Training Industry Predictions for 2009

As we all know the economy has slow down, which has caused the training expense in the corporate and government as well. Training Industry has published the top 10 predictions in the learning and training arena for 2009 and me too feels the same will happen by looking at the current scenario. The top 10 predictions are:

1. Total spend for training services will decline by 10%
2. The Training Workforce in North America will decline by 11%
3. Re-engineering Activities for Training Organizations Will Increase
4. Investment in Customer Training Increases to 59.5% of Total Spend
5. Consolidation of Training Departments Will Increase
6. Fixed Resources Dedicated to Training Will Decrease
7. Supply Based Training Models Will Decrease
8. Availability of Informal Learning Content will Increase
9. Creation of User Generated Content Will Increase
10. Development of Compliance Based Training Increases

In North America, the total spend on training service is expected to be $116B compare to $129.2B in 2008. Per Training Industry report, the expected declines to be smaller in IT, energy and utilities, government, and construction verticals.

In 2008 the estimated total job market in training and learning related jobs was 568,000 professionals (308,000 worked in traditional corporate training organizations and 260,000 working for training suppliers or as independent training consultants). And in 2009 the job market for training related activities will drop by 65,000 (the supply and independent consulting side of the industry). It will bring down the job market to 503,000.

Per me, the slowdown will also affect the re-engineering activities in 2009. However Training Industry expects there would be some increase in the spending for the re-engineering activities.

As new products and services become more technology oriented, certainly there will be increase in the customer training and channel partner training programs. Customer training has traditionally been about generating revenues, now it is about corporate responsibility. In 2008, on average, 58% of a corporation’s spend for training was targeted to customers and channel partners. In 2009 there will mix of spend for customer training to employee training will grow by 1.5% to 59.5%.

Virtually 100% of Fortune 1000 companies have more than one training department, with some having more than 50 independently managed training groups. Decentralized business models were more advantageous when training was predominantly instructor led and delivered in conference and meeting rooms. With the increased adoption of technologies for learning delivery and administration, the advantages of consolidating resources are increasing.

Consolidation of decentralized organizations is a frequently used strategy when executives seek to eliminate duplication and realign the level of service provided by a corporate function in lean economic times. Whether their objective is to reduce costs, increase access to information about training activities and results, or improve economies of scale, you will see more companies consolidating duplicative activities and moving to a ‘federated’ or 'centralized' model for training administration and the delivery of non-proprietary training.

Reducing the number of fixed resources in non-core functional areas continues to be a strategy for managing costs in 2009. Training organizations are not immune to having to shift to a more virtual and variable workforce for design and delivery. Instructors and instructional designers are easily sourced on an as needed basis. The move to reduce the number of administrative resources will grow as more training goes online. You will see a strong emphasis on eliminating real estate and moving to variable classroom space. Procurement organizations will drive variable sourcing models. More companies will move beyond the use of contract instructors and instructional designers to out-tasking and outsourcing of training administration, vendor management, tuition reimbursement, and more.

Re-engineering training will lead to the creation of new business models. Training has traditionally operated under a supply based business model where you create portfolios of courseware, publicize a schedule, see how many people register for the courses, charge back the costs to the business, and measure success based on how many people attend. This is proving to be the most inefficient model for corporate training.

Informal Learning is similar to On the Job Training (OJT). And it is also about access to information when it is needed. With the introduction of the computer and then the internet, expectations have been high that there will be an increase in e-learning. The shift to date though has been more about access to information delivered in a less formal manner than courseware. Search for knowledge on the internet has become much more accepted than delivery of knowledge.

Informal learning improves how employees and customers get access to intellectual information when they need it and in a format which they need it the most. We will continue to see the use of mobile technologies, social networking, and innovative asynchronous learning environments. It’s not only about how it will be delivered, it’s about the design and packaging of information.

SME (subject matter expert) generated content, or user generated content, is the future core of online learning. New tools and technologies are being created to allow the subject matter expert to create rich media based content while being a novice in the use of internet based instructional design and authoring tools. This empowers SME’s within the lines of business to create rich media training for their peer employees at a very low cost, without anyone from the training organization having to touch the material.

With the increase in litigation costs from employees and customers suing companies because they were not properly trained, we are seeing an increase in compliance based training to mitigate the risk and cost of litigation. In the healthcare industry, compliance based training is the standard as the costs of not training is greater than the cost of training. This translates into strong growth for companies that provide testing and assessment services. Where the risk of failure is high, testing of skills will increase. Continuing medical education (CME) for doctors is highly regulated and mandatory.

Compliance training is also an important marketing tool. Automotives have used compliance training as a marketing tool for repair and maintenance technicians. There is a greater expectation that more professional skilled jobs must comply with training requirements as well as testing and assessment mandates.