Hey folks, Phil Zito here and welcome back. In this post, we are going to be tackling a conversation point that I've been hearing a lot lately. It's this concept that employers don't want to pay to train their people, which doesn't make a whole lot of sense for multiple reasons.
So, let's tackle my favorite topic, which is training. Now, I would be remiss if I didn't openly acknowledge that we are a training organization. So obviously, there's a bias there, right. I run one of the largest building automation training businesses and we obviously have a bias to believe that training is important. I do want to say, though, that if employers would not invest in training for their employees, our company would not exist; our company would not be growing and continuing to grow.
So, I mean, right off the bat, if any of you feel that your employer will not train you or will not invest in your development, I want to tell you, it's probably how you're presenting the training opportunity to them. My hope is, by the end of this post, you will have a clear framework on how to communicate in a business discussion, because that's what this is. It's a business discussion; the value of investing in training you, personally. My other hope is that folks who read this will understand why they should train their people.
So, let's first talk about the process of making business decisions. Now, I have for the longest time, advocated that technicians, salespeople, engineers, programmers, etc, really need to understand their impact to the business. Right now, we're in a market condition where there are so many jobs. Like, if you could spell BAS, you could probably get hired. And that's great, right? But the reality is that the market may not necessarily always stay like that. So, being able to understand and communicate your impact to the business is going to be important.
If you're ever in a situation, like I was, where you start seeing people getting laid off around you and wondering how you’re going to deal with this or how to avoid getting laid off, understanding your impact to the business and then being able to communicate that is really going to help you out.
Now, the process of making business decisions, here's how you do it. First off, you're going to identify the end goal and the need for the decision. So, what is the end goal? In the case of a business, we want to execute backlog in building automation businesses, we want to execute that backlog profitably, and then we want to ensure that it's executed accurately. So that way, customers want to use us again. That's on the construction side.
On the service side, we want to provide service, we want to establish relationships with customers so we can get awareness of future work, but we also want to be able to resolve the customer's issue. So that way, they're able to utilize their building automation system to the maximum ability that they can.
How do we do this? Well, in the past I’ve mentioned gathering all the relevant information. I've talked about the importance of logging your training hours, logging them to job task codes, understanding where your people are at, doing efficiency and technical knowledge surveys, training to those gaps, etc.
Once we understand what our goal is, we identify what our viable options are. So, what can we do? We can hire more people who are already trained, we can train people, we can improve our processes. There's a variety of things we could do. We list out the pros and cons to that, we make a decision, and then we execute that decision.
So, with all that being said, how does training impact a business? How is your training going to impact your business or your employer's business?
Well, let's talk about the cons first. Everyone wants to talk about negatives, negatives get way more attention than positives. So, there are some downsides to training. I will argue that they are short-term downsides, but they are downsides, nonetheless. There is a cost to training. Training usually almost always requires some form of downtime, and then there is the potential for loss.
I've heard this from a couple of companies, where they say, “If we train them, they're gonna leave.” Then there's that old adage of, “What if you don't train them and they stay?” But that doesn't really get a whole lot of attention for people. So, what I find is that if you are really, really worried about your people leaving after you've invested in them, there's always a possibility for that. No matter how good your culture is, no matter how good your pay is, no matter how great of a manager you are, there's always the potential for an employee to leave. That being said, by addressing culture, understanding your employees’ styles and what matters to them, and investing in your employees, you can significantly reduce that cost.
Now for the pros. There are a lot of pros. This is important for those of you who are individuals reading this and you’re thinking you’ll never get your employer to train you. So one, there's an increase in efficiency. Everyone's trying to hire people right now because people are sitting on backlog that they can't execute. What is backlog? Backlog quite simply is booked work that has not been built out yet. Thus, you have not revenued it yet. One of the biggest issues is that companies are not having enough people to execute that backlog.
Next is employee retention. Employee retention is huge. As someone who runs a business and has hired people, who has had people exit the company, as someone who has run teams before running this business, it is very expensive to replace an employee. Not only do you have costs, like posting for positions, because they can cost you 10-20% of first year wages if you go through a recruiter, but there’s the time. Your likelihood of getting that person highly profitable is going to be at least 3 months. So, there's a time to bring people up to speed.
Then there are long term cash benefits. Let's say you have a bill out of $80 an hour for a tech. Let's say that that tech is 75% efficient. That means that 60% is revenue, profit, all that fun stuff after margin and costs and all that. Then $20 per hour is getting lost, it's inefficient. Let's say you increase that efficiency by 10%. So, now we get about $10 more an hour, roughly. If you do this across 2000 hours, you find yourself $10 times 2000, and that's $20,000 of revenue that you are now bringing in. That repeats year after year after year because that efficiency stays.
