ROI (Return On Investment) for training can be difficult to quantify. It can also be an important measurement that helps an organization determine whether there is sufficient value in paying for training.
How Does Training Help?
People tend to believe that training is a good thing. They sometimes, however, lack confidence in whether it is worth paying for, or whether the time it takes away from the normal workday is justified.
At Open Road Communications, we believe that the computer training we provide can pay for itself in many ways. On a personal level, I have always found that taking a short break from work for professional training helps re-invigorate me for my tasks. It does so because it helps me remember why I do what I do, pushes me to think creatively about better ways to do it, and removes me from the workday grind. Additionally, it has always improved my morale that my company invested the dollars necessary to aid my career development with them. So this type of feeling alone can be something worth paying for, just as the occasional office celebration may build morale and keep the work worth doing.
But on a little more concrete level, computer training can pay itself off by increasing the speed, confidence and efficiency with which employees complete tasks. Also it can help them rise to tasks which they were previously incapable of. Plus, adding this kind of cross-training within the ranks of a company's employees can help when absences or turnover inevitably take place. Finally, it can decrease the workload for the ad hoc software expert who has to help other people in the office do work that may not be their own.
Looking At the Numbers Behind ROI
All of these reasons explain how training can improve the efficiency and morale of workers at an organization. But at ORC we have a number behind the "idea" of ROI. Our students report an average increase of 70% in their capabilities for individual skills presented in computer training. A 70% increase in your capabilities can quickly improve the amount or quality of work you accomplish.
So as an example, if one student normally spends just 20% of her workday (1.6 hours) using these computer skills to accomplish 20 tasks, she could spend the same time accomplishing 34 of those tasks after training. Or to accomplish the same number of tasks, she could cut her work time down from over an hour and a half each day to less an hour per day. Take that times 5 days for a standard workweek and she has just saved herself 3.3 hours each week.
ROI Math
Standard Workday = 8 hours
20% of a standard workday = 1.6 hours
Assumption 1: Before training, worker accomplishes 20 tasks involving these skills during these 1.6 hours.
Assumption 2: After training, worker reports an increased confidence of 70% in her capabilities with these select skills.
[This would be the average improvement after 5 hours of training with ORC.]
Assumption 3: A reported 70% increase in skill capabilities means 70% greater efficiency of speed.
Thus: 1.7 efficiency * 20/tasks per day = 34 tasks per day (where she spends the same time per day on these tasks as before training)
OR
1.6 hours / 1.7 efficiency = .94 hours total time spent on the same number of tasks per day.
Thus:
ADDITIONAL TASKS ACCOMPLISHED PER WEEK
14 more tasks accomplished daily * 5 days in one workweek = 70 more tasks accomplished in the first week after training. Depending on the value of these tasks to the organization, they are likely to "pay for" the cost of training over some weeks.
OR
TIME SAVED PER WEEK
1.6 hours (pre-training time spent) - .94 hours (post-training time spent) = .66 hours saved per day * 5 days in one workweek = 3.3 hours saved in the first week after training.
Just looking at the time saved for one person who went through training and spent a fifth of their day using these skills, you can see that she has "earned back" an additional 3.3 hours in one week. After two weeks, she's more than "made up for" the time lost spent in training. Plus, she's likely to be rejuvenated with the investment spent on her career development and may feel more confident in learning new time-saving techniques inspired by her training.
Conclusion
If you accept a few of these premises or even plug in your own values, you'll see that training can be a worthy investment in your organization. It pays itself off for time spent and productivity yielded after a short duration -- and then continues to yield returns thereafter.
For a free consultation on computer training ROI, please feel free to contact me.
On the Road,
Eric J. Reid
