Why auditing your language training costs pays off
How many language training vendors does your company use?
Even uncovering that simple fact can take a bit of legwork if your employees are located around the globe. Once you’ve found your answer, a smart followup is to audit all of your language training costs.
Here’s why. It’s still not unusual for language training services across a company to be spread out among local and regional vendors. That opens the door to wide swings in procurement costs, vendor management fees, and training inconsistencies. Converting language spend from many providers to one global platform has proven to be a clear cost-saver.
Performing a language cost audit may ultimately lead to a significant reduction in your overall learning and development (L&D) vendor costs. But taking the deep dive into your procurement process can be overwhelming. Here are three suggestions to help you and your company through the process.
Begin with your own procurement team or region
A complete review of your organization’s language training procurement may take some time, but the results will be worth it. You’ll want to find out if procurement currently purchases language training services or software, or has in the past? Later we’ll take a look at other avenues taken within companies to contract for language services that are outside of normal procurement channels.
Does your company have a global policy when it comes to language training? If so, does it include purchasing requirements?
Even taxonomy plays a role here. Not all companies follow a standardized way of identifying language training programs. If that’s the case within your business, following up with a word search can help identify suppliers that provide those services but aren’t listed with standard labeling.
One of the most promising approaches is to ask all of your category managers, since language training can be billed in a variety of ways. Differentiating factors can include who requested training and how those services are delivered.
Review departmental language training expenses
Many of the same questions raised in the first step above carry over to the departmental level. Additional queries about current and past activities can reveal interesting purchasing patterns.
Here’s a common example: going back only one year won’t necessarily give you a full picture. Understanding year-to-year variances in language training spend will provide you with a more complete picture.
Differences in payment methods is another area that often masks true spending. Are language training services billed through procurement or as an indirect cost? Are they purchased from the same vendor or different vendors?
Departmental leaders outside of L&D or HR are often frequent purchasers of language training. They may require specific training for certain employees that’s not reflected in audits that don’t take all payment methods into account.
Looking at the broad options available for purchasing employee language training will usually reveal unknown but legitimate hidden training costs. A good example is when services are purchased with departmental credit cards.
Another often overlooked expensive category where language training can be found is in your tuition reimbursement program. A good idea is to also include benefits managers in your audit to learn the types of language training classes and programs that are being taken by employees.
Zero in on region-specific expenses
If purchasing language training services within your company is decentralized, it’s good to start at the top. Work closely with regional leaders to identify individual category managers responsible for tracking L&D, HR, or software/services spend in each region.
On the other hand, if your company does have a global language policy, an important step is to ask each regional team if they are currently using the policy. Having standardized language training purchasing requirements and defined naming conventions are only valuable if they are followed. Finding the answer for every region is another key piece of the procurement puzzle.
A natural extension of asking departmental leaders for purchasing information is to also ask L&D and HR staff to identify language training purchases. These may or may not be billed as indirect expenses and can frequently be missed in an initial audit, yet another good reason for doing a fuller language training audit.
What happens next?
Like many global organizations that have completed this process, you may reach a common conclusion—your company is spending a lot of money on language training. Now that you know, what can you do to make training more cost-effective while providing the the highest level of language training?
Rosetta Stone Enterprise helps some of the world’s leading brands realize big cost savings by helping them streamline procurement. The result: consolidating language spend and delivering a single, award-winning enterprise language training solution.0