It’s budget time! 5 top tips for getting the training budget you want.

We are frequently asked what is the value of investing in training. It often cannot be measured and sometimes people leave companies even though they have received training. That leads management teams to chop or at best trim budget to be allocated for development. Well, here are some tips for motivating for your next training budget to address the needs of your team now and to prepare them for the future of work:

1.     Steer clear of the constant focus on ROI. When the marketing team can prove the ROI of a new billboard on the highway and their investment in a major ad campaign at train stations, then you too will prove every bit of training ROI.

2.     That said, there is a whole lot more data that is available as you convert to gathering details via the new learning apps. They provide detailed heat maps and data analysis right down to how many people accessed a video, how long they spent watching it and what answers they provided to reinforcement questions thereafter. These new apps eat old legacy systems for breakfast as they have the capability to provide incredible insights in to the level of usage of individual learning assets so that you can determine what is working and what needs to be adapted and improved so that it hits the mark.

3.     Although we often have to go out with our begging bowls for a training budget, let’s compare the costs of training vs what we spend on recruitment. A recent survey by global provider General Assembly found that the average spend on training varies according to size and industry sector. Budgets vary between $200 - $2000 per person, depending on their status in the organisation. Before asking for additional budget, do the maths and know what the average spend is per person, even if it is weighted in favour of the senior team. 

Then once you have this figure, chat to the recruitment team and find out what the average cost is per acquisition of a new team member – this can be up to $30K. Add on to the direct cost of recruitment, the time of getting new team members on-boarded and up to speed. Compare the 2 costs: surely it is more worthwhile placing full effort in to training to retain team members than recruiting new ones?

4.     When trying to shift your exec team off the status quo which might not be entirely positive towards training, consider highlighting these points so that the team begins to understand the risk of not conducting sufficient training:

·       Deloitte Human Capital Report states that managers who receive professional development are 10% more likely to stay with their organisation. Do the maths on that and determine what recruiting 10% of managers could cost your organisation in hard cash. You could also estimate what it would in terms of time to induct them and ensure that they were up to speed. You budget request would be far lower than these costs.

·        Almost 1 in 4 employees feels disconnected and disengaged at work. That’s a frightening statistic. And low engagement = low output = less profitability + lower team culture which then self-perpetuates. Get your calculators out again and find an estimate for what so little training could in fact be costing your business.

5. The days of wasting a training budget on travel and accommodation are over! Yes, it's great to connect in person where necessary and NO, not everything has to be conducted face to face when there are incredible technologies and platforms now available.

6.     Now that you have the budget you are looking for, check that you have included the following programs in your budget - so that you are ready for the next budget round the following year:

·       Leadership development: The Insured Retirement Institute in the USA predicted that through 2030, baby boomers will retire at a startling rate of 10,000 per day. This opens up a myriad of leadership positions that baby boomers once held. However, according to Deloitte Human Capital Trends:

? 56% of executives report their companies are not ready to meet leadership needs.

? A mere 7% report their companies have accelerated leadership programs for millennials. Organizations need to start filling their leadership pipeline by identifying which millennials have the potential to fill those management positions in order to avoid any shaky transitions as baby boomers hand off the baton to millennials in this leadership relay.

·       Culture and team engagement boosters: organisations use employee retention strategies that include career development, a thriving work culture, and work-life balance into the mix in order to hold onto their own talent. Training is certainly a key predictor in terms of on-going engagement. Last year, 69% of employees didn’t believe they were meeting their full potential at work. (TinyPulse survey,2016)

Please share other tips and guidelines that have been helpful for you in your own industry or organisation! Let's ensure that organisations are prepared for the new world of work and that L and D is at the forefront of positive initiatives!

Speak to us at MCI about what we can do to make your training spend as budget-friendly as possible and at the same time have a wide, deep and impactful reach. 1300768550 or email [email protected].