Corporations and governmental entities around the United States spend more than $100 billion in training on an annual basis. Although much of this expense is attributable to the cost of doing business in an ever-evolving and rapidly advancing economic landscape, some of it can be reduced by analyzing current development programs, streamlining related processes and, in some cases, pinching pennies.

Classroom-Based Training

On average, companies spend over $1,000 to train each employee. The majority of this cost is allocated to classroom-based training. Used as a means of introducing a new employee to the field without giving them real-world responsibilities, companies are known to host both internal and external training sessions that follow this format.

As an alternative, many are switching to virtual classrooms using software or the internet. This type of e-learning has the potential to save significant costs in the long run. Cisco, for example, reduced company-wide training costs by as much as 60 percent by moving away from the traditional classroom and embracing e-learning.

Technological Needs

Today’s emphasis on technology and e-learning has proven to be quite effective when it comes to developing new skills, transferring knowledge and ensuring success. However, the initial costs associated with modern e-learning can be insurmountable in some cases.

Some companies are saving money using pre-owned or refurbished equipment. As others have increased spending as a means of staying up to date with the latest technological breakthroughs and advancements, much of the used equipment in the market today is still relevant.

Leadership Personnel

A great deal of training expenditures are also allocated toward senior figureheads and other leadership personnel. In fact, many companies are investing the majority of their budgets to refine the skills of managers and supervisors. While leadership development remains a necessary component of any thorough training program, there are a number of ways you can cut your costs.

Creating a dedicated mentorship program is a great way to transfer the knowledge of your current supervisors and managers to your company’s future leaders. Not only does mentoring provide the necessary training, but it can be used to ensure the continuity of corporate culture and service across multiple generations of leaders.

Hands-On Training

Regardless of new and innovative learning methods, there’s still no substitute for hands-on training. Standing in stark contrast to the hours spent sitting at a desk in a classroom, this education gives employees the valuable experience and knowledge that they will need on a day-to-day basis. While the importance of hands-on training cannot be denied, there are still some methods to cut back on the overall expenses of the process.

Establishing a standardized field training program is a surefire way to minimize these costs. It is especially helpful if your company maintains multiple locations in different regions. Apart from ensuring brand and service continuity across all of your facilities, it also eliminates the need to develop several different training programs.

General Mills recently standardized supply chain training for nearly 40,000 employees in more than 30 plants around the globe. While it was no small feat, the company has seen greater staff engagement, improved workplace flexibility and increased quality control.

Freeing Capital to Invest in Other Areas

Companies that can reduce training costs are better poised to invest into other areas of their business. Although professional development remains a vital part of any organization that hopes to achieve long-term success, it is possible to divert funding from this area without hampering the success of individual staff members or the company.