Archive

The Relationship Between Training and Organizational Performance

By Staff Report

Jan. 13, 2004

The chart below shows a positive correlation between training expenditures both revenues and profitability. In other words, the more a company spent on workplace learning in 2002, the greater its sales and profits.



    Interestingly, the data does not show a direct, positive correlation between training dollars spent and human resources metrics such as retention and employee satisfaction. In other words, according to this survey, more dollars spent on employee training didn’t necessarily mean a happier workforce.

 

Expenditure per Employee

Expenditure as % of Payroll

Self-Rating of Performance Compared to 2001

Better Same Worse Better Same Worse
Ability to Retain Employees $571 $253 $702 1.97 0.45 1.47
Employee Satisfaction $603 $419 $640 1.40 0.71 1.77
Quality of Products/Services $497 $419 $541 1.14 0.71 1.80
Customer Satisfaction $307 $419 $468 0.75 0.71 3.18
Sales/Revenues $1,109 $705 $563 4.66 1.54 2.50
Overall Profitability $987 $685 $524 3.70 1.42 1.71

Self-Rating of Performance Compared to Other Organizations

Better Same Worse Better Same Worse
Ability to Retain Employees $743 $329 $996 2.58 1.55 2.72
Employee Satisfaction $736 $419 $634 2.43 0.71 1.51
Quality of Products/Services $749 $329 $703 2.89 1.55 2.46
Customer Satisfaction $665 $329 $648 2.42 1.55 3.10
Sales/Revenues $842 $709 $619 2.33 1.74 1.68
Overall Profitability $815 $654 $477 2.46 1.51 1.35

The information is fromASTD’s 2003 State of the Industry Report.

Schedule, engage, and pay your staff in one system with Workforce.com.