Since moving from the Recruitment industry into the Sales Training and Development arena, I have been surprised by the number of companies that I speak with, that haven’t worked out the correlation between a lack of investment in employee training and the high recruitment costs that they face and the effect it has on staff attraction, engagement and retention. So my question is ‘Why view Training as an Investment, not a cost?’
My best client takes their People Development extremely seriously and have Gold status as Investors in People. Their annual cost on recruitment is negligible. They don’t use agencies, they don’t advertise vacancies in the press, they genuinely have a “Talent pool” of sales professionals, applying to join their business on an almost daily basis and when a vacancy does arise, almost always due to growth, then they have a smorgasbord of great talent to choose from.
Their employee testimonials on the likes of Glassdoor are a dream for any CEO to read. They weren’t always like this, however, they took a positive decision to put the development of their people as their Number 1 Business priority and it has been paying off for years. Their Investment in Training is sizeable, however their return on that investment is even greater.
Having asked the question of many other companies about how much they spend per annum on recruitment costs and how much they invest in training, my star client’s Training expenditure is still considerably less than the vast majority of companies recruitment costs and naturally considerably more than those organisations training expenditure.
In a recent IBM report, it highlighted that Top performing companies not only recognise the importance of their people, but also the need to provide the right skills and training to enable their people to peak perform.
- 71% of CEOs in the report of over 4000 companies cited human capital ahead of customer relationships and brands as the leading source of sustained economic value.
- 84% of employees in Best Performing Organisations are receiving the training that they need, compared to 16% in the worst performing companies.
- 65% of global leaders cite “talent and leadership shortages as their Number 1 business challenge”.
- 21% of new hires intending to stay at companies that do not offer training for their current jobs, compared to 62% of new hires intending to stay when training is provided.
- Those who felt they weren’t being invested in and therefore couldn’t meet their career goals in their current organisation were 12 times more likely to consider leaving.