9 Things to Consider When Creating Your Learning and Development Budget

7 Considerations When Developing Your Training BudgetThis blog post was originally published on September 20, 2017 and was updated on December 2, 2020.

Creating a budget for developing your people can be a daunting task for many HR professionals. Throw in a global pandemic and you've got an even more challenging task. While there are many unknowns, it's still critical to plan and be clear about specific learning needs and associated costs.

You can alleviate some of these “pains" by doing your due diligence during the creation of your learning and development budget. Here are nine actions to consider when creating your budget.

1. Benchmark Your Organization

The average direct learning expenditure per employee is $1,299, and the average amount of formal learning hours per employee is 34.0, not including informal learning such as on-the-job learning.[1]

Understanding your industry and how your organization compares to these national figures may give you a baseline for your budget planning. However, every organization is different, and therefore, has differing needs and approaches to staff development.

2. Conduct a Training Needs Assessment

A Training Needs Assessment is one method that can be used to improve the predictability of your professional development for the next year and for years to come. It is best to conduct a Training Needs Assessment annually. A Training Needs Assessment can be conducted in-house or you can bring in an outside consultant to assess the needs of your organization.

An assessment like this can help determine where the opportunities for improvement are in your organization. It can determine if you need to dedicate monies to leadership development, or succession planning if you have an executive or manager that will be transitioning out of the organization. It can also determine if you need to re-train managers on how to conduct performance reviews or at least provide refreshers on a regular basis.

You can determine these things by talking to your people and looking at your people metrics. If your turnover rate is increasing, find out why, then figure out what type of training, either for the managers or the employees, is necessary to improve that metric.

When conducting a Training Needs Assessment, it helps to assess needs categorically (e.g. by location; division/department; position level, manager vs. individual contributor, etc.). When there are large groups who need the same training, it makes it easier to know whether classroom training is the answer, individuals should be sent out, or webinars or e-learning should be used. 

3. Initiate Employee Engagement Surveys

With millions of employees working remotely, employers should consider adding employee engagement surveys to their budgets. An employee engagement survey measures the strength of the employees' emotional connection and commitment to the organization and its goals. Research shows engagement contributes to a number of business outcomes, including increased retention, motivation, and productivity.  

Employee engagement surveys are usually administered online. Standard and pulse versions are typically available. The data can be segmented and analyzed by using demographic categories like location, division/department, and position level.  

4. Review Administrative Costs

The administration costs that you can budget for truly depend on the size of your company. If you are a small organization and the only administrative aspects to training fall on an HR Generalist to coordinate and schedule training for a group of 60 people three times a year, your administrative line may be very minimal.

However, if you are a larger organization that needs to track and evaluate the training of 500+ employees, you may want to invest in an LMS (learning management system) to document, track, and report all of your training programs.

5. Invest in Consultations

Not every workforce “pain” you experience can be fixed by sending a handful of employees to training. Sometimes the pain is actually a strategic misstep that needs to be addressed on a higher level. Sometimes the pain is when only one employee is experiencing issues which may be resolved with one-on-one coaching rather than sending the employee off to training. 

For instance, if you are having trouble with one or two recruiters bringing in talent to your organization, you may be able to alleviate this issue by training those recruiters directly.

However, if your organization is experiencing a high turnover rate and is losing out on high-performing talent during the recruitment process, it may be time to take a look at your overall talent management strategy.

6. Experiment with Train-the-Trainer

Mid-size or large organizations that already have an in-house trainer on staff for onboarding new employees or training on soft skills can actually send their already-salaried trainer to training that teaches them how to train employees on a specific topic.

This is ideal for organizations that already have an instructor on staff and are looking to expand their in-house training capabilities.

7. Support Employees with Coaching and Mentoring

For many avenues of professional development, particularly for employees on leadership tracks, it’s important to support those employees by helping them achieve their objectives and goals. Coaching is typically focused on ensuring that key employees such as senior leaders and executives are continuing to develop effective workplace behaviors. Coaching can be paired with assessments that help identify leadership and interpersonal styles and areas of improvement.

Mentoring programs can also be developed for employees who may not be (or desire to be) on leadership tracks but are still looking to grow as a professional. Mentoring programs can either be set-up in-house in which more senior employees are mentoring entry-level or associate employees, or they can be set-up to involve outside professional networks. In either case, training for both the mentors and for those being mentored is necessary to ensure the mentees get the direction and development they need.

