Training is an investment for every company, and it is important to know whether this investment is worth it or not. Measuring the ROI of your training is important to keep your business running and competitive. Training should not only look good as a record but also be effective for your workforce and the company as a whole.
Why measure the ROI? Some important questions you need to ask when justifying the costs of training are:
What are the goals of this training? To enhance employee engagement and productivity? Or maybe to let the employee learn a new skill to decrease cost by avoiding outsourcing?
Are you investing in the right training initiative? What data do I have that can be converted into monetary value?
What value does this training give to the company that you can showcase to stakeholders Asking these questions and being able to answer them is key to identifying a goal and helps with ensuring a budget for future training initiatives.
How to measure ROI?
There are many methods of measuring training ROI. Some can be highly monetary; however, the return on investment may sometimes not be as straightforward as you would think. Let’s explore the two ways of calculating ROI.
1. Training ROI Calculator
When it comes to measuring how much return financially has been made after training, the calculation of it is simple.
This is a good way to measure ROI in a purely financial approach which is good to use to ensure investments and budgeting for future training incentives.
2. The Kirkpatrick Model of Training Evaluation
There are 4 levels to approach using the Kirkpatrick method to measure the course of this training and its impact.
Being able to approach each level honestly is key to configuring the investment return of the training. This shows the manifestations of training not only in financial terms but also skill-wise and the effect of this training on the well-being of the employees.
Collecting data and measuring training ROI is no easy task. That’s why it is important to acknowledge the aspects you lack and strategize planning that can contribute to the goals you aim for in the business and what impacts it the most.