24 July Worship of High Profit Margins (...umbrella...)

[Paul Terlemezian]

A focus on profit margin creates a safe haven (umbrella) for the low cost competitor.

 

An internal provider may have layers of overhead and internal costs that result in the fully loaded cost of internal training to be higher than that offered by low overhead external providers.

 

While not necessarily bad  - it may lead to inflation of costs and either a poorer competitive position or a reluctance to implement training initiatives that could lead to innovation and revenue growth.

 

By focusing on productivity improvements and the profit dollars (vs. margin dollars) there would be an increased focus on the impact of the training vs. the cost of training. Do you agree?