asked on July 20, 2009
1 Additional Answer
Very good post Aaron. Most accurate answer to this question is..... depends. :)
Trying to answer the original posters question I can say that much though. Every now and then it has happened that budgeting needs to be done before training and development plan is finalized, so some estimation is beign asked by finance people. Then some „rule-of-thumb” can help you out without too much headache.
I've done a very big project concerning training of team leaders (21 day course for almost 15% of all workers) + extra management training courses and now in hindsight, the costs didn't go over 5,5% of the payroll that year. With additional funding from EU social funds, the project cost 3% of the payroll. And this is hardly a thing I'm planning to do every year.
From my experience as training manager - when you can squeeze in 2% for training into a budget and that doesn't involve MBA's, or big language training projects, then that's more than enough. With 4% you can do some special and big things.
Best Regards,
Kaarel
Best Answer
0
Mach-
Thre's really no hard and fast rule. Some of the factors to consider are your industry, how you want to compare to your peers, and your corporate culture. Even with that, it will vary greatly based on how your company is doing at any given time (training tends to be one of the first items to go when a company is having financial difficulties). Rather than starting with a dollar/%, I suggest you start with what you want to accomplish. What are your company's goals/strategic plan for the next few years? What skills will your employees need to get you there? What is the gap between their current skills and what you identified? To what degree are you going to help your employees advance their careers within your organization? Starting with the answers to those questions, you can begin to build an overall development strategy for your employees. You can then tailor that strategy based on your financial position (% of external training vs internal training, # of development areas, frequency of training opportunities, classroom instruction vs ojt, etc). In the end, you should have a robust corporate development plan that matches your culture and budget and also enables your employees to grow within your company with a clear and concise strategy. Feel free to contact me at aaron.klein@crystalpointsolutions if you would like to discuss further.
Best of luck!
-Aaron