Is on-the-job training killing your organization's potential? Here's what you need to know.

The opinions expressed by entrepreneurs contributors are their own.

On-the-job training is a common practice, regardless of the number of employees working in an organization. As humans, we naturally observe and model the behavior of those around us, especially when their behavior aligns with compensation, promotion, and cultural norms. The not-so-secret secret to on-the-job training is that it relies on top students to teach when they could or should perform income-generating tasks. Relying on top performers to deliver the training also limits the scope of skill exposure to what a top performer is willing or able to share. Not all experts are aware of their own skills or actions that help them achieve consistent success, and not all experts are good instructors either. The reality is that on-the-job training is inefficient, non-standardized, unreliable, and very difficult to scale.

However, on-the-job training has one key advantage: it is not theoretical. Practicing real skills in real situations gives individuals the advantage of knowing when, where and how a skill is used at work - see consequences of actions, get personalized insights (if mentor is in tune with mentee) and establish the first set of experiences that could lead to performance confidence.

Related: Most Companies Fail at Employee Training. What are they doing wrong?

Myth: 70% of training is done on the job, in real time

Myth: 20% of training is delivered socially, through coaching

Myth: 10% of training is formally structured, in a course

Looking at what most organizations do when it comes to training, it's not unreasonable to believe that only 10% of job skills are supported by formal training. Good training is expensive and time-consuming to create. It is estimated that it takes learning and development professionals nearly 490 hours to create 1 hour of quality training (Level 3).

In a corporate environment, training and development is usually seen as a cost center and not a source of revenue. On paper, the arithmetic of 70:20:10 looks ingenious, 70% of training costs are free. Make no mistake about it, the most expensive training you can buy is training that doesn't work.

A bad lecture, boring online training, or required reading that doesn't create any new skills or organizational changes wastes all employees' time that could have been productive. On-the-job training that must be delivered repeatedly, or worse, processes that must always be handled by the sole expert in the business creates massive missed opportunity costs that end up on the balance sheet.

When it's time to play, it's too late to practice. —Dr. Michael Allen

In the modern age of corporate training, many organizations don't believe that 70:20:10 is a prescriptive model for smart training. 70:20:10, however, is an ingrained legacy pattern that is hard to let go of. The basic assumption to justify an investment in effective training is that new or improved skills will improve business operations:

Increase your income

Minimize accidents

Reducing operational costs

Create loyal customers

Reduce turnover

It will improve business operations, but only if the training is effective. The results of ineffective training create organizational beliefs that training is not worth investing in...