Cost-Efficiency Optimization in Business Training
RCTReview
One-on-one professional technical consulting for microenterprises yields solid business practice improvements but is cost-prohibitive to scale across large low-income populations due to high consultant fees and individual delivery ratios. Replacing expensive professional consultants with former student peers delivering classroom-level group sessions achieves equivalent net income gains at a fraction of the cost.
Picture this
Hiring an elite master chef to teach students cooking one-on-one is extremely expensive and hard to scale. Bringing a successful recent graduate into the classroom to demonstrate their working recipe to the entire class achieves the same meal quality for everyone at a tenth of the price.
What the evidence says
Role model group sessions cost approximately 10% (1/10th) of individualized technical consulting while delivering identical US$30–US$50 monthly household income gains (~15% increase) 1 year post-program.
- Who was studied
- N = 1,712 microentrepreneurs across 66 training courses in Chile (92% female, lowest two income quartiles).
- How
- Two-stage randomized evaluation comparing role model group sessions against individual technical assistance at business locations and in classrooms.
What to do
Replace 1-on-1 professional coaching with group-based peer role model visits in business training curricula to maximize cost-efficiency and scalable impact.
From the source
"The role model sessions cost about one-tenth of the individualized assistance, but both personalized components achieved similar impacts regarding business income."
inspiring_success_personalized_trainings_for_microenterprises.pdf