Reality: Malam's New Training Branch

In 1997 Amir Fishman, then in his twenties, started Reality, a consulting and training company. The young firm offered organizations comprehensive consulting and implementation solutions. With constant growth, four departments took shape: consulting, assimilation, training development and a department offering these services through outsourcing. Six months ago, when the company had 170 employees, Amir sold it to one of Israel's major computer companies, Malam. The cooperation accelerated Reality's growth. Since then three subsidiaries have been acquired and the group of companies has turned into Malam's training branch.
We spoke with Amir Fishman, today director of Malam's training branch, about the group's activity and approach to employee management.

What did Reality do when it got started?

Amir Fishman: Reality operated as a consulting company - manager development, business and financial consulting, behavioral training. But we had special operations. Many consulting companies finish their job with a summary report suggesting steps to take, and then the customer has to implement the recommendations. We didn't do that, but stressed our involvement in the implementation of the recommendations as well.
That means we didn't just set out to show which behavioral insights we needed, e.g. developing the managers, rather we identified the client organization's business needs. Then we defined what has to be done and helped implement the recommendations. It was important to affect the profit line. In short, I didn't want to set up a consulting company, but a company that assists the organization improve its business performance.

Many consulting companies employ external consultants based on a flexible setup, according to the projects they receive. How does it work at Reality? 
For the first few years I worked that way too. We had salaried consultants, but we also had many other consultants who only came for specific tasks. What was important to me wasn't the way the consultant was employed, but his loyalty and commitment. Today it's different. The majority of consultants are company employees.

From which disciplines do the consultants employed by the company come from?
A substantial portion are people with experience in the field. People who were involved in management. Because we're focused on implementation we can't hire people without experience, the kind of people who just graduated. We don't have a practicum, like at many other consulting companies. We're not set up to employ consultants at the beginning of their careers.

Why does a manager switch to being a consultant?
Sometimes it happens because he lacks a job, so he sees this as a temporary position until he lands another management job.
It varies from one case to the next. It's not always an employment necessity, but can also be a case of a manager opting for a different career path.
Still, it's reasonable to assume that a 32-year-old manager who becomes a consultant at a certain stage will want to return to management. However, a manager in his forties who becomes a consultant is likely to continue his career in consulting over time. We have both types. Therefore the average age of consultants at Reality is high compared to other consulting companies that hire through practicum programs as well.

So what is Reality - a consulting company or a training company?
Today it's a company whose core is providing comprehensive training solutions, such as developing training programs, assimilating information developed among the client organization's workers and developing managers and activities through special programs held in nature. Therefore Reality and the subsidiaries are now defined as Malam's training branch.

And has the name Reality been preserved, or will you be working under the name Malam?
Reality is a label in the field of organizational training and there's no reason to give it up.

Malam is a computer company. If you focused on assimilating technologies or high-tech training, like John Bryce, which is a bit like Reality and was purchased by Matrix, I could understand the connection. But most of the employees are not necessarily high-tech people. Where is the synergy with Malam's activity?
John Bryce is also involved in training in fields besides high tech, such as training managers or training service providers, but it's appropriate that it leans toward technology, because that's where is emerged from. That's precisely the difference between us – we didn't grow out of high tech but from organizational processes, and therefore our package of services is broader and more varied. But of course there are many activities in which there's competition between us and companies like John Bryce, just as we compete with consulting companies in the field of consulting. Because of our range of activities we compete with various companies in various fields. Therefore in many cases it's convenient for a customer to choose us, because then it receives a comprehensive solution and doesn't have to work with a number of providers.

But how does that connect with Malam as a computer company?
Reality provided Malam two relative advantages. One is carrying out complementary activities that used to be executed by external companies, like John Bryce. For instance, if Malam gets an ERP project, today we handle the assimilation. And we go beyond that, managing the change, which is the main thing - assimilating the work processes that result from purchasing the technology. That's what's important to the client. The technology merely serves the work processes.
The second advantage is that Malam did not have to set up the entire system from scratch. We created Malam's "John Bryce" in two or three months. Its name will be Malam-Team Training.

Earlier we spoke about consulting activity. What does the training development activity include?
Developing targeted learning programs, such as training salespeople from a certain organization, constructing the business doctrine for mortgage bank employees and developing e-learning aids are examples of the range of activities. In this field we compete with other companies like AKT or E-Learning.
The development department employs 60 training developers, all of whom are company employees, or course.

