Dealing With A Credit Crunched Training Budget

This article on the training zone website gives some great ideas about how businesses and organisations can make the best of their training budget. Too often evaluation is weak and this is an ideal time to really look at the results of training being undertaken, to develop inner resources, for example training your managers to coach their staff properly, and to consider a broader range of media to facilitate learning opportunities.

Julia Miles

Dealing with a credit crunched training budget

In difficult times, there are certain budgets that tend to get squeezed first, and training is often one of them. But after speaking with a number of training managers and consultants, Christiana Tollast finds that where there’s a will, there is most certainly a way.

“Firstly, pool your resources: nine borough councils in Sussex have formed their own training consortium and created a highly sophisticated programme of jointly-funded learning programmes. My own organisation, Breast Cancer Care, is a member of the Charity Learning Consortium, a group of over 20 charities who have pooled their resources in order to purchase elearning tools at a reduced rate.

“Secondly, now more than ever, organisations need to get serious about internally delivered learning. This requires changes to the very structure of an organisation, building a requirement to pass on skills and knowledge into job descriptions, work practices and strategic objectives. Only then will employees feel empowered and enabled to make the time needed to share their learning.”
Alex Dawson Learning & Development manager at Breast Cancer Care

“There should be no automatic assumption that a recession has to mean a budget cut – all training spend should be justified in both good times and bad. I have always advised that training spend is categorised into three boxes: ‘must have’, ‘added value’ and ‘nice to have.’ If anything has to go it should be the ‘nice-to-haves’ first while box one must always be protected.”
Paul Kearns, evaluation expert

“Crude approaches to cutting back can make you less cost effective – making it a double whammy. As far as possible make the biggest cuts against your lowest priorities. Tell the board precisely what they will lose for a saving of £X, and even offer to save them more if they are prepared to lose priority Y. Clearly identifying the consequences of potential cuts usually leads to more rational decisions. Simply cutting 25% off everything is absolutely the worst approach. Don’t do it!

“Lastly, it is learning that delivers benefits and training that costs money. It is vital to lever the absolute maximum out of the learning – to ensure that training is a value for money investment not an overhead. We exist to get the right learning to the right people to achieve the right effect. Doing it cost efficiently and effectively should be in our DNA and not just a consequence of the credit crunch.”
Graham O’Connell, consultant, the National School of Government

“Tie in what you do very closely to business needs – I attend operational meetings and even complaint meetings so I know what the issues are. This allows me to be seen to be making positive suggestions and offering help. It’s really a matter of looking for every opportunity to add value.”
Josie Roberts, training manager

“Be clear on what elements of training you offer give the greatest payback and make them available – and that may not be financial payback, but that which is most closely aligned to your key purpose or challenge – for the RNLI it would be operational training for lifeboat crew so that they have the skills to save lives at sea.

“Question whether you need to use consultants – some of the best training-related outcomes I have seen have been achieved through working groups of volunteer employees – they invariably know what the organisation really needs and put it in the right language with the right tone. That way you deliver what’s required and generate buy-in through the working group members who act as natural ambassadors.”
Geraldine Grainger, college principal/head of training, Royal National Lifeboat Institution

“Perversely, the credit crunch might have a benefit in pushing organisations to make more creative use of their internal resource. I think training managers will focus more on the ‘enabling’ skills in their organisations; for example, coaching, mentoring, shadowing and action learning.

“In tough times everyone becomes painfully aware of the cost of activity, but they forget about the cost of inactivity. Helping staff to develop builds confidence and commitment, which could have a beneficial effect on business for the future. That said, cutting back on learning activities is an instinctive response based on immediate financial realities, so finance directors often win the day.”
Colin Boxer, learning and development manager, Children’s Hospice Association Scotland

“Developing skills and motivating staff to perform comes at a cost, but a recession is about making sensible cutbacks, not wholesale budget reductions. Organisations need to invest in critical development areas to ensure as much impact as possible is made.”
Jo Causon, director of marketing and corporate affairs at the Chartered Management Institute

Ten ways for training managers to beat budget cuts

1. Jump before you are pushed: review all your programmes for the contribution they are making to current business or organisational goals and cull those that are not doing enough.

2. Make the case for each and every programme based on how it will help the bottom line and contribute to organisational goals.

3. Put elements of the programme online – enabling wider penetration at lower cost.

4. Which face-to-face seminars can easily become webinars? Prepare the staff delivering online so the experience is at least as good as what is being replaced, at a fraction of the cost.

5. Before you present your case to the board, rehearse it with a group of friendly staff outside the L & D function. If it makes no sense to them, it won’t make it at executive board level.

6. Mind your language! Cut out learning jargon; add in the language your organisation uses.

7. Have a fall-back plan. Work out what the absolute minimum resources you need.

8. Network: Grab colleagues in other organisations and pool ideas. Most people are in the same boat.

9. Start more focused evaluation based on what the programme contributes to helping the organisation survive.

10. Have a glass of wine and imagine what you will achieve when you are back on a growth curve two years into the future when most of this decline will have passed. This might not help much in the current circumstances, but you will feel a lot better!