Impact of Continuous Development and Training on Organizational Performance: A Case Study of Petronas

This literature review explores the impact of continuous development and training on the organizational performance and profitability of Petronas, a major oil and gas company in Malaysia. It analyzes the major components of organizational performance, the possible impact of continuous development and training on employees, and effectual techniques for improving development and training.

Running head: LITERATURE REVIEW
Literature Review
Name of the Student
Name of the University
Author note

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Table of Contents
Introduction:...............................................................................................................................2
Background:...........................................................................................................................2
Purpose and Problem Statement.............................................................................................2
Significance of Research........................................................................................................3
Research objectives:...............................................................................................................3
Research questions:................................................................................................................4
Literature Review.......................................................................................................................4
The major components of organizational performance and increasing the profitability of
the business organization:......................................................................................................4
Analyse the possible impact of continuous development and training on the employees.....6
The effect of continuous development and training on the organizational performance and
the profitability of Petronas....................................................................................................7
Effectual techniques for improving the development and training........................................9
Conclusion:..............................................................................................................................12
References................................................................................................................................14

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Introduction:
Background:
The oil and gas industry in Malaysia has attracted various foreign companies to
invest, therefore with the course of time it has created a wide range of employment
opportunities in the country. This sector plays a vital role in the economic development of the
country as it makes up to more than 20% of the gross domestic product of the country. The
oil reserves of the country are considered to be the fifth largest in the world as well. Petronas
or the National Petroleum Limited is a major organization in this sector which is entirely
owned by the Malaysian government. The organization is vested with all the resources in the
country and it is also entrusted with a major responsibility of expanding and adding more
value to the oil and gas resources. Petronas has also been ranked with the 500 largest
organizations around the globe. Since its inception, the organization has developed to be an
integrated global oil and gas organization which has business interest in more than thirty five
countries in the world. The organization has been engaged with a large range of the
petroleum activities comprising of the production and exploration of gas and oil, distribution
and marketing of the products, processing of gas, trading, transmitting the gas through
pipeline and networking operations, liquefaction of gas, marketing of the liquefied gas,
automotive engineering and many others. Therefore, it can be indicated that the organization
is a continuous source of income for the government of Malaysia.
Purpose and Problem Statement
Research Purpose:
As indicated by Khalique et al. (2015) the research purpose tends to provide a proper
structural approach to the research work which also helps to provide a definite and proper

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purpose of the research. The purposes of research are of three kinds: descriptive, exploratory
and explanatory. The exploratory research purpose tends to refer to the long term procedure
whereas the explanatory research purpose tends to help connecting various concepts for
understanding the reasons and outcomes of the research study. On the other hand, the
descriptive research purpose is helpful for conducting the research with more explanation and
exploration as well. For this research purpose, descriptive research purpose will be taken so
that the specific research topic can be explored and explained at the same time.
Problem Statement:
The continuous development and training is considered to have an optimistic impact
on the overall performance of the business organization and to enhance the profitability of the
organization, therefore this research will investigate whether continuous development and
training has a positive impact on the organizational performance and its profitability on the
backdrop of the Malaysian oil and gas company Petronas.
Significance of Research
In spite of a large number of researches conducted on defining the relationship
between the development and training and the organizational performance, there is still a gap
concerning the idea of continuous development and training and its subsequent effect on the
organizational performance. Therefore the significance of the study is that it will profoundly
investigate for closing the gap with the help of relevant literature which will shed light on the
relationship between these two factors.
Research objectives:
The research objectives are:

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 To investigate the major components of organizational performance and increasing
the profitability of the business organization
 To analyze the possible impact of continuous development and training on the
employees
 To investigate the effect of continuous development and training on the organizational
performance and the profitability of Petronas
 To recommend some effectual techniques for improving the development and training
so that it positively affects the overall organizational performance and the profitability
of the business organization
Research questions:
The questions for this research are:
 What are the major components of organizational performance and increasing the
profitability of the business organization?
 What are the possible impact of continuous development and training on the
employees?
 What are the effect of continuous development and training on the organizational
performance and the profitability of Petronas?
 What are the effectual techniques for improving the development and training so that
it positively affects the overall organizational performance and the profitability of the
business organization?

