By: Norman Behar on November 15th, 2019
How to Maximize Your Sales Training Budget
How to maximize a sales training budget is a question that comes up quite often when we talk to clients. In most cases, they're looking at either a new sales training initiative or an annual budget.
When you think about training budgets, here are a few key considerations.
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#1 What Are You Looking to Accomplish?
What is it that I'm looking to accomplish from a business standpoint?" What are people going to do differently? Is it that we're going to go out and get more new business? New accounts? Are we going to increase our win rates? Are we going to improve margins and avoid discounting?
You must look at what you want the training to accomplish? When we think about that, then we must think about, " What behaviors need to change to achieve these results?"
Is it better pre-call planning? Maybe it's better questioning and active listening skills so we can develop a more in-depth, better understanding of the customer's needs.
Maybe it’s having a better sales conversation that adds value by aligning our solution with what we've discovered through our questioning and active listening skills.
Ultimately you want to think about what results we want to change and what behaviors need to change.
Another dependency that we need to think about, is who are we looking to train? Is it the entire sales team? Is it a subset of the sales team? It could be new hires, or it could be a strategic account team, or it could be an inside sales team.
We must also consider the target audience. If this is something where we're looking to maximize our ROI, we may want to train only a subset of that audience. So, when you look at the results that you're looking to achieve and the associated behavior change, who’s the target training audience?
#2 What’s Your Budget?
We also must think about ROI. Companies view training budgets differently.
Some companies look at their training budgets as part of an annual budgeting process. They may have a preliminary budget submitted in September. If they're running an annual fiscal year, maybe starting in January, and they'll just say "This is how much we have for our sales training budget." They can then turn this over to a sales enablement or sales training department and say, "This is what we have to work with."
Other companies look at ROI differently and say, "Well, what's the business case?" In that case, you might be looking at, "Okay, there's an investment we're going to make here. Based on that investment, what kind of ROI would we expect?" And in many cases, there may not be an associated training budget.
Ironically, many of our largest training engagements have begun with clients that don't have a budget, but they know that they're looking to improve the way they sell and engage with customers.
They start to build a business case, and then based on that business case, they'll allocate a certain amount of money.
So the budget could be determined through an annual budgeting process, or it could be specific to an initiative where you're building a business case.
#3 How is Training Being Delivered?
Okay, so, we're going to have this training budget, how's the training going to be delivered?
When the goal is an excellent training program, you want to focus on quality. A quality training program will typically have the following components: It'll be blended learning, it'll include pre-training consultation (you need to understand the client, the culture, and what they're looking to accomplish). There will also be customization involved so that all the examples are very relevant to that client and their industry.
Training participants can then quickly think about how they're going to apply the new skills they're learning on a day-to-day basis.
Then from a blended learning standpoint, it may start with onsite delivery (e.g., a two-day workshop). Then it could include online reinforcement with virtual instructor-led training sessions spaced out over time with small group cohorts.
It could also involve some self-paced online learning that extends the learning from the classroom into a reinforcement program.
Also, as part of the training initiative, you'll want your managers to provide sales coaching. Sales coaching is one of the best ways to make the training stick.
So, when you look at a blended learning program that has all those components, you want to think about, "Okay, is that reasonable based on my budget?"
Is that reasonable for all the training audience or a subset of the training audience?
One thing to think about is: Is your team centralized or decentralized? If you have a highly decentralized team, travel and lodging could account for as much as 50% of your budget.
Although we're big advocates of onsite training. There's excellent peer-to-peer learning and an engagement level, in terms of eye contact, that you may not be able to replicate in other modes. But if most of your budget is going to be allocated to travel, you may want to consider another method of delivery.
Virtual classrooms have become popular along with self-paced learning as a way to maximize budgets, or if you really want to include onsite learning you may want to limit the number of people you're looking to train and say, "You know, what we want at the end of the day is this highly engaging experience," so that is another consideration you'll want to think about.
At the end of the day, I would always urge you to strive for quality. There's an intangible here, which is the amount of time your people are taking from their day-to-day sales activities to participate and succeed in a sales training program. And that has a considerable cost to your organization.
This may not be a tangible cost in the way that travel or spending with a third-party training vendor does, but that's probably the most essential thing if it's a high quality, well thought out experience, that's going to yield a much higher ROI than just trying to fit something within a budget.
Another area to think about is, even though it's nice to have a third-party training vendor provide a turnkey solution, there may be many elements that you can do on your own. For example, you could look at your third-party training provider as a content provider and subject matter expert, and think about, "How can we leverage our internal resources."
#4 Remember to Focus on Quality
At the end of the day, training budgets are important. It’s critical to think about what you want to accomplish, what results you are looking to achieve, and the associated behavior change. How much money you can allocate may be based on a business case and expected results, or pre-determined from an annual budgeting standpoint.
Make sure you're looking at the right kind of training partner and focus on a program that's going to be viewed as high quality and designed to achieve your training goals.
About Norman Behar
Norman Behar is Chairman and Managing Director of the Sales Readiness Group (SRG). He has over 25 years of senior sales management experience, and is recognized as a thought leader in the sales training industry. His blog posts and whitepapers are frequently featured in leading sales enablement publications including ATD, TrainingIndustry.com, and Selling Power.