The Business of Training

Back in 1999 The Jack Philips Center for Research coined the term "The ROI Process" (TM) .  It was, and still is, a comprehensive methodology for capturing ROI as well as the measurement of all aspects of the benefits of training (learning or performance) interventions.  See The Four Evaluation Levels for Training Programs for additional insight. In The ROI Process there are five levels presented.  ROI being a separate level from the traditional levels presented by Dr. Donald L. Kirkpatrick.  Dr. Kirkpatrick included ROI in level four known as Results , because ROI is one of the measures of the final business results such as increased sales, reduced costs, etc.  In my opinion, ROI is really a nice 'business' way to summarize your investment in the training intervention. However, common sense must be enlisted when, and if, you decide to establish the ROI of a learning event.  The cost of determination can exceed the benefit! The organizatio...

Return on Investment (ROI) or justification for invested capital, time, etc. is an important concept for training organizations.  Again, this is the language of business and you must know and understand how to demonstrate the value of your training programs to the company. To calculate the Return on Investment for Performance Solutions (Training) can be easy or difficult due to the nature of Learning Events or Training Interventions. The ROI formula is simple: ROI  =   The Net Training Event Benefits                    The Training Costs For example: Cost of Training Program = $195,000 Benefits of Training Program (1st year) = $350,000 then: ROI  =  $350,000 - $195,000   =  $155,000   = 0.80 X 100  =  80% return in one year                ...