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Literature Review
The major components of organizational performance and increasing the profitability
of the business organization:
According to Golini, Kalchschmidt and Landoni (2015) the productivity of any
business organization is mostly dependent on the productivity of the employees. It has also
been highlighted that the employees who seem to be happy and satisfied with their job, they
tend to have a better job performance, therefore it leads to less employee attrition rate than
those employees who are not at all happy with their jobs. Furthermore, it can be indicated that
the employees tend to leave the organization if they are not happy with their job and utterly
de-motivated for showing a better performance. The higher the employee performance is the
higher productivity and profitability of the organization. It is also easier for the management
of any organization to motivate the employees who are satisfied with their jobs for going
beyond their fixed targets (Zumrah and Boyle 2015). However it is worthwhile to mention
here that the employees can only be satisfied with their jobs if they feel they are competent
enough for performing which can be attained through a complete and proper development
and training program while they join any new organization. Therefore, it can be said that the
workforce plays a significant role in enhancing the organizational performance; therefore it is
necessary to provide an extensive development and training program for creating higher
performers in the organization along with that it also helps the management to create an
improved working environment within the organization. In this context it can be said that the
internal environment is another component that helps enhancing the overall organizational
performance. Eccles, Ioannou and Serafeim (2014) have indicated that there is a strong
impact of the internal strategies taken by the management on the organization performance.
For instance the main objective of the cost strategy is to gain the competitive advantage by

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reducing the unnecessary costs however if that cuts down the expenses spent for the
betterment of the workforce and improving the organizational environment, it can affect the
organizational performance in a negative way. The structure of the organization also plays an
imperative role in defining the organizational performance as it is related to the size of the
organization, number of the workers and other associated aspects that tends to recognize the
firm from its potential competitors and make reference to the adaptability and flexibility of
their positions and functions. In addition to that, performance management can also be
defined as a major component in defining the productivity and profitability of the
organization. Therefore the management needs to employ both the financial and non-financial
performance indicators so that they can measure which employee needs more development
and training programs (Riggio and Porter 2017). In this context, it can also be said that
leadership is another major component for enhancing the organizational performance as the
managerial practices has a strong impact on the profitability of the organization. It also acts
as a key component which makes sure that there is a strong connection amongst the factors
that can enhance the organizational performance.
Analyse the possible impact of continuous development and training on the employees
The actual supervision of individuals and managing people at workplace is Human
Resource Management, and it has been formed to be a primary part in many business
organizations and is the adjustment for a wide - extending thought process which concerns
the idea of the contemporary business connections. One of the real segments in the
coordination and administration of work in an association is the administration of human
asset. Cascio (2018) eluded to Human Resource Management as counting all of management
exercises and choice, that impact the connection between associations also, its workers which
are the HR. For the most part, administration settles on basic decisions for quite a while that
impact this relationship. (Tahir et al. 2014). Anitha (2014) contends that the affirmation of

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the significance of preparing starting late has been strongly affected by the escalation of
competition and the relative accomplishment of associations, as interest in workers'
improvement is broadly stressed. They encourage contended that creative upgrades and
various leveled change have continuously determined a couple of organizations to the
acknowledgment that accomplishments rely upon the aptitudes and capacities of their
specialists, and this suggests huge what's more, relentless interest in preparing and
improvement. Eccles, Ioannou and Serafeim (2014) saw that Human Resource Management
idea for instance, obligation to the association and the development in the quality
advancement have driven senior administration gatherings to comprehend the expanded
significance of preparing, worker advancement and long - term instruction. An idea of this
nature requires careful arranging, as well as a more accentuation on worker advancement. To
Ford (2014) regardless of how deliberately workers are screened, regularly, a hole stays
between what the representative does know and how they should know it. An association in
this way, wanting to pick up the aggressive edge in its areas of expertise, will require rigorous
labor and powerful preparations of its human resources (Parmenter 2015). Development and
training works are a larger amount of source for a learning action to obtain enhanced abilities
and information expected to play out an errand. Training is the prerequisite for a more
protruding profitability and security in the activity of particular equipment or the requirement
for successful deals constrains, to say a few. To concoct the coveted information, capacities
and aptitudes of workforce to perform well at their work side, requires appropriate preparing
programs that may similarly affect representative inspiration what's more, responsibility
(Goetsch and Davis 2014). Representatives can either formulate or break their organization's
notoriety for being admirably as productivity. Moreover, they supervise the greater part of the
exercises which can impact satisfaction of the clients, in accordance to the everchanging
demand of the global market.

