Training becomes more focused

More training with fewer dollars, study shows
By Uyen Vu
|Canadian HR Reporter|Last Updated: 07/28/2005

T

he shine is coming off of e-learning. Companies continue to clamour for soft, essential or employability skills. And they’re parcelling off entire training functions to outside vendors. Depending on whom you ask, these are some of the trends seen in the training industry.

“Companies are doing more with less,” said Lynn Johnston, executive director of the Canadian Society for Training and Development. Canadian numbers from the latest American Society for Training and Development (ASTD)

State of the industry

report show a decline in training dollar per employee but an increase in the number of employees undergoing training.

The share of employees trained increased from 68.9 per cent to in 1999 to 79 per cent in 2002, according to the report, while per-employee expenditure fell from $690 in 1999 to $560 in 2002. Sixty-nine employers were included in the 1999 survey, while 2002 results were obtained from just 38 organizations.

If employers are doing more with less, it may be that they’re achieving this savings by using e-learning products, added Johnston, pointing to the sharp increase in employees per trainer, from 314 per trainer in 1999 to 487 in 2002.

“Anecdotally, we find that we are doing more just-in-time training. We’re looking at what we need before we start, so that we’re not just doing training for the sake of training,” said Johnston.

Joan Hill, president of Core Consulting, a Mississauga, Ont.-based training consultancy, said organizations are shying away from purchasing whole curricula.

“There seems to be a refocus on individual development planning.” Employers seem to be approaching training through the performance management process and developing individual plans based on an individual’s skills and competencies. “So the plan may not be part of a training and development curriculum where one size fits all.”

Consistent with this approach is a willingness on the part of employers to look to a diverse array of training products and media, said Hill. “Most of our clients are looking at a multi-pronged approach.

Hill added she’s seeing more and more training dollars going to outside vendors and consultants, and more spending decisions made by line managers, not just the human resources department.

Nancy Burnard, director of development with training supplier Eagle’s Flight of Guelph, Ont., said she’s noticing more employers asking training consultancies and vendors to handle entire training functions, including the needs analysis.

“What’s happening more and more is businesses realize they can’t do it all,” said Burnard. “Some companies outsource all of their training, so an outside vendor could play the role of their vice-president of training. With this model, it’s a total partnership because you have someone from the outside working with HR to determine how to determine the needs and develop the skills of employees.”

For this partnering relationship to work, training providers have to take the lead in figuring out what kind of skills training is needed to help an organization meet its business goals. “And the training provider has to be given free rein within an organization,” said Burnard, adding that it’s really important for the training provider to be familiar with staff at all levels at an organization. “That way, you’re not just looking at programs. You’re looking at issues within an organization, what obstacles are there that prevent people from doing their jobs, how you can help an organization meet its goals, those kinds of things.”

The trend indicates to Burnard that employers are placing increasing value on training, in that they’re willing to spend money to bring in the experts for that function.

Norm Shulman, executive director of the Office for Partnerships for Advanced Skills, a corporate training provider set up by 17 Ontario universities, said employers are beginning to realize that it’s not enough just to roll out e-learning tools and products for employees. Businesses have to help employees learn how to learn with learning technologies, he said.

“It’s not cheap. It saves you some money because you don’t have to send people to a hotel in Niagara Falls or something. People can still sit at their desk, and you still reduce the time for travelling and so on. But if employers are saying, ‘E-learning is dirt cheap,’ It’s not,” said Shulman.

“It’s a different kind of cost. Depending on how much time you are employing this tool, there’s a certain amount of time people need to get comfortable with, and up to speed at, learning online. A lot of employers don’t think about that.”


Training technologies increase share of pie

According to the

State of the Industry

report, published by the American Society for Training and Development, North American organizations on average spent 2.2 per cent of payroll on training and development in 2002, up from 1.9 per cent in 2001 and two per cent in 2000.

The statistics reflect results from a survey of 325 organizations, including 38 in Canada.

•Expenditure per employee also rose, from $975 in 2001 and $862 in 2000 to $1097 in 2002. Training hours per employee also rose, from 23.5 in 2000 to 23.7 in 2001 to 28 in 2002.

•As is expected, the share of classroom training continued to dip, from 79.9 per cent in 1999 to 72.1 per cent in 2002, as training via technologies climbed from 8.4 per cent to 15.4 per cent of all training in 2002.

•In Canada, the share of employees trained increased from 70 per cent to in 2001 to 79 per cent in 2002, and per-employee spending rose imperceptibly from $559 in 2001 to $560 in 2002. In 1999 the amount per employee was $690.

•As a percentage of payroll, Canadian training expenditure rose slightly from 2.5 per cent in 2001 to 2.7 in 2002. Training expenditures in 2002 were more likely to stay in-house than in 2001, when 31 per cent of training spending went to outside payments (28 per cent of training spending went into outside payments in 2002).

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