A survey from LearnUpon found that 61% of learning leaders said that they don’t measure training return of investment (ROI).
However, to understand whether your training is effective and whether you’re receiving the outcomes you want as a business, it’s important to measure this. Knowing the ROI on all key elements is crucial. Training isn’t always straightforward, but it’s important to keep an eye on it’s ROI to maximise efficiency.
In the survey, 50% felt it was difficult to measure their training ROI, suggesting businesses need educating on how to do this. Here, we share a handful of useful methods so you can start measuring the ROI on your training…
Start using a Learning Management System (LMS)
A good starting point is integrating a Learning Management System (LMS), which is a software application that manages administration, documentation, tracking, reporting, automation and delivery of educational course, programmes and materials.
An LMS allows businesses to track completion of training, monitor employee competencies and record assessments that measure progress of training programs.
Overall, it means a business can assess the ROI of multiple aspects of the training at your company whilst providing long-term tools to support future assessments. Our partner brand Erango specialise in providing LMS software to businesses.
Use the training ROI calculator tool
An ROI calculator is a tool businesses can use to work out return on their investment, comparing the cost charged against benefits received.
This approach works especially well with monetary measurable benefits like manufacturing or sales. Why not apply this tool on some previous training to measure the value it delivered for your business?
Depending on the results will guide you on whether to invest in further training or find a more cost-effective supplier.
Carry out regular assessments
Your business can carry out ROI measurements themselves directly by tracking objectives on a regular basis. When any employee joins a business, they should have some set objectives, which are usually SMART.
A manager would measure against these objectives to determine progress, helping to set more goals if achieved or alter to make targets more realistic if not achieved. This helps determine whether the training program currently being provided is working or needs improvements.
Run a business impact study
The final way you could calculate ROI is to create a business impact study, which is any change brought on by the training; these include sales, employee retention or customer feedback.
The process involves four stages: evaluation planning, data collection, data analysis and reporting.
In the first stage, you evaluate the objectives of a program and from there develop the evaluation plan and baseline data. During the data collection phase, all the data is collected regarding the application, implementation and business impact of the training.
Following this, data is analysed to isolate effects of the program and converted into monetary value to calculate the ROI. In turn, this leads to a report being created known as the ‘impact study’.
Hopefully you now feel more educated on measuring the ROI when it comes to training programs. Whichever method suits your business the most, start measuring your learning to assess the value it’s delivering to your employees. If it’s not working, consider investing in a new training program to maximise your efficiency!