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How do you measure and achieve value for money?

Measuring and achieving value for money is often difficult to do, yet it is an essential part of being accountable for they way you spend money and the resources you buy. One of the methods is to undertake a Cost Benefit Analysis. Start with what something costs, don’t leave out the cost of time, then look at the cost and implications of doing things differently. Make sure you consider quality and the results achieved.

This is an overview of a basic Cost Benefit Analysis for the Skills for Care Common Induction Standards that I undertook during 2010 whilst working as Social Care Training and Development Manager at West Berkshire Council, to evidence how the online assessments provide value for money.

What I quickly realised was that with decreasing budgets, we just could not afford to continue sending everyone on training courses. We therefore had to increase the usage and different types of assessments used and incorporate them into refresher training. Not only did we significantly reduce the costs associated with training but we achieved a fair process for everyone and evidence of knowledge that cannot be generated through classroom based training.

(Some assumptions have been made and these are set out further down.)

Classroom Based Training Model
Cost of trainers £25,000
Cost of room hire £7,500
Cost of staff time to attend training £59,050
Cost of cover for absent staff member £59,050
Total £150,600
Online Assessment Model
Cost for 100 user licence in year 1 £2,250
Cost of staff time to take assessments £1,140
Cost of cover for absent staff member £1,140
Cost of 50 people attend further training £75,300
This equates to a £70,770 difference in year 1 but you only pay 20% £450 for the licence from year 2 onwards, equating to costs of £78,030 a difference of £72,500 per annum. This is a 47% saving in year 1 and 48% saving per annum thereafter.

Spending too much on training? Realistically, you will need a combination of online assessment and other methods of learning like classroom based, e-learning, shadowing etc. The model shows the savings per annum if you could half the number of people who need training because you have assessed their learning needs and evidenced their knowledge. The higher percentage of staff you can evidence the knowledge for, the more savings you can make.

Organisations with more than 100 staff will achieve much larger savings. I would be happy to help you work out how much you could save based on your cost models. If you would like to discuss this further, do not hesitate to contact me on 0845 873 0373 or email: sarah.knapp@cis-assessment.co.uk.

Click here to download a PDF document of this information

My former colleagues in Social Care Training at West Berkshire Council would be pleased to talk to you about their assessment centre and policy of assessing new staff before allowing them to attend training to ascertain if there is a training need or if their prior knowledge can be valued. Additionally, Bracknell Forest Borough Council have cut staff turnover in half by using our assessments which has resulted in huge cost savings through the model demonstrated above but also staff turnover and cost of recruitment savings.


• Average time to take assessments for all 6 Induction Standards is 1 hour

• Average working week is 37 hours with pay rate of £10 per hour, plus “on costs” (employers NI   at 11% and pension contributions at 3%) This equals an annual cost per employee of £21,933

• Average cost of staff cover is the same rate (it will be higher if agency staff or overtime rate   and zero for some staff, for example admin or managers, who might not require cover)

• Excludes staff travel time to / from training

• Average people trained on a course = 14 (based on M&H = 8, First Aid 12, others 16 with   courses full to capacity)

• 100 staff ÷ 14 places = 8 courses x 7 days = 50 days of training

• Average room hire of £150 per day to include refreshments / equipment etc.

• Assumes cost of management, supervision and admin time is similar for either option

Save money whilst getting results
Focus on evidencing knowledge
No Software necessary