"Does training really work?"
“If we as leadership, learning, and development professionals can’t answer that question with an enthusiastic yes, we’re all in trouble,” says Dr. Paul Leone, ROI expert at Verizon and author of the book Measuring and Maximizing Training Impact: Bridging the Gap between Training and Business Results.
“The truth is, HR people don’t always know if training is working,” says Leone. “Often we ask for budget at the beginning of the year, but at the end of the year we aren’t able to show the training has had an impact on the bottom line. That’s not a good position to be in.
“Imagine how much better you would feel if you could go into meetings with senior leaders and stakeholders saying, ‘This time I have some data—and I can show that we are impacting the bottom line by X amount of dollars.’ I think that’s where we all want to be in the industry.”
The good news, according to Leone, is that you can demonstrate the impact of training if you know where to look, how to set up your initiative, and how to present your data.
“Begin with the end in mind,” says Leone. “What are the leadership behaviors you want to impact and what is the benefit in terms of increased sales or productivity, decreased costs from better alignment or efficiencies, or improvements to the customer experience?
“Senior leaders want to know that the money they are spending on training is generating a good return on investment. If you don’t clearly identify the benefits along with the costs of training, it creates some pretty lopsided equations and makes it difficult to talk about ROI—because training is seen only as a cost. That’s a vulnerable position.”
Start Small and Be Conservative in Your Approach
For L&D professionals just getting started with measuring ROI, Leone suggests focusing on a small, manageable test case, such as a pilot study with a group of managers who have direct reports with easily quantifiable key performance indicators (KPI).
“Two things are important here,” says Leone. “First, remember that you are measuring the benefit of better leader behaviors by looking at the improvement in performance of that leader’s direct reports—that’s where the bottom-line impact will show up. For example, better leader behaviors from a call center manager will translate into better performance from that manager’s frontline associates. Better goal-setting and coaching skills from a sales manager will translate into better sales performance from that manager’s individual salespeople.”
“Second, choose managers whose direct reports have KPIs that are easier to convert into bottom line impact. Don’t try to quantify the impact of better research and development performance among a group of engineers as your first project. Choose a group where you can measure shorter-term impact and easily convert improved performance into dollars and cents.”
Use a Proven Model and Process
Leone also recommends using a proven approach such as the Phillips ROI model and the Kirkpatrick levels of change. He suggests focusing on levels 3, 4, and 5 in the Kirkpatrick model which cover leader behavior changes and bottom-line impact.
Leone uses a survey administered 90 days after training to measure perceived changes in manager behavior. To corroborate answers and provide a more airtight case when presenting evidence of changed behaviors to senior executives, Leone surveys both the managers who participated in the class and their direct reports.
“It’s important to not only ask the managers if they have changed their behavior, but also ask the direct reports if they have experienced changed behavior from their manager. This provides a corroborating data point.”
To isolate the impact of the changed behaviors on business performance, Leone recommends comparing the financial performance of the treatment group (the managers who went through the training) with a control group (similar managers in an identical business unit who have not yet gone through the training).
“Comparing the treatment group with a control group allows you to isolate the benefits of the training. When senior leaders know that everything else between the two groups is identical, they are more at ease attributing the improved performance to the training initiative.”
Keep the Presentation Simple for Best Results
Leone also has a tip for how to present the data to senior leaders: keep it simple!
“When I first began presenting data after graduate school, I thought it was necessary to show things like multiple regressions and multivariate analysis in my presentations. But in reality, it had the opposite effect. When I made my presentations more understandable, they started to go higher and higher in the organization.
“If you want to squash your story, throw in a lot of numbers and tables,” says Leone with a smile. “But if you want to push that story up the hierarchy to the highest levels, make it simple and it will get up there.”
Establish Credibility that Lasts and Builds Confidence
“The goal with your ROI presentations is to create credibility within the organization—where you can say, ‘If we are going to keep a program, we are going to run a pilot and we’ll measure it. If it’s great, we’ll scale it across the organization. If it’s not so great, we won’t.’ I can guarantee you that at some point in the very near future, someone is going to ask if a training worked. You will want a study and some data to show that it did.
“Remember, you don’t need to measure everything at first,” says Leone. “Go in and measure one or two programs and do it right. Once you get your foot in the door as a credible evaluator, you’ll have a much easier time securing budget in the future.”
Would you like to learn more about calculating ROI and measuring the impact of training? Join us for a free webinar!
Leadership Training—Calculating ROI and Making the Business Case
Thursday, November 29, 2018, 9:00 a.m. Pacific Time
Improving leadership skills is one of the best ways to impact your organization’s bottom line. Still, many leadership, learning, and talent development professionals struggle with both identifying the expected return on investment for training expenditures and measuring impact after an initiative.
In this webinar, David Witt, program director at The Ken Blanchard Companies, teams up with Dr. Paul Leone, author of Measuring and Maximizing Training Impact: Bridging the Gap between Training and Business Results to show you how to identify anticipated fiscal impact of a leadership training initiative and how to measure it in a cost-effective manner after the class has been conducted.
You’ll learn:
- How to calculate the ROI for your leadership training initiative using Blanchard’s Leadership Training ROI Worksheet. (Worksheet provided to all registrants.)
- How to measure the impact of training using the methodology outlined in Leone’s book Measuring and Maximizing Training Impact.
- How to improve the adoption of new leadership practices from the classroom to the work environment.
Don’t miss this opportunity to learn how to quantify the impact of leadership training in proposals—and how to set up your training to deliver on expectations.
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