5 Steps to Drive Value from Training
According to the ASTD’s 2013 State of the Industry Report, U.S. organizations spent $164.2 billion on employee learning and development in 2012.
The report does a good job of categorizing and classifying expenditure. But what about ROI? How can managers structure training to ensure a positive ROI?
There’s plenty of talk in L&D communities about admonishing executives who fail to understand the value of investing in their people. The way our accounting systems are structured, the photocopier shows up as an asset while people count as costs.
But it’s intellectual capital—a company’s employees—who drive the value of the photocopiers outputs. Hence employees are underinvested in.
Learning and training leaders, however, need to understand that most executives have been to their fair share of borderline useless training.
Perhaps they enjoyed a nice few hours or days out of the office, but the exercise has had no lasting impact—an ROI of zero. But that’s not all.
Managers must also factor in the negative opportunity cost of other projects they could have been working on while at useless training.
Of course, it doesn’t have to be that way. I’ve observed some notable exceptions, but only if certain conditions are met. Here are my recommendations—and if you’re thinking of kicking in an investment in training, you ought to factor these considerations into your planning:
1. Establish Objectives
The $164 billion spent every year on training is easily measured, but measuring the impact of that spending is a little more challenging.
The first step is to realize that training is not an event, but should be considered a process along a path to reach some goal —behavior changes that make the organisation more productive.
Procter & Gamble is a famous innovator. Nonetheless, in the early 2000s only 15 percent of its innovations were meeting their revenue and profit targets. To address this, the company set about building organizational structures to systematize innovation.
They created innovation and strategy assessments into a combined and revamped executive review process.
To design the training program, they asked themselves questions about what they were trying to achieve, and therefore the type of skills they would require.
- What do you want the training to achieve?
- What knowledge are you trying to transfer?
- What changes in behaviour are you trying to make?
- What results are you trying to attain?
- How will you know whether you have reached them?
If simple and measurable goals for the project (note: I wrote project, not training) can’t be set, then you’re unlikely to be able to select the right training program in the first place. And you have little to no chance of accomplishing any meaningful improvement.
2. Gain Buy-In From Front-Line Leadership
Front-line managers are the critical influence on the success or failure of any training initiative. Without their active buy-in, support, and field-level reinforcement, you can guarantee a trickier effort to get employees to invest and learn what you teach.
P&G wanted to develop more innovation to drive growth. P&G’s leaders recognized that the kind of growth the company was after couldn’t come by simply doing more of the same. They gained support from managers, and began holding a two-day training workshop for seven new product development teams.
The training began with short modules on topics, such as assessing the demand for an early-stage idea and evolved to multiday-courses on entrepreneurial thinking.
Managers were equipped with the tools, skills and insights they needed to reinforce the mind-sets and behaviors needed on a day-to-day basis. In fact, I’d go so far as to say that you need to train and equip your managers on coaching and development skills before you train your people.
3. Tailor to Your Environment
Off-the-shelf, standard methodology and training packages (and particularly public courses) tend to be generic, with very little reference to your specific environment.
Even if the methodology is potentially suitable to your environment, the program’s impact is dramatically reduced if the examples and emphasis are not tuned to your specific situation.
To create the kind of results P&G had in mind, the company needed a tailored training program that also evolved as the organization moved along its innovation journey.
There are many highly effective methodologies available. You need to start by thoughtfully choosing the one that seems most relevant to the behaviour you are trying to instill. But you also have to unequivocally ensure that you tune the application to make it relevant to your people.
If you're purchasing a training program from a third party, make sure that the company is willing and able to personalize the material.
If members of the third-party company care as much about outcomes as you do, they ought to enthusiastically embrace the idea—and be able to show how they have done the same for other clients.
4. Bring in the Reinforcements
Before you even begin to conduct training, be sure you have reinforcing systems in place and materials prepared. This might include ensuring that your workflow automation tools are aligned with the training methodology and preparing guides that reinforce the approach.
P&G created a process manual—a step-by-step guide to creating new-growth businesses. The manual includes overarching principles as well as detailed procedures and templates to help teams describe opportunities, identify requirements for success, monitor progress, and make go/no-go decisions.
This helped to reinforce and embed the lessons into the organization, making the implicit explicit and the explicit implicit.
5. Support With Coaching and Mentoring
A mass training curriculum can never hope to address the specific development needs of all individuals. So you need to blend your group training with individually targeted coaching and mentoring.
To create the kind of high-level individualized advice required, P&G formed a group of new-growth business experts to help the teams working on innovation projects.
These experts advised teams to remain small until their project’s key commercial questions, such as whether consumers would habitually use the new product, had been answered. The guides include several entrepreneurs who have succeeded—and even more importantly, failed—in starting businesses.
Also, have managers conduct regular needs assessments and personal development plans with every member of the team. That way you’ll be able to target your interventions towards the areas where they can really make a difference to individual performance.
For P&G, this tailored, process-driven approach to training needs got results. Tide, the leading laundry detergent, was one such example of success. A decade ago, Tide came in either bottles or boxes, small or large.
After P&G’s innovation initiative, Tide now comes in dozens of varieties and allied products with various scents and capabilities. In addition to shaking up the locally mundane, P&G also developed versions for emerging markets such as India where 80 percent of people wash their clothes by hand.
And, of course, don't forget to provide a decent lunch during training. Nothing shows up more on feedback sheets than a poor lunch.