So, if you're able to increase efficiency, you will have long term cash benefits. This is the biggest thing I think people miss when they're communicating with their boss and their boss tells them they’re not going to approve training. If you can simply provide a 5-10% efficiency gain, then you are going to pay for a good portion of your salary, not to mention the ROI on the training over a period of you know, six months.
Alright, so how do you determine your role and what training you need? That's ultimately what it comes down to. You may be drawn to something in particular, because I do that all the freaking time. I'm always doing some form of training. It's ridiculous. I recently finished a master’s degree in Cybersecurity, and now I'm like, “Ooh, that Executive MBA Program looks cool.” It's a little ridiculous, but what you need to be able to do is to look at your role and actually identify what is going to impact your role.
If you're a technician, learning how to do proper install would probably be beneficial. If you're a programmer, learning more about HVAC may be beneficial. If you're an integrator, learning about IT may be beneficial. But what you have to do first is identify what is my training need? Where am I inefficient?
This is where you have to be honest with yourself, and this where job task codes come in. You have to be honest and say, “You know what, I am not really executing the way I should execute. It's taking me too long to do this.” Then you identify the tasks that are impacted. Maybe you always have to call your boss every single time you do a BACnet chiller integration. You've done them dozens of times, but every time you do a BACnet chiller integration, you still have to call to get help. Then you have to ask yourself, “What is the amount of time it's going to take to train me to get to the level I need to be at in order to do whatever task I need to do?”
So, seriously running a training organization that's had 10,000+ students now, we have a really good system of follow up to make sure people move through training. So, once people are in our training, we don't really have an issue with them completing it. One area where we do experience trouble is with our free skill assessment. It's an awesome tool because not only will it pinpoint what people do and do not know, but it also pinpoints the people who are serious and not serious.
We will have managers who will enroll their people and we’ll give the employee 48 hours to take it. You’d be surprised how many employees never even log into the system. Then the managers say, “You know, that's funny, because this person is always complaining that they don't get training, but we give them an opportunity to figure out what their gaps are, so they can get trained, and they don't do it.” So, you'll start to flush out the people where training is more of an excuse, than an actual desire. It’s not, “I can't do this, because I'm not trained.” It's because you're lazy, and you don't want to put in the effort to better yourself.
Because I mean, let's be honest. Even if your company wouldn't train you, like they wouldn't spend any money on you, which I'm not seeing the data to prove that's true, but even if that were the case, there are so many resources that if you have an inkling of motivation, you can get pretty far on just training yourself. I mean, I used to go and read the literal like 1600-page programming manuals of software. Then when folks would ask how I knew all this stuff, well, it’s because I read the manual. So, you know, if you desire to invest in yourself, you will make it happen.
Alright, let’s shift gears and discuss how to communicate your training request in an ROI-centric manner. I find a lot of folks do not know how to do this. They don't know how to do basic ROI math. So, ROI, return on investment, is a percentage; it's a number. Essentially, what you do is you find the monetary benefits. So, what is that benefit post training? I gave you an example of, if you can increase your efficiency, or you can do a task. Like, if you complete a training program and now you can program, but you're still a technician, and a technician gets paid $65k, and a programmer gets paid $85k, then your employer is getting $20k worth of work from a $65k person. They're getting that $85k work, but from a $65k person. Even if you're only 90% efficient, 80% efficient at it, they're still making money.
So, to figure out these monetary benefits, you figure what work can you do now, and what money value does that have compared to your current salary? That's how you figure out the monetary benefits.
Then you do training costs, and here's training costs. It's not just the cost of the course, it's also the cost of time to do this, unless you're doing the training on your own time. If you're doing the training on your own time, then that’s not such a big deal. The cost is just your own personal time. But a lot of organizations will train their people during their work hours. Some organizations have you do training in certain locations, but you've got a potential labor cost, right, and you've got the training cost. So, you take monetary benefits, minus that cost, divided by the cost times 100, and that gives you a percentage.
Once you have a percentage, you also have to take into account one more thing. So, you could present it to your business owner and show the return on investment, but you also want to figure out your ongoing benefit. So, this is where you would go and you would show that you are now 90% efficient and you were 80% efficient. That's a 10% efficiency gain. You’d calculate what that equates to in dollars and then you would take those dollars over the course of the year and say this is the cash flow each year that this training is going to result in. So, this enables you to build out not only an ROI, but also a cash flow projection.
