Is it more cost-effective to develop and administer your own training programs in house or to bring in an outside training company?
The answer is, it depends. If you only need to train employees to improve a few pinpointed, well-defined skills, it can be more economical to develop your own programs in house. Some examples include:
- Teaching salespeople about the features of a new product or service.
- Training employees to use a new or revised company intranet.
- Explaining new HR procedures, benefits or other programs.
When you have to teach more complex skills than those, it can become more difficult to decide whether to create your own training or hire an outside training development company.
As you make that decision, be on the lookout for the following assumptions that can waste time and cost you money in the long run.
In-House vs. Outsourced
The benefits of developing your training in house can include:
- Training can be economical to design and deliver, provided you have an internal training department.
- There is no need to teach non-company training designers the basic about your company, such as what you sell, what your company vision is, who your leaders are, and more.
- Older training materials that have the right look and feel can be referenced as you develop your new training programs.
- If you need to revise your training programs in the future, there is no need to rehire a training development company because you already have people your traning department who developed your training the last time.
The benefits of outsourced training can include:
- An outside training development brings “new eyes” and a fresh perspective to your training and can often see opportunities that your internal trainers cannot.
- Many outside training companies are fluent in new training technologies that your internal staff may not know about.
- If you are using in-person training, the company might be able to offer you the services of their expert trainers and presenters.
- An outside training company might be able to integrate your training into a Learning Management System that allows you to track who is taking your courses, who has completed your courses, and more. Bulding your own LMS is probably something you do not want to undertake. But when you use a Training company like Tortal, it is included.
Faulty Assumptions that Can Lead to Making the Wrong Choice
Assumption One: “We understand our challenges better than any outside training company ever could”
Yes, you are keenly aware of your internal processes and can describe what you would like your training to accomplish. However, objective outside experts can often see obstacles and opportunities that company insiders miss. Competent training companies can often recommend solutions that have worked at other companies, including forms of training that you might not know about.
Assumption Two: “We’re already paying employees who can handle it”
Sometimes it does cost less to have current employees develop and deliver training. But it is important to assess the true costs and compare them to what outside training companies charge. It costs money when employees take time away from doing their jobs so they can develop training programs and materials, for example. Also, an expert training and development company can often achieve better results on the first try, which can cost less than having internal employees tweak training repeatedly to get it right.
What about creating an in-house training department instead of hiring an outside firm? If you have a lot of training that needs to be done, it can be a good idea. But it is also important to weigh and compare costs. When you get to the bottom line, you might discover that outsourcing saves money in salaries and benefits alone.
Assumption Three: “We’ll have more flexibility and control if we develop the programs ourselves”
While it’s true that creating training content in-house may allow for quicker, more flexible revisions, the involvement of an expert third party can lessen the need for changes and provide greater efficiency. Another consideration is that the cost of reviewing and fine-tuning training is often built into the fee that you are paying the consulting company.
For example, Tortal Training’s Out of the Box Training (OTB) solutions are designed to be adaptable to clients’ needs, both at the start of training and when changes are made.