and development programmes. In most organizations, fresh graduates or diploma holders are taken as apprentices or marketing trainees. These are absorbed and integrated in the company’s marketing function after course completion. Hence, training proves to be an effective source of recruitment. Employee training characterizes an investment in human resource with a promise of significant returns in future.

A comprehensive training and development programme ascertains that a company pays dividends to both the employee and the organization. Though, no defined training programme may yield all the benefits, it is evident the organization, which devotes itself to training and development enhances its human resources capabilities as illustrated by Amway’s coverage and marketing innovation, hence enhancing competitive advantage. Meanwhile, the employee's career and personal goals are furthered, generally adding to her or his value and abilities to the job environment. In the long run, the objectives of the human resource and marketing departments are also furthered.

Methods and Techniques of Training

A company’s products are a significant determinant in the choice of training and development methods to be used in its marketing efforts. Therefore, various methods of training are used to train employees. However, these can be categorized as On the job methods, which are applicable in the workplace, while the employee is working and off-the-job methods are used away from workplaces. Essentially, training techniques characterize the mode of imparting knowledge and skills to employees. Thus, training techniques are the approaches employed in the training methods. Training methods may involve the use of techniques like lectures, case studies, films, audio cassettes, video tapes, role playing and simulations.

Lectures are commonly used training techniques where verbal presentation of information by an instructor to a large audience forms the basis of the training. In light of this, the lecturer is presumed to have a considerably in depth knowledge of the subject at hand. A significant virtue of this approach is that is can be used for significantly large groups, and hence proves to be cost effective since trainee costs are low. While this method is efficient for large groups, its limitations account for its low popularity. This method negates the principle of learning through experience and practice. It involves a one way line of communication; where there is no feedback from the audience; hence, continuous lectures are likely to bore the audience (Roach, Mottet & Beebe, 2004). However, the lecture approach can be made effective when combined with other methods of training.

On the one hand, a more visual training approach like the use of overheads, television slides films and video. Visual aids will demonstrate and provide a wide range of realistic examples of the marketing environment and situations in a condensed period of time. On the other hand, the quality and effectiveness of the presentation can be controlled while remaining equal for all marketers in the training group. However, audio-visuals represent a one way system of communication with no forum for the audience to raise questions or doubts for clarification. Further, flexibility of presentation is limited from audience to audience.

On the job training offers are the most effective and efficient marketing training approaches. This gives the employee hands on experience of the subject matter while eliciting an immediate response to the program. On the job, training is conducted in the work environment and integrates the job context. In most cases, an experienced worker demonstrates and shows a trainee how to perform and execute marketing tasks. On the job training has the advantage of being the most effective method as the employees or trainees learn through experience; therefore, making them significantly competent. On the other hand, this method has reduced training costs since no formal training approach is organized. Hence, the trainee is motivated to learn. The employee is aware of the fact that their success on the job is dependent on the training received (Landale, 1999).

While On the job training is preferable, it may have significant drawbacks. For instance, the experienced employee may demonstrate deficiencies; therefore, lack of the experience or the capacity to train the junior employees. In light of this, the training programme is not systematically organized; hence, a poorly conducted on the job training programme is significantly probable. This may lead safety hazards, damaged materials or products, and cause unnecessary stress to the trainees. On the job training is conducted at the work site and in the context of the job. While on the job training requires a trainer to be present, a Programmed Instruction does not require the presence of a trainer. Hence, Programmed instruction is a critical substitute training method where a trainer is not required or is unavailable. Information is disseminated to the trainee in segments, especially through a programmed training machine.

Once a learner completes each segment or block of learning materials, they are required to answer a predetermined question on the subject matter. In light of this, a programmed instruction involves the presentation of questions, problems or facts to the trainee while enabling responses from the trainee. The answers provided are evaluated and feedback is provided. These form the basis in which the trainee progresses through the training program (Schneier, 1994). This approach allows trainees to learn at their own pace, hence providing significant motivation to the trainees to repeat learning where the subject matter is self contained, and structured while offering a clear scope of the objectives of the training programme. However, the training costs are significantly high considering the costs of manuals, books and machinery.

