According to the American Society of Training and Development, organizations spent $156.2 billion on learning and development in 2011. This statistic clearly indicates that employee training can drastically impact a company’s success among other factors. In this day and age when technology is on the rise and workplace dynamics are changing, training is a high necessity, as are finding the funds to cover it.
Training is crucial because it not only benefits organizations, but also enhances overall employee performance. According to Ferdinand Fournies, an internationally known consultant, author, and former professor at Columbia University’s School of Business, employee performance issues occur because employees: 1) are unaware of what they’re supposed to do 2) are unsure how to do it 3) are unsure why they should do it.
Other benefits of training include:
- Saving money and labor: Skilled employees may contribute to a decrease in maintenance expenditures, minimal supervision, lower turnover rates, and valuable time that may be used elsewhere (e.g. spending time on correcting others’ mistakes).
- Guaranteeing an organization’s competitive edge in the market: Employees must be updated on skills in regards to the ever-changing workforce and market. Employees are important assets to organizations and if training efforts are not invested to enhance their skills, companies may see a spiraling downturn in profits.
- Employee retention and/or satisfaction: The more effort management puts forth in their employees, the more opportunities their workforce has in career advancements and overall personal growth.
- Increased customer satisfaction: With increased skills comes better quality of work, which in turn means higher quality of services and/or products—these factors decrease customer complaint rates.
From an article in Workforce Management in 2006 detailing the training costs and efforts of the popular restaurant chain, The Cheesecake Factory, the organization spends approximately $2,000 on training per hourly employee each year. The chain takes their training seriously and involves all their employees: servers are enrolled in two weeks of on-the-job training; those seeking managerial positions receive 12-week development courses; dishwashers are also included in training programs. The Cheesecake Factory finds training to be beneficial as their turnover rate is approximately 15 percent below the industry average of 106 percent.
An important question to consider is: how does one pay for all the training expenditures? The Employment Training Panel (ETP) is a California State job funding agency created to assist organizations (only in CA) in finding the means to train their workforce. This fiscal year, ETP has up to 80 million dollars solely for training purposes with priority industries in technology, manufacturing, biotechnology, and agriculture to name a few. Not in California? No worries; grants and scholarships can be found in various state programs as well.
Training is essential for organizations, large and small. How much will your company invest in training efforts this year?
*e-VentExe is a full service human resource consulting firm located in Northern California. Our expert consultants can assist you with any training needs and assist you with finding funds for training. Give us a call at 916.458.5820 to learn more about how we can help you get on board with your training!