Outsourcing training department

Saving money, time, expertise

Here will be some numbers we took from our experience with Russian companies, so you might find some mentions of “rubles” and a local tax. You can apply this number to your realities as well.

Very often you can find a vacancy for a business coach with a monthly salary of 60,000 RUB (~750 USD) on Russian hiring websites. Sometimes the job description does not match this modest sum, since it often includes duties that are possible to complete if you work in a group of at least 3 persons. In this case, either part of the work will not be closed, or the quality of the future training will be affected.

Let's calculate how much it would cost to launch a training department within the company. Let’s say the average salary of the Head of the department would be around 120,000 rubles. Let's add here a T&D specialist (the average salary on a popular hiring website is 80,000 rubles) and a methodologist (60,000 rubles). Here we do not take into account fees for a producer for recording courses, a project manager, renting a studio, or preparing materials (design, proofreader).

So, in the first month, your payroll is 260,000 RUB. Let's add tax up to 43% (we're talking about Russia). In total we have:

371,000 RUB for the first month of work (plus the cost of hiring these employees). For three months, employees get acquainted with the industry. In the third month, they begin to build a training system, attracting contractors with an additional budget. Let's say you're the lucky one who has all 3 employees successfully passed a probationary period and doesn't have to lose money on rehiring.

On average, you can start training in a company from scratch in 4-6 months (if you already have recorded courses, pre-training diagnostics, IDP, etc.).

371,000 RUB x 8 (2 months to “get into the topic”: understand the company’s industry, find experts who are well versed in the topic, study the market; 6 months to build a training system) = 2,968,000 RUB. This is the minimum cost of building a training department hoping that the employees you hire will have all the skills described in the resume and will not leave in a few months.

The cost of the agency’s work, of course, will depend on your needs, and the price may vary, but if you compare cost, time, and expertise, it is often much more profitable to hire an outsourcing agency.

Also, such agencies often have discounts for external evaluations, video recording studios, and training.

Obtaining a wide range of tools

In general, a fully-fledged training department's responsibilities include building a product-based training system, a notification system, a Knowledge base, and a soft skills development system. It is almost impossible for one employee to have deep expertise and experience in all areas. For each direction, you will need a specialist.

Imagine you need to develop a notification system. You need the skills of conducting in-depth interviews, communication analysis, and software patterns design. Or to implement a 360-degree assessment method, you need an employee who knows exactly this methodology.

The strong side of a third-party educational agency here is the ability to introduce exactly those specialists whose skills are needed to implement a particular task.

If you want to record a course for a product, an agency can hire a producer and a methodologist who will talk to your expert and wrap content in the desired format by the purpose of training, the age of employees, the specifics of the industry, the tone of voice of the company.

Or, to develop leadership skills for managers, they will look for a soft skills specialist who will be able to conduct pre-training diagnostics and select a training course based on identified needs and weaknesses.

Speeding up launch dates

If you want to create your own training department involving your experts, you need to set the priorities, since the working time of full-time employees is limited to 8 working hours a day. It might take quite a time to manage all the launching processes.

On the other hand, the outsourcing agency can quickly dive into the topic thanks to their a set of competencies, and experience working with clients from different industries. Usually, these skills allow them to launch a training system approximately in 6 months.

The agency can introduce additional specialists and simultaneously implement several projects for one client (also while respecting an 8-hour working day). Specialists can record a product course, set up an information system, a Knowledge base, and pre-training diagnostics. It will save employees at least 2 months of usual training.

Always set and record KPIs by which you will evaluate the quality of the agency's work
It is not always possible to measure KPI with a certain amount of money. But you can set KPI by paying attention to the compliance with the deadlines, the level of NPS of trained employees, or their average score in testing. It is better to discuss KPI at the stage of signing the contract unless you want to wave your fists after a fight.

Always ask to split large projects into smaller parts, with indicating deadlines
So that you have points by which you can check what has been done. Not in six months, but every month. You can share a task manager that you are using with the agency or create the usual Gantt chart in Excel, where all the stages of work, deadlines, and responsibilities on both sides will be scheduled.

calculate the labor and financial costs;

evaluate temporary resources;

evaluate your own competencies in employee training (to control the result);

communicate with candidates and agencies and make a choice that is right for you.