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Satisfaction Level in Outsourcing Seen to Decline

by: Sarah Joson

Tuesday, September 16, 2014 |

Businesses are known to have different training practices. Some of them create learning programs in-house; others contract with third party service providers, while a number of organizations use a combination of both.

In most cases, outsourcing decisions are based on the capacity of the internal training staff. In a study done last year, it was discovered that even if firms are satisfied with their outsourced training programs, the level of satisfaction is declining. This year alone, nearly 50 percent of firms are expected to tap a service provider to increase the capacity of their learning function, but then again, satisfaction is dwindling.
A monthly survey is conducted by IDC on the Chief Learning Officer magazine’s Business Intelligence Board (BIB). It covers several aspects such as the outlook, challenges, and interests of senior learning executives. For this month, over 125 BIB members participated in the survey that aims to find out their thoughts on training outsourcing.

A post at CLOMedia.com shares some of the survey’s important details. 

The changes in training outsourcing activity amongst enterprises are minimal but evident. It was high in 2007, down in 2009 with 45 percent, and high once again in 2011 with 55 percent. In the latest survey, activities have normalized wherein the recent figures show that nearly 59 percent of the participants said they are outsourcing some parts of their training function.

Experts believe that the low figures in 2009 and 2010 are results of the resonating effects of the global recession. Firms were more careful with their spending which often resulted to non-renewal of outsourcing contracts.

This event - though rocked the outsourcing boat - resulted to better spending and recovery amongst enterprises. They utilized capability of external providers to beef up their training programs and have access to new tools and expertise at a more modest budget.

Organizations that outsource spend less than a third of their total training budget on outsourcing services. This is slightly higher than the total spending in 2013 and 2012. Meanwhile, the percentage of organizations that are spending over 40 percent of their training budget on outsourcing increased, from 20 percent back in 2008 to 28 percent in 2014. On the other hand, only seven out of 10 firms that outsource training spend below 40 percent of their total budget. Back in 2008, that figure was 8 out of 10.

It is projected that by 2015, about 46 percent of firms will spend more in training outsourcing. It is also anticipated that even as economies have not fully recovered from the global crisis, only 16 percent said their training outsourcing budgets would decrease next year. 

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