When budgets are tight, training is usually first in line for the chop. But there are ways of getting even more out of what little you’ve got.
Training budgets are always under pressure and when the economy slows, as is the case now, training and development is often one of the first functions to suffer. But there are many ways for training managers to get the most from a tight budget.
First, they must ensure the training programme they devise reflects the organisational strategy. This requires a full training needs analysis (TNA) to identify skills gaps that must be addressed. Otherwise money could be wasted on training that brings little business value.
Managing training budgets and resources is little different to managing other investments in an organisation, such as marketing and IT, yet some researchers indicate that less than 10% of training expenditure makes any difference to the way people work.1
Once a TNA is done, it’s time to consider other budget savers such as looking in-house.
“Training and development is not just about spending money on outside organisations,” says Geoff Newbold, a senior consultant at training provider PTP Training.
He runs a one-day course called ‘Managing Effective Budgets’, and says that while hiring external trainers is certainly the most expensive form of training, it is not always the most effective way of delivering learning.
Value for money
He recommends that trainers look at the skills that exist in-house to see if these can be used to deliver training to colleagues. This, he says, should be done as part of an initial skills audit. It works well when giving staff an overview of a subject area.
Newbold acknowledges this isn’t a completely free solution, as time is money, but it may well be more cost-effective than hiring an outside trainer.
In-house expertise can also be used in areas such as coaching, mentoring and secondments which facilitate the transfer of skills and knowledge.
The head of HR at financial services company IFX Markets, Sharon Cunningham, says allowing employees from the accounts department to job shadow several of the firm’s traders for half a day helped them appreciate how their work impacts on others.
Time can also be put aside at team meetings for skills transfers, says Amanda Pearce-Burton, managing director at training and development company Formation. This could take the form of team members reporting back on courses they have attended or giving a short presentation on a skill they have, such as effective letter-writing or public speaking.
“These can be as formal or informal as you want and could give younger members of the team a chance to shine,” says Pearce-Burton.
Training managers should also use their contacts to get value for money. If you buy a sizeable amount of training from a particular training provider then negotiate a better rate.
Pearce-Burton also suggests using the budgets of other departments imaginatively for training ends. If your company uses a public relations company, for example, ask a representative to come in and give a session on PR skills.
Skills and knowledge can also be disseminated at little expense through a volunteering programme says Pearce-Burton. “There are an increasing number of opportunities for people to take up placements at charities,” she says. “Through this, a host of new skills, as well as an understanding of how other organisations work can be transferred back to the host workplace.”
Your local Business Link, Chamber of Commerce or further education college may also offer training courses and other business support services at relatively low rates. For instance, the Business Link website (www.businesslink.gov.uk) offers many courses in subjects ranging from sales to health and safety. E-learning may be another low-cost option.
At Lloyd’s brokerage, Glencairn, compliance officer, Chris Goodeve-Ballard, says one of the reasons the firm brought in e-learning modules was because employees work different shifts and it was difficult to get them together for a training course.
In this instance, e-learning offers extra cost savings as it results in less disruption to the business.
Traditional media, such as books and manuals can also be used to complement learning and cut down on training costs, as can telephone-delivered training.
It can also make the training more effective according to Hedda Bird, managing director at training company 3C Associates. “By delivering training in different ways, trainers can reinforce messages and hit different learning styles, thereby getting more from their budget,” she says.
Five budgeting tips
- Transfer skills in-house through presentations, coaching, secondments and job shadowing.
- Exploit your contacts – strike deals with training providers and think creatively about how established suppliers can add value.
- Set up a volunteering programme – much can be learnt from stepping into another organisation.
- Use a blend of training media – face-to-face, e-learning, phone, books, etc. It’s effective and can offer better value for money.
- Ask your local Business Link, Chamber of Commerce or further education college about their training.