Our economy has been hard hit and we’ve got less spare time than ever before.
So in this business climate it’s a natural reaction to cut costs, and we should. For small businesses the training budget will be one of the first to go since it’s seen as an overhead, but for corporate organisations training is seen an investment that has a direct, positive impact on profit.
They know this because they measure it. Just look at the results below from various studies:
- One of the most successful restaurant chains in the United States; The Cheesecake Factory, annually spends approximately $2,000 per employee on training and has sales of $1,000 per square foot to show for it — that’s more than twice the industry average. Plus their employee retention rate is approximately 15% higher than the national average.
- Over a 3 year period 575 companies training investments were analysed showing that companies that invested the most in training yielded a 36.9% total shareholder return as compared with the 25.5% weighted return for the S&P 500 index for the same period. 1
- Studies revealed that a 2% increase in productivity has been shown to net a 100% return on investment in training. 2
Reduced Staff Turnover
- Respondents in an AON survey ranked “opportunities for personal growth” as the main reason they took their current job and remained in that job. Notably, they ranked it ahead of salary.
For more evidence of this watch the short video below on what motivates us.
I have to thank Flying Solo for the recommendation for this video.
- According to a survey of 6,400 employees conducted by consultants Sharon Jordan-Evans and Beverly Kaye, career development is the No. 1 factor in employee retention.
- Companies that don’t train their employees are more than 3 times as likely to lose them. According to a study by Louis Harris & Associates for Interim Services Inc.
Reduced Costs, Increased Productivity and Quality
- Motorola calculated that every dollar spent on training yields an approximate 30% gain in productivity within 3 years. Motorola also used training to reduce costs by over $3 billion and increase profits by 47%. 3
- The less time and money you have to spend on monitoring and guiding employees, the more you have available for other activities.
- Training improves customer satisfaction. Better-quality work means better-quality products and services . . . resulting in happier customers.
Increased Competitive Edge
- Maintaining a competent workforce keeps you competitive.
- According to Nobel Laureate Gary Becker, professor of economics and sociology at the University of Chicago, "Any company has to recognize that not only is the human capital of their employees a major asset, it is also a depreciating asset that needs continuing investment."
- “What’s worse than training your workers and losing them? Not training them and keeping them.”
—Zig Ziglar, success speaker
For small business traditional classroom based training is costly and inconvenient, but with the advent of online training what was once only available to those with big budgets is now available to all, and at a fraction of the cost and inconvenience.
Microsoft Office products are widely used across almost all business and they’re ideal for streamlining processes and improving communication. Since the vast majority of employees have never had any formal Microsoft Office training this is one area small business can get some quick productivity gains.
Click the link to started with over 10 hours of free Microsoft Office online training.
1. American Society for Training and Development (ASTD).
2. “The 2001 Global Training and Certification Study," CompTIA and Prometric.
3. Tim Lane et al., "Learning to Succeed in Business with Information Technology," Motorola.