2% Is All it Takes

Being ‘World Class’.

Often heard, but what does it actually mean?

Or, more importantly, what does it cost?

If you were setting out to create a ‘World Class’ organisation, what would you say are the additional costs to get there?

10% of your sales?

40%?

80%?

Even more than that?

If I said it was just 2%, what would you say?

If I then said I don’t mean 2% of your sales, I just mean 2% of your total staff costs, then what would you say?

Hard to believe, isn’t it?

Well, I have news for you!

It really could take just 2% of your total staff costs to transform your organisation into one that can genuinely compete on the world stage.

The first and most important thing to remember is that you don’t have to be big to be World Class. In fact, far from it. I have been fortunate to work with many World Class organisations, some of which were single person businesses.

Being ‘World Class’ is fundamentally about the Knowledge, Attitudes, Skills and Habits (behaviours) – or K.A.S.H. –  of your workforce. Whether that workforce is just you or numbers in the thousands, the route to excellence is just the same.

Remember the Pareto principle? Better known as the ’80/20 Rule’?

Well, it is estimated that around 80% of the benefits your personnel bring to your organisation are down to their ‘soft’ skills – K.A.S.H.!

Yet around 80% of UK organisations develop their personnel’s ‘soft’ skills through just 2 days of training per year or less!

Crazy isn’t it? And they wonder why progress is so slow or even non existent or, worse, that they are getting left behind by the competition!

The reason most often cited for doing so little? You guessed it – cost! Please bear in mind that a day’s training to a high quality need only cost around £100-£150 per person.

So the message being sent out is effectively that something that brings 80% of the benefits to an organisation isn’t worth investing in.

Just where is the sense in that?

You look at any World Class organisations, of any size, in any sector, and you will see one thing in common – they continuously invest in developing their people.

So, back to this ‘2%’ then.

If developing the things that bring 80% of the benefits to your organisation were to cost you just 2% of your total staff costs, that’s a pretty good return on your investment, isn’t it?

So what makes so many organisations cut corners when it comes to developing their people, especially if all it takes is just 2%? Goodness knows!

Let me show you a simple calculation as an example:

An organisation pays an average annual salary (taking into account everyone in the organisation, including the Directors) of £30,000

Additional costs directly associated with employing each person, employer’s National Insurance, benefits and so on, typically equate to around 40% of their salary.

So total average annual employment costs per employee (in this example) is:

£30,000 + 40% = £30,000 + £12,000 = £42,000

Now take this amount and calculate just 2% of it as a budget for learning and development = £840/yr

So the annual average budget per employee for developing their skills is £840.

Or to put it into training days, that’s somewhere around 6 to 8 training days per year, every year.

Just imagine the impact on your orgainsation if every employee had (on average) 6 to 8 training days every year?

If the training plans are properly developed (and most training companies worth anything can easily help you do this), your organisation could easily achieve World Class standards within 5 years.

And all for just a measly 2% of your total staff costs!!

Amazing isn’t it?

So what are you waiting for?

Get in touch! T: 01242-672440

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