No Image Available

Annie Hayes

Sift

Editor

Read more about Annie Hayes

Training: A poor investment?

pp_default1


Is the transfer of learning into the workplace the ultimate training goal? Or should a grip of the financials and a focus on the return on investment be the centre of attention? Martin Schmalenbach a training and development expert investigates.



“Trainers should stop worrying about whether courses bring a return on investment and simply focus on whether people are taking their learning back into the workplace, applying it properly, a leading business school has said. Ashridge Business School has found that it is almost impossible to quantify ROI around management development because there are so many variables involved.” (Training Magazine, November 2005.)

I’m familiar with the credentials and reputation of the Ashridge Business School. Whilst I haven’t seen the research referred to in the quote above, I can’t help feeling there is something not quite right about what is being said.

I should first declare some interest and bias here. About five years ago I lost my job as a training manager for a large technology company that found itself in the midst of a profit crisis and had to shed jobs. I was one of many to be shown the door, primarily because I couldn’t justify my existence in financial terms – I and the training function could not demonstrate a positive ROI to the shareholders.

The sense was that training was financially, at least in the short term, a poor investment. I also run a business that works in the area of training evaluation and ROI, using our own toolset. So I’m somewhat interested in this whole return on investment issue.

To ensure a positive ROI from a training intervention, surely there must be at least some transfer of learning back to the workplace? If not, doesn’t that suggest that the training is superfluous at best?

While I agree that there isn’t enough focus paid to the transfer of learning what is often overlooked is that if the learning is not what is needed then the ROI will be skewed anyhow.

Isn’t it a responsibility of management to maximise the returns on the investments they make with the resources at their disposal?

As we see the UK economy stagnate somewhat (a personal opinion, based on the number of industrial units I see around the country that are now ‘for let’ that weren’t in this state six months ago, and also based on the volume of goods coming into the UK from the Far East) I am beginning to note conversations with FD’s and CFO’s that are more focused now on ROI.

Let me be clear. The ROI doesn’t need to be financial, though we often tend to think only in financial measures. But managers want to know that the effort put into training is worth it. FD’s and CFO’s would like to see some hard and financial ROI figures backed up by solid, robust analysis and data.

The industry-standard approaches to evaluating training and producing ROI data are arguably not robust enough in this respect, but this does not mean that they shouldn’t be used.

There seems to be a widely-held perception, expressed in the quote at the start of this article, that quantifying ROI for management development is almost impossible due to the many variables involved. This seems to suggest that it is alright to not even try, but to do management development almost as an article of faith.

And when times get hard, and the belt needs to be tightened, management development is one of the first casualties. And what kind of capabilities are most needed in these turbulent and ambiguous times, when judgement is needed, when employees look to managers for assurance and leadership?

That’s right, management and leadership capabilities. Only the development of these capabilities are halted. Is it any wonder some organisations really struggle, perhaps more than they should?

The transport business has developed comprehensive methods for investigating accidents and getting to the root causes, so that lessons can be learned and that accidents hopefully are not repeated in the future. Perhaps the best known example of this in the UK is the Air Accidents Investigation Branch, part of the Government’s Department for Transport. Human factors are frequently major contributing factors in accidents.

I have some knowledge of this, having worked some years ago in flight safety in the RAF. My point is that there are tools for looking at large numbers of variables, for looking at behaviours and the human factor. There are tools from the world of the AAIB, and from the worlds of engineering and manufacturing(also areas I worked in – I have a degree in engineering). But it seems that there has been little cross-over until now.

Should trainers worry about the transfer of learning to the workplace? Absolutely. Should they stop worrying about ROI? No way, not if they want to avoid what happened to me five years ago!

Should management development be evaluated for ROI, despite the high number of variables? Absolutely, perhaps more than any other training activity.

The tools for dealing with this situation exist. They are not included in the industry-standard training evaluation methods. Find out what your key stakeholders need in terms of ROI and other evaluation data and deliver it to them. Find out where your (and their) training processes can be improved and improve them. Do this and you won’t go too far wrong.

About The Author:
Martin Schmalenbach has been enhancing performance through change and training & development for more than 10 years in organisations such as the RAF, local government, through to manufacturing and financial services. He has degrees in engineering and management training and development. For the past three years he has focused on developing and implementing a rigorous, robust and repeatable process for ensuring interventions contribute to the bottom line. You can find out more at 5boxes.com and How Did I Get Here?

More articles by this author:


One Response

  1. Don’t give up because it’s difficult!
    Should we be worried to hear a provider of management training recommend that companies shouldn’t try to find out if the kind of training they provide is worth it?

    My only disagreement with Martin here is where he says that “industry standard approaches to evaluating training and producing ROI data are arguably not robust enough” – there’s no argument about it!

    Of course there are many factors between the development event and the impact on company performance. Actually there are issues before the event, like whether the business objectives are clear and measurable as a starter. It’s this start point that usually leads to measurement problems later, and we should not be surprised at that either.

    HR Metrics are only just beginning to join the 21st century. Lots of stuff is difficult to measure and it will stay difficult until you start trying, reviewing, revising and improving the measurement process. But sure, don’t even start if there’s no measurable objective at the outset!

    Tim Douglas
    http://www.commercialhr.com

No Image Available
Annie Hayes

Editor

Read more from Annie Hayes
Newsletter

Get the latest from HRZone

Subscribe to expert insights on how to create a better workplace for both your business and its people.

 

Thank you.

Processing...
Thank you! Your subscription has been confirmed. You'll hear from us soon.
ErrorHere