How to Calculate Meaningful ROI for Workplace Learning

October 2, 2018

How to Calculate Meaningful ROI for Workplace Learning

Learning professionals in many organizations are facing the same struggle: proving the worth of employee development to senior and executive leaders. Budgets are made according to the resources that present the most promise and need, but why is corporate learning and development so easily deprioritized by so many companies regardless of size or industry? 

If you are struggling to provide the return on investment of your L&D strategy, here are some crucial tips taken from findcourses.com’s 2018 U.S. L&D report

1. Provide concrete evidence of positive business impact.
Many who are in the L&D field have been having to prove the most obvious value of employee development: successful business impact. 

If you don’t have the statistics to ensure your claims of positive influence, senior management will easily see L&D as an opportunity for budget cuts. If you are not able to prove the business impact of your department in numbers, the core connection between bettering your employees and the betterment of the company will be lost entirely in the eyes of executives. 

2. Define your own successes. 
“We have to redefine learning success. Success doesn’t occur in the classroom or a keyboard or on your mobile phone. Success occurs when you actually use what you’ve learned and had an impact in the organization—with your work, with the customer, with the people around you. That’s the business connection. Until you have a business impact, you’re not successful,” said Jack Phillips, Ph.D., Chairman of the ROI Institute.

In past and recent years we have been viewing employee development a “success” simply if an employee attends a course or workshop, rather than if they are implementing the learned skills into their actual efforts. Success in providing L&D for employees is when you are able to see that they are improving their performance within the company or with their interpersonal relations with colleagues, clients, or customers. 

Those who are facing the task of maintaining their budgets for learning and development must encourage and enforce the abilities of their company’s employees so that when the time comes to agree a budget, those in charge will see their employees as a feasible investment rather than an obstacle. 

3. Take ownership of your employees.
Whether or not an employee utilizes the training provided is not within your power, but knowing that you provided the best possible access to furthering their abilities should be. 

Learning professionals may be more readily able to claim successes but they must also be ready to claim results of failure. While the optimum outcome for every piece of education and learning would be to have more readily skilled employees, this simply cannot happen in every situation, and you must handle each negative impact just as aptly as a positive result. 

“We have this philosophy that we can’t control what employees do with learning so if they don’t ever use it, it’s not our fault. Well, that may be true, but it’s the organization’s budget that you’re spending. You better be concerned about it because it’s ultimately your budget that’s going to be cut if your top executives don’t see that connection,” says Phillips.

Taking responsibilities of negative results should not only fuel a desire for positive impacts, but also spur changes in your efforts to reduce the  chances of undesired outcomes in the future. Ownership of missed opportunities may expose a weak spot or area in your training methods, but it also leaves all the more room to alter and improve the techniques of education to better meet the needs of employees. 

Tactics that are proving successful in the L&D industry have been to utilize quantitative data throughout the entire process of training, so as to be able to calculate the impacts of learning upon introduction as well as how an employee is or is not incorporating those methods into their practices. For example, Jo Rapley, People and Culture Manager for BPS World, said, “When we have had a successful quarter, there will be a number of people/factors that try to ‘own’ that success. We therefore set clear qualitative and quantitative objectives at the start of any program. Participants are asked to keep a learning log of how that learning has had an impact on their job/team/business and it’s collated when calculating ROI.”

4. Include management in your development.
View your managers as your closest source to employees. Include them in the development of your training process and  consult with them post training to better determine what was successful and what should be changed in future efforts. Learning professionals must also seek to understand manager’s L&D needs through open and effective communication habits. Feedback gained and input from these individuals to the L&D team of a company serves as an invaluable view into the effects of your training, the receptiveness of employees, and what is or isn’t being utilized on the job. Share your abilities and insights with management and include them in your practices so that when the time comes for them to deem which investments are necessary or not, your budget will not falter or be cut in the process.

Efforts of learning professionals have the ability to deliver substantial results for a company, and while not every individual values those possibilities to the same degree, you must make others understand the value that is possible.

The Authors: 

Mary-Louise Ortiz is a content developer and strategist for findcourses.com, one of the world’s leading search engines for professionals seeking corporate training and continuing education. Ortiz is part of the writing team that conducts in-depth research and analysis of the L&D industry trends in both the US and UK markets.