What is your company’s annual spend on corporate training? What type of impact is it having?
Many attempts have been made to quantify the benefit of training. Some seem to work while others provide questionable results at best. I recently saw some statistics that gave me a new perspective on the impact of corporate training.

Instead of looking at the return of training, I thought I would look at the impact of similar investments compared to training. Some people might not like this approach. Admittedly it is based on perception and subjective experience – all of the things we are taught to avoid. However, I believe that it is an instructive way to challenge our thinking about corporate training. See what you think.

According to one study[1], U.S. corporations spent $55.8 billion on training in 2006. The report predicted a 7% increase in 2007 projecting about $59.7 billion in spending on training. How much better off are we because of this investment? It’s hard to say definitively. However, here are some other things that $60 billion could do[2]:

• Quadruple President George W. Bush’s Emergency Plan for AIDS Relief
• Fund the American Cancer Society for the next 103 years
• Cover the American Red Cross’ annual operating expenses for the next 17 years
• If earning 8% annually, could indefinitely pay the salary of 104,753 public school teachers (average pay: $45,822 a year)
• Fund the Centers for Disease Control 11 times over
• Pay every Harvard undergraduate’s tuition ($30,275 a year) for the next 297 years
• Provide two to three month’s income for the 1.2 billion folks who live on less than a dollar a day (they could each get a one-time $50 payment)

Of course, I am making somewhat of an apples to oranges comparison. First, it’s easy to see humanitarian causes as having more impact. That was not my point in citing these numbers. I considered these relative to the amount of change they could drive, not the nature of that change. Secondly, it’s hard to compare the impact of an individual company’s training with the impact of such global programs as these. All caveats aside, however, these statistics are still compelling. As a nation, we can and should get more from our spend on corporate training.

Five tips for increasing the impact of corporate training

Focus on the right problem – Align training with key business priorities and problems.

Invest more in less – Choose a few targeted programs and invest properly in them. Good training costs money. It is better to have a few good programs than a large number of poor quality programs.

Use training sparingly – Use it to build skills that are too costly to learn on the job. Don’t use training to disseminate information – there are more efficient and effective channels for that.

Invest in developing a full capability – Training alone won’t solve problems. Your investment in solving a performance problem should include training, information systems, new processes, and other organizational resources.

Don’t trade efficiency for effectiveness – Good training requires good design. It can’t just be thrown together by well meaning or even knowledgeable subject matter experts. It will only be as good as 1) the quality of the requirements definition, 2) the quality of the content, 3) the understanding of audience, and 4) the quality of the instructor/delivery channel.

[1] Bersin and Associate’s 2007 Corporate Learning Factbook (http://www.bersin.com/newsletters/07_feb_el.asp)
[2] Just How Much is $60 Billion?, Forbes.com, June, 2007, (http://www.forbes.com/2006/06/27/billion-donation-gates-cz_ts_0627buffett.html)