How can credit unions calculate the return on investment (ROI) of their employee training programs? Consider these tips from the project management training company ESI International:
1. Shift your thinking from a quality mindset to an impact and results mindset. ROI is more than a calculation; it’s a way of thinking.
Trainers often focus on the quality of their training rather than the impact of the learning, assuming that quality leads to learning and learning leads to impact. While quality is important, it doesn’t go nearly far enough in proving that training positively impacts the business.
2. Realize you don’t need to go overboard in calculating ROI. You only need to prove that your program is cost-justified.
3. Calculate ROI continuously so you always know how much benefit your program is generating.
There are two ways to waste training dollars—train people who don’t need it or train people who don’t use it. Neither of these has to happen in your program if you have a handle on what is working and what is not.
4. Build your case for ROI step by step.Getting to ROI is like building a court case. You make arguments and then present facts to support them.
5. Validate your findings with as much data, from as many different perspectives, as possible. This will appeal to those in the organization who make decisions about your training budget, such as the chief operating officer or chief financial officer. They’ll want an explanation of how you reached your conclusions.
This will require obtaining trainees’ and managers’ feedback about training programs immediately after it occurs and a couple months afterward.
6. Realize that ROI isn’t just about money. Analyze results that lead to ROI across four levels of learning measurement: quality, effectiveness, job impact, and business results.
7. Be conservative in your ROI calculations. Self-reported scores should be factored down to compensate for bias.
Also, provide the job impact number reported in the follow-up survey rather than feedback obtained immediately after the class. Often, students are enthusiastic about training right after the completion of the program, which causes bias.
8. Know the investment outlay. Training ROI can’t be calculated without knowing the cost of the investment. First, calculate the investment (class cost added to the salary of those attending and teaching the training during the program). Then, calculate the return: Multiply the average salary by the percentage of students who said their work improved due to training.
9. Communicate the story behind the numbers. When you’re discussing your program with stakeholders, clearly state the goals of your program as you first envisioned it, the challenges you faced, and how you overcame them to make a difference for the organization.
10. Don’t be discouraged by low ROI numbers. Low ROI can be improved.
Taking a proactive stance and a comprehensive view of job support and other adoption practices will get your ROI numbers where they need to be and ensure the continuation and advancement of your learning programs.
Visit ESI International’s website for more information.