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Dear Workforce How Do We Determine Training Budgets for Executive Development

By Staff Report

Feb. 28, 2005

Dear Grooming Director:



Before figuring out percentages, decide what you really hope to accomplish with these training efforts. Do you expect to develop leaders? Do you expect to develop salespeople? Do you expect to develop better communication skills, project-management skills or something else?

A commonly cited benchmark for development budgets is upwards of 5 percent of executive payroll. I recommend, however, that you calculate budgets only after looking carefully at your talent-development objectives, keeping in mind how hitting those goals contributes to the business.

It’s best to start with the end results you’re seeking and work backward. Be specific about your objectives. In the past, most executive-development programs were too generic and not easily measured. Often, programs were administered en masse because of some fad or perhaps because a top manager had attended a learning session a year earlier and thought the whole company ought to go through the same experience. Executive development is definitely an area where one size does not fit all. The more specific you can be about your expectations, the better the training experience will be and the better the return on your training dollars.

Let’s say you want to teach your executives to be better communicators. Identify those execs who have specific shortcomings regarding communication–be it written, verbal, one-on-one or in front of groups, externally with clients or internally with peers. A training professional can then provide a specific cost for addressing the gaps or needs.

Some training may be done for a group of executives. Other individuals may require training by an executive coach.

A common problem with training programs is that we expect to accomplish too much in too short a time. The result: training is of too low a quality to benefit anyone. Learning occurs over a long period, and learning programs should be thought of as ongoing and not just one-time events.

SOURCE: William J. Morin, chairman & CEO, WJM Associates, Inc., New York City, April 7, 2004.

LEARN MORE:A Sample Leadership Strategy.

The information contained in this article is intended to provide useful information on the topic covered, but should not be construed as legal advice or a legal opinion. Also remember that state laws may differ from the federal law.

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