8. Factor in Direct Costs (The Basics)

Whether you are using an outside firm or an in-house instructor, there are a laundry list of questions you must ask and things you must account for, direct-cost-related, when developing your learning and development budget. Also, depending on your organization's comfort level with the risks associated with the global pandemic, you may want to factor in (or out) instructor travel, facility rentals, and any costs associated with in-person training. Here’s a list of a few direct-costs to consider, if applicable:

  • Trainee travel, lodging, meals, etc.
  • Instructor travel, lodging, meals, etc.
  • Instructor fees
  • Facility rental
  • Technology costs
  • Materials (workbooks, videos, etc.)
  • Evaluations

9. Don't Forget Indirect Costs

There are a number of indirect costs you also have to account for when developing your budget. These indirect costs include things such as employee absence and impact on the organization. In fact, if organizations are averaging 34.0 hours of formal learning per employee per year, accounting for employee absences adds up quickly.

This also affects any position that may need a replacement to fill-in during their time in training and that cost should be accounted for in your budget. 

[1]The Association for Talent Development’s (ATD) 2019 State of the Industry report

ERC provides customized training for organizations across the nation.

Train Your Employees

6 Ways to Help Employees Get Along

6 Ways to Help Employees Get Along

This blog post was originally published on April 4, 2012 and was updated on November 5, 2020.

Sometimes employees don't get along and these conflicts and office disagreements can dampen productivity, waste time, reduce a team's performance, make the work environment tense and uncomfortable, and increase stress in work groups - none of which are beneficial to your business. Here are a few ways managers can help reduce conflict on their teams.

1. Set the tone

Managers and leaders set the tone for team interactions by what they say or do when conflict or problems emerge between their employees, how they manage conflict with their own peers, and what behavior they tolerate. If managers act passive-aggressive, disrespect fellow employees, or do not directly deal with conflict, employees will follow their lead.

2. Hire team-players

Hiring employees who have strong interpersonal, team-building, and internal customer service skills can decrease the likelihood of conflicts. While it's tough to predict how well a candidate will interact with your team, a solid personality or style assessment and behavioral interview as well as asking for references can help.  

3. Don't ignore conflicts

Managers have a tendency to ignore problems with poor team players or team conflicts until they escalate. Instead they should encourage employees to collaborate on a solution and seek coaching and/or training for current employees who argue with coworkers, don't provide good internal service, or are overly critical or judgmental of others. It's critical to not let conflict spiral out of control.

4. Educate on styles and generational differences

Great teams are melting pots of different generations and backgrounds. Each employee brings a different personality and style to the table. Most conflict stems from not fully appreciating who another person is, their background, and the strengths of their individual style. Spend time educating your team on style and generational differences.

5. Spend time interacting

Developing common ground is one of the most important ways to fend off conflict in the workplace, and it's achieved in the simplest of ways: spending more time with one another. Informally interacting and talking is one of the best ways to get employees familiar with one another. When they eventually find common ground, magic happens.

6. Reward teamwork

Most managers want teamwork, but reward individual achievement. Recognizing and rewarding teamwork, collaboration, and supportive interactions and promoting or giving choice assignments to employees who act like team players helps promote and encourage a supportive work environment.

When conflict strikes in the workplace, your managers are the best people to nip it in the bud, deal with it, and prevent it.

Conflict Resolution & Mediation Training

Conflict Resolution & Mediation Training

The course demonstrates how constructive conflict resolution techniques can be useful.

Train Your Employees

Leading by "Eggs-ample:" ERC Makes Workplaces Great

IMG_4363-1ERC is serious about making workplaces great. We created and cultivate an "F" workplace culture: Family-First, Fun, Flexible, Fitness-Minded, Footprint-Light, and Financially Supportive to employees. This week, ERC's Fun Committee organized the 1st Annual Easter Egg Hunt for all staff in the office. This fun activity was organized because ERC understands a positive employee experience is crucial to the health of the organization.


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How to Re-Engage Employees Who Are Ready to Leave

How to Re-Engage Employees Who Are Ready to Leave

Do you currently have an employee who has one foot out the door? There are endless reasons for voluntary turnover, and data from ERC's 2018 NorthCoast 99 Top Performer Survey specifically identifies four of the most commonly cited sources of disengagement.

