The last surveys of employer-provided training done by the Bureau of
Labor Statistics (BLS) were done in 1995, giving us an idea how sales
training breaks down between industries -- and as a priority against
management training, professional/technical training, computer
training and other categories.
BLS numbers show that larger companies (more than 100 employees) spend
more than twice as much time as small companies in training. Each
year the larger companies are putting employees in the classroom for
12+ hours, versus 5.7 hours for the small firms.
However, sales training gets the same emphasis with large and small
firms -- 0.8 hours per year.
Professional/technical training and computer training are about double
the effort put into that for sales.
The BLS 1995 Employer-Provided Training Survey
"Hours of formal training per employee by type of training " (May-Oct.
1995)
http://www.bls.gov/news.release/sept1.t01.htm
The breakdowns for each industry group for sales/customer relations
training are probably most interesting for comparisons, rather than
the actual numbers:
SALES/CUSTOMER RELATIONS TRAINING:
Mining: 0.4
Construction: 0.1
Mfrg/durable: 0.5
Mfrg/non-durable: 0.2
Transporation/communications/public utilities: 1.8
Wholesale trade: 1.2
Retail trade: 1.5
Finance/insurance/real estate: 1.6
Services: 0.4
Among the different industries, retailers (3.7) had the lowest overall
numbers for training -- but the highest percentage of time spent on
sales training. Transportation/communications/public utilities had the
highest overall training numbers (18.3) but spent less than 10% of the
resources on sales.
The BLS 1995 Employer-Provided Training Survey
"Hours of formal training per employee by type of training and
industry" (May-Oct. 1995)
http://www.bls.gov/news.release/sept1.t03.htm
Specific dollar amounts for training were collected by the American
Society for Training and Development (ASTD) in 1997. They don't show
differences in company size, though that may be a bias of surveying
members. Here's how OVERALL training spending was split:
TOTAL TRAINING PER EMPLOYEE:
All organizations: $499
HIGHEST:
High technology: $911
Finance/insurance/real estate: $567
Business services: $535
LOWEST:
Health care: $298
Customer service: $162
"1998 ASTD State of the Industry Report" (January, 1998)
http://www.astd.org/virtual_community/comm_trends/state_of_industry_td0198_cms.htm
MORE RECENT TRENDS
------------------
Lacking more up-to-date BLS data for trend information -- and knowing
the dramatic impact that the Internet has had on business
infrastructure -- we need to look elsewhere.
ASTD tracks what's happening in training, in areas of like technology
and measurement. In fact, they've set up a benchmarking service for
members to analyze training costs and results:
http://www.astd.org/virtual_community/research/measure/bnch_svcs.html
In an ASTD summary, "Training Industry Trends 1997," they note the top
10 trends. I've edited these to the most relevant:
1. Skill requirements continue to increase because of technology.
Most new jobs will require education beyond high school. The
workforce is responding, as you may find interesting in another Google
Answers question on U.S. education levels:
https://answers.google.com/answers/main?cmd=threadview&id=67577
4. Training departments are shrinking, with a Conference Board study
noting that HR development departments had been shrunk in 57% of large
corporations.
7. At the 1996 ASTD conference, 89% of participants said that
performance improvement is a higher priority than training. In
addition, executive surveys showed that more than 90% of senior
managers felt that it was important to build a "learning
organization."
The seemingly contradictory results were coming because of increased
training activity over the Internet, where activities had doubled in
the past year. "Training Industry Trends 1997" includes some
anecdotal accounts of computer-based training saving time, allowing
flexible scheduling and reducing travel:
http://www.astd.org/virtual_community/comm_trends/training_trends_td1197.htm
This 18-month old report in Information Week emphasizes why e-learning
is spreading. In the case of J.P. Morgan Chase, the director of
e-learning notes that "with a traditional classroom solution, it
would've taken six months to a year to train our 83,000 employees."
Curiously, sales-related reasons for training are near the bottom --
obtaining new customers (40% of companies) and increased revenues
(30%).
Information Week
"E-learning Branches Out" (Feb. 26, 2001)
http://www.informationweek.com/826/prelearning.htm
SUPPORTING INCREASED COSTS
--------------------------
In the spring of 2001, a study was published in the Journal of
Personal Sellling & Sales Management (Erffmeyer and Johnson) which
looked at the cost of sales force automation to determine whether
companies were finding the investment was paying off. The interviews
of 40 companies found that most felt their company was more efficient,
that 44 percent saw increased customer contact -- and one third
increased sales.
Their disappointments were that half of them saw the training time
being too long. The Journal of Personal Selling & Sales Management
article is available as a reprint at the site:
http://mkt.cba.cmich.edu/jpssm/default.htm
The article may also be available at your local library, if it has the
Expanded Academic ASAP database.
ANALYTICS
----------
Having been involved with sales & marketing for two decades, most
reports give sales training a high payback. The ASTD site has a
Powerpoint presentation on training analytics, which recommends
segmenting the sales force for maximum impact. In this example,
training costs were $1,069 per person, but the payback in
profitability was twice the amount within one year -- even with a
modest 10% return on sales. "Training Analytics: the Holy Grail of
Training" (February, 2002) analyzes a sales training project in a $2
billion company and contains a wide ran of data:
http://www.astd.org/astdtk2003/Handouts_for_Web/W101.ppt
The data in the above report are consistent with results and costs
experienced elsewhere. They don't yet show any significant trends for
costs to decline -- though the report indicates that the market for
performance measurement software is growing at more than 57% per year.
Google search strategy:
"sales training" + costs + trends
"sales training" + benchmarks
Please also consider Google's site search at locations like the
American Society of Training and Development (www.astd.org). It
highlights a variety of items not normally indexed, including forum
discussions among members.
Information Week is a rich source of articles following corporate use
of e-learning. There are dozens of articles you can find using a
search strategy:
e-learning + sales
Best regards,
Omnivorous-GA |
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