Corporate Training’s $70+ Billion Dirty Secret
According to analyst Josh Bersin, US companies spent well over $70 Billion for employee training in 2013. Analysts predict that amount is will be significantly greater in 2015.
These are the kinds of statistics one might expect C-suite executives to pay attention to. So it’s odd that they seem not to be paying much attention to the ROI for corporate training.
Leading experts have studied the subject at length; the statistics they provide differ. Some say there are too many variables to allow for “one-size-fits-all” statements about how much training is retained, and how quickly it is forgotten. They note the variety of training goals and audiences receiving the training, as well as differences in training delivery methods.
Having said this, there is general agreement among experts in the field that that corporate training’s success rate is, shall I say, “poor.”
One of these experts is Dr. Art Kohn, who has done a great deal of work on “the forgetting curve” and its effect on training retention. He’s also the recipient of not one but two Fulbright Fellowships for work in Cognitive Psychology and Educational Technology. In a recent article in Learning Solutions, he wrote the following:
It is the dirty secret of corporate training: no matter how much you invest into training and development, nearly everything you teach to your employees will be forgotten…this investment is like pumping gas into a car that has a hole in the tank. All of your hard work simply drains away.
The fact is that this “dirty secret” is really not secret at all.
The research and resulting articles about this have been out there for years. Yet there’s not much evidence that corporae executives are acting upon it, despite its its obvious and critical importance to the bottom line.
Bersin’s research also shows an explosive growth in technology-driven training, including self-authored video, online communication channels, virtual learning, and MOOCs. Worldwide, formal classroom education, now accounts for less than half the total training “hours.”
According to Bersin, mobile devices are now used to deliver as much as 18% of all training among what he calls “highly advanced companies.”
Does this mean that employees are using their iPads to access Udemy courses? If so, is there a significant difference in retention rate for employees who have information presented by a live trainer while sitting in a room with 20 fellow workers… versus those who receive it on mobile phone the subway on the way home at night… compared to someone being trained via iPad while sitting in the living room after the kids have been put to bed?
We won’t have statistics to provide answers to those questions for some time.
But corporations should be watching closely to see if new methods of delivering training result in a dramatic increase in retention among employees once they’re on the job — because if Kohn is right, even achieving a whopping 400% increase in retention will mean that after just one week, the average employee will still be retaining only about half of what is needed on-the-job.
That’s hardly a stunning success rate.
Research has made it abundantly clear that the basic premise that drives corporate training is fatally flawed.
It’s abundantly clear that the training corporations are currently providing to their employees is not succeeding in providing them with the information they need to do their jobs properly the first time. So why does corporate America keep throwing good money after bad, trying to find a “patch” or download an “updated version”?
It’s as if a purple elephant with pink toenails is standing next to the coffee table and corporations are only willing to acknowledge that there’s an “unusual scent in the air.”
My next blog will give more compelling facts to show why a major change in corporate training is needed.