Introduction
Modern organizations believe that their main asset is their people – and their people are the ones that drive them forward and help them gain a competitive edge against their competition. Based on this belief – companies invest a lot of money in the development of their people’s skills. Companies believe that improved skills will help employees improve their individual performance – thus increasing company’s productivity and shareholders’ value. Therefore, companies spend billions of dollars each year on employee training. It is estimated that annual training costs incurred by many organizations today surpass $200 billion mark. These costs cover all types of training – formal as well as informal, on-the-job training. With this kind of high investments in their employees, it comes as no surprise that companies are curious to know if they realize full return on their investments, what kind of return they really realize, and what are the opportunity costs. After all, in this highly competitive market, companies have to think twice about every dollar they spend based on the return they get. On one hand, training could be of a great value if it helps employees acquire knowledge and skills to improve their individual job performance and sustain company’s competitive edge. On the other hand – it could be a great waste of money, if the knowledge and skills obtained during training are not directly applied to the job performance (training transfer) and/or maintained over time to translate into higher productivity and better organizational performance to align with organization’s main strategies. That is why a successful transfer of training should be of a paramount importance for modern organizations and a growing area of focus – to justify the huge expenditu ...