• Organization lose valuable knowledge when institutional memory is not transferred to others. When employees leave, especially as a result of layoff, the departing employees may not pass along the institutional memory they hold. Daniel W. Rasmus, vice president of Giga Information group, has written, "As a knowledge management practitioner, when I look at lay offs, I see executive taking the easy way to cut cost - or give then impression that they're doing so- with little regard for the imact of workforce reduction on the long-term viability of the oragnization, let along its people. And savings may not result. After all, it takes several thousand dollars to coach an employee to thrive in a postion, and that investment is lost when the emplloyee leaves. Then there is the issue of losing members who are vital in terms of their knowledge about their work and their connections to content, processes, and people. suerly there is a cost in this loss."
• The damage to workers includes loss of moral, anixiety, presimism and a "save-my-own-butt" attitude- a soege mentality that isn't in the best interests of the company. Dr. Trevino points out that there;s plemty of evidence backing this up. "We know that eveyone within an oraganization pays close attntion to layoff because they know it's often not a single occurence . Layoff happen in stages. Instrad of working, employees look for clues as to when it might happen to them and discuss among themselves how they'll be trated.
• It's more expesive to lay off workers(legal, administrative and financial packages out the dorr) and then rehire (recruiting and training expense) than it is to shorten the workweek and temporarily reduce pay. Joutnalist Victor Infante, whos has extensively covered layoffs, sums up a secret that productive companies know. "Companies downsize to cut costs, but then are quickly forced to bring new people in because surviving employees leave for what they perceive to be more stable environments. This turnover starves production and lowers work quality." And he adds a thought that represents another way of looking at the cost issue: "Since the cost of a single new hire is generally equivalent to one year's salary, any savings from layoffs are negated." Dr, Trevino agrees. "Although layoffs have been touted as good management, they actually do not have a postivie impact on the bottom line."
• While layoffs may lead to superficial short-term effeciencies, they don't produce or sustain productivity. Consultant Darrell Rigby has written, "[Companies] understand that although employee layoffs will reduce costs in the short term, the combination of severance expenses,loss of knowledge and trust, and subsequent hiring, training, and retention costs can quickly overwhenlm expected savings" (From "Moving Upwards in Downturn," Harward Business Review, June 2001)
  

Skill is the ability that has been acquired by training. In other way skill is the ability to produce solutions in some problem domain e.g. “the skills of the well trained boxer”.

Why do skill Development?
Many times companies recruits fresher or people belonging to some other organization. These people are new to the processes and working culture of particular company. To make such people able to handle new kind of work and culture training is required. i.e. skills development is necessary for the development of business and individuals in an organization.
Different type of employees need different type of training, e.g.

• People working in call centers need training on communication skills.
• Marketing people need training on communication, company culture, product, etc.
• Managers and management level employees need training on leadership.
• Workers in mechanical workshop need skills to handle mechanical machines.

So we can say, skill is a learned capacity or talent to carry out pre-determined results often with the minimum outlay of time, energy or both. Skills can often be divided into domain-general and domain-specific skills.

Skills Development Model

Theory - is the explanation of the process. E.g. explaining how the lathe machine works.

Practice - Some skills development requires few minutes where as some required hours of practice. Initially some work takes more time to learn, but as an employee keep on practicing, he/she starts working more efficiently. Employee must practice to become good in particular work.

From During My MBA

• Cognitive - or intellectual skills that require thought processes
• Perceptual - interpretation of presented information
• Motor - movement and muscle control
• Perceptual motor - involve the thought, interpretation and movement skills

• Verbal instructions
• Demonstration
• Video
• Diagrams
• Photo sequences

• Cognitive phase - Identification and development of the component parts of the skill - involves formation of a mental picture of the skill

• Associative phase - Linking the component parts into a smooth action - involves practicing the skill and using feedback to perfect the skill

• Autonomous phase - Developing the learned skill so that it becomes automatic - involves little or no conscious thought or attention whilst performing the skill - not all performers reach this stage

• the initial conditions - starting point
• certain aspects of the motor action - how fast, how high
• the results of the action - success or failure
• the sensory consequences of the action - how it felt

• Perceptual trace - a reference model acquired through practice
• Memory trace - responsible for initiating the movement

• Analyze the reference model actions, the result of those actions and the desired goals
• Refine the reference model to produce the required actions to achieve the desired goals