Employees are likely to chase after new advancement opportunities and more competitive compensation, while fleeing from a lack of flexibility and a lack of organizational support.

Once employees become disengaged, it can be a struggle to change their minds in a way that makes them want to stay.

Consider the following 4 ideas to re-engage those employees who could be on their way out.

1. Keep Lines of Communication Open

If regular employee-manager conversations don’t occur, you might find yourself quite surprised when you hear a top performer express intentions of leaving the company. Listen to all concerns intently and take them seriously. Consider preventive measures such as conducting regular “stay” interviews or employee engagement pulse surveys. Keeping your employees engaged requires continuous communication.

By maintaining an awareness of how your people are doing and how they feel about their work and roles in the organization, there will be more time and opportunity to engage your talent base.

It could be easier to remedy employee issues as they come to surface, rather than continuously cycling through the talent attraction and hiring process as a result of turnover.

2. Get Them “Un-stuck”

Give disengaged employees somewhere to go within the company. When you give them the opportunity to re-engage they feel less inclined to take their talent and knowledge elsewhere. Advancement opportunities allow top performers to feel continuously challenged and in charge of their learning, which not only serves to fulfill their needs for growth, but also benefits an organization’s competitive advantage.

Take note of the knowledge, skills, and unique attributes your organizational talent pool consists of, and figure out how you can better utilize your employees’ capabilities.

When they feel ready to move on to an external opportunity, offer to move these individuals into a new set of responsibilities in which they can flourish. And when you add new work to their plate, make sure their compensation is adjusted accordingly.  Having a talent-management system in place can facilitate this process. (Ultimate Software is an ERC Preferred Partner offering succession planning and talent development services.)

3. Recognize and Reward

A number of employees could be on their way out because they feel unappreciated for their efforts, and are no longer motivated to work for an organization that doesn’t recognize their contributions.

While no employee is likely to turn down a bonus for a job-well-done, money alone is not an effective long-term motivator. 

Showing appreciation can take on many forms, such as giving public recognition during staff meetings or interoffice email, awarding extra paid time off, or giving employees the chance to work on challenging projects that provide more work autonomy.

4. Support Work-Life Balance

If organizational policy is rigid and forces individuals to choose between work and family, employees will likely recognize that they have options that will better suit their needs (that don’t include their current employer).

Granting employees more robust benefits such as flexible work schedules, generous parental leave, telecommuting opportunities, and unlimited bereavement leave, is a way to communicate to employees that you recognize they are holistic humans and not productivity machines.

Don’t lose your best people to the competition by hanging on to traditional workplace practices that hold them back from living an enjoyable life.

In the end, if you feel unwilling to put in the effort required to re-engage departing employees, consider whether you can truly afford to lose this talent and adjust accordingly.

 

Interested in learning more about engagement surveys?

Submit your contact information and receive instant access to a brochure that overviews what is included in ERC's engagement surveys and our process for conducting and assessing.

View the Engagement Brochure

 

Helping Employees Succeed: Managing Below-Average Performance

Helping Employees Succeed: Managing Below Average Performance

Whether you work for a Fortune 500 company or a small mom-and-pop machine shop, chances are performance reviews aren’t very high up on the list of your employee’s favorite things to do at work. Whatever the shortfalls, perceived or real, of the performance management process at your organization, the angst around reviews is only magnified when working through the process with employees who receive less than stellar ratings.

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5 Ways to Spot & Develop an Emerging Leader

5 Ways to Spot & Develop an Emerging Leader

Your emerging leaders are your rising managers and leaders in the making. But how do you spot an emerging leader and then develop them into a leadership role? Picking the right people and training them the right way is essential. That's why we've provided five (5) qualities these talented employees usually embody plus 5 ways to develop them.

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11 Ways to Improve Employee Recognition

11 Ways to Improve Employee Recognition

According to research by OfficeVibe, “65% of employees feel like they don’t get enough praise” and “82% of employees think it’s better to give someone praise than a gift.” This is the key difference between rewards and recognition. Rewarding an employee with a gift as a means of recognition is great but sometimes all employees want to hear is “job well done.”

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