How Training Engagement Can Boost Your Bottom Line
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Increase Your Profit By Establishing Training Engagement

Whether you’re struggling to get a small business off the ground or manning the helm of a global conglomerate, the budget crunch is an all-too-familiar territory. It can be tempting to save some dollars and cents by trimming content and time from your Learning Management System (LMS) or just chucking training altogether. However, cutting employee training could make you take a bigger loss in the long-term.

If you do it right, investing in employee training can feed your bottom line instead of depleting it. In fact, businesses that spend at least $1,500 per employee annually on training activities reportedly earn 24% more profit than those with lower training budgets [1]. And, companies can generate a 6% higher shareholder return just by raising the annual, per-employee training expenditure by $680 [2].

But don’t think you can set up an LMS and call it a day. Before you’re able to reap the financial rewards of a well-trained workforce, you must make sure your team members are interested and participating in the offering. Furthermore, make sure that you are engaging your learners so that your team doesn’t fall victim to training tune-out. In order to ensure that you’re maximizing what learners are taking away from training and applying in the workplace, you may want to look at hard data analysis so that your strategy always provides optimal results. As a result, your efforts to boost training engagement may be some of the smartest investments you’ll ever make. So, let's move on to the ways in which training engagement can really boost your bottom line:

Increase Productivity And Quality

A 2013 IBM study of more than 3,100 U.S. workplaces revealed that a 10% increase in training and development translates to a nearly 9% gain in productivity. In 2016, another survey identified a positive correlation between investing in employee training and improved product quality and customer satisfaction. Even Net Promoter Scores (NPS) experienced a boost from training expenditures.

In fact, well-trained employees not only have higher achievement rates. They are also more likely to exceed goals and expectations. It just makes sense. If you provide employees with the tools they need, they are naturally able to do their jobs a lot better and faster than employees who don’t understand what needs to be done, let alone how to do it.

Boost Morale And Loyalty

Replacing people who leave your organization, and getting new people up to speed, takes a great deal of time and money that could be contributing to your bottom line. Also, according to the IBM study, employees who don’t feel that an organization is providing the development they need are 12 times more likely to leave for another opportunity than those who say they’re receiving enough training. Consequently, reducing turnover is a big incentive to dial up the focus on training engagement.

You shouldn’t need to push too hard. The dedicated, talented and hardworking people you want on your team have a general inclination toward self-improvement and strive to advance their careers. Furthermore, by showing a genuine interest in their future and offering not only job training but professional development, your employees are not only able to do their work effectively, but they’ll appreciate the growth opportunities. This boost in morale contributes to increased organizational engagement and loyalty.

Speaking of morale, because we’re only human, confrontations are bound to arise in any workplace. In fact, 60 to 80% of all difficulties in organizations are not even from customer issues or process problems. The majority of all organizational hardships are from employee conflicts. Those disagreements lead the typical manager to spend 25 to 40% of the time at work dealing with these conflicts. That’s a huge hit to productivity.

But there’s good news. You can use Learning and Development to head off some of these conflicts at the pass. Fortify your LMS or training offering with soft skills training, like emotional intelligence, conflict resolution, and interpersonal communications, so employees are equipped to quickly settle interpersonal problems themselves.

Build A Deep Bench Of Experts

Beyond the typical churn that arises from standard turnover, if you lost one of your organization’s leaders today, how quickly would you be able to rebound? How much of your deep institutional knowledge might be lost? Making training engagement a priority not only helps your people gather the skills they need to further their careers, but it’s also an effective remedy for organizational gaps at the highest levels.

Don’t wait to start training employees for the C-suite until leaders invariably leave or retire. This will severely handicap your organization, so a head start is necessary. Get your leadership successors and high performers engaged in leadership training, job shadowing, mentoring programs and relevant skill development.

And if you haven’t already, it’s time to start considering cross training. This is where all team members train to become competent in numerous roles and skills within the organization. Cross-training provides additional development that modern employees crave. Furthermore, building up a roster of experts in the various roles of the company helps prevent knowledge loss when team members leave or are simply absent.

It’s the ultimate win-win. Employees get the skills and development they want and need, and the organization gets a multifunctional team that is prepared for virtually any challenge. For example, a marketing team where everyone also knows graphic design and computing programming basics is equipped to handle the work in the event a developer or graphic designer is sick. Cross training also improves quality, customer satisfaction, and productivity, as well.

You could also reap cost savings when it comes to hiring. If you’ve maximized your current workforce, you may not have to increase your headcount to increase functionality and output.

You can use an LMS to assign and track cross-training endeavors, or you can tap existing team members to serve as mentors and coaches. And, if you’re creating new training materials for cross-training purposes, you’ll likely be able to reuse them for onboarding new employees, which translates to even more savings!

Avoid Costly Mistakes

Gains aside, a strong focus on training engagement can also save you from costly consequences. From lost profits, legal action and lawsuits to production delays and federal penalties, there’s a laundry list of potential financial hardships for not being up-to-date with mandatory compliance training and certification. Furthermore, being out of compliance could mean an unsafe workplace and higher injury risks.

Due to ever-evolving technology, shifting business landscapes, and plain old turnover, companies lose 10 to 30% of their original capabilities every year [2]. That means, if you’re not continuously focused on training engagement, you’re likely hemorrhaging vital skills and knowledge, and sometimes, you also risk falling to the wayside—especially if you fail to keep pace with the competition.

References

[1] HR Magazine, January 2001: Stepping Carefully

[2] Not Investing in Employee Training Is Risky Business

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