The Challenge of Learning and Development Outsourcing

What Do All of These Events Have in Common?

The answer is they all are candidates for training opportunities. As such, if the training event is not conducted in-house, then it is outsourced to a third party organization to execute the training requirements.

Increasingly, companies are outsourcing their training projects if it is not part of their core competencies as the following chart depicts:

It’s clear that outsourcing training projects are a way of life. As such, this is an opportunity for procurement to engage the end user stakeholders either directly or as part of the project team with the in-house training department(s).

Even if the training event is developed in-house, procurement still plays a role by linking the stakeholders to the training organization if they are not already working together. If the training project is to be outsourced to a third party, then that’s an opportunity for procurement to really swing into action!

The Problem Facing Learning and Development Outsourcing

What are the issues with sourcing training in today’s organization?

First, as most organizations are complex in nature, the training spend is decentralized across differing lines of business. This leads to both spend duplication and a proliferation of training suppliers to support the business needs. Thus, the organization is not leveraging its total training spend as a cost competitive advantage.

As the prior graph shows, organizations are spending a lot on training, but the key question should be, “how does the company spend it’s training budget dollars?”

• Are there multiple suppliers performing similar tasks?
• Is the organization utilizing prior completed (and paid for) projects that can be re-purposed?
• Are training suppliers being selected for short term projects rather than for long term strategic plans?
• Is the organization choosing suppliers and not strategic partners?
• Is the organization correctly aligned for training program success or does it contribute to duplication and short term results?

What is Your Company’s Strategy for Training?

A simple question with complex answers! But I believe to achieve the most value for your training budget, a cohesive sourcing strategy must be developed, executed, measured, and managed.

That’s why I wrote How to Buy Learning and Development, to help both the procurement professional and the Chief Learning Officer understand the challenges and opportunities of outsourcing training.

To Read More, download How to Buy Learning and Development, a 6-step Procurement Strategy Guide