HR on a budget: Outsourcing in tough times and beyond

March 31, 2009

HR on a budget: Outsourcing in tough times and beyond

How can your employees help grow and develop your organisation to get in shape for when we emerge from the current recession? Partnering with a managed training service provider could be the answer, says Sean Craig.

Preparation for when the economy turns for the better – and it will – should be a key part of every HR strategy. Indeed, we should regularly review our learning and development strategy to ensure it’s aligned closely to the business’ needs – and now is as good a time as any.

How are we supporting our managers and leaders to achieve even more from their teams? How can we free up our teams’ time to concentrate on areas core to our business, yet reduce cost whilst increasing quality, flexibility and value to the business?

“We should regularly review our learning and development strategy to ensure its aligned closely to the business’ needs.”

Working with the business and leading learning initiatives to drive cost efficiencies helps to get learning and development further up the agenda as a boardroom topic; that is if you can demonstrate how you can achieve these efficiencies and deliver return on expectation.

Partnering or outsourcing can bring huge benefits. Apart from the obvious (and expected) cost efficiencies from having an ‘extended’ team without the fixed-cost overheads, the flexibility and improvements in quality achieved by organisations that do this for a living can far outweigh the hassle and often limited success organisations have by trying to do it all themselves.

Control over spend

There’s never been a better time to introduce cost efficiencies and increase control over spend to increase the visibility of learning and development – especially if it’s on a budget. Working with a managed training service partner whose role it is to drive efficiencies, increase quality and flexibility, whilst introducing innovative learning solutions will help you to achieve this.

It could be time to say goodbye to those tiresome calls from training providers with ‘special offers’; trying to avoid them is equally tiresome and what if there was something they had to say that really would add value to your business in those precious few moments of your valuable time? Why not refer them to your managed service provider instead?

But what can you expect from a managed service? How is your time going to be freed up so you can focus on your core business?

Agreed, it takes a while to get to a point where you feel comfortable in sharing and committing to a ‘long-term relationship’. Let’s assume the ‘courting’ has gone well and both sides have started to feel more comfortable with each other – remember, this is a partnership.

You’ve agreed the commercials and, typically, your procurement team have done their best. The KPIs have been discussed and agreed. As part of the strategic consultancy stage, you’ve agreed those work packages which will drive the greatest benefits. You’re aware of the management information that will whizz its way to your inbox at a time and frequency you’ve typically not experienced before, and you’ve probably been given online access anyway.

So now you can spend as much time as you like in splicing and dicing data. The learning strategy team is in place; you’ve agreed how often you are going to meet and how often the outputs from the continuous improvement model will be discussed, and how and when those service enhancements will be implemented.

The service transformation phase is beginning to implement those cost efficiencies promised during the ‘courtship’ and you can rather smugly demonstrate these at the next board meeting whilst your marketing colleague ‘needs another £X for another brand awareness campaign’.

Showing capability

Now it’s time for your managed service partner to show what else they are capable of. They’ve delivered the work packages that have introduced cost efficiencies you were rather sceptical of whilst still delivering innovative learning to the organisation.

Suddenly, there is a need (which is outside of the agreed process) and the business needs a training programme, now – if not sooner. They can’t go to the market themselves because all training spend must come though a single process and you now have control over that.

So what do you do? Previously, someone in your team would have spent considerable time calling any number of training providers looking for a solution and of course negotiating costs and expected outcomes. Or you might have had something on the shelf that would have done – or maybe it wouldn’t.

So your managed service provider comes up trumps because they’ve been here before with another managed service client with similar needs – after all, they are now your single point of contact for learning services. And of course, you don’t have much budget but you still need to deliver training to meet this need because that’s part of what HR does.

“It doesn’t have to cost a fortune. Your managed service provider has access to wider resources than you do.”

But it doesn’t have to cost a fortune. Your managed service provider has access to wider resources than you do. They also have the economies of scale because they’re not only buying on your behalf but for other clients with needs similar to yourself. They will probably have their own continuously market-tested material which they can tailor at a moment’s notice anyway.

Then there’s the shared service centres which support the self-service approach you’ve been looking for. Your users now have access to an online portal and are able to search for courses and book online – all within agreed guidelines of course.

So panic averted, and you begin to realise your managed service partner has grown with you. You both understand each other’s strengths and have a greater appreciation and value in each other’s abilities. You’ve not only delivered this urgent need, you’ve introduced a new and robust learning and development model which has seen you achieve savings (typically 25% in the first year of service) and with greater control and flexibility than you thought possible.

Outsourcing on a budget? I prefer to call it a partnership; no, a joint venture on a budget – but not a budget service.

Sean Craig has 15 years’ experience in learning and development and is head of managed services at Capita Learning & Development. He can be contacted on 07795 827033 or sean.craig@capita.co.uk