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Employee Training and development programs are critical for enhancing employee job performance. A survey conducted by the International Journal of Business and Management Confirmed this, with 90% of those employees surveyed indicating that the impact of training and development programs instituted by the company can significantly improve employee job performance. This is especially true amongst millennials and Gen-Z customers, where 87% of participants believed that learning and development opportunities were crucial when deciding to apply for a specific position.
Globally, companies spend over $358 billion on training and development activities, stating the importance of a more competitive workforce, increased employee engagement, and redemption. Despite this, critics often point to a painful lack of results from these eye-watering investments. So how can startups train their employees without breaking the bank? Let’s take a look.
The Need for Employee Training
Before we look at some of the most cost-effective training programs and methods, it is first important to understand why and when employee training programs need to be instituted at the workplace.
By carefully designing a program with customized content, real-world examples, and opportunities for hands-on practice, the organization can help employees build their skills and measure their progress. With the right approach, training can be a highly effective way to close those gaps and help people succeed.
Investing in employee training and development has several benefits, from improved productivity and engagement to lower turnover and errors.
- First, Effective training can bridge gaps in skills and knowledge, leading to improved high-performance organization and success and an overall improvement in organizational efficiency and productivity.
- Second, by instituting training and development programs, organizations can show that they are committed and value their employees in helping them with their professional growth, leading to lower turnover and higher retention.
- Third, and perhaps more important, training can help align the skills and goals of employees with the company’s goals, leading to less friction and a more cohesive workforce.
Despite these significant benefits, most training programs seem to have minimal impact on actual job performance. This makes sense since employees, on average, spend just 1% of their time, or around five minutes per day in a normal workweek, on upskilling and training development. There is also a significant gap between the training and development programs and their implementation. A survey shows that only 12% of employees who undergo training & development actually apply the skills they receive to their job. So where is the training program falling short, and how can companies see better results?
The answer may lie in providing targeted training, an effective way to ensure that employees retain knowledge and can immediately apply it to their work. This approach helps to overcome the “forgetting curve” by providing context and motivation for learning. To maximize the effectiveness of training, it is important to consider both the design and timing of the training, ensuring that it aligns with the learner’s motivations and provides opportunities for immediate application.
Cost-Effective Training Methods for Employee
Employee training can be significantly more expensive at the initial stages of a company’s lifecycle or when the company is small in scale. However, far more money is lost if employees are not trained on the job due to a lack of motivation, a decline in productivity, and higher employee turnover. A 2021 study shows that the annual turnover rate across all industries is 57%. Couple this with the cost of losing an employee that is estimated to cost between 1.5-2 times their salary, and the financial burden can add up quickly over time.
If a startup or SMEs budget is limited, the best answer may be not to abandon training altogether but to be more strategic about the process. Here are a few cost-effective training methods for employees without compromising on quality –
- Peer-to-Peer Training – Existing employees in the organization with specialized skills can be deployed as a valuable and cost-effective resource when training new employees. Maximizing the use of an in-house talent pool can help drive low-budget training and ensure that the organization is leveraging its staff to their maximum potential. New employees can be paired with someone in their position as a ‘Buddy’ or someone with more experience as a ‘Mentor.’ A survey conducted showed that retention rates for both Mentors (69%) and Mentees (72%) were much higher than if the program was not conducted (49%), so the results can be instantaneous.
- Adopting Microlearning – Microlearning is an alternate coaching process that can both expedite employee training and reduce the cost of the program. Microlearning is the process of short, focused training sessions (between 5-10 minutes). By creating microlearning modules that can be easily edited and rearranged to create customized learning paths, organizations can tailor their training programs to meet the specific needs of different roles and teams. This helps ensure that employees receive relevant and targeted training and makes it easier to make updates and changes to the program as needed.
- Utilizing Online Learning – The most cost-effective way for employees to access training programs is to access the vast library of free/low-cost online resources. This includes MOOCs (Massive Open Online Courses) offered by universities/educational universities, OERs (Open Educational Resources), free licensed educational materials, and online learning and certification platforms like Coursera and Udemy.
- Collaborating With Other Organizations – Partnering with other corporate or educational institutions is a cost-effective way to provide trading to employees. When organizations collaborate on training, they share resources and reduce the costs associated with building a program. Some ways to collaborate include sharing training materials and resources, collaborating on training programs, and hosting joint training events.
Employee training is essential for the success and growth of any organization. It helps to improve the skills and knowledge of employees, which can lead to increased productivity and efficiency. Training also helps to foster a positive work culture and can lead to higher levels of employee engagement and retention. By implementing cost-effective strategies, organizations can ensure that they provide valuable training to their employees while minimizing costs. Employee training is a smart investment that can pay off in the long run by helping to create a more skilled and motivated workforce.