Training companies are not created equal, nor do they provide the same quality of products or service. Understanding a training company’s capabilities is critically important when choosing the right supplier for the right engagement. To assist buyers of training products and services with how to identify and select training suppliers, Training Industry, Inc. created The Training Supplier Stratification Model (TSSM).
The TSSM categorizes companies into four categories based on three differentiating factors. 
- Breadth of Capability: a company’s ability and/or willingness to deliver a breadth of services, products and technologies.
- Geographic Reach: a company’s ability and/or willingness to serve customers over a broad or regional geographic market
- Business Viability: a company’s viability and/or willingness to manage large and more risky financial engagements as opposed to a smaller and more transactional projects and service deliverables.
Stratification Definitions
Strata 1: Comprehensive Service Providers – companies with broad and diverse process and service capabilities, as defined by their abilities to perform virtually all processes within the Training Process Framework. They choose to serve a global customer base, are well capitalized to handle large financial deals, and possess access to a vast array of resources to scale up on large customer engagements in a short period of time. Engagements tend to be multi-year business process outsourcing (BPO) service contracts for large and complex engagements. Buyer relationships with Strata 1 companies tend to be more strategic and less transactional.
Strata 2: Selective Service Providers – companies with a broad and diverse process and service portfolio, but limited in their ability or choice to deliver around certain processes within the Training Process Framework. Selective Service Providers are often limited in their ability to handle large scale financial risks, or their ability to deliver in particular geographic markets. Engagements tend to be mixed between multi-year service agreements and mid size to large contractual projects. Buyer relationships tend to be strategic with a mix of transactional services.
Strata 3: Niche Product and Service Providers – companies focused on delivering a niche product and/or service, they are usually focused around a technology product, content products, or process capabilities. Strata 3 companies are often larger in revenues and broader in geographic scope than Strata 2 companies due to their choice to focus on niche markets. Engagements tend to be more transactional, although they may have multi-year license or service agreements. Buyer relationships tend to be less strategic and more transactional.
Strata 4: Consulting and Contracting Providers – companies focused on delivering a consulting or contracting level of service. They tend to be sole proprietorships and/or partnerships and focused on providing content related services around instructional design and/or delivery of courses. Engagements tend to be project based for transaction related fees (e.g. fee per hr, fee per day, fee per project, etc.). Buyer relationships tend to be less strategic and more transactional.
How does the stratification model help buyers of training services?
The risks of choosing the wrong supplier for a particular engagement can be high and costly and the difference between success and failure. Unfortunately, many training suppliers portray themselves as able to do more than their capabilities warrant. Their desire to grow their business leads to promises they sometimes cannot fulfill. Simply said, an independent consultant (Strata 4) with no staff and little financial resources does not have the ability to take on a multi-year, million dollar, international training outsourcing engagement. Nor is it a good idea to engage a Comprehensive Service Provider to deliver a one time, two day workshop for a few students. The objective of the buyer is to select a training supplier who properly aligns with the complexity and risk of the engagement. This optimizes the potential for success and ensures the cost of the product or service is in line with the risk and complexity of the engagement.
If you would like a copy of the Training Supplier Stratification Model, feel free to send me an email at /dharward@trainingindustry.com. And as always, I welcome your comments.
