London has established itself as a global tech powerhouse. How will the city make the most of this movement to ensure prosperity for businesses and talent?
As we’ve recently written about, skills training and development opportunities can give your business a competitive advantage by increasing growth, improving performance, and reducing turnover.
More and more companies are understanding this. A 2018 survey of more than 100 companies (U.S. L&D Report: 2018) found top-performing businesses are five times more likely to have a culture of learning, and twice as likely to be investing significantly in digital skills in the coming year (45 percent vs. 23 percent).
There’s also evidence that skills training can help on the recruiting front: a recent study by PwC found millennials rank access to training and development as the most important benefit an employer can provide.
How do you get started?
By building a training budget that pays off.
Build Your Budget on Strategy
A training budget includes costs associated with courses or programs, materials like books and equipment, and the indirect costs of coordinating and implementing a program.
But there’s more to a learning and training budget than money—to get results, it’s important to keep strategy in mind.
A learning strategy should clearly identify how training and development opportunities will support the bigger goals of the business. For example, if the goal is to boost digital skills ahead of a digital transformation initiative (say the adoption of digital marketing tactics), your learning strategy should outline how the proposed courses or programs will achieve this, how their effectiveness can be measured (are employees now savvy enough to use Google Analytics, for example?), and how much you’re willing to spend to get there.
Making clear links between training opportunities and business goals can improve engagement and buy-in across the organization, and help create an ongoing culture of learning.
Focus on Measurement
As mentioned above, measurement is another important part of a learning budget.
According to a 2018 learning and development report (the U.S. L&D Report: 2018), 100 percent of the companies surveyed that grew in the last financial year tracked the ROI of training. In addition, 100 percent of companies expecting a budget increase measured the impact of learning and development.
To get the most out of your learning and development dollars, build in measurement opportunities at different stages throughout the learning process. A commonly used method for evaluating learning is called the Kirkpatrick Model, which measures learning at four levels:
- A participant’s immediate reaction about a course or program (for example, a survey given immediately after a learning exercise about the effectiveness of the course instructor and/or materials used).
- How much a participant has learned or retained from a course or other learning opportunity (for example, a quiz, survey or follow-up assignment after a learning opportunity).
- How training has impacted an individual’s actions or behaviors on the job (for example, measurement through individual performance reviews by a manager).
- How training has impacted business results (for example, measuring data like sales numbers or staff turnover).
Understand How Much to Budget
Now that you know how to develop a stellar strategy and measurement plan, it’s time to think about another key part of the plan: the money.
The Association for Talent Development 2017 State of the Industry report states that organizations spent an average of $1,273 per employee for direct learning expenditures in 2017. Learning budgets, however, can vary depending on the industry and size of a business, and in fact, there is no magic number for how much money to allocate to a training program.
Some companies dedicate a small portion (about one to three percent) of each employee’s salary to a larger training budget. Deciding this amount, however, will come down to your strategy – what are you trying to achieve?
By measuring the success of training and development year over year, you can begin to understand what works, what doesn’t, and where to invest in a way that best impacts your business needs.
To learn more about how BrainStation’s digital skills training could fit into your employee learning and development plan, visit BrainStation for Business.