Training For ROI

The American Society for Training and Development (ASTD), a professional association of 70,000 corporate-learning specialists around the world, provides new ammunition for anyone who needs to make the case for employee training programs in their study “Profiting from Learning: Do Firms’ Investments in Education and Training Pay Off?” They suggest that companies should view employee training as an investment and report it in their financial statements alongside R&D and capital expenditures. While probably few companies will be reporting training as an investment, it is certainly an operating cost that gives a good ROI.

Considering that the latest figures show that dealing with poorly performing employees costs businesses in the United States $105 billion each year, that managers spend 14% of their time redoing or correcting the mistakes of others, and, according to a recent consumer study, fifty-seven percent of consumers surveyed identified poor employee training as a leading aspect of service deficiencies, employee training may be one of the most important expenditures a company can make in terms of getting a serious return on their investments.

The right training can improve employee performance and production, decrease management’s problem-solving time, and improve customer satisfaction. But, how does a company pick the “right training?” Technology training, team work training, motivational training, writing classes, sales training, job tasks and procedures training, the list of types of training is almost endless. Couple this with variety on old and new training methods, such as online training, classroom, rapid e-learning, DVD and CD-Rom training, etc. and you begin to see the difficulty in picking the “right training” for employees.

First, make goals and set objectives for training outcomes. Make sure you target your training to teach necessary skills. Get input from your staff what they think they need to know to do their job well.

Develop a training plan and policy based on the problems/needs to be addressed. Determine exactly what skills need to be taught and which staff members need training in what areas.

Determine format and resources for implementing training. The format might be group or individual, in-house or out-sourced, and the options on resources include CDs, intranet and internet resources, traditional classroom, books, DVDs, etc. In other words, present the material in a way that will match your staff’s learning style.

Evaluate each training session you implement, regardless of format or resources used. Ask staff for written evaluations of their training and set up a method for determining outcomes, such as analyze whether staff error has diminished after the training in that task/skill.

One example of a training need that most companies face each year is technology training. With rapid advancements in computer technology, companies must frequently update hardware and software, but without training, you and your staff will waste substantial time and money trying to accomplish old tasks with unfamiliar technology. Many experts have suggested that 70 percent of your technology budget should go to training and only 30 percent to hardware and software. However, those figures are based on last year, and like everything else that has to do with computers, last year is obsolete.

Let’s look at using e-learning for computer training, which has helped many companies increase their reach of training at a reduced cost from traditional training. However, it still was not inexpensive. Development and delivery required advanced skill sets and lengthy turnaround time. Today, many methods are available for rapid e-learning that can be used to quickly and inexpensively create learning tools for quickly giving employees training on software tasks. For example, we recently needed to train some staff on a new data entry task to be done in a database they were unfamiliar with. Our SME created a recorded training module with audio, video, and review questions while actually working on the database in about two hours, losing actually less than half an hour of productive time. The employees being trained required minimal training time, about thirty minutes, to be at least adequate at the task, began working at the task, and were proficient by the end of day working. Since the training module was a recorded session, it still existed if the employee needed a refresher or for training temporary or replacement employees. That’s cost and time efficient training, leaving more of your budget for hardware and software.

Today, more and more companies are embracing new learning resources and developing training that is job specific rather that concept or program oriented. In other words, companies are not looking so much for training in Microsoft Word as they are looking to train employees how they will use Word in their specific job. With such new resources as rapid e-learning, companies can reduce the time and money spent on training development.

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