Most organizations today face a shortage of IT skills that are critical to digital transformation and business growth. That means most organizations are also actively searching for the most cost-effective solution to shore up on skills and capitalize on adapting faster than competitors. In pursuit of this endeavor, leaders have two basic options:
- Hire external talent and buy the IT skills they need.
- Develop internal training capabilities to cultivate skills from within.
Which is more affordable? Hands down, the answer is developing internal training and employee development programs. How much more affordable? Hundreds of thousands of dollars less expensive, depending on the skill demand. Job openings currently outnumber available talent, forcing organizations to compete on a global scale for a handful of critical roles. This, in addition to existing new-hire challenges (such as onboarding and new-hire productivity), can lead to higher recruiting costs and compensation packages, not to mention the time and resources required to onboard and train new employees. Let’s do the math:
The High Cost Of Hiring
According to Zenefits:
- Recruiting: costs about $4,129 per new hire.
- Training: costs average $1,286 per employee.
- Employee Benefits: cost between $10.58 and $19.82 per hour, per employee.
Totaled, these hiring costs quickly amount to 1.25x to 1.4x the actual cost of a new hire’s base salary. To put that into perspective, let’s say your organization needs ten people to work on a data project.
The average base salary for a data scientist is about $100,000, plus the cost of recruiting, training, and benefits, which equates to as much as $140,000 per new hire.
$140,000 per new hire x 10 new hires = $1.4M
Tally The Cost of Turnover
Beyond the cost of hiring and onboarding a new hire, organizations must also consider the cost of an employee not working out. According to Psychology Today, 33% of new employees quit within 90 days of hire. And when they do, organizations can expect to lose 50% of an employee’s salary.
Referring back to our example, let’s say three out of the ten new hires do not work out. The organization is looking at more than $210,000 in losses, in addition to the $1.4M already spent in an attempt to close the skills gap.
The More Affordable Option: Training & Employee Development Programs
Employees want training and development opportunities that allow them to learn new skills, increase their marketability, and advance in their careers. By investing in employee training and development programs, organizations can cultivate technical skills faster than it would take to complete the recruiting, hiring, and onboarding cycle, plus they keep historical knowledge in-house and prevent turnover by creating a career pathway for employees.
The key to maximizing your investment is having the right program development partnership. Here’s what to look for:
1. Breadth of Professional Services
Training and employee development programs, especially those designed to teach data science and other technical skills, have a lot of moving parts. Hiring a full-scale team of instructional designers, technical writers, software developers, and subject matter experts will undoubtedly rival the cost of hiring skilled IT professionals. However, managing numerous vendor relationships can also result in higher costs and a slower pace of progress.
Simplify how you develop curriculum and deploy programs by seeking a single-source partnership that offers all the connections, resources, and professional services you’ll need to deploy a world-class learning experience. Baseline, your educational partner should offer:
- Curriculum Development
- Program Design
- Instructor Onboarding
- Program Administration
- Learner Assessment
- Ongoing Maintenance
- Full-Scale Support
2. Outcomes-First Program Design
Bootcamp-style programs for IT skills training and employee development are an attractive solution to the talent shortage. Like many solutions, these programs help organizations balance cost with quality learning. However, they often lack the level of customization needed to deliver intentional, measurable outcomes.
The most progressive IT skills training solutions take an outcomes-first approach to program and curriculum development. This means conducting a thorough assessment of your organization’s current IT skills and identifying gaps based on specific business objectives. With a thorough understanding of what your corporation hopes to accomplish, design and development experts reverse-engineer a training program that begins with the current IT skill levels and ends with the technical capabilities needed to execute specific business strategies and operations.
3. Curriculum Flexibility
One of the greatest challenges educators face in the 21st century is keeping up with the speed of change in technology. Higher education institutions and other training solutions simply cannot produce curricula fast enough to teach emerging technical skills, and certainly cannot deliver the level of agility needed without also increasing the cost to produce and execute programs. For organizational leaders, this makes it almost impossible to realize the full ROI potential of training and employee development investments.
To ensure that training continuously meets emerging demands, partner with an IT curriculum and program developer that builds flexibility into their core delivery process. For example, creating a curriculum using a modular approach that anticipates content updates, changes, and new curriculum development as trends change over time.
The Future of Training & Employee Development
Rather than looking at training & employee development programs as an expense, corporate leaders need to look at them as an investment with massive return potential. To that end, your ability to maximize ROI will depend on partnering with proven experts in designing educational experiences that deliver measurable results.
Find out how we helped an IT staffing and technology firm deploy training and employee development programs 2x faster and decrease overall program costs by 47%.