Measuring ROI In Learning & Development Programmes

Learning and development professionals are often faced with the difficult task of demonstrating return on investment (ROI) for the programmes and initiatives they have implemented or want to implement. Business leaders, quite rightly, want to know what kind of return they are going to get, and what benefits the business will realise as a result.

However, demonstrating return on investment (ROI) is a much easier exercise in certain areas of a business than others. The challenge for L&D professionals is linking said investments to specific and measurable business outcomes.

In an ideal world, L&D ROI could be measured by outlining how many people went on a sales course; how much the cost per person was; and then showing how many participants increased their volume of sales as a result.

ROI Challenge For L&D

But for L&D, it’s sometimes only possible to provide figures relating to the number of employees participating in a learning programme; the cost per person; and whether or not the programme was well received/the instructor was any good. The problem is, this is not sufficient to prove the programme’s impact on the organisation (i.e. demonstrating ROI) to the board.

When it comes to L&D programmes and initiatives, isolating ROI is often difficult because there are too many variables involved. Let’s also not forget that certain types of learning programmes do not have a finite period in which they will demonstrate ROI. That’s because some learning lasts for a lifetime and can benefit a company long into the future – even after the official measuring has stopped.

This leads to another crucial point – when do you start and stop measuring the effectiveness (ROI) of a particular piece of learning?

It’s not even easy to determine specific objectives for a learning programme. Every employee inevitably has a different set of individual learning preferences, needs, aptitudes and motivation to put what they’ve learnt into practice.

So, while a learning programme shows huge benefits for one individual because they are actively utilising what they have learnt, it might seem as though it’s lacking ROI for another because that person is simply choosing not to apply it.

That’s why L&D professionals often determine a different ROI for each learner. The key here - as with any learning programme - is to identify where an individual is before they start. That’s because it is impossible to measure any progress/development/improvement without first knowing where the learner was before the exercise commenced.

Learning ROI

This is where your LMS and LRS will come into their own.

Learning ROI for sure needs your data in one place and this helps if your learning technology is both an LMS and LRS combined. But data is just the starting point to revealing true ROI. A good HR Learning business partner will be having these challenging ROI discussions with the business way before and after any learning intervention - formal or informal.

To know the true ROI of learning, keep it simple and link learning to individual, team and organisation performance outcomes. Job done.

Agree? Disagree? I'd love to hear your thoughts.