5 Ways to Reduce Costs of Corporate Training
Corporations must now pile more and more pressure on their internal learning and development (L&D) processes in order to train underqualified and under-skilled workers. Why? Because the hiring process is failing to bring fully qualified talent through the door, thanks to chronic global talent shortages. A CareerBuilder study found that 49 percent of employers are planning to hire underqualified staff members and train them to become productive employees. This is a great opportunity for L&D divisions to shine, as there will be heightened demand for their services. At the same time, as L&D costs rise to cope with demand, there will also be increased financial scrutiny on L&D departments.
That’s why every L&D professional will need to look at ways to reduce training costs without compromising training quality.We have some tips on how to do just that:
1. Switch to Online Training
Online learning is more cost-effective than classroom learning, so a switch to online learning could save your organization money. A study from Judith B. Strother of the Florida Institute of Technology recounts how IBM saved 200 million dollars and provided five times the amount of learning by implementing online training. The same study also shows that Ernst and Young reduced its training costs by 35 percent by incorporating e-learning into its training programs, and Rockwell Collins reduced training expenditures by 40 percent by converting 25 percent of its training program to e-learning.
2. Streamline Your Training
Review all your training sessions and determine whether or nor specific programs are necessary. You may find that some programs are superfluous and can be discarded altogether, or that some programs can perhaps be delivered in reduced, more cost-effective capacities.
3. Make Sure You Use a Training Supplier Suited to Your Company’s Size
Training providers’ pricing packages are often tailored to companies of specific sizes. You may find some vendors that charge very high prices per trainee and offer massive reductions once you purchase in volume. These kinds of pricing models suit larger firms while penalizing smaller businesses. Therefore, small business training buyers should bypass these enterprise-geared suppliers whenever possible and focus more on suppliers that can offer lower costs per trainee, even at small volumes, to maximize savings.
4. Shop Around
While we are all disciplined when it comes to comparing prices in our personal lives, this practice does not always follow through into our professional lives — particularly in small companies, where buyers may not be very experienced in purchasing training programs. Such buyers may be tempted to buy the first thing they see. It’s vital to shop around when buying corporate training services in order to find the best prices and save money.
Enterprise L&D buyers will be more experienced at negotiating with training suppliers, but small business buyers are often not experienced negotiators. As a result, they may be prone to accepting prices at face value. Most training suppliers leave ample room for negotiation, so developing a policy of haggling is a great way to reduce costs.
For deeper discounts,you could buy in bulk — or buy training credits — which can usually deliver massive reductions. You could also offer to endorse a company’s product on your website in exchange for a price cut.