Despite its importance and potential to improve organizations, corporate training is not always effective. All too often, businesses spend big on corporate training but end up not reaping the rewards. Bad content, misaligned technology, and poorly defined learning goals can stand in the way of deriving the most value from corporate training programs. Equally problematic, however, can be a lack of effective performance measures for training that does delivery quality and value. Even the best training program can’t be appreciated without an accurate and persuasive means of measuring its success and, ultimately, its impact on your business’s bottom line. Below, we’ll explore four key measurements of corporate training ROI that can help decision-makers view training as an investment, rather than an expense.
How to Measure Corporate Training ROI
Most investments in corporate training are justified as a means for improving a businesses’ bottom line, hence it’s a no brainer that revenue can be used to measure the success of a corporate training program. While traditional ROI formulas can be applied to the direct cost of the training program and/or materials, the challenge is knowing exactly what share of any financial impact can be contributed to the program’s learning outcomes. One way to overcome this challenge is to combine your L&D metrics with key business metrics from the very start in order to understand how they are influencing each other.
Tip: Establish connections between key business metrics and financial goals with measurable outcomes of the training program, from the very start. e.g. Retail Example: Training Hours (L&D metric) & Revenue per Transaction (Revenue Metric).
One of the most important measures of training effectiveness, especially for programs that have any focus on customer experience, is customer retention. For this type of training, higher retention rates indicate not only improved customer service skills on the part of trainees, but an impact on brand perception and loyalty. As a measure of training program success, retention rates help demonstrate that continued investment is worthwhile from a branding and customer experience perspective. Other customer experience related measures might include things like:
- Customer feedback submissions
- Number of submitted customer complaints
- Average complaint resolution time
- Customer Loyalty program registrations
Learning and Development is no longer just about improving employee performance: it’s about investing in employees and giving them the opportunities for growth they demand. More so than ever before, today’s workforce wants to learn and considers the degree to which personal and career development is offered as a reason to stay with, or leave, an employer. Effective training programs are those that resonate with your learners and effectively meet their unique development wants and needs. Thus, one of the most important measures of any training program’s success might be its impact on employee turnover.
Employee Morale and Productivity
Morale and productivity are also effective measures of your training program’s success. Closely related to employee satisfaction and reduced turnover, empowering your team with new skills and knowledge through training can create ripple effects throughout your organization. When team members are given the tools they need to perform their roles more effectively and foster upward mobility, productivity and office morale are kicked into high gear.
The value you derive from training programs can be viewed through many different lenses and thus recognizing and understanding the return on investment in any form of corporate learning is complex. But regardless of the context, no program will be successful without the right measures for capturing successes and understanding shortcomings. If you would like to learn more about how to derive value from and measure the success of corporate training, contact our team today.