Having an expected return on investment (ROI) from any business activity is as fundamental as putting gas in a car and expecting it to go a certain number of miles.
Without this anticipated ROI how can we measure success?
Imagine being in a meeting where some variant of the usual question is asked: “So, what can we expect to get from this?” The person being asked just shrugs, says, “I’m not sure, really.”
Ordinarily said proposal would be laughed out of the room.
Except when it comes to knowledge based training.
Despite the fact that many leading entrepreneurial minds, like former GE CEO, Jack Welch and VC, Ben Horowitz, see training as a mission critical function of any senior management team. When Horowitz was a product manager for Netscape he read Andy Grove’s High Output Management, in which, chapter 16 entitled ‘Why Training is The Boss’s Job’ and it changed his career.
The main challenge, inherent in any training course, is a general inability - or disinclination - to measure the results.
Assessing Training ROI Using The Kirkpatrick/Phillips Model
Developed between Dr. Donald Kirkpatrick and Dr. Jack Phillips, using research which dates back to the late 1950’s, this model is the basis of how to evaluate all training programs.
How engaged were your staff? Did they seem to benefit from the training on the day? This is subjective, but easy to measure. Bored staff, means not engaged, which immediately reduces the ROI from the training because they will be taking in less information.
2. The Learning Step
Next, evaluate how much they learned. Doing this in a real world - non-classroom scenario will help you judge whether they stepped over the knowledge gap.
3. Behaviour, Application, and Implementation
How much have they learned, and how often do they need to put it into practice? Some knowledge, particularly functional knowledge - which helps people do their jobs - is used frequently. Other knowledge, like management training on how to let staff go, hopefully shouldn’t be used too often.
4. Business Impact
This is a cumulation of the previous steps. What’s the bottom line impact? Did the lessons they learned in training four weeks ago help them improve productivity in time for the next quarters results? That’s the principle yardstick. If training hasn’t had sufficient impact by this stage of the evaluation then it won’t in the next. Time to revisit.
5. What’s the bottom line?
You should now be able to see the results of training in the financial reports. You bought this training. It had a value. You’ve had time to measure how your team put it into practice. Now to find out how much, or little, impact it had on the bottom line. Getting feedback from staff during this evaluation process is also useful, as the knowledge will be getting absorbed into their everyday practices.