Now, for some of you who are techs, some of you who are programmers or engineers, you're probably a lot like me when I first was a tech, and this stuff would like make your eyes glaze over. You likely think this is a lot of math and seems like a lot of work, but’s it’s really not. Honestly, you should think about these concepts. Everyone says they want to make more money; they want a raise. This is how you make more money.
Now, let’s say you don’t really understand your business financials. Okay. Well, if you don't really understand your business financials, and a lot of you won't, that's not saying you're not technically capable of doing that. It's rather, a lot of organizations do not cascade their financials down to their field level personnel. So, the managerial staff will often know their financials, but that won't get communicated down to the field level personnel.
I think if people are going to be executing work and contributing to the bottom line, they should know what their impact is. I tend to find that by communicating and opening that door so that people can see it, helps them realize, “Oh, so you mean if I place all my hours on this job instead of that job, not only does that violate like Sarbanes-Oxley and all that jazz, but it also causes issues with the organization and how the organization profits and grows.
So what do you do, if you don't have visibility to those numbers? It doesn't mean you give up and don't do anything. You still can take what I taught you here, and you can say, “You know what, I'm taking a programming course. I realized I could talk to my ops manager and tell how many jobs are held up because of programming right now.” Your ops manager may say, “We have probably five jobs we can't get done right now because we just don't have enough programming labor.” Then you could say, “Well, I've been looking at a programming course. I realized that it would impact us by taking me out of the field for three days, so maybe we do it in the shoulder months, and that way, we can potentially use what I learned in the programming course, to go to customers and maybe do some site optimization. I'm pretty sure that if I learned programming, then I would be able to go and execute that work, which would bring more revenue to the business, and would make us all look good. What do you think about that?”
By being able to point out the efficiency gain and the cash flow gain that you're delivering to a business, then that is a much more actionable conversation come raise time than sitting there and saying, “I feel like I'm a 4.” Then the manager says, “What makes you feel like you're a 4 out of 5? And you're like, “Well, because I do good work. Then the manager says, “Okay, well, why do you think you do good work? Then you say, “Because no one complains when projects get done on time, I have identified a gap and I've closed that gap, and I am now taking our estimated margin, and I'm increasing it by x. I'm bringing in these change orders. I'm doing these numeric specific things that are impacting the business. Thus, I believe I have justified this raise.”
I know that this was a little bit of a different topic, and I was honestly very unsure of whether I should talk about it or not. Anytime I see any training provider talking about purchasing training, or how to purchase training, I immediately raise my red flag. Of course, you want to talk about this, you're a training organization and it benefits you directly. I don't ever want to be perceived as someone who is taking this blog and using it as a direct benefit. Am I naive enough to believe that some folks will find this valuable and move on to purchase our training? Of course, and that's fine, but I don't want this to turn into an infomercial for our services.
So, my hope is that reading this has made you think about the training process and the act of asking for training differently. Even if you don't do it perfectly, you will at least come into the conversation with your manager and instead of just saying you want to go to this training, you will say you want to go to this training because it will help me to XYZ. You can say you’ve seen on past projects that they’ve struggled with doing these tasks and this training will address these tasks, which then ultimately will help you be a more valuable member of the team.
That's a different conversation than simply saying, “Hey, I want this training because I want this training, because it's cool, and it seems like it'd be a lot of fun,” which is clearly not going to work. So, I hope that helps and that it gives you all a different perspective on things.
That's also a completely different conversation than coming in and saying you want to take this training because you want to know programming because you think it’s the next step in your career. Not once did you address any benefit to the company. It was all you, you, you, you.
So, I hope this helped. I hope this gave you a different perspective. I want to leave you with this: We've trained 10,000+ people across many companies. Our business would not exist if employers were not willing to train their people. Oftentimes, when we talk to companies, they tell us they want to train their people, but they just don’t know what to train them in.
We don't know if the person we're going to train is going to take it seriously. By having the kind of conversation I just gave you, you're showing that you care about the business and you're going to take it seriously. You're helping your manager, who's likely crazy busy, to identify what training actually makes sense. So, follow this formula.
Let me know if you think of a better way of asking for training. I'd love to hear about it. If you disagree with me, and you think I am fundamentally wrong in what I'm saying here, I'd love to hear that as well.
Thanks a ton for being here and take care.