What’s your ROI on learning initiatives and your overall training and development budget?
Don’t feel bad if you don’t have that figure handy. It’s been a topic of debate for decades.
Maybe it’s similar to advertising…
“Half the money I spend on advertising is wasted; the trouble is, I don’t know which half.” – John Wanamaker
Wanamaker (1838-1922) was an early proponent of modern marketing, and despite his nuanced assessment of advertising, the quote is most often used to validate buying more advertising. We can infer that Wanamaker probably saw something good was happening in his business when he advertised.
Similarly, one way to evaluate the value of a training budget is to get down to the individual outcomes and see what good things are happening. This is especially valid when one of the goals is employee retention.
In one of Jamesson Solutions’ recent leadership development engagementsServices we found some encouraging responses from participants:
- The employee who received a much higher raise than is tradition for their company’s merit program. Their manager said the raise was directly attributable to the growth demonstrated since going through the program.
- Another employee had had their team taken away prior to our engagement. Towards the end of the program, they were restored as team leader. Again, this was based on a manager observing positive growth in the employee.
- At graduation for every cohort, participants must present what that they got out of the program. In the last cohort, one participant said completing the program was the single most important thing they had done to advance their career.
Each of these mini case studies, coupled with positive participant survey responses, demonstrates a bottom-line value, when you consider the cost of having to replace an employee, whether they leave for something better or have to be replaced.
Pre-pandemic, the corporate training industry was $83 billion in 2019, according to The Industry Report. Training Industry, in June 2020, reported some increase in training investments during the pandemic.
As with Wanamaker, organizations know training is valuable, even when precise ROI is difficult to determine. So when evaluating your training performance and planning budgets, don’t overlook qualitative review and individual performance assessments.