If training is such an important investment in a company's future, then why do companies spend less when things are bad? Shouldn't we invest more in our people to help them be more efficient, or to prepare them for when the business returns?
Most of us would like to think that the work we do as training professionals is a critically important service for our company's employees, customers, and shareholders. But the fact that corporate executives choose to spend less on training when earnings are down is a clear indicator that we are not viewed as an investment, but actually an expense. We've all seen that the first two expenditures to be cut or reduced are training and travel.
So why is that?
I believe there are two fundamental reasons. First, training, just like travel, is a variable and discretionary expense. Yes, discretionary - meaning it is a choice. It is an expense that is not tied to the direct delivery, manufacture, or support of a product or service. Management has a choice of when to provide training; they can provide it now, or sometime in the future.
How much and when to offer training is not a pure science. There is no clear cut metric or formula that helps us calculate how much training to provide, nor when the optimum time is that we should provide training.
The second reason training is easy to cut is we have difficulty calculating and demonstrating its true value. As training managers, we have not learned how to unequivocally demonstrate the value, or return on investment, of the training we provide.
Of course I know there are exceptions and isolated cases where you have to to train new employees who have no idea how to perform the tasks of a new job. But in the grand scheme of things, there are lots of training we provide that is optional, discretionary, or something that can be put off until later.
With this in mind, do you think management is justified in cutting training dollars when earnings are low?
I believe they are, and most often correct in doing so. Too much of the training offered in companies today is not aligned to corporate objectives. there are too many programs offered that just isn't necessary. For example, consider how many online training curriculums with large numbers of titles are made available to the entire workforce but is never viewed.
I know this is not a popular message to training professionals. But we
have to be better stewards of the corporate dollars we have the
responsibility to spend. The old days of supply based training
curriculums must end. It's wasteful spending even in good economic
times.
How can I say that? I just look at how many companies are currently going through portfolio rationalization activities today.
We have to break this trend. We have a responsibility to change our business models for how we manage training organizations to one where we provide only the training that is aligned with corporate objectives. Those that we can directly tie to the needs of the business.
I believe corporate executives expect us to come out of this economic climate with a new 'Road Map' for training. My advice is do not plan on returning to the training practices of before this recession.
It's time to re-engineer training services. Think long and hard about what type of training you provide, how you provide it, when you provide it, and how you support it.
There is a new philosophy needed for training management. I believe the winners will be those who embrace this change and truly reinvent their way of training.
I welcome your comments. And as always, please feel free to send me an email at dharward@trainingindustry.com.
