The impact of employee training on organizational performance: A conceptual framework

Employee is a key element of the organization. The success or failure of the organization depends on employee performance. Therefore, organizations are investing huge amount of money on employee development. This paper analyzes the theoretical framework & models related to employee development and its effect on employee performance. The key variables analyse related to employee development and organizational performance. Further, the researcher develops a proposed model which explains the relationship
between employee development variables (employee learning, skill growth, self directed, employee attitude) and organizational and employee performance variable. Findings show that employee performance–measured through training–has a significant effect on organizational effectiveness.

The paper is divided into three parts. The introductory part provides brief overview related to employee development and its impact on organizational growth. The second part analyzes researchers’ views on the chosen area of study, including an assessment of the theoretical frameworks related to employee development and organizational performance.

In the end, this paper presents a proposed model along with the discussion and conclusion.

Keywords: Employee development, employee performance, organizational effectiveness.


Employee Development is one of the most important functions of Human Resource Management. Employee development means to develop the abilities of an individual employee and organization as a whole, hence, employee development consists of the individual or employee and overall growth of the organization. This implies that when
employees of the organization receive proper training (with significant impact on their personal and profession growth), the organization would, in turn, attain competitiveness (Elena P. 2000).

Therefore, there is a direct relationship between
Employee Development and Organizational Performance. As when employees would be more developed, they would be more satisfied with the job, more committed to their duties, thus, improving in their productivity levels. An increase in employee performance therefore leads to organization effectiveness (Champathes, 2006).


Source: Chay Hoon Lee and Norman T. Bruvold, (2003). „Creating value for employees: investment in employee development, Int. J. of Human Resource Management Vol.14 No. 6 p 981–1000.

Importance of Employee Development Activities

Employee development activities are very important for the employees, and as the activities are performed, it indicates that organization cares about their employees and wants them to develop (Elena P. 2000). More organizations in the 21st century are investing in employee development. According to Champathes (2006), when organization contribute towards employee development activities, workers show commitment to the actualization of organizational goals by utilizing their full skills and constantly making efforts to improve their competence.

There are many schools of thoughts. One school of thought says that employee development should focus on:
1. Self Development
2. Self Directed Learning

This concept indicates that employee development must be recognized by the employees who want to learn or who are willing to learn. When employees are willing to learn, they show their interest in the developmental activities, and as a result, they gain job satisfaction–which is foundational to achieving organizational goals (Elena P. 2000). Employee development also depends upon the individual employee’s curiosity to

 How much curiosity to learn an individual employee?
 How to learn to develop themselves?
When employees want to learn, they would dedicate time and focus on achieving desired goals by taking part in individual and group tasks. These activities include attending seminars, workshops and others training sessions, either on the job or off the
job. This indeed would lead to employee development, and employee development would lead to an increase in performance, competitiveness and sustainable profits.

Does one’s level of expertise lose value if he is not willing to develop? Does an increase in investment make training programs attractive to employees? In essence, employee development is also a personal responsibility. Employees at all levels are involved in the developmental activities whether the upper level employees, middle or lower level employees (Antonacopoulou 1996).
Challenges in Employee Development
Organizational growth depends on the individual employee’s willingness to participate
or not. Employee development also depends upon the organization culture, attitude of top management, and opportunities of promotion–which may be limited (Elena P. 2000; Antonacopoulou 1996).

Organization Culture: – If organization culture supports employee development, workers will be encouraged to participate in decision making. This endears employees to organizational goals and improve overall performance.

Attitude of Top Management: – Top Management attitude is another important factor that influences on employee developmental activities. Managerial competence, in most cases, is a distinguishing factor between successful companies and the rest. But a lot depends on the sincerity and commitment of the top management.

Limited Opportunities of Promotion: – If opportunities of promotion are limited then employees would not participate in the employee developmental activities.

Developmental Activities
Coaching is an important activity for employee development. Coaching is not formal. It involves treating employees as a personal partner in achieving both personal and organizational goals. Agarwal (2006) notes that management can solve personal problems of the employees by providing coaching, with concerns for an individual’s emotional problems or private life. When an employee believes his problems are well taken care of, his commitment to the job improves. This leads to a significant increase in organizational performance.

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