return on training investment

NATIONAL UNIVERSITY OF MODERN LANGUAGES

TRAINING & DEVELOPMENTPRESENTATION

COURSE INSTRUCTOR: MISS AMNA MALIK

PRESENTERS

•IRFAN AHMAD•ADNAN SIDDIQUE•H. M. NOUMAN RIAZ

TOPICS•EXCELLENCE (in terms of HRM)

•Return On Training Investment

•Measurement Of Training Impact

•Organization's Needs

EXCELLENCE

•“The quality of being outstanding or extremely good”

Hrm adds some distinctive aspects to simple definition of excellenceSuperiority, Distinction, Supremacy, Value

•Enhancement of efficiency •More output less input

BUSINESS EXCELLENCEBusiness excellence, as described by the European foundation for quality management (EFQM), refers to; ”outstanding practices in managing the organization and achieving results, all based on a set of eight fundamental concepts”• Results orientation• Customer focus• Leadership• Constancy of purpose

BUSINESS EXCELLENCE CONT.… • Management by processes and facts• People development and involvement• Continuous learning• Innovation and improvement•Public responsibility 

RETURN ON TRAINING INVESTMENT

It is used to: •Quantify the effectiveness of training.•Manage the training budget.•Provide evidence to management and other stakeholders.

•Build trust and respect for ourselves and our unit.

• Identify areas for improvement.•Keep our jobs (enough skills are job keepers)

MODELS

BENEFITS TO COST RATIO:

ROI %

100(%) xCost

CostBenefitROI

Costs ProgramBenefits Program

BCR

RETURN ON TRAINING INVESTMENT

Different levels involved 1. Reaction and planned action (need and response)2. Learning (results of training to employees)3. Application and implementation (how it is used)4. Business impact (effect on business)5. Return on investment (impact on profitability)

MEASUREMENT OF TRAINING IMPACT

TRAINING INITIATIVE Easy as A, B, C, D

Audience: whoBehavior: what do “they” doCondition: what is the setting and method of evaluation

Degree: measurement to be met (desired skills)

AudienceBehavior

Condition

Degree

At the completion of the course the learner will be able to score 85% or better on a written multiple choice 25 question test

OBJECTIVE EXAMPLE

COSTS, BUDGETS AND BENEFITSQuantifying ROI means accounting for

all the costs of the program.Fixed costs: independent of the number of participants.Variable costs: dependent on the number of participants.

Count cost at every step.

OUTPUTSOutputs are product-driven and include data that are not performance-based but rather outcomes of changes in performance or investment in equipment. Examples include:

• Units built.• Time it takes to build the units.• Income from sale of units.

IMPACT (SOFT SKILLS)Change in:

•Attitude•work climate•Leadership•Teamwork

Effectiveness Efficiency

ORGANIZATIONAL NEED Four basic needs of organization • (BODY) SURVIVAL • (MIND) GROWTH AND DEVELOPMENT — Economic growth,

customer growth, innovation of new products and services, increasing professional and institutional competency.

• (HEART)RELATIONSHIPS — Strong synergy, strong external networks, and partnering, teamwork, trust, caring, valuing differences.

• (SPIRIT) MEANING, INTEGRITY AND CONTRIBUTION — Serving and lifting all stakeholders: customers, suppliers, employees and their families, communities, society — making a difference in the world.

ORGANIZATIONAL NEED CONT….Change in:

1) Attitude, 2) leadership, 3) teamwork.• We desire these changes because they ultimately effect productivity.

• Allow time for change in attitude or behavior, then measure these changes and report qualitatively.

• Allow time for change in productivity, then measure for data and report quantitatively.

NEED TRAINING • Many times an organization will have policies, procedures or structures in place that are not aligned with the strategy or direction in which the organization wants to move.

• It will define ‘how’ the organization can resolve the underlying  root causes that are hindering performance.

• Achievement of compatibility with changing environment requires training and development.