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The perils and pitfalls of outsourcing learning

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DangerOrganisations often highlight the huge scale of their investments in learning. But, says Adrian Snook, too much effort is focused on buying competitively priced training resources or trainer time, while relatively little is focused on ensuring this investment will actually deliver learning.







An ever-increasing number of organisations now outsource a significant volume of training to external providers. In the case of many major organisations the annual budget for the procurement of learning from external providers now runs to many millions of pounds. As the total amount spent on outsourced learning and development has gradually increased this has inevitably drawn the attention of finance directors and, in turn, procurement functions.

Over the last 10 years increasing numbers of procurement professionals have deployed their skills and expertise in search of better value. However, the definitions of value traditionally employed by purchasing specialists do not adequately address the challenges of procuring outsourced learning services. Established procurement practice demands that variations in the products or services offered by vendors are identified at an early stage so that 'apples can be compared with apples'. This has led to a very clear focus on those elements of learning and development services that are straightforward to quantify, audit, compare and contrast.

Photo of Adrian Snook"Despite all the procurement effort that has gone into the award of contracts for learning and development services, feedback from learning and development stakeholders in many major organisations indicates that the quality of learner experience does remain extremely variable."

In most cases learning and development providers that clear the basic quality assurance hurdles are either short-listed or rejected on the basis of their stated trainer day rates, expenses policy, cancellation terms or any other quantitative metrics that can be applied to their training product or service. There is usually the opportunity for a 'beauty parade' of short-listed providers. Further high-pressure haggling over final discounts then takes place before the final deals are done and the contracts are awarded.

So how successful has this standard procurement approach been?

Procurement professionals have used their buying power to apply a real competitive squeeze to the profit margins of training providers. Over the last five years a number of major providers have gone into liquidation or have been consolidated into larger organisations in an effort to reduce costs. The IT training sector has proved particularly vulnerable because vendors usually offer standardised courses on topics like Microsoft Office Fundamentals. This makes fee comparisons between the day rates charged by vendors especially straightforward.

The resulting pressure to discount quoted day rates has led training providers to cut costs, to down-size their wholly employed training teams and to rely increasingly on the services of freelancers and short term contractors. In an effort to maintain their profitability training providers have in turn applied pressure on the fees charged by the freelancer/contractor community, where necessary engaging those that charge the lowest day rates and still have the necessary subject matter knowledge. All too often this means using facilitators who either have limited experience, no training qualifications or both.

This downward pressure on freelancer day rates has intensified as a result of the large number of corporate trainers taking voluntary or forced redundancy. Many of these individuals with limited experience of self-employment are now seeking work in the freelancer market, charging what may well be unsustainable day rates.

If these concerns are set aside, there is a school of thought that regards the procurement processes implemented by major organisations as an unqualified success. After all, costs have undoubtedly come down and savings have been made. However, there are some significant underlying problems. Despite all the procurement effort that has gone into the award of contracts for learning and development services, feedback from learning and development stakeholders in many major organisations indicates that the quality of learner experience does remain extremely variable. Why is this?
Research shows that a course leader's training skills are the greatest contributor to the learner's achievement of learning objectives. Learners working with a skilled learning facilitator achieve their learning objectives more quickly and retain what they have learned more effectively when they return to the workplace. Regardless of the knowledge displayed by the course leader, the nature of the facilities, or the quality of the course materials, the achievement of learning outcomes depends very largely on the learning and development skills of the facilitator.

"The Training Foundation estimates that less than 20% of course leaders utilised by major learning and development providers in the UK hold the equivalent of an A-Level pass in learning and development or above. The results achieved by some of these unqualified trainers often reflect very poor value for money indeed."

On the basis of research carried out by The Training Foundation most of the quality problems that major organisations encounter with their contracted training providers are either directly or indirectly attributable to poor performance by the course leader. Unfortunately, the commercial pressures that procurement professionals have placed on learning and development providers have actually resulted in a gradual slackening of ties between vendors and the personnel that resource their courses. Most of the leading learning and development providers in the UK - as measured in terms of revenue - now employ no more than a handful of course leaders, relying instead on an army of self-employed freelance personnel.

Given the sheer scale of the outsourced contracts being placed these days, training providers are often forced to take risks with untried freelance personnel. This resource-planning problem is exacerbated because providers all tend to fish in the same freelancer pools and conflicting commitments inevitably arise. Client organisations are becoming increasingly aware that the range of personnel utilised by training providers do deliver extremely variable standards of learner experience. This means that many major long-term clients actively resist any attempt by the provider to substitute trainers. Newer clients have to take whoever is available.

In this freelance labour market the development and certification of training skills is now funded at the discretion of the individual freelancer. Since neither procurement functions nor most training providers have a clearly stated policy of utilising qualified facilitators in preference for unqualified ones there is really limited incentive for freelancers to incur the cost and lost–opportunity penalties associated with developing and externally certificating their training skills. As a result, The Training Foundation estimates that less than 20% of course leaders utilised by major learning and development providers in the UK hold the equivalent of an A-Level pass in learning and development or above. The results achieved by some of these unqualified trainers often reflect very poor value for money indeed.

It is true to say that procurement professionals have failed to recognise the importance of requiring training skills certification to quality assure the return on their investment in outsourced training. In order to address this problem a new item needs to be added to the standard list of closed questions set out during the procurement process. This item is: "Please confirm that all personnel put forward to train our employees hold one of the following externally awarded training skills qualifications…".


Adrian Snook is deputy chief executive of the Training Foundation and a director of the British Institute for Learning & Development

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