There’s no denying that times are tough and money is tight. The learning function is critically important to help organisations achieve competitive advantage in tough times. While organisations face shrinking and tight budgets with their training and learning initiatives it is critical to find the best practices that will bring the biggest return on the organisation’s investment.
So how do you do more with less and still skill your people and grow the business?
In the South African context this seems to be a thorny question that might be met with a whole lot of reasons why training employees to be relegated to the bottom of the pile. However, we have good reason to believe that it should not take a back seat. In fact, research has shown that making provision to provide your staff with adequate training not only boosts morale (especially in times of hardship), but it has the added benefit of growing your business too.
The best place to start is to recognize the shortfalls within your organisation and determine where the training will have the most impact in terms of your ROI. Obviously, there would be certain areas where spending unlimited budget when times are good, would be hugely beneficial to the company’s growth. But during an economic downturn this isn’t the case. Therefore, choose where you want to invest and determine the why’s based on past data.
“It is critical to establish an ROI model when investigating any training initiative, this is often not done and thus the reason many CFO’s and COO’s will see training as an expense. If the cost benefit analysis shows that investing in training will have a positive impact on EBITDA, it becomes a much simpler decision to take. This is always our model when approaching any intervention and we have seen bottom-line impacts of up to 2% contribution on the EBITDA line,” says Matthew Lambert MD of Summit.
Measure, adapt and re-implement
Once you’ve made a calculated decision on where and how to spend your training budget, the next step would be to determine how to measure the ROI. This is especially important when it comes to BBBEE scorecards and complying with legislation. There are certain minimum criteria that still needs to be adhered to in spite of a challenging economy.
Once you’ve undergone the process of measuring the impact at any given point in the training programme (which should be done throughout the lifecycle of a training programme) the next step would be to adapt wherever the data came up short. Keep in mind though that you need to have a robust feedback loop in place to properly measure success (or not).
A huge win in terms of measuring and adapting the programme as you go along the training programme, is that it enables you to adapt accordingly and avoid monetary pitfalls due to poor training programmes and inadequate measuring. Recognising and pre-empting potential issues and thereby mitigating them will result in money saved and better off employees.
An investment in your people will never be a waste of money. Having said that, poorly implemented and thought-through training programmes especially in tough economic times will be detrimental to the bottom line.
In South Africa there are certain acts and legislations which suggest the best ways to implement training in organisations. Some of the benefits of legislation (like BBBEE or the Skills Development Act for example) are:
- Skills are developed in South Africa
- Skills shortages are identified and shared within sectors
- Focuses on applied knowledge
- The quality of training is monitored
- Employers are encouraged to use accredited providers
- Ensures training is learner centered
- There is national quality management
- Subject matter experts are registered by the SETA (Sector Education and Training Authority) as assessors and moderators
- Training is made more affordable
- Assessments usually take place at the workplace
- Outcomes based learning is encouraged
- Training providers are governed by the SETAs
“One of the critical elements we often overlook in our incredible country is the various tax incentives in place to stimulate training. These incentives make training in touch economic times extremely viable, combined with a positive ROI impact there really is no reason why more companies should have a focused ROI strategy on training and have it as an imperative at the C suite.” Adds Matthew Lambert MD Summit
If training staff and figuring out the most effective recourse stumps you, then it might be best to partner with a training provider such as Summit in order to assist and recommend how you can possibly win on all fronts. Don’t hesitate to choose an expert in the field of training across various sectors. Summit is personal, professional, hands-on and approaches each client’s needs with integrity. Summit is adaptable and can develop any training based on your business’ needs.
Contact us today for more on our training programmes:
Telephone: +27 31 536 6650