Effectively Funding Organisational Learning

January 29, 2013 1 Comment

How do organisations fund their learning?

I have spoken about this in other ways in previous posts, but I thought it was worthwhile raising the subject again both as a means of thinking through it for myself an hopefully to get some thoughts from everyone else about how they do it and what is most effective.

I guess from my thinking there seems to be a couple of models that seem to be the most prevalent in terms of funding L&D functions as follows;

  1. 100% Funded by Organisation –   0% charge to business units,
  2. ?% Funded by Organisation –   ?% charge to business units,
  3. 0% Funded by Organisation –   100% charge to business units.

Each of these structures have their own challenges, but I think by far the biggest challenge for all of them is around equity of delivery of service.  In the 100% funded model, some business units who have high need for the delivery of mandatory or compliance based training are going to take up a large proportion of the delivery hours.  In the 100% charge model there are issues around who has training budgets and the size of those budgets as well as the issue of regulatory need.  The problem of course with a mixed model is what should the mix be and how can it be made to be fair and equitable.

Some parts of the organisation will need low-cost training for a large number of people while other units will require only small numbers to be trained by the costs associated with the training may be much higher, then  when you add the management and procurement of  external specialist training for particular business areas the situation gets increasingly more complex.

I tend to lean towards the 100% funded model, simple because it is easer to manage a ‘cost centre’ delivery unit than one that relies on the business ‘buying’ internal training.  It also makes sense in terms of centralising of procurement and administration which is I think more difficult to fund and manage under a charge to business model.

I would be interested to hear what other people think on the subject.

Filed under Chief Learning Officer, CLO, Executive Development, Formal learning, Informal learning, Learning and Development, organisational development, Training, Training Delivery Tagged with , , , , , , ,

About pauldrasmussen
Paul Rasmussen is one of Australia’s most widely read Vocational Education and Training Commentators. He provides deep, unbiased analysis and insights not only on topical issues, but also on the underlying structure and policy which supports the industry. His writing and analysis has been praised for its uncompromising and thought provoking style and its ability to focus on the issues of real importance to the sector. He has advised various government departments and ministers, training providers, public and private organisations, not for profits and small to medium enterprises on the VET sector and the issues and opportunities facing it. He is one of Australia’s most awarded learning professionals and a regular speaker at a range of conventions and forums. His extensive experience in vocational education, and learning and development coupled with formal qualifications in philosophy, ethics, business and education management allow Paul to provide a unique view of the road ahead and how to navigate it.

One Response to Effectively Funding Organisational Learning

  1. Pingback: Government Funding, RTO’s and Organisational Learning « Organisational Learning and Development

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