BMJ Stone
EZG Manufacturing
Federated Insurance
Fraco USA, Inc.
Hohmann and Barnard, Inc.
Hydro Mobile, Inc.
iQ Power Tools
Kennison Forest Products, Inc.
Mortar Net Solutions
Non-Stop Scaffolding
Pullman Ermator
Tradesmen's Software, Inc.
May 10, 2004 8:18 AM CDT

Price of (Not) Training


As a full-time professional speaker for the last 20 years, I have been asked so many times, "How much does your training cost?" I have learned to reply, "Would free be too much?"

Training is not a cost ? it's an investment. It really doesn't matter what we pay for an investment. It's what we get in return that's relevant.

One of the best ways to jeopardize an organization's future in today's world, and increase the probability of troubled times, is to look at training as a cost and pay the price of not training or provide substandard training that operates only as a bandage for the training requirements.

It's a simple principle: An organization's staff is where they are currently, in terms of competence and success, in direct relationship to what they know and how well they apply what they know. We all come into this world the same way, broke and naked. (And we all leave the same way ? broke ? they just give us some clothes.) We knew how to do nothing when we arrived, but then we learned. The more we learned and the more we applied what we knew, the greater our own success and, subsequently, our organization's success.

Some like to quantify the results from training. Here's a good example: A person being paid $50,000 per year, who wastes just one hour per day, costs the organization $6,250 per year (excluding benefits, overhead, opportunity costs, etc.).

If, for example, through one of our Time Management Seminars, that person can learn how to recapture just one hour per day, that translates into a payback to the organization of $6,250 per year. If a group of 25 people is involved in the same training and they all receive a similar benefit, the return to the organization is $156,250 per year (and this does not include other benefits to the organization, such as profitability, reduced turnover, improved morale, enhanced teamwork, better customer service, greater creativity, etc.). Over five years, the payback is $781,250. What should an organization invest to achieve that return and payback?

Many find it difficult to get the time for training. This is another false economy. They are so busy doing it the wrong way that they cannot take a little time to figure out how to do it the right way. When someone says they cannot afford to take three days out of their next week for training, I know they are looking at training as an "expense" and not as an "investment." Three days out of five is 60% of the week, and that would be a big expense ? but three days out of 365 is a drop in the bucket. And if that investment provides just one idea that saves one hour per day, every day, the payback on the investment of three days is over 250 hours in the next year alone.

Not so many years ago, training ? beyond showing employees the basics of doing the job ? was an option for most organizations. Today it is no longer an option. If any of us continues to do what we do the same way, within five years most of us and our organizations will become obsolete. Why? Because our competitors are making themselves and their employees more effective through training. If we look closely at companies that are doing well in the long run, they almost always have in place a well thought out and executed training program for their people. They understand that the price for not training is the real expense.

About the Author

Dr. Donald E. Wetmore is owner of Productivity Institute - Time Management Seminars, a professional speaker and a member of the National Speakers Association. He can be reached by visiting


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