Stop! Don't Cut That Training Budget

Last Updated Aug 31, 2010 2:19 PM EDT

What's the first thing to get cut when companies are economizing? It's always training. In the last three years, training budgets have fallen by nearly a quarter. It's stupid. Everyone knows it's stupid. Because when you're battling for customers and trying to do more with less, your most valuable asset is your staff. And they can do more and better if you train them more.

A classic example of great training is Norm Brodsky's company CitiStorage. Brodsky's wife, Elaine, argued that it wasn't just customer service reps who should be trained; everyone should. This wasn't a trivial suggestion. Taking every employee out for three days is expensive -â€" never mind the cost of the trainer. But, argued Elaine, isn't customer service everyone's business?

What the company found was that the investment more than paid off. The training gave each employee a better understanding of their own work, and how it dovetailed with everyone else's. With greater insight into the dependencies of their organization, they could anticipate problems better -â€" and forestall them. Employees started giving each other more feedback and, if there were customer complaints, they were more creative about fixing them.

The acid test was this: CitiStorage's customers got the impression that the company had taken on more staff. But of course they hadn't. They were just getting more involvement, commitment and creativity from the staff they already had.

One customer, visiting the company, commented that everyone who worked there was smiling. That's one reason he gave for closing the sale on the spot. So the training didn't just make everyone smarter and better coordinated; it made them happier, too. And as we already know, happier workers are more productive.

So think twice the next time that tiny training budget is about to be chopped again. It could prove to be a very expensive savings.


  • Margaret Heffernan On Twitter»

    Margaret Heffernan has been CEO of five businesses in the United States and United Kingdom. A speaker and writer, her most recent book Willful Blindness was shortlisted for the Financial Times Best Business Book 2011. Visit her on www.MHeffernan.com.

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