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How virtual instructor led training saves you over 40% in training costs

Training is expensive. There is no doubt about it. But training is also necessary. The reason organizations invest in training is to increase capability, increase productivity, and increase engagement. But the social aspect of training is also important: networking opportunities, exposure to senior leaders and managers throughout the company and the ability to learn more about adjunct functions are all benefits and side effects of attending a workshop or training course.

However, it's expensive! And justifying a huge cost center expense without being able to always definitively demonstrate a return on invest (specifically in the case of soft skills, leadership development) often creates an influencing, persuasion and negotiation challenge for any director of a learning & development function.

So let’s calculate a hypothetical: assume a company runs 10 leadership training sessions per year. And each session is one-day long.

Now let’s assume that each session has 20 participants.

And finally, let’s assume that the average hourly wage for each participant is $38 per hour. This equates to a cost of $60,800 is salaries paid per year while participants are sitting on training courses.

Next: one thing we always have to do when running any form of training session is feed our participants. So let’s assume a cost $30 per participant in breakfast, lunch and snacks per session. This gives us a total of $6000 for the year.

Now let’s assume that one-third of those participants need to travel to the venue from out of town (and stay in a hotel the night before the workshop). At a conservative estimate of $500 per flight and $300 for a hotel room, this equates to $52,000 in travel and accommodation expenses for those participants for the year.

Participants also have to have printed workbooks to use and refer to during a session, which adds another $10,000 to the budget in printing costs per year.

While the actual cost of a days training for face-to-face facilitation is fairly similar to virtual facilitation, the vendor provided facilitator probably needs to travel and be accommodated as well. So let’s add another $8000 to the expense line to cover travel and accommodation for the facilitator for these 10-sessions.

If we add all of this up (assuming the fee due to the training vendor is $2400 per session), this provides an annual cost for 10 training sessions with 20 participants per session, at $161,600.

Now let’s look at the equivalent costs for virtual instructor led training (vILT). The benefits are just the same: vILT training can increase capability, increase productivity and increase engagement. In addition, it still allows for networking opportunities, exposure to senior leaders and managers throughout the company, and the ability to learn more about adjunct functions.

But, it reduces the cost of training considerably, thereby reducing the overall total expense line on any training budget.

Our assumptions are the same: 10 training sessions per year with 20 participants per session. However, since this is virtual and we assume that a normal face-to-face session is equal to a whole-day training event (i.e. 8-hours), then each day of face-to-face training would equate to two 2-hour vILT sessions plus 1-hour of pre/post work per session in order to cover the same amount of material. So this means that 10 face-to-face full-day workshops annually would equal 20 virtual training sessions per year.

However, with each session lasting only 2-hours with the addition of 1-hour of pre/post work, the salaries paid per year while participants are sitting on training courses and completing pre and post individual assignments (still assuming an average wage of $38 per hour), would now only be $45,600.

The vendor cost would be higher, since there are more sessions (20 virtual sessions vs 10 full-day face-to-face sessions), however the cost per session is a little lower (assume $2400 for face-to-face per sessions vs $1900 per vILT session).

The other added extra is a telephony cost per vILT session (the cost of each participant dialing in to a 2-hour virtual session), which, at worst case scenario, is roughly 10-cents per participant per minute, which equates to about $4800 per year in telephony costs.

But now comes the savings: there are no travel expenses. No accommodation costs. No need to feed participants. No expenses for the facilitator. And no printing costs, since all materials are online and accessible through interactive PDF workbooks.

Therefore, total costs for the equivalent virtual instructor led training program, assuming 20 training sessions with 20 participants per session is $88,400.

This represents a saving of $73,200 for our hypothetical.

This means that you can achieve the same results using vILT (with the same benefits and resultant side effects as face-to-face training) for 55% of the cost of live, classroom workshops.


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