Ever since the start of the decade, companies are spending more on outsourced third-party suppliers than they did in previous years. I think it has a lot to do with the idea that industry bosses don’t want to go back to the old way of handling training. They are looking for real change and finding ways to better leverage the money they spend for training.
Here are seven reasons why companies are currently choosing to outsource more of their training and development services.
Training may be a necessity; but, the development, management and delivery of training is a distraction. For offshore businesses that manage training everyday, it IS the core to their business. And they are much better at doing it than you!
More and more businesses are acknowledging that training is a source of income, and they have intellectual property that is valued in the market. So they use another company that knows how to market, sell and deliver training to a mass or targeted audience to create new revenues streams. Look at Microsoft or Cisco – they’ve been doing this for a long time.
Training helps reduce failures. It helps protect you from the liabilities of your company being sued if you don’t provide the right training. Since training reduces risks, it is easy to see that using a company that specializes in training could help prevent unnecessary failure costs. It sounds like insurance. I wonder which is cheaper in today’s world?
Running an in-house training department requires people of various levels of skills and talent. Full-time internal staff is a fixed resource. But training is a variable activity. Using an external supplier allows you to flex the number of resources to deliver the training you need, when you need them. It allows your company to scale up and down based on the demand of training your company actually needs. It makes a lot of sense when your company is hiring a lot of people for a short period of time.
Bringing a new product to market may depend on how to get resellers trained on how to sell or service your product. Using a training outsourcing company allows you to get your product into a lot of customers’ hands much faster, without scaling up internal resources.
Admit it, no company has all the knowledge they need internally to be successful. Sometimes it’s necessary to outsource the skills of an expert to teach internal employees how to do something that is new to their company. Yup, hiring an outside consultant to deliver a training course is considered outsourcing.
And lastly, the leading reason why companies outsource training is to reduce production costs. It’s the bottom line. It’s the common denominator and main reason for all the other reasons mentioned above. Also, you should never forget that how you manage training is always about how you manage your company budget.