Managed Training Services: doing more with less

Judith SpickDirector Business Development at Cegos-Integrata Germany

What are the main goals of Learning & Development units these days? According to many clients we spoke with, and even more request for proposals (RFPs) we have received during the last months: there is a short and a long answer.

The short answer: Increasing the quality of the learning offers in all aspects and saving costs while doing so.

The long one?

The challenges for which L&D professionals are responsible these days are both vast and varied:
• L&D offers need to become more self-paced, offered in various types and formats (micro/mobile learning and shorter learning cycles) and address multi-generational work forces
• L&D professionals need to become learning consultants and business partners
• L&D needs to set up tremendous Re- and Upskilling initiatives, e.g. for Digitalisation and 21st century skills
• L&D needs to create and support the right company culture by developing the right kind of leaders
• L&D needs to oversee business-critical content and portfolio areas, e.g. Sales or Purchasing curricula that will have a real impact in business results.
• L&D needs to manage platforms, e.g. LMS and LXP

But, as the tasks increase, the resources for L&D are getting smaller - less people, lower budgets. And to top it off: timelines get a lot tighter, responses to requests need to come faster, the "time to market" is expected to be shortened.

So the challenge is: these main goals, increasing the quality, saving costs AND becoming quicker, sound quite contradictory. But if it was impossible, no company in their right mind would aim for it, right? So, there must be ways to deliver and meet the challenges.

I’ll share in this post approaches that will help L&D teams do more with less.

1- Reduce your internal administration costs

In order to meet all the aforementioned challenges, L&D will need to free resources. This can be done by getting external support for tasks in the value chain training, where the most common approach is to outsource all the administrative and operational tasks (“the nitty-gritty of learning and training management”).

Managed Training Services (MTS) providers have very lean, highly automated processes that will be aligned with your requirements. Plus, they have both the talent and the tools in place to deliver your training programs quickly and effectively.

Costs will be generally lower than with own personnel as you don't have to spend time and money to find, recruit, train and retain top admin staff, plus there are no employee on-costs, no vacation and no sick leave days.

As a result, your internal L&D staff has time to focus on the really important (and especially interesting) tasks, leading to much happier employees. Your L&D administration will be managed by your new external L&D staff who are led by you, act on your behalf with a very service-oriented approach to serve your employees best, and ensure a great learning experience from A to Z. And: You save money.

2- Consolidate suppliers

Hand to heart: How many training suppliers do you have?

When we discuss this point with our clients, many can't even tell. Others take a deep breath and brace themselves for the numbers they are about to announce, knowing that it is far from ideal - as it is way too high. The "worst" number we ever heard was 30,000 globally. Companies with 20k to 50k employees have on average 5,000 to 10,000 providers only in the training category. Some with around 50k employees even have 30,000 training providers worldwide. Smaller companies, e.g. with up to 5k employees, still have several hundreds…

“Why is it a problem?”, you may ask…

The short answer: Because it means a lot of work and a lot of money.

The long one: The cost of your internal process is very high. This is because you need to:

  • have valid contracts and maintain vendor data in your systems
  • process purchase orders to many vendors (internal cost per order transaction approx. 100 EUR according to third-party reports)
  • check and pay all those monthly invoices (300 on average for companies with 20-50k employees)
  • keep track of different booking, cancellation or other terms for trainings
  • monitor feedbacks and participant satisfaction, and manage any incidents that may come up
  • get their offering onto your LMS or LXP and maintain it constantly

Your external training costs are higher, too, because the more vendors you have, the less likely you can negotiate volume discounts.

Here again, a solution can be to externalize the vendor management, which is also part of the offering of MTS providers. Three models are best known in the market:

  • Neutral Vendor: You can keep all your vendors, but instead of having contracts with your company, they now have them with the MTS provider.
  • Master Vendor: You let a Master Vendor harmonise your portfolio and consolidate your suppliers.
  • Master Service Provider: You have a strategic partner who not only manages your portfolio and your vendors, but also supports in defining and implementing your Learning Strategy, offers Learning Project Consulting directly to your internal clients, supports your HR Business Partners in all things learning, and helps in promoting learning offers internally.

In all models, a MTS Provider can consolidate all your vendors for you. Just imagine receiving only 5 or even just 1 invoice a month instead of 300!

You don't necessarily have to choose which vendors you want to keep and which ones you can do without. Your MTS provider could manage them all for you.

Your budget landscape would be transformed. Evidently you pay a higher price for this added value service but you redistribute your training expenses, granting bigger turnover to a few "big ones" that’ll give you better conditions.

And securing high quality is easier with only a few ones, too.

Another downside of having too many training suppliers is that your offer is most probably the opposite of lean, putting “the agony of choice” onto the learner. This leads us directly to the next point.

3- Harmonize your learning portfolio

Another tough question: How lean is your training portfolio?

How many different trainings do you offer to improve communication, presentation skills or time management? Or to learn agile methods?

Of course, L&D units aim to offer a compelling internal catalog, consisting of different formats, types and durations, and many sub-topics to serve every need.

But when your portfolio gets too broad and too deep, learners get confused. Finding the difference between various options for the same topics can become quite difficult.

Often, such broad offerings have just grown over time - new topics were added or existing ones were amended when needed, but there were no resources to check at least annually which topics should be deleted.

The results in a catalog can be as we have seen with some of our clients: 20 training programs on communication skills, 15 on presentation skills and 10 on agile methods.

A good MTS partner has strong portfolio management skills and can support L&D units in building a catalog offering that will motivate learners:

  • with up-to-date topics,
  • state-of-the-art methods and didactics,
  • in the cycle that you choose - quarterly, half yearly or annually,
  • considering former booking and satisfaction rates, NPS,
  • considering strategic goals that should be supported by the right training offering.

Make sure you look out for the following skills when recruiting a portfolio manager who has an excellent knowledge of the market, is constantly screening industry-specific updates and trend studies, benchmarks and identifies which provider is particularly good on a specific expertise and whether their price level fits your budget.

Of course, there will still be some very specific needs which your catalog won't cover. This will always be the case. Your MTS partner also steps in here to consult your employees on the best suitable offer for their requirements and can competently assess which offers should be added to a catalog and which are for individual demands only.

Having focused on these three most important aspects, let me look at some more angles where an MTS partner could help:

  • Enhance your reporting capabilities and improve visibility of your training expenses
    (knowing not only the exact amount spent on training, but also for what for and making sure it was money well spent)
  • Increase flexibility and scalability of your learning offer
    (never worry about a big rollout project coming your way and how on Earth you can handle the training part of it with your existing resources)
  • Get the support you need to internationalize your L&D reach
    (by weighing all the multiple challenges that come with it!)

If we raised your interest, don’t hesitate to reach out and learn more about getting support for your L&D unit (and at the same time making your procurement colleagues probably quite happy).

Written by

Judith Spick

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