Outsourcing turnaround

Alison Carter argues that long-term prospects can be damaged by moving
in-house training functions elsewhere

The outsourcing bandwagon has been with us for some time, and since the mid-1990s,
training has been one of the support functions most often targeted for

Granted, outsourcing training is popular. By 1998, 36 per cent of UK
organisations were outsourcing a significant amount. By 2002 most large UK
organisations were using more than 10 outsourced suppliers of training and
development activities.

The design and delivery of classroom-based training and, to a lesser extent,
development and provision of e-learning materials and support for e-learners,
are the activities most likely to be outsourced.

Many companies have realised the intended cost savings from outsourcing. But
over time, concerns have turned to quality, skills and relationships. Think,
for instance, of the Strategic Rail Authority’s high-profile announcements
about taking back in-house the maintenance over some rail lines.

Cynical observers might suggest this is because some of the outsourced
companies are just not up to the job. But I have no beef about quality with
external suppliers of training per se. My concern is more an objection to
outsourcing entire training functions.

Institute for Employment Studies (IES) research indicates the private sector
may be scaling down its outsourcing of training. We also observed moves to pull
a sizeable amount of training activity back in-house among major UK
organisations which can be considered ‘early-adopters’ of outsourcing. Our
study found:

– Over time, the client organisations’ ability to manage training contracts
well declines, as expertise is lost. In one company the training ‘function’
became better at procurement, but worse at identifying training needs. This had
an adverse impact on quality

– Opportunities to become more strategic are not necessarily sufficiently
well developed by those left at the organisation in training, advisory or
internal consultancy roles. Many training professionals moved out to join the
outsourced providers, or became freelance. This reduces the size and depth of
the talent pool available to move into strategic roles

– Loss of the key interface between supplier and individuals or line
managers receiving training services means outsourced service providers can
have a more direct link into the business through the delivery channel. This
can lead to a weakening of understanding training needs.

These are the experiences of companies which took great care over roles and
relationships when they introduced and managed their outsourcing arrangements
on an ongoing basis.

Most people recognise that outsourcing can sometimes be little more than a
convenient fiction to ‘get rid’ of the delivery arm of training and development
by taking it out of the internal function, and making it someone else’s
‘problem’. Surely tensions would then be more disruptive.

The arrival of multiple training delivery methods and difficulty of finding
organisational forms that meet business challenges are leading to an array of
different role demands on trainers. And organisations may see these sitting
better in-house. Advice-giving is one critical aspect I would definitely not

The IES research shows a number of roles predicted to increase in
importance, with the trainer as a facilitator and agent of change.

We hear about the importance of new training advisers or ‘business
partners’. Advising line managers can relate to individual employees, groups or
specific business needs. In practice, these range from quite high-level or
corporate roles to a much more intimate and local role. They often focus on
helping line managers see a clearer link between the training activity they
request and the real business issues.

Outsourcing of training design and delivery will continue to be a major
feature of the training landscape. But for training advisory functions, I think
outsourcing will struggle to claim to be the ‘best’ option.

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