7 Essential Ways To Measure Your Training ROI


Many managers recognise corporate training as a basic necessity, filling the gaps between what employees know and what they need to know in order to remain competitive within the industry. However, just like any other business activity, managers want to be able to see ROI to justify spending. When money gets tight, staff training is often the first thing to be cut. However, measuring its success, businesses can make much more informed decisions on whether to maintain, increase, or decrease training budgets moving forward.

Calculating the ROI for training can be difficult. Although you can monitor whether sales increase, training and development can help in many other ways, such as improving morale, which can’t necessarily be measured and provided to managers as a number.

There’s no single formula that will show the ROI for training, however the team at Saxons has gathered some useful tips to get you started!

Approaches to measuring training ROI

The first step to measuring your ROI is looking at the investment you have put in. This could include the training itself, travel costs, facility hire, and time away from the business, along with many other elements. These costs vary on the business and the type of training. For example, you may see lower investment costs for online learning compared to traditional classroom led training.

Next, look over the objectives of your business training. Did you want it to help staff get their work done faster, to make less errors, or for customers to be happier with the service? Think back over these goals and find ways to measure whether you have met them successfully. There are a number of different returns you can measure and various methods of measurement. Here are a few to consider:

  • Sales – This is probably the easiest measure of ROI, as you can simply look at your sales figures before and after training. As training will potentially improve productivity and efficiency, it is reasonable to expect sales to increase, too. However, don’t forget that it may take time for your training to have an effect, so allow some time before making any big decisions.
  • Mistakes – Mistakes naturally happen along the way. Logging these as they happen will allow you to compare the number of mistakes before and after training takes place. Fewer mistakes can lead to time and cost savings in the long-term.
  • Staff turnover – Recruiting new staff not only takes time, but can also be costly. It is important to consider the time it will take for a new employee to learn the ropes and become familiar with all the systems and tasks. Training and development often shows an employee that the business is prepared to invest in them and can lead to lower staff turnover. To see if your training is having an effect on staff turnover, review the number of people leaving your company before and after you introduced regular staff training.
  • Time saving – Often training can help staff use systems more effectively, thereby increasing efficiency. Although this is difficult to measure, monitoring a certain task over time may allow you to work on the average time saved. Keep track of the time it takes for an employee to use a system or perform a task before training, and record their timing and progress again at a later date when they are more comfortable using the tool. Saving time will have an overall impact on the revenue and profit of your business.
  • Managers’ time – Managers can often find that they are faced with constant questions, or being asked for advice and support. With further training, staff can become more competent and confident, taking up less of the managers’ time. This means managers can be utilised elsewhere. Although it is difficult to measure, try to carry out a simple survey with managers to see how their time is being spent before and after training.
  • Customer satisfaction – Any business wants to keep their customers happy, and training can help provide a better service from start to finish. Proper training can help retain customers and have a positive impact on the overall, providing long-term profitability. Try surveying customers and clients to measure their satisfaction levels and see if it increases with staff training.
  • Morale – It is easy to look over employee morale when considering ROI, as it is intangible. However, it is extremely important to any business. Before and after training, survey staff that participated in the training to see whether they are happier, more motivated, or feeling more valued. This can have a huge impact on their productivity, willingness to help, and retention.
  • Uptake – If you’re spending lots of money on training, including the money lost from employees’ time away from work, you don’t want to see staff reverting back to old habits and ignoring the methods they’ve been taught. Monitor your staff to make sure they are putting their new skills into practice and help them form new habits that benefit the company.

It’s important not just to focus on the money you make back in the business, but also the intangible benefits that aren’t as easy to measure, such as job satisfaction, team work, increased morale, better decision making by managers, and improved competitive advantage, to name a few. Don’t forget that it’s the team behind you that helps to run your business. Make sure your team is happy and motivated to do the best job possible.

Remember that it may take some time for employees to become comfortable with their new skills, so allow some time before making any decisions on the effectiveness of your training. Also, don’t just monitor the ROI before and after training. If you’re training your employees on a regular basis, continue to measure your ROI throughout the process.

Photo: Simon Cunningham – https://www.flickr.com/photos/lendingmemo/ – CC BY 2.0