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Training Budgets


I'm planning how to spend my training budget (Woohoo... got one this year!)

I've divided my budget by the number of staff to get a spend per head figure. But what I wondered was whether there is some formula for taking into account the cost of management training.

Can anyone suggest a rule of thumb to use in planning the use of my budget please?


Frank McGoldrick

3 Responses

  1. Budget Split
    I am not sure it is possible to split your budget in this way. I am responsible for over 400 people and find that some of the non manager courses cost considerably more than courses for managers. Rather than that I ask team managers to submit their needs in advance on a quaterly basis and prioritise them based on the information they give me. So far this has worked and as long as each team gets something they are quate happy.

  2. Allocation of training budgets
    There is no formula that I know of. It really has to be based on your T&D Strategy. Many organisations devolve as much of the budget as possible for operational training to Line Managers/ Team Leaders. This has to be enough to make the buying in of training a viable proposition. If you only devolve, say, 10% of the budget no one person has enough to buy anything meaningful. Similarly, most organisations hold back enough to pay for corporate change/centrally-driven/strategic T&D. So, if you are moving to a new performance management system, for example, and will have to train everyone, then you may need a lot in your central fund. Where the budget sits for things like qualifications and CPD is highly variable – some centralise others don’t.
    My rule of thumb is: if the need is from the front end of the business then the budget should be there too; if the need eminates from the top of the organisation then hang on to the funds.
    One final point, you imply that you may be planning to divide out the budget on a head count basis. Don’t! This may at first glance seem equitable and straightforward but it rarely works in practice. One team may need more because of high turnover, one particularly expensive bit of training, or because their needs are different. Another team may need a lot less, at least in any one year. If you divide it on head count, the one team won’t get all their key needs met while another team will find ways to spend the money or far less crucial training.
    There is no substitute for doing the needs analysis and having a strategy.

  3. Use a software tool to calculate your training budget
    Hi Frank

    I have a software tool that accurately works out your training budget. In the application the training budget is derived from the individual’s skill gap. Their current skills assessment against the requirements of their job role. This ensures that no training spend is wasted and stops the ‘sheep dip’ approach to skills development.

    Finally, it ensures that all development is focused on the individual’s current job role. It is important to build a business around the skills it needs to support the organisational strategy.

    Email me if you want to know more


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