Computer-Assisted Instruction characterizes an extension of the Programmed Instruction method. The data-manipulation and speed memory capacity of the computer allow significant utilization of simpler Programmed Instruction concept. Computer assisted instruction is an improvement when compared to the Programmed Instruction approach. For instance, Computer Aided Instruction is significant where accountability is critical as tests are taken on the computer enabling the management to monitor each trainee's needs and progress. On the one hand, a Computer assisted instruction training programme is easily modified to reflect technological advances and innovations in the subject matter of the training (Holton & Laird, 2003). On the other hand, this training should be more flexible enabling trainees to use the computer at the most opportune time, and thus get training when they need. However, computer assisted instruction has high costs; but continuous use may provide a justification for the cost.

The use of a simulator, which can be an equipment or technique, which duplicates as nearly as possible the precise conditions faced on the job. Simulation embodies an attempt to mimic a real decision-making environment for the trainee. Simulation is a representation of the likely problem situation and possible available alternatives to the trainee. For instance, activities of a marketing department may be simulated; where the trainee may be required to make a decision in endorsement of those activities. The results of the decisions made are communicated to the trainee with an explanation of what would have transpired had they occurred in the workplace. The trainee learns from the feedback, hence improving subsequent simulations and work decisions. For instance, simulation can be in the form of case studies; where a description of an actual situation in marketing, which challenges the employee to discern the prevailing situation, defines the problem and the possible cause of actions and defining the problem in relative terms.

Given that, these experiences are derived from actual companies like Amway, they describe as accurately as possible the actual problems faced \by managers. Trainees should study the cases to determine problems while analyzing causes, hence the development of alternative solutions, selecting and implementing the best one. Case studies create stimulating discussions among participants and excellent opportunities for marketing trainees to defend their judgment and analytical abilities. Case studies are an ideal method for promoting decision making abilities within the constraints of available data. On the other hand, Role playing focuses on mainly human relations issues rather than actual ones. The basis of role playing is to form a realistic scenario, as in case study where the trainee assumes the parts of defined personalities in the situation. For instance, a female employee may assume the role of a male manager, where the manager may assume the role of a female employee. Thus, they may be given a work situation and required to respond as they would expect others to respond. Hence, the consequences are an improved understanding among trainees.

Role playing enhances interpersonal relationships while facilitating attitude change.

The other form of case study is Vestibule Training, which utilizes equipment, which resembles the actual equipment used on the job. However, training is conducted away from the work environment. A designated area is separated from the main production area and equipped with furnishings resembling those in the actual production area (Wick, Pollock, & Jefferson, 2009). Thus, the trainee is allowed to learn under a simulated environment, without disrupting actual operations. Vestibule training relieves the employee from the pressure of working while at the same time learning. In this case, the emphasis is on learning abilities required for the job. However, the cost of duplicate facilities and a trainer is an obvious demerit of this method.

Simulation is advantageous in that it provides the opportunity to recreate an environment similar to actual situations. However, it is difficult to duplicate the realities and pressures of actual decision making on the job. Also individuals act consistently differently in real life than they do in acting out a simulated exercise.

On the other hand, sensitivity training is critical since it requires a small numbers of trainees. These meet with a passive trainer where they gain insight into their own behavior and that of others. When meeting are organized, there is no predetermined agenda, hence they are held away from workplaces, where the rationale of the sessions is to deal with the present. Discussions emphasize on why employees behave as they do, their perception of one another, feelings and emotions derived in the process.