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The effect of continuous development and training on the organizational performance
and the profitability of Petronas
Training has been priceless in increasing the profitability of business organizations. It
doesn't just upgrade representatives creatively, it also gives them a chance to project all
intents and purposes take in their occupations and perform all the more efficiently. While
expanding Petronas’ prosperity as well as the company’s efficiency. Different examines
exhibit the optimistic effect of training on company’s profitability. Development and training
works as a procedure in this field is a standout amongst the most inescapable techniques to
improve the profitability of the business organization and conveying hierarchical objectives
to faculty (Mone and London 2018). (Hyland, Lee and Mills 2015) additionally bolstered that
driving resources into training executives on basic leadership, cooperation, relational
relations and critical thinking has valuable effect on the company’s development, as well as
affecting on staffs’ execution. Training influences workforce's conduct and their working
aptitudes which come about into PETRONAS ‘upgraded execution and additionally effective
organizational changes (Taylor, Doherty and McGraw 2015). Training is surely the best
method for encouraging and retaining high caliber workers by HR inside a business
organization. Likewise included by preparing is a method for improving worker duty and
augmenting representative potential. As indicated by Mone and London (2018) training is an
instrument that generally manipulates the useful achievement of the company’s goals and
objectives. Be that as it may, the model objective of each business organization is to produce
high income and boost benefit and an essential apparatus to understand this is a proficient and
compelling workforce. Consequently, a workforce is just productive and successful if the
proper training and improvement is accommodated such and consequently prompting
efficiency of the company.

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Source: Mone and London (2018)
Authoritative execution is currently a vital factor in the exact probes about of the
business associations (Goetsch and Davis 2014). As indicated by (Epstein and Buhovac
2014) organizational performance can be surveyed by the inward and outside variables on
which the survival of the company depends. Notwithstanding this, the operationalization of
the idea is extremely troublesome as it is a multi-dimensional and complex aspect (Sloman
2017). Impressive research has been done, distinguishing the connection between HR hones
and the execution of the association (Golini, Kalchschmidt and Landoni 2015). The impact of
HR hones on the authoritative execution is significantly impacted by the COQ of the
association. The higher the disappointment expenses of value the more lower the levels of
authoritative execution will be. As the disappointment costs caused by the absence of duty,
expectation to stop the association overhaul of preparing programs;what's more, losing
potential workers incredibly drive the levels of hierarchical execution towards the lower end
(Davis et al. 2016). Henceforth, the better the HR rehearses usage the higher will be the
performance levels of the business organization.
Effectual techniques for improving the development and training
In fact, supervisors pass on aptitudes, information and knowledge through instructing
and coaching. However, in our more aggressive and complex world, the part of the leader has

