The Importance of Calculating the ROI of Learning in Your Organization
There was a time when people would just take a leap of faith and invest in a training program. But now, with resources being short and businesses having to be even more competitive, this has drastically changed.
Initially, measuring return on investment (ROI) began only in the manufacturing sector but now it is being utilized in other fields as well. As a vital aspect of every business, the ROI metric is used to determine profit and loss, assess the benefit of investing a new technology, building new facilities, eliminating procedures that are not profiting the business. It is being used more frequently in the measurement of the soft skills that learning programs often address.
Like it or not, your learning program’s worth is assessed on the basis of the profit it garners. Do your L&D programs gain enough benefit to outweigh their investment costs? If you don’t know the answer to that question, you need the ROI tools for you to understand whether your programs are profitable or not. In today’s complicated business environment, it is important for you to show that your programs are worth all money and time being spent on them.
What are some more reasons to use ROI to measure your learning program?
- Measuring ROI Attracts Attention of Top-Notch Stakeholders
A positive ROI result stirs interest and curiosity among stakeholders, especially when the ROI value breaks all records. Having a good result would revive stakeholders’ trust in the value of of your interventions. Using the ROI measurement tool will help confirm the progress through a valid procedure.
- Plays a Key Role in Business Processes
Your leaders use ROI as a tool to establish a solid business plan and to administer their business successfully. ROI enables them to measure the outcome of large investment accurately. Most top executives have MBA’s these days and so are equipped with excellent knowledge and skills in business management. They know the significance of ROI and expect you to also.
- Helps Investors Determine Progress
ROI metrics basically helps investors understand the “efficiency” of their investment. They are able to determine whether their investments bear fruit. Whether you must answer to inside or outside investors, you can help them judge better whether they should continue investing in the particular learning program or not.
- ROI Determines Where to Invest
One of the biggest dilemmas faced by investors is understanding where to put their money for the most return. Your learning program has a lot of internal and external competition for those dollars. A wrong investment may lead to loss of money. Since making profit is the main purpose of your investors, it is vital for them to see that they are optimizing their capital by investing in your program.
If you can provide the ROI measures, stakeholders can easily determine which of your programs will produce maximum profit. At Dialoguing for Success, we have professionals who are trained and certified in ROI Institute methodology. Contact us at 281-694-4023 or firstname.lastname@example.org and let us know how we can help you determine the ROI for your learning programs!