Macro and Micro Factors

The effectiveness and efficiency of any business strategy is significantly dependent upon the business locations environmental factors. These may be influenced by macro and micro factors; therefore, the implementation of a sound training and development programme should factor in these aspects. For instance, a country’s political environment is critical in establishing a marketing strategy (Simms, 1999). Political factors are categorically the methods to what degree a government intervenes in the prevailing economy. These factors include areas such as labor laws, tax policy, environmental law, tariffs, trade restrictions, and political stability. Furthermore, governments have significant influence on the education, health, and infrastructure of a country. For instance, with the liberalization of the market in India, a significant number of foreign companies including Amway have invested in its economy. The establishment of India as Amway’s production base has afforded the company to benefit from government allowances (Amway, 2012). Hence, these aspects have enabled the country to become an integral member of the world trade organization.

Economical factors are critical in establishing a company’s marketing program, these aspects include interest rates, economic growth, inflation rates and the exchange rate. These aspects have critical impacts on how businesses function and make decisions. Amway has a localization of raw materials and production in India where its production plant is based; therefore, fifty percent of raw materials are acquired in India. These have the advantage that the company does not suffer significant labor costs since it recruits its employees locally. Hence, it is essential to train it s marketing employees on the significant aspects and approaches of effective and productive marketing.

While the economic factors are essential in establishing the basis for a marketing strategy, it is critical to observe the social factors. These include the social-cultural aspects including health consciousness, age distribution, and population growth rate, emphasis on safety and career attitudes. Trends in social factors influence the demand for a company's products and its operations. Therefore, a company should actively involve the local community and implement a corporate social responsibility program, where human and financial support in areas like education, health care, culture, art and environmental preservation initiatives endear the company to the community.

However, while these are being observed it is crucial to factor in technology in any marketing efforts; therefore, a training and development programme should embrace technology as an integral aspect of marketing. Technological factors include product innovations, automation, the rate of technological change and technology incentives (Salas & Kozlowski, 2009). They can determine minimum efficient production level, barriers to entry, and influence outsourcing decisions. For instance, Amway developed and tailored products for Indian women such as whitening makeup. Legal factors should not be ignored and include consumer law, discrimination law, antitrust law, employment, health and safety law. These aspects can affect the company’s operations, its costs, market share and the demand for its products. 

Significantly, the business environment should be conducive for the smooth running of the business. These include environmental aspects such as weather, climate, ecological aspects and climate change, which may influence the functions of companies. Furthermore, growing awareness of the potential impacts of climate change is affecting how companies strategize their marketing campaigns and their product portfolio. For instance, Amway prides itself in its products, which are 100% composed of natural ingredients, hence have no effect on the environment (Amway, 2012). The company recycles its waste containers and bottles; while scanning the environment to identify and understand opportunities and potential threats to the company. These enable the company to market its products effectively. These aspects enable the creation of training and development program, which is comprehensive. This integrates issues concerning the company’s suppliers, publics, marketing intermediaries, competitors and customers in an inclusive marketing strategy. Meanwhile population variables like gender, age, occupation and marital status helps the company to evaluate the market and develop their offerings. On the other hand, shortage of materials and increase in the income differences are crucial concerns of   the companies.

The Benefits of Employee Training

Employee training and development is significantly beneficial to the employee and the organization as it leads to (Rmmler & Ordione, 1988):

• Improves profitability and attitudes towards organizational objectives.

• Improves the skills and knowledge in all employees of the organization

• Improves the morale of the employees hence helping people to identify with organizational goals.

• Helps create a better corporate image and fostering trust, openness and authenticity while improving the relationship between management and employees.

• Facilitates organizational development where trainees learns from other employees; hence facilitating the creation of job guidelines and protocols.

• Enables understanding and executing organizational policies while providing information for future purposes in all aspects of the organization.

• Organization development where effective decision-making and problem-solving skills are improved significantly while rewarding and promoting from within.

• Facilitates the development of leadership skills, loyalty, motivation and better attitudes; while increasing employee productivity and job quality.

• Creates a conducive environment for growth, communication enabling employees adjust to changes while minimizing conflicts and reducing tensions and stress.

