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Training and The Return On Investment Challenge

In tough economic times, training budgets are amonst the first to go. Such decisions may be short-sighted, but it's hard to blame companies that dispense with training and development, when it's hard, if not impossible to DIRECTLY demonstrate a positive return on investment. After all, training costs dollars, and perhaps more importantly, time--time away from work.

The Ideal Training ROI Situation

The ideal return on investment situation occurs when one can show there has been a direct causal relationship between training and some sort of performance measures that tap into business results. So, a sales team goes to training, and subsequently, their sales jump 50%. That doesn't prove causation, though, because it's possible the increase was coincidental, which is why an ideal ROI training assessment should have a control group--an equivalent group of salespeople who don't receive the training.

That's the ideal. That's the kind of experiment social scientist researchers try to set up. It's not usually possible in real work settings.

The Less Than Ideal Training ROI Assessments -- Flawed

Apart from the fact that businesses don't usually do ROI assessments of training, even if they are undertaken, the results have to be suspect, because of problematic methods. Corners get cut in terms of metrics, because measurement is often costly. So, companies may rely on self-reports from learners, and that's pretty unreliable when it comes to performance improvement documentation.

  • As you look at some of the return on investment content below, you might want to consider these questions:
  • Should companies be more dligent in measuring the ROI of training, so as to protect its budget, or, for that matter know for sure whether cutting it will damage performance?
  • What are the implicationms of doing ROI evaulations, if the methods used are flawed?
  • Is there a point where evaluating ROI of training is so costly to do effectively that it can't, itself be justified?

    Top : Training - Return On Investment :

    Too many companies pay insufficient attention to return on investment for the training dollars they invest. The neglect putting strategies in place that will increase training ROI, don't measure it, and generally assume there's a return.


    Opportunity Costs: The Forgotten Training Cost By David Vance
    Opportunity cost is an economic concept with great relevance for the learning field. You might even say it is a philosophical concept. Basically, opportunity cost is the value of what is given up or forgone when a decision is made. In training, it is the value of the participant's time. If they are taking your class, then they are not doing something else, like performing the tasks they were hired to do. There is a tradeoff here because they cannot do both things at the same time. Hits: 586 )

    Return on Investment for Customized Training By Howard Community College
    Overview and some statistics in support of the use of custom designed training, in tersm of return on investment Hits: 2301 )

    Types of Staff Training -- Employee Training By n a
    How does employee training benefit your company? What difference does it make? Can it really make you more competitive? Find the anwsers within this article. Hits: 936 )

    Measuring soft skills training return on investment article By J.T. Taylor
    If you are willing to live with a decrease in scientific reliability, there is a way to effectively measure "soft skill" training. This article will show you a simple way to link soft skill training to measurable business results. Hits: 1056 )

    Staff training pays for itself over and over By Roy Chitwood
    If you need to convince others in your organization about the cost effectiveness and return on investment of staff training, read this article for its great points. Hits: 1404 )

    Types of Staff Training -- Employee Training By n a
    How does employee training benefit your company? What difference does it make? Can it really make you more competitive? Find these anwsers in this article. Hits: 988 )

    Investing in Training - How To Predict ROI By final copy group
    Here's a quick overview on how to predict training return on investment (in pdf format) Hits: 708 )

    Trainers' Task: Do More with Less By na
    A benchmarking study finds that, despite the need, companies are not increasing their training investment. - PharmExec Hits: 700 )

    Training ROI Worksheet By na
    Looking for a training ROI tool? Here's one. The Training ROI Excel Worksheet is designed to help you calculate the "real" or "actual" cost of any "off the job" training program and place a future %u201Cvalue%u201D on your performance in the portion of your job that uses the knowledge/skills that may be improved by the training. Hits: 1712 )

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    Pages Updated On: 19-Sep-2017 - 11:33:37

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