How Do You Know if Training Is Effective?
You’ve heard it before, but training without measurement can be a serious waste of time and money. There are ways to prove training is effective.
In the United States, roughly $60 billion is spent each year on training. Yet, most organizations never truly know if their efforts are effective because few actually measure to find out how much of the training was absorbed.
Further, by the time they return to the office, participants often lose up to 90 percent of what they learned in training. And how much knowledge transfer occurred in the first place? Without practical follow-up and meaningful assessment, most new skills are lost within a year.
The crux of the issue is determining how to make training stick. The famous Peter Drucker quote, “What gets measured gets done,” comes to mind. Why bother carrying out an initiative if it’s not tied to desired performance? Not only does measurement help determine if training was worthwhile, but also tracking — especially if incentivized through bonuses — compels participants to leverage training to improve performance. If people are held accountable, they tend to work harder than if no tracking process is in place.
One effective way organizations can measure training is to use key performance indicators. If training is measured against KPIs, it’s important to understand how companies define this term. It can be subjective and vary from entity to entity. A KPI can relate to sales growth, volume of discounting or, perhaps, lead conversion ratio.
Depending on the industry, training KPIs can help companies set and adjust strategy. It can be a key part of what they evaluate quarter to quarter, as well as a way to justify and make decisions about future training. When KPIs are measured, the results are based on accountability, precision, measurement and overall effect. Some training firms even go as far as tying compensation to performance on or attainment of KPIs.
For example, let’s say a firm takes on a large-scale training implementation with a commercial bank. Part of the annual objective for the bank is cross-selling enhanced products and shortening sales cycles. Customized content is aligned to provide habits and tools to improve in these areas.
After training, performance is measured for 120 days. The bank sees an 18 percent increase in cross-selling volume and a sales cycle reduction of three days. Both of these KPIs were tracked weekly, and the financial effect equated to millions of dollars.
In other industries such as pharmaceutical sales, an ImpactRx study can be used to tactically measure things like physician perception of account managers. It can start with a baseline prior to training and be followed by a measurement 60 and 90 days afterward. Specific behaviors such as product positioning, clarity of messaging and managing the total office environment are possible measures.
Of course, not all training can be measured by KPIs. Some types of training are easier to measure than others. Training tied to a specific strategy or pricing is easier to measure than soft skills training, which largely consists of theory. Essentially, if training has practical tools and habits associated with it, it’s easier to measure.
To measure soft skills, training may require a different approach. For example, knowledge transfer can be tested immediately following the training and then some months after. Another way to gauge its effectiveness is to measure employee satisfaction scores. This typically results not only in improved performance but also decreased turnover.
Organizations also can take training for a test drive. To measure impact pre-investment, train one group within the organization and measure the effect on that control group before a wider roll out. It’s then easier to gain buy-in because the test drive or pilot provides a platform for return on investment to help sell the idea internally.
Other measurement methods include comparing year-over-year results for several months following training if seasonal, or several months before vs. those same months after training takes place.
The key with any of these methods is to remember they’re estimates to help determine if training was worthwhile. They’re not exact ROI calculations because will always be other factors in play.
If learning leaders implement these suggestions, they can successfully design and implement a training program that delivers strong ROI for their organization. Need help? Find a training partner willing to tie its compensation to program success.