While the organization derives significant benefits from employee training and development, similar advantages accrue to the employee.  These include instances where new employees are oriented while other employees are promoted and are availed with information on equitable opportunities through affirmative action. These help communication between individuals and groups, hence developing staff interpersonal skills, which are critical to marketing. These aspects make organizational rules, policies and regulations to be viable. Meanwhile, individual morale is improved through building cohesion within groups and creating an environment for coordination, learning and growth.

Marketing Strategy

The Amway Marketing strategy is a low risk and a low capital business opportunity that is open to all. It allows individuals to build business through retailing Amway products and sponsoring other potential businessmen and women, who in turn, can retail its products while offering the business opportunity to others. By passing sales and marketing knowledge to other developing teams, an individual not only creates his own business and market network but also enables others to create one of their own. Therefore, a marketing strategy is critical in commanding the marketing through innovative initiatives aimed at endearing the company to the customers through quality assurance and asserting consumer benefits accruing from the use of the product (Bassi & Darlene, 2007). For instance, in developing a marketing strategy for selling its Super Concentrated Cleaning System, Amway required to set out the critical objectives to be achieved. These included increasing distribution and productivity by providing new and captivating business opportunity. Therefore, the optimization convenience and value through significantly enhanced product differentiation with this revolutionary cleaning system; thus, providing unique and innovative products, which enhance Amway Home Care’s image to its consumers (Amway, 2012).

Amway strategically implemented a Multi-level marketing strategy where the marketing force is rewarded not only for sales they individually generate, but also for the sales generated by others they recruit; therefore, creating a stream of distributors and a structure  of multi-level compensation (Amway, 2012). Although, Amway’s products and the company are required to be marketed directly to potential business partners and consumers by means of relationship referrals and mouth to mouth marketing.

Amway strategically use direct Selling technique to sell its products and services. Therefore, Amway offers their potential customers membership. These members act characteristically as Amway agents and sell the products solely as they wish. Amway issues points on every product sold, which further gets translated into monetary terms and the points acquired have worldwide recognition (Amway, 2012). Therefore, in order to start the Amway Business, a potential business person needs to purchase the Amway Business Kit and be endorsed in the business by an existing Business Owner.

Conclusion

Amway is among the largest direct selling companies. Amway’s main objectives are to maximize its profits; therefore, it eliminates the middlemen while providing the products to the distributers in reduced prices. The products of Amway are world class product quality. They are made up of natural thing that’s why they are good for health and environment. Amway prides itself on the knowledge of a dynamically networked market that is increasingly becoming central to modern business. Therefore, through this knowledge, and the willingness to act upon it, has enabled Amway to be among the industry's significant leaders. In light of this, through the continuous pursuit of innovative product ideas, while consistently refining the current product line, Amway has become one of the leading providers of advanced networked products in the global market.

The Amway product portfolio includes a wide range of products from health care, beauty care, to clothing, and products used on a daily basis. However, these products are significantly costly in comparison to other products available in market; but when comparing the product quantity, Amway’s products last longer. Therefore, successful business today depends upon an effective training and development strategy and the company's ability to swiftly adapt to market changes.

It is essential that an effective training and development programme ascertain that the management commits to allocating significant resources and sufficient time to training. This characterizes a high performing company, which values and develops its human resources. Therefore, it is essential to ensure that effective training contributes to overall competitive strategies implemented by the enterprise. Different strategies require different human resource skills for their implementation. Hence, training should help employee at all hierarchical levels to acquire the needed skills. It is critical to ensure that a systematic and comprehensive approach to training and retraining are done at all levels on a continuous basis. Learning should be an integral and among the fundamental aspects of the company. This should be percolated down to all levels and employees in the organization. Therefore, a proper linkage among individual, operational and organizational training needs should be emphasized and implemented while a system for evaluating the effectiveness of training is implemented.

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