How Effective Training of your Employer Saves You Money

As the economy approaches full employment, the competition for top talent increases, as do efforts by businesses to retain current employees.  According to Zane Benefits1, the cost to business to replace an employee who moves on is, on average, between 6 and 9 months of that employee’s annual salary.  For a manager who makes $40,000 a year, that’s between $20,000 and $30,000.

The Hidden Benefits of Employee Training Programs

Admittedly, providing employees with the training they need to do their jobs well doesn’t come without a cost—but the cost (in time and money) of training programs is more than made up for in the benefits your company will realize, including the following 4:

  1. You’ll increase employee satisfaction:  when employees don’t feel competent to do their jobs, they’re more likely to make mistakes.  That usually means weak performance evaluations and the inability to move up the ladder.  Training your employees will give them the skills they need to succeed, and success breeds satisfaction, fulfillment and loyalty.  According to Autodesk, that enhanced job satisfaction also translates into increased worker productivity.
  2. You’ll reduce miscellaneous costs:  think of the simplest examples of the kinds of mistakes untrained workers make.  For example, someone who is told to use a copying machine, but hasn’t been trained to do so, is more likely to make mistakes, which means increased costs for paper and toner.  Now extend this to mistakes related to more important job functions, like incorrectly creating a CAD drawing, delivering inferior customer service, or misreading key analytics data.  When you provide comprehensive training for your workers, you’ll reduce these and similar miscellaneous costs.
  3. You’ll retain more customers:  the success of your business is dependent on the extent to which you deliver superior products and services to your customers.  When your sales reps don’t know how to leverage CRM data on mobile devices, or marketers don’t have the latest information about social media or email marketing, your business is going to lose customers to the competition.  Training these employees will ensure they are able to effectively acquire, engage and retain customers, and that markedly increases the odds your business will succeed.


It’s understandable that businesses which are already struggling to succeed would want to invest in employee training.  But it’s also important to understand that those very training programs are geared to enhancing employee retention, boosting productivity, increasing sales and growing your business.  In other words, the more effectively your workers are trained, the more money you’ll save, and the more money you’ll make.

Part II: Programs to Implement Right Away

In Part 1, we focused on why employers should implement employee training programs, with a particular focus on the monetary benefits of these programs. In Part 2, we expand on this idea by showing you what types of programs to implement, as well as the efficacy of specific training programs.

Sexual Harassment Training

Not only is sexual harassment a form of discrimination under federal law, it’s currently a hot news topic and has gained social standing under the #metoo movement. Accusations of sexual harassment have thus far taken down music moguls, elected officials, company executives, comedians, and chefs. As such, companies now have more incentive than ever to implement a sexual harassment training program. But not all of these training programs are created equal, as some are more effective than others.

So what does an effective training program for sexual harassment look like? A recent article in the New York Times differentiated between ineffective and effective programs with the following:

  • PowerPoint presentations, employee manuals, and mandatory seminars are ineffective;
  • Empowering bystander intervention and encouraging civility in general are some of the most effective forms of sexual harassment training.

The major difference between what’s effective and ineffective lies in how well the training tries to change workplace culture. In the past, for instance, sexual harassment training has been known to backfire as it reinforced gender stereotypes of women being weaker than men. Modern training programs thus tend to focus more on civility, such as speaking up on someone’s behalf if they’re being harassed.

Diversity Workplace Training

Another hot button issue is cultural diversity and sensitivity. As with sexual harassment training, diversity training can backlash. However, a meta-analysis on diversity training conducted over a 40-year period showed it can be effective depending on the method used. Based on this study and some independent research, Harvard Business Review came up with two different exercises that should be part of an effective diversity training program:

  1. Perspective-taking, where one walks in someone else’s shoes.
  2. Goal-setting, where a person sets specific, measurable goals related to diversity in the workplace. (E.g., calling out inappropriate comments on the spot when overheard).

Both exercises empirically resulted in changed behaviors, where participants provided more support and displayed less mistreatment towards traditionally marginalized groups. This outcome is in contrast to other programs that seek to only inform people that cultural differences exist.

Skills Training Programs

We live in a fast-paced society where one skill we learn today can easily become outmoded within a few years or even months. Indicative of this phenomenon is how technology rapidly changes. For instance, iPhone seems to release a new version bi-annually these days, along with frequent updates to apps and other software programs.

In dealing with technology’s ever-changing interface, Harvard Business Review suggests training should be more than just a once-in-a-while activity. Rather, employers should think of training as a continuous, ongoing process. That training should additionally be:

  • Employee-driven, with individuals being able to choose their own career development programs.
  • Flexible, with on-demand and distance-learning options.
  • Tailored to different learning styles, as different generations have different comfort levels with technology.

Built around mentorships, with companies providing managers with incentives to coach and pass on knowledge to employees.