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disintegrated (Albrecht et al. 2015). Overseers are at present overstrained with duties. They
can hardly deal with what they have easily estimated on, not to mention offer coaching and
instructing. The management of the organization needs to help and boost directors to carry
out this project.
The company should tutor representatives to claim their professional advancement.
Exceptionally prepared, ‘one-measure fits-all learning programs’ do not work much longer.
Individuals should possess, self-direct, and control their learning process (Riggio and Porter
2017). However they can't do only it, nor do they need them to. The development and
improvement of the worker’s skills is imperative to the company’s constant achievement,
capacity to enhance, and wide-ranging profitability. It's a brittle adjustmen, one Don Jones,
previous Vice President, Learning at Natixis Global Asset Management condensed in this
way: "We need 'modified' answers for people, while at the same time giving scale and
cost efficiencies over the association," he said.
The organization should the short-timeframe of realistic utility of learning and
improvement requirements. It used to be that; what the management understands was
significant for a significant length of time, however now; learning and professional
capabilities can wind up out of date inside months. This makes the urge to learn swiftly and
consistently more vital than any other time in recent times. This expects management of the
business concern to reconsider how taking in and progression take place from a time to time
advancement to a more nonstop, progressing effort (Khalique et al. 2015). As Senior Chief
Learning Officer and Vice President; Annette Thompson, at Farmers Insurance brought up in
a meeting, keeping away from information over-burden is vital, so the management must
establish synchronization between giving the correct information as opposed to providing
excessively.

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They should also give adjustable learning alternatives. Advising legislative body have
to contribute in all the more learning and development exercises with their officially
substantial workload often discard them feeling devoured and overpowered by the inquiry,
"When and in what capacity will I discover the time?" business organizations must react
by embracing on-request and convenient arrangements that make learning opportunities all
the more rapidly available for your kin (Birasnav 2014).
Matching idiosyncratic learning choices to a range of learning styles should be done.
With five ages effectively in the labour force, the management of the company must
reconstruct the way representatives learn and the devices and exercises they use to precisely
coordinate the dissimilar styles, inclinations, and desires for workers (Helmreich and Merritt
2017). For instance, Millennial became an adult utilizing PCs, cell-phones and computer
game consoles, so they will be expecting to make use of these innovations in order to help
their learning exercises.
Trust should be fabricated in hierarchical administration. Individuals desire
straightforwardness, transparency, and dependability from their pioneers. Sadly, business
pioneers generally keep on confronting issues of trust. As indicated by a study by the
American Psychological Association, one of every four laborers say that they don't confide
in their boss, and just about half-trust of their manager is open and forthright with them. In
the event that pioneers withdraw or refuse to share their own particular incessant learning
ventures, how may they foresee that their kin will eagerly seek after theirs? It is the familiar
saying of "show others how it’s done." If directors of the companies need employees to
participate in learning and improve mental programs, at that point they have to exhibit that
they are at present looking for after their own learning ventures also (Zumrah and Boyle
2015).

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They should also provide the changing needs of more virtual groups. While most of
the business organizations have more employees working tenuously and for all purposes and
intents, it needs further idea and innovativeness in how to train this fragment of your labor
force. This includes formal kinds of learning through courses, yet in addition the casual
tutoring and training channels. Because representatives are outside of anyone's capability to
see does not mean they have the possibility to be out-of-mind in relation to learning and
advancement.
Conclusion:
This research work may face a major drawback of limited budget and time. Therefore
the future researches on this topic can be capable of finding various other potential impacts of
the continuous development and training on the overall performance of the organization
along with increasing the profitability. In future, the numbers of samples can also be
increased for gathering adequate information and data. In addition to that, the future
researches can also utilize different research philosophies to evaluate the research study from
various other approaches. This research work has various chapters that cover different stages
to complete the entire research study. The first chapter refers the introduction to the study
including the background of the company, purpose of research, problem statement and the
significance of the research. The second part of the research work includes the review of
various relevant literatures. This part contains various related concepts, models and theories
of development and training of the employees along with the concepts associated with the
organizational performance and the profitability of any business organization. The
concluding section of this part will include the further implications of the research along with
the research objectives and research questions. The next part of the study is the research
design which is comprised of two sections. The first section includes the background of the

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research, purpose of research, problem statement, research questions, research objectives and
the research framework. The next section includes the research methodology that comprises
of the research methods, sampling methods, data collection, data analysis, ethical issues and
gnat chart. The researcher has linked the objectives of the research while reviewing the
relevant literatures in this study.

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