Learning and Development (L&D) is an essential, value-adding function within any organisation. And yet, when times get tight, it’s the L&D programme budgets that are usually the first to go.
With the effects of economic recession already starting to take shape, companies from all industries are going to keep a closer eye on what they’re spending over the coming years. So is it bye-for-now to L&D? No! Because that’s a false economy.
We know that companies are changing how they spend their training budgets, so how can they be sure to extract every penny of value from their investments?
Let’s find out.
Contents
Some companies cut L&D as an impact of the recession — here’s why you shouldn’t
L&D delivers continuous development to drive commercial success
L&D increases engagement and strengthens culture
L&D improves employee retention
eLearning is more effective (and more cost-efficient) than ever
How to navigate training budgets during a recession
Assess your learning needs
Choose the right e-learning platform
Foster a collaborative culture
Some companies cut L&D as an impact of the recession — here’s why you shouldn’t
Recessions are a natural part of the economic ebb and flow, but that doesn’t make them any less painful when they strike. And businesses get hit even harder when there are no contingency plans in place.
Budget-cutting and downsizing represent the unfortunate reality of recession-era business. Back in 2008, businesses across all industries made a 63% cutback on their training spending. Now, we’re seeing a similar pattern evolving throughout the COVID-19 pandemic — but with a 70% cutback starting in 2020.
But knowing just how impactful L&D is within an organisation, the training budget is worthy of being protected!
Let’s talk about why L&D is the last thing that should be cut from the company budget during times of duress:
L&D delivers continuous development to drive commercial success
A recession shouldn’t mean that companies turn their attention away from developing talent. This is especially true since roughly 50% of the workforce is represented by millennials and the top reason why millennials leave their jobs is due to a lack of career development.
What’s more, according to the Association for Talent Development (ATD), companies that implement thorough training programmes experience a 218% increase in income per employee. They also experience 24% higher profit margins.
L&D increases engagement and strengthens culture
It’s no secret that the way we work has changed. But did you know that remote work has actually opened up more time for e-learning strategies? 7.7 million hours of LinkedIn courses. And while some of that may have been down to a sudden increase in spare time, L&D managers need to harness employees’ hunger for development opportunities in-person and online.
Investing in L&D leads to improved employee engagement and better performance rates, as well as a stronger work culture. This is because highly skilled employees — given the right support — are more productive and collaborative, strengthening relationships and business.
L&D improves employee retention
As an L&D leader, the keys to employee retention are in your hands. As mentioned above, millennials make up the majority of the workforce today and they’re seemingly always ready to leave for better opportunities. However, the one thing that can get them to stay is providing them with the paths for professional growth — and that’s where you come in.
A comprehensive L&D programme is the path to growth and development within a company. By having these programmes in place as well as growth opportunities, your employees will be more likely to stick around.
eLearning is more effective (and more cost-efficient) than ever
If you’ve received pushback when trying to expand your L&D resources, then you’re in good company! L&D leaders have been told everything from not having any room in the budget to employees not “having time” to invest in their own training.
But e-learning has evolved significantly over the past few years. And thanks to cutting-edge technology and plenty of training outsourcing solutions, investing in highly effective training programmes is more cost-effective than ever before.
eLearning also empowers learners to complete L&D when it works for them, from wherever they are in the world.
How to navigate training budgets during a recession
Making the argument to hang onto L&D programmes or double down on them during a recession is the easy part. The challenging part is figuring out how to allocate the training budget you’re able to work with during the tough times.
Here are a few tips on how to navigate training budgets during a recession:
Assess your learning needs
The first thing you’ll need to do for your L&D programme is to assess the learning needs of your employees. This means doing several things:
Conducting a skills analysis
Evaluating your resources
Utilising the data at hand.
You need to understand how your employees’ skill levels translate to their developmental needs within the company and what you need to meet those needs. From there, you can use the data at hand as your budget planning base.
Choose the right e-learning platform
A remote e-learning platform is the obvious first choice for most businesses — whether your whole team is distributed or some work from home and others in the office. Lack of options isn’t the issue, more that there are tons of e-learning technologies out there and they’re not all universal solutions.
You’ll need to find the training platform that fits the needs of the company’s budget as well as your employees in order to deliver high-impact and customisable learning.
Foster a collaborative culture
As mentioned earlier, increased employee engagement leads to a stronger work culture and higher retention rates. But for L&D to really work its magic, you can’t just drop learning materials into an employee’s inbox — you need to spark engagement and foster a collaborative work culture for optimal success in your L&D programme.
Here are a few things you can do to foster that culture:
Ensure that mentorship is offered through those with management and other upper-level positions.
Implement the learning theories that work best for teams and individuals.
Introduce gamification along with incentives for winning teams.
Cut down on the ‘learning’ content by only using the necessary training documents that will enhance your employees’ skills, development and comprehension.
Personalise the materials so they’re relatable and translatable to the everyday life of your employees and their positions in the company.
Leverage micro-learning opportunities, especially for employees who show interest in learning specific skills for specific roles.
The bottom line is that you can’t afford to cut your L&D programme in a bid to protect the bottom line and mitigate the effects of the recession. Think of the opportunity cost of losing valuable employees and the direct cost of hiring and training new ones.
Book a demo today to find out how My Learning Hub makes L&D customisable, affordable and scalable — even during tough times.
P2P learning and the power of mentorship
Peer-to-peer learning can be a really useful L&D tool for facilitating knowledge sharing across an organisation. But only if it’s done correctly.
The correlation between changing roles in L&D
Changing times require an adaptive way of enabling people to perform. So it makes sense that traditional roles within the L&D sector are changing too.
