Ways to reduce L&D cost in your organization

Businesses increasingly rely on the capabilities of their workforce to gain an edge over the competition in the complex business landscape. Pressure on Internal Learning & Development teams have increased immensely to train under-skilled human resources to make them more competitive and relevant to changing business trends. With rising shortage of talent, hiring processes are failing to meet the talent expectations of an organization.  As per a study conducted by CareerBuilder, 49% of employers have made up their mind to hire people who are underskilled and train them to bring them up to be productive resources who adds significant value to the organization’s growth. Even though this is an excellent opportunity for L&D departments, the cost for such training programs are always a matter of concern.


With the growing popularity of eLearning, it has been seen in many cases that shifting to online training makes training very effective.

  • According to a report by Judith B. Strother that had findings of Hall and LeCavalier, some of the big shots were able to cut their training costs tremendously by switching to blended learning. One of them is Ernst and Young, who cut their training  costs by 35% (An Assessment of the Effectiveness of e-learning in Corporate Training Programs)
  • The same report also described how IBM was able to cut almost $200 million after moving to online corporate training.

So where should we start off?

Assess your Requirement

It’s important to understand what your organizational goals are from a training perspective. You can use employee surveys and quizzes to create a training program that can be effective in developing employee capabilities as per their requirement. Furthermore, a retrospective on training feedback will help you fine-tune your training plan.

Using the results from employee surveys and quizzes, you can narrow down those areas where training can bring your organization closer to its strategic goals.

Program Streamlining

As employees are expected to juggle multiple responsibilities, there are many areas where they may need to be trained on. Some programs can be redundant and thus avoided entirely. Categorizing your training modules as per their priority can make your programs more cost-effective. Based on their priority, you can decide on when and how much to invest in them. This is useful, especially where your training costs are charged per training program.Learning & Development

Prioritizing the development areas that will help your organization achieve its vision will not only let you use your resource efficiently but also drastically reduce the risk of investing in the wrong training program.

Related Reading
What’s in the future of LMS eLearning? Read Learning Management System: Does it Have A Future? here.

Choose the Right Trainer

The right trainer can reduce costs while providing the necessary training that your team needs.  Sometimes the top gun in the market may turn out to be the wrong choice for your organization. Each training vendor will have to be carefully assessed to suit your organization’s priority and requirement. If you are looking to develop your team’s soft skills or a general skill area, you don’t really have to invest a premium. However, when it comes to training your team on a specialized skill, you might want to consider vendors who are known for their quality of training in that specific skill set.

Transforming learning and development [Source: Onlignment]

Talent Management Strategy

A general market study shows that over 70% of corporations having over 10,000 employees are focussed on setting up a Learning Management Solution (LMS). And today, almost all LMS vendors have a Talent Management system bundled along. From the market research, it has been noticed that companies having a Talent Management system from the same vendors as their LMS are getting almost four times returns from those who are buying them from a separate vendor. Learning Management System

An eLearning software not only saves my time and energy to train someone on a specific skill set but also allows me to reuse a set curriculum/course with multiple candidates. The only effort required is to maintain/update the learning material when required. A good eLearning system will help me track my team’s progress with the training and at the same time help the employees map their training with their career path.

Reducing cost in the overall functioning of an organization is a part of everyone’s priority list. Developing my team’s skill along with cutting cost is a deal I’m willing to take any day!


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Ashmitha Chatterjee

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