As most managers know, planning a training program does not end when you select a training strategy. You must first weigh the costs and benefits of the type of training you selected, and then build a business case to secure the necessary resources to deliver the training.
Managing Training Resources
To manage training resources, follow these steps:
Step 1: Weigh costs and benefits.
• Identify potential costs.
• Identify potential benefits.
Step 2: Build a business case.
The following pages explain each of the steps involved in managing training resources.
Step 1: Weigh Costs and Benefits.
Once you have selected a training strategy, you should weigh the potential costs and benefits to make sure that the strategy is cost-effective and meets the business case requirements for investing organizational or unit training resources, if this is necessary. You should be able to answer questions such as:
“What will the organization gain as a result of the training?”
“How much will training cost to obtain that gain?”
IDENTIFY POTENTIAL COSTS.
Prior to making a commitment to provide training, it is important that you fully understand the potential costs. Listed below are potential costs of providing training:
Training attendance costs (salary, travel/per diem, etc.)
Cost of replacing the individual while in training
Training/tuition and material costs
Training development costs (if new training is being developed)
Other training implementation and follow-up costs
IDENTIFY POTENTIAL BENEFITS.
Next, you should balance training costs with the potential benefits to be gained. The chart on the following page summarizes the types of potential benefits that may result from the training.
| POTENTIAL BENEFITS | INDICATORS |
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Increased Outputs Training may be designed to increase the outputs produced by the employees. |
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Time Savings Training may be aimed at reducing the time it takes to complete job tasks. |
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Improved Quality Training may seek to improve the quality of performance. |
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Error Reduction Training may reduce or prevent errors. |
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DETERMINE IF POTENTIAL BENEFITS JUSTIFY COSTS.
Now that you have estimated the cost of providing training and projected the potential benefits, you should answer the following questions:
“Is the cost of training worth it?”
“If I had to pay for this training out of my own pocket, would I?”
If you answer “no” to these questions, then you need to go back to the drawing board. Remember, you have already determined that the performance gap is worth addressing and that training is needed. Your challenge is to identify a cost-effective way of providing the needed training. Remember to look at alternative training methods and work-based training strategies.
Step 2: Build a Business Case.
You may be asked to build a business case for any training that requires a major investment of organizational resources. A business case presents the rationale used in making decisions about the following areas. Here are some ways to present it:
Use of inside versus outside training delivery resources
“If the organization were to use internal instructors, the productivity costs due to the instructors’ absence from their jobs would be 544 hours or 68 days. There is no significant value for the organization to build the internal expertise in this training area because it is not a core organization mission.”
Program length
“Based on the anticipated outcomes, a 2–3 hour workshop is warranted.”
Develop or buy the training
Lost opportunity costs: “If the organization were to use internal staff for designing, developing, and pilot testing the program, time/productivity costs would be expensive.”
Speed requirements: “Speed is critical to this initiative. There is a mandatory requirement to complete all training within a specified period, and within this fiscal year. If the organization were to handle the training development and delivery, it would take months of additional time and cause major delays during the past fiscal year.”
Availability: “High-quality, job-relevant commercial training programs, packages, and materials are available.”
Costs: “When looking at costs for design, development, delivery, materials, reproduction, distribution, and so on, those costs using organizational internal resources would total over $55,000. Costs using vendor instructors and materials were determined to be $54,600.”
Cost per participant: “Given the large number of employees being trained (136 sessions), the preferred vendor’s costs were extremely low—$7 per employee and $1 per employee for materials.”
Media and method for training delivery (e.g., classroom, video, computer-based training, distance or online learning, self-instruction, on-the-job training, job aids, etc.)
“Given our requirement for small groups of participants, live interaction, and the presence of a skilled instructor, classroom training is the preferred method.”
The examples presented above were used to establish a business case for using external training resources.
Summary
Now you are ready to develop or acquire the appropriate training to meet the needs of your unit and deliver the training to your employees. However, there is more to enhancing employee performance than just training. The next section, Promoting Training Transfer, will describe how you, as a manager, can ensure that the skills and knowledge acquired during training are transferred to the job.