MARKETING • CREATIVE • DIGITAL
How to Build Training & Development into Your Budget
There are so many reasons why it’s important to create a budget for your employees’ training & development. First, we know that well-trained talent makes fewer mistakes and need less supervision. But, we also know that building development plans for your staff helps you retain your talent, boosts morale, cuts-down on absenteeism, and even makes employees more productive.
But constructing a financial plan for training & development can be tricky – especially if you’re not able to dedicate a large portion of your budget to these crucial activities. So, to help you strike the right balance, here are a few tips:
Strategically Consider Training Costs
There are a few factors you must consider when you’re creating your training budget. Ask yourself the following questions in order to identify specific training costs:
- How will this training be delivered? (i.e. classes, eLearning course, webinar fees, tutorials, training software, course fees, etc.)
- What training materials will be needed? (workbooks, laptops, etc.)
- Will we be paying for an instructor?
- Will there be travel, lodging, or meal expenses for this type of training?
- How much time will the training take for staff members (including any replacement time)?
- Are there any facility costs associated with the training?
Some other things to keep in mind include what initiatives and types of training you’ll be covering for the year: For example, new employee on-boarding, leadership development, or new technology training.
After you’ve approved your budget and your leaders have too, you’ll still need to think about the coming year. To have a better idea for what you’ll need next year, it’s a good plan to track the results of your training and development programs. You’ll be able to see how each program performed and begin to establish a baseline for next year’s budget and agenda goals.
Training and development is also not something that is completed only once – it should be continuously improved over time. There will always be employees who leave and new employees who will need to be onboarded. New technologies and tools will continue to be introduced and employees will need to learn how to use them in order to keep up with competition. And, as your business grows, you may notice a need for a new set of skills in the form of a new job on your team.
Invest in Your Talent’s Development as Leaders
Finding the right people on your team to develop into leaders can be tricky. Did you know that 55% of candidates will drop out of a leadership program within 5 years? That’s because they were likely not the right fit for a leadership development program.
Focusing on identifying the best employees for potential leadership will help save you time and money. Avoid concentrating on the wrong criteria when you’re choosing employees to develop. High-potential leaders are not always the employees with the best productivity or tenure with the company. Potential leaders show characters related to leadership – things like honesty, integrity, the ability to inspire others, accountability, and the proven ability to make decisions.
Overall, your training & development should typically comprise approximately 1-5% of your overall expenditures on salary. That doesn’t always leave much room for employee development if there is a greater amount of training needed. So, thinking of creative, inexpensive ways to develop employees is critical. Here are some ideas:
- Create a Lunch & Learn (employee-lead or industry expert)
- Encourage employees to sign-up for free webinars & events
- Develop an employee forum or book club
- Implement cross-training
- Launch a company mentorship program