Social networking, more online courses can help organizations improve learning while holding down costs.
by Helen Neale
You cannot pick up a paper or read a blog without seeing the words “credit crunch” or “global economic crisis” in these early days of 2009. But what does this economic uncertainty mean for the talent that’s left behind in organizations that have undergone significant change, whether that’s down-sizing through redundancies, hiring freezes, or other forms of cost-cutting affecting the workforce?
The result is that we are in for a “talent crunch.” Organizations have reduced their talent but expect to get increased productivity from their retained workforce as belts tighten and market conditions become tougher. This means they have to maximize performance and ensure they are getting the optimum return from ongoing investment in talent. This requires a greater emphasis on training. However, learning budgets are often the first targets for cut-backs. So how can organizations achieve enhanced employee performance with reduced spend on employee development? Will learning functions have to make do, or can they evolve to implement new approaches that combine greater organizational impact with reduced expenditure?
A key strategy for enabling such evolution is to evaluate the channels, locations, and sourcing through which learning services are provided. For example, a shift of appropriate material from classroom-based learning to self-service e-Learning can potentially have a significant positive impact on both per unit cost of learning and learning take-up and effectiveness. Similarly, moving learning administration offshore has the potential to enable greater support with less expenditure.
Sourcing is also a key lever, with adoption of outsourced learning BPO (LBPO) a mechanism for rapid implementation of new-style learning services. This approach may be particularly relevant in which organizations are looking to achieve rapid payback on initiatives while facing the challenge of ramping up, on-boarding, and developing employees in emerging economies. New locations for learning service delivery may be required to support a shift in economic focus of the organization and not for cost reduction alone. So what benefits should organizations seek from learning BPO?
- Ability to provide flexible next generation learning styles. Firstly, organizations face the need to rethink the channels through which learning is provided. In particular, they must tailor learning for a new generation of learners, incorporating media such as e-Learning, virtual worlds, and Web 2.0. For example, social networking, and employee knowledge exchange can foster an on-the-job learning culture. In addition, the development of appropriate e-Learning can reduce travel costs and the time employees spend away from revenue-earning roles.
For example, a large airline company outsourced learning to ACS, achieving $40 million of savings through the life of the contract; this reduction was considerably affected by moving toward a 40-percent online training model for the company. However, developing such new learning environments internally can be costly. Organizations facing reductions in learning budget may shy away from these investments, but LBPO providers have often already established such infrastructure.
- Take advantage of multi-shoring. There are learning activities such as learning administration and custom content development that can be effectively delivered from offshore sources, with savings of up to 50 percent.
- Maximizing spend through learning analytics. Another reason for considering LBPO is to optimize the business impact of the learning spend. Obvious? But how easy is it to really achieve this? A good LBPO provider will look across your function, suppliers, course content, process, and delivery model. Their goal is to ensure that learning is cost effective and aligned with business objectives. To achieve this, measurement of the value of learning to an organization is critical. LBPO providers work with their buyers to determine what should be measured and why.
More complex metrics such as sales success before and after negotiation training can demonstrate whether learning affects revenue contribution and which types of learning have the greatest impact. For example, the development of a new delivery mode could ensure more professionals are exposed to the most effective training.
NelsonHall has found that LBPO can help organizations to further grow despite the economic downturn, assisting organizations to develop talent more effectively at reduced cost. It could help companies avoid having to make do and mend their learning due to lack of resources, skills, or capital.