When did your business last expect a return on its training spend? A real, measurable and commercial return that you would require from any other investment in the business? For most companies, the honest answer is never.
Skills development is often managed as a cost rather than a measured investment. The result is that training is often not measured properly, and companies don’t realise it isn’t delivering value. However, the metric that matters is time-to-productivity – how rapidly a trained person adapts to your working environment and starts contributing at the level you need. A candidate who has spent months inside a real office, working on a real technology stack, mentored through real delivery, arrives ready to work. Someone hired the traditional way is still finding their feet three months into the role.
Time to productivity
Most training is measured by how many people attended, how many seats were filled and how many certificates were handed out. These metrics don’t tell you anything. It’s easy to report that 40 people undertook a training programme, but it’s much harder to report what they did for the business afterwards and how this training delivered a return on the original investment.
Let’s be clear. The cost of the training doesn’t change; what changes is how rapidly this investment is returned to you through productivity and service delivery. This return can start much earlier than most companies realise with a model that trains young people in live client environments, teaching them both the hard and soft skills required day in and day out. A model where candidates are placed in real-world situations and offices and are already doing the work before they become permanent members of staff. They develop their skills while learning in and working on live projects defined by real client requirements and prioritising actual project delivery.
This return on investment is generated during the investment itself with real output from trainees before anyone has signed a permanent contract. It is about fast-tracking time to productivity.
It is also a methodology that matters more now than ever. In the last quarter alone, employed youth fell by 258,000, and youth unemployment rose to 45.8%. The programmes designed to address this issue are still reporting attendance figures, but they aren’t moving the numbers. Something has to change, and it comes down to the ways in which companies are measuring the success of these programmes.
What every company should be asking is a series of much simpler questions. Instead of how many people passed through a programme, it’s how many of them ended up employed. Instead of how many certificates were issued, it’s how quickly they started contributing. When you change the questions, you change how you perceive and measure the value of training because the reward isn’t activity; it’s outcomes.
The challenge is to move training out of its comfort zone, where it is measured only by attendance. It’s a difficult move because attendance is a tangible number that produces neat reports. However, every Rand spent on a programme that fills a seat without changing an outcome is money that has returned nothing, and companies are carrying far more of that cost than they realise.
Treat training as you would any other serious investment in the business. You would never approve capital spend on new infrastructure without asking what it will deliver and when, and you wouldn’t sign off on a marketing budget without expecting leads or sales or growth in return. Skills development deserves exactly the same rigour, and when it is held to this standard, it has the potential to become one of the most reliable investments a business can make.
By Jessica Hawkey, MD of redAcademy