Money, Money, Money – ABBA
You knew this one was coming, right? But I’m not talking about the money that you don’t have in your budget right now to conduct employee training and development. I’m talking about making sure you are clear on what return on investment (ROI) you expect and how to determine your actual costs for the budget you do have.
Reason #4 – The Solution Is Too Expensive
Evaluating and assessing your expectations from the beginning will go a long way towards achieving success. It may be that a negative ROI is not actually a sign of failure. You may determine that some intangible results such as perceived values or significant short-term behavior changes are more important than a bottom-line ROI.
That being said, a bottom line ROI figure can be a powerful indicator of training viability. Phillips and Phillips found that one large bank’s executive leadership development program offered excellent learning opportunities including mentors, learning coaches, project assignments and an impressive curriculum. However, after multiple years of providing benefits, when all the costs for curriculum design, consultant fees, personal learning coaches and facilitation teams were tallied; the total reached almost $100,000 per participant. The program was cancelled.
Conversely, one hospital network conducted a sexual harassment prevention program at a cost of $424 per participant and realized a ROI of 1,052 percent. This can be done by sharing clear expectations with your consultant or HR team, expect a clear cost analysis projection from that team, and factor in the intangible benefits.