For decades, companies have been struggling with the actual costs,

benefits and return on investment of training costs. With

With increasing online learning opportunities, organizations are seeing their focus shift from providing expensive on-site training programs to using new tools and technology now available. Companies need to understand and apply business analytics to fully appreciate the effectiveness and impact that eLearning and training offers.

Companies invest large amounts of money, resources and time in

training. According to a 2002 ASTD State of the Industry report

where more than 375 major corporations were surveyed, companies spent

between one (1) and three (3) percent of your total payroll in

training. This translated into a per person basis of more than

US$700 per employee per year. In cutting-edge companies that

increases significantly to US$1,400 or more per person per year.

If training expenses are considered as a percentage of company expenses

earnings, then the training budget could represent as much as

5 – 20% of the total profit margin. With rising costs

associated with travel and accommodation, as well as increased costs

and expenses for registration and attendance at meetings or to develop internal training programs, it is undeniable that the costs of the training budget are going to increase, which only underscores the need to justify its cost.

To effectively measure training programs, companies

they face three critical issues: efficiency, effectiveness and compliance. Every major decision made regarding training falls into one of these three areas. Fortunately, each of these three areas can be compared and measured.

The 2002 ASTD study reported that only one-third of companies

measured the effectiveness of learning and that 12% or fewer attempted to measure the employment and business impact of their training programs. Because? Interestingly, the main reason companies don’t measure training is that they lack the expertise, tools and infrastructure to do so.

It is impossible to effectively improve or optimize training.

program if it is not compared or measured. Training must be measured and evaluated as companies measure productivity, profit or quality. Many scorecards, dashboards, algorithms, or metrics have been developed for this purpose.

If we consider the total investment in training per person in the

company (see above), the question is how much should they spend

in measurement and evaluation? One, five or ten percent? Looking back at the ASTD 2002 best practice study, we found that most companies spend 40-50% of their total training dollars on content development, 8-10% on infrastructure, and the remaining resources on salaries and costs. of facilities.

To many, the development of measurement and evaluation tools sounds like additional costs and expenses for the organization. Companies that allocate a small but fixed percentage of the training budget for this purpose will be able to effectively measure the effectiveness of their total investment in training. One study found that organizations that adopt this model and spend between US$2 and US$10 per employee on learning analytics reported notable improvements in measurability and return on investment.

Companies will need to justify the costs associated with measuring learning by identifying the business impact and risk of not training their employees. This could be quantified by fines or lost profits as a result of non-compliance with laws or regulations. This can often result in fines being imposed on the company or even lawsuits or other forms of lost profits.

In the health field, for example, the lack of compliance with

collecting, coding, and reporting cancer incidence could have a far-reaching impact on budget dollars spent not only on operating and training costs associated with the Cancer Registry department, but could also offset costs associated with the development of cancer programs and community outreach programs. While program development and outreach programs have the ability to compete with consumer dollars, all of this could come to naught if required reporting is not done accurately and in accordance with state or accreditation program standards. Training programs for the Cancer Registry can ensure that data management processes are properly managed.

So, in short, companies need to focus on developing

and measuring their learning programs. investment in

learning analytics will overcome the risks of inadequate training. The success of any organization will directly depend on its employees’ understanding of its products, services, operations, and policies. Employees must be fully trained in compliance, standards, confidentiality, non-disclosure, and other legally sensitive areas of the business. And companies need to be able to track and measure this using effective learning analytics.

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Copyright 2005, MA Webb. All rights reserved