LEARNING OUTSOURCING:
It’s Not Just for Cost Savings Anymore
Much has been said about the pros and cons of Learning
Outsourcing. And now, corporate decision makers are
rapidly adopting this practice, hoping to fulfill the
promise of “faster, better, cheaper” performance.
However, we believe the business case is better illustrated
by a more detailed equation:
Outsourcing Value Equation
Why Costs Count
For obvious reasons, many organizations focus on cost
savings to justify an outsourcing model. The potential
upside can be significant, if costs are reduced or
eliminated in categories such as:
- Facilities ownership/maintenance
- Equipment
- Personnel (including systems design, development,
testing, support and administration)
- “Stand-by” pay
- Overruns
- Attrition backfill
Nevertheless, focusing solely on cost reductions within
your Learning budget can be extremely short-sighted.
Consider this: The typical corporation allocates less
than 1% of its overall operating budget to Learning.
Meanwhile, on average, labor costs absorb a whopping
70% of that same budget. So rather than squeezing costs
from Learning’s relatively insignificant budget,
why not focus on improving overall workforce performance
– where even a fractional improvement can generate
tremendous financial rewards?
Beyond Costs: Building Long-Term Strategic
Value
As companies look for new sources of competitive advantage,
it’s increasingly important to cultivate knowledge
and skills among employees, partners and customers.
Smart business leaders know that better-informed stakeholders
can generate increased revenues and profits. Furthermore,
they know that effective Learning requires ongoing
investment in world-class tools and techniques. Therefore,
rather than dismissing it as a costly luxury, today’s
senior executives often appreciate Learning’s
potential to fuel business success.
This “new view” of the Learning function
has important implications for the way you plan and execute
educational initiatives.
Getting Started
Let’s say you’re ready to harness the
power of outsourcing to enhance business performance.
Where do you begin? The first step is to link Learning
with corporate imperatives. This may be difficult—especially
if you’ve operated in a relatively limited or
isolated training role. However, this exercise is a
legitimate opportunity to explore, discover and expand
your reach.
Start with these steps:
- Identify existing programs that contribute the
strongest business impact or ROI;
- Develop a case for reinforcing or enhancing the
most promising efforts;
- Analyze specific Learning functions to determine
which could be optimized in an outsourced scenario;
- Seek
formal support for your agenda among senior executives.
Getting a Reality Check
If you need guidance to align your initiatives with
corporate priorities, a Learning outsourcing consultant
can be a valuable ally—especially during critical
early-stage planning. Experienced consultants know
how to avoid common pitfalls, so you can accurately
assess your situation and develop a realistic roadmap.
If you hire a consultant, consider those who also provide
full-service business process outsourcing and IT services.
These firms offer more than theoretical models. They
have first-hand, real-world insight to justify their
recommendations. What’s more, they can quickly
and seamlessly breathe life into your roadmap, once it’s
approved.
Who Should You Trust?
The critical question is this: When you’re ready
to hire a Learning Outsourcing vendor, who should you
call? That leads back to our cost/benefit equation – and
another question of equal importance: Are your candidates
able to deliver across each of these critical success
factors?
Outsourcing Value Equation
With this formula as a reference, you can conduct
a thorough strengths and weaknesses evaluation to determine
how well prospective vendors fit your requirements.
Although weighing vendor qualifications in advance
requires an investment of your time and energy, the
effort can pay for itself repeatedly throughout the
life of a successful engagement.
Let’s talk about
how Expertus can help you achieve your Learning goals…
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