Corporate training is oftentimes a disconnected process from the rest of the corporate creature. But if you think of training as another piece of the puzzle that can add to your company’s bottom line, then you’ll need to measure both the cost of corporate training as well as any benefits that result: you’ll need to somehow compute the “Corporate Training ROI.”

The Cost of Corporate Training

As with any other business activity, there’s a cost to how you conduct your corporate training. Training can be performed in a traditional face-to-face manner, through an LMS, or by using a blended approach to training. If you use the traditional approach, you’ll either have to hire someone to do the training or you’ll have to send your employees off-site to complete the training.

costs with 2 dollar billsIf you choose the traditional approach, hiring someone permanently might be more cost-effective if a lot of employees work at your company. And, if you’re a smaller company and are situated near a large city, then there’s probably a supply of local corporate trainers that you can tap into.

Another advantage to hiring a local corporate trainer is that your company could develop a long-term relationship with the trainer. This would allow him or her to get to know your employees and gain an understanding of your corporate culture.

As a lower cost option, your company can use its LMS to provide some if not all of your corporate training. An LMS, or Learning Management System, is a way to provide corporate training online through videos, PowerPoints, and assessments.

With the lower cost of the LMS, however, may also come the need to hire an instructional designer. And, while there might be more of an upfront cost to hire an instructional designer to develop the training modules for you, the cost could be lower in the long run. Also, having the instructional designer work with you and your team over a period of time to develop the training can lead to training that is much better suited to your particular company.

The Benefits of Corporate Training

Measuring the benefits of corporate training will be much more successful if you know your training goals ahead of time. And you can use a system that you’re familiar with, such as OKR, to determine what your measurable objectives are ahead of time: you can then actually measure whether those objectives are achieved.

As one example, let’s consider sales training. Using an LMS, you can provide a pre-course and post-course survey with questions regarding attitudes that you want changed. For example, did the trainee answer questions in a “me-centric” manner before the course, but in a more “customer-centric” manner at the end of the course?

analysis graphFor larger companies, another approach that you could use to measure benefits of training is to provide the training in two different ways and then compare the two groups. One group could be trained using an LMS and the second group could be trained using a more traditional approach.

After the training is completed, you can compare the two groups in both the short and long term. Performing this training experiment could show you the benefits associated with each training method and could also be a way to quantify the difference in the benefits.

Continuing with the sales example above, you could compute the ROI of each of the techniques by computing the (hopefully!) positive change in sales divided by the investment in the sales training.

And this approach isn’t just limited to sales training. You can use this technique to compare a variety of things pre/post training such as:

  • number of customer complaints (customer care training)
  • number of sexual harassment incidents (sexual harassment training)
  • number of company safety violations (safety training)

You could take each of these numbers and quantify a benefit associated with them, and then divide by the training cost to compute the ROI.

Conclusion

Corporate training should be part of any company that hopes to continually grow. However, if you’re training your employees and not measuring the costs and benefits, you’re missing out an opportunity to examine the process and tweak it to maximize the ROI of your corporate training.

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