Research released by Thales Training & Consultancy, Thales UK’s integrated training services provider, reveals a clear divide between enterprise businesses and small-to-medium-sized organisations in their approach to measuring the effectiveness of their learning and development (L&D) strategy. The study was based on an exit poll among HR decision makers at the ‘World of Learning’ exhibition in late September.
Medium-sized businesses led the way in providing a proactive L&D strategy (90%) and measuring success (90%); in enterprise only 75% had a proactive L&D strategy and only 50% of respondents measure the success of the programme.
Commenting on the findings, Rachel Kay, Business Development Manager at Thales Training & Consultancy, says: “Many organisations are missing a trick by not having a measurement strategy in place for L&D interventions. In a time of economic pressure it’s more important than ever to be able to demonstrate a return on your investment (ROI).”
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The study also showed that medium-sized businesses spent the biggest proportion of their L&D budgets on management development, indicating their hunger to ensure that skills were in place for future growth. Some 60% of medium-sized organisations spent more than 20% of L&D budget on management development, compared to enterprise businesses, where only 50% invested more than 20% of total L&D budget on leadership skills.
“It’s encouraging to see medium-sized businesses laying the foundations of their future leadership by investing in management development. This type of L&D intervention can be crucial in ensuring you retain the best talent and ensure the long-term growth of your organisation,” says Kay.
As well as looking at where L&D budgets are being spent, the research examined how an organisation’s propensity to outsource was likely to change over the coming months. Around 36% of small businesses forecast an increase in spending on outsourcing of L&D, citing changes in budgets or the business structure for their change in strategy.
At the enterprise level, 8% expected an increase in L&D outsourcing as oppose to the 25% of respondents who intend to reduce spending in this area, all of whom said that budget changes were the major reason for their decision. For mid-sized businesses the picture was more balanced, with equal proportions expecting increases or decreases.
Other key findings:
Enterprise business (1001+ employees)
• All but one respondent outsourced some aspect of their L&D delivery
• 25% of enterprises spent more than 33% of their L&D budget on H&S training, suggesting that they are being pushed into spending a large proportion of their budget on mandatory training instead of that which would support the business strategy and leadership development
• 50% of enterprises spent 20-40% of budget on professional development
Mid-sized business (251-1000 employees)
• 20% outsourced all delivery of L&D
• 20% outsourced all procurement of L&D
Small-sized business (1-250 employees)
• 66% don’t outsource any L&D
• 25% spend between 21-30% of budget on management development
• Nearly 15% would not consider outsourcing L&D because they would not know how to measure ROI
• Over 40% said they have a reactive strategy to L&D
• Nearly 25% have no way or are unsure how to measure L&D programmes