What is their professional background?
They can be clinical psychologists with a master's degree, mathematicians or liberal arts graduates. Their education is less important than their experience in this field. This experience is acquired only at a few large organizations. The breeding ground is the IDF. Many of our employees were involved in training development at the Ground Forces Command. Civilian organizations that provide a breeding ground like this are a portion of the banks and cellular companies. It's a profession that's acquired in the field.

What kind of activity is there in the field of assimilation?
We call it "work processes assimilation." Again, this is not necessarily in high tech, but in an interface that connects between organization and methods, technology and semiprofessional behaviors. For instance, we execute work processes assimilation in the stores of a fashion chain and work processes assimilation as a result of the technological change in the organization's information systems.
Here, too, these are not work patterns brought from the outside. We have methodologies of assimilating work processes and we train the workers at the organization to work according to these methodologies.

In this case the assimilators don't need prior experience.
That's right. The employees in this department are the youngest at the company. Many of them are in their twenties.

When there are different population characteristics in every department, how important is it to you to create an organizational identity among the workers?
It's very important because the organizational identity is strengthened the more the organization you belong too is big and strong. Therefore we also want to strengthen Malam's identity even though the training branch is at a location separate from Malam.
Organizational identity helps preserve workers and I fully appreciate the importance of preserving workers. It costs us a lot less to preserve existing employees than to recruit a new employee.

What you define as a consultants branch is essentially outsourcing. The name "consultants" is no nicer than what they call in high-tech work "by the head." You put someone at the client site and receive payment for him?
Not at Reality. It's true there are places where this approach is common, but with such an approach you'll lose.
When a consultant sees in you a body that provides him added value of training and identification, and not just somebody who recruits him and pays him a salary, he weighs this among his various considerations and doesn't just look at the level of the salary he receives. If he sees you merely as a salary bureau, he will focus only on high compensation and then you'll have to pay him a salary that will lead you to lose money because the competition over projects is played out in terms of costs as well.
Therefore we make a point of not relating to your workers at the client sites any differently than our workers at the company offices. We include them in company activities and maintain constant contact with our employees at the client sites.

Why do people leave the company?
Inevitably there's turnover at every company for a variety of reasons. Wholesale quitting is most likely among the assimilators. An assimilator has a life expectancy of about three years. After this period a career development option has to be created for him if he's good and you want to keep him at the company.
For instance, if an assimilator finishes a project and is asked to switch to another project, he can decide he's uninterested in the next project because it's carried out in a geographic location that's less convenient for him. On the other hand, training developers can remain with us for many years.

How do you recruit employees?
We look for employees primarily because of the constant growth, but also because of turnover. First of all, anyone looking for work in the field comes to us, too. In addition we recruit through every possible channel: Internet, which is the most effective recruitment source for us, newspaper ads, placement companies and employee referrals.

If Internet is the most effective source, why is it worthwhile for you to put resources into other sources. Many organizations have told me newspaper ads have gone by the wayside.
I disagree. First of all if newspaper ads brought me even a single good employee, it's already worth the investment. Despite the popularity of Internet, not everyone uses it to look for work. Besides, advertising in the newspaper also carries image considerations. The ad gives the company exposure and demonstrates that it's dynamic, that it's growing.

What newspapers are worth advertising in?
Anyone who places an ad somewhere besides the Yediot Ahronot want ads - and even there if it's not reasonably large and noticeable – is simply throwing his money away.

What Internet sites are worth advertising on?
Our experience shows the most effective site for us has been Jobnet, and I'm not just saying that because this interview is being posted on it. It's simply that that's where we get the largest number of suitable candidates. Therefore in terms of cost effectiveness for us it's the most worthwhile place to advertise.

Is recruiting employees difficult?
The real difficulty is recruiting managers. It's hard to find good managers.
Until two years ago I always believed the grass is always greener on the other side and all the managers I needed I recruited from outside the company. But I found out - from a customer of mine - that first you have to look on the inside.
Today I take a good look inside the company to see whether I have a suitable candidate before I start looking elsewhere. And then, if I have to recruit a manager from the outside, the manager from the area in question has to explain to me why he didn't develop someone on the inside. The various managers know that today one of their important tasks is to create managers.

How are they supposed to go about doing that?
By locating the managerial potential in good employees and then sending them to courses and training programs both inside and outside the company. They can do it through personal coaching. There are a variety of ways to develop managers.

What percentage of the managers hired by the company in the past two years were promoted from company ranks?
About half. Today I'm very selective in choosing people. If necessary I'm willing to wait as much as six months for a good manager. Only a person I really want will be here. Period.

 

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