How to Measure ROI on Training and Coaching: Part 1

Part 1: An Overview

When it comes to training courses and coaching, it can often be challenging to measure specific financial Return on Investment (ROI). For example: what is the ROI on wellbeing, effective management, inspirational leadership and interpersonal skills development?

How do we know it has worked? How do we know it has had a positive impact on the bottom line (i.e. financial)? Those that are investing in the intervention will usually want some objective, scientific measurement of the ROI. However, many interventions are notoriously difficult to measure. The results are often intangible and confounded (or aided) by other variables outside of the intervention. Perhaps, for example, a team build has been successful because of the ‘management day out’ or perhaps it has been successful because the previous boss has left and been replaced with someone more effective.

Obviously, the notion of measuring an intervention implies measuring it against something else. The time to generate a ‘success criteria’ would be before the intervention takes place:

• What would success look, sound, feel like?
• How would we know we have been successful?
• What are some of the other possible variables that may help or hinