Running a business is no smooth ride. The best business leaders are the ones who manage to get a balance between the effervescence, constant change and human nature of the people in their organization and all the business data and rational decisions they have to make in order to keep the company moving forward.
At the end of the day, the success of any business is based on its profits. But no profit can be made without people.
It’s impossible to fit into a spreadsheet cell the impact an employee can have over the bottom line, try as you might. But that impact exists and it can be influenced by how well an employee is trained within the company.
Since it’s so hard to see crystal clear ROI for how more knowledgeable workers increase company profitability, training budgets are among the first to be cut in hard times. In many cases however, this decision can turn out to be what the Brits say “penny-wise and pound-foolish”.
A cut training budget may positively affect cash flow in the short term, but may trigger some serious negative effects in the long run.
Providing relevant learning opportunities and professional development for employees is certainly a significant investment. Couple this with the aforementioned foggy ROI, and you can’t really blame managers for searching for options and consider all the ways to cut training costs.
Why online training is cost-effective
Going online might be the perfect middle ground. Through e-learning employees can still get the training they need, while managers can optimize the training expenses.
Here are five ways online training is more cost-effective than the traditional way of supporting employees to become more knowledgeable and productive.
1. No more costs with training facilities
Traditional training needs physical space. Whether there is a training room available in the building or it must be rented somewhere else, the availability of this physical space comes with a cost. If employees — or trainers, for that matter — need to go to a different location, in a different district, region or country, travel and accommodation costs increase the training bill.
What’s more, if a training program or session lasts for more than a few hours, lunch should be provided, at the cost of the beneficiary company. That’s because people can’t absorb new information efficiently when they’re hungry. No one is their true self when they’re hungry, so lunch is actually a small price to pay.
All these costs disappear completely in the case of online training.
Renting a physical space for delivering training becomes unnecessary, and so does the corresponding travelling and accommodation.
Both trainers and trainees still need to eat to function properly, but since they’re not tied to one physical location they can do this on their own terms and on their own resources.
2. Easier maintenance and management of training materials
In a traditional face-to-face training setting hard copies of learning materials and various printed hand-outs are inevitable. Depending on the class size and repeatability of the course, the costs related to printing can become considerable.
And when new rules are to be included in the training materials the old printed ones become obsolete. Trees are destroyed and ink wasted.
Since online training makes no use of ink and paper, trees are thus saved, and so are money.
Perhaps developing training materials for online courses takes as much time as for traditional ones, but maintaining them is so much easier and completely free. The same training materials, once created, can be used and reused as many times as needed, without recurring costs.
Plus, whenever these online materials need to be updated based on latest standards or modified in one way or another, this can be done without spending a dime.
3. Faster turnaround
The main drawback of traditional training is that it was designed to meet the trainer’s needs. It’s always easier for a trainer to deliver one session in front of many trainees than to spend time with each individual, basically repeating the same thing over and over.
But managers are starting to care about learners’ needs more, as they realize they are the ones who must improve their performance and consequently the bottom line of the company.
Online training puts more control into trainees’ hands. They can decide when to attend a training course and how much time to allocate to it. If the means through which they access the course — moreover a company LMS — has a responsive design, they can also decide where they need to be when accessing that course.
Being able to access the right piece of information at the time they most need it, no matter what device they use, makes employees better remember and recall training materials. More to that, the time they spend away from their core tasks is significantly reduced.
Cheaper does not necessarily mean better
Success stories of companies that turned the gear towards online training and witnessed significant reductions in costs abound. According to an older study, IBM managed to cut approximately one third of its previous training budget after going digital, to give one example.
However, plenty of companies make haste to deliver online training and leave the traditional training classroom in the rear-view mirror, but don’t witness the same positive results as IBM did. It all depends on the company’s learning needs and readiness to adopt technology.
Sometimes, a blended approach to training — combining classroom instruction with online courses — may be an even better solution for offering learning opportunities for employees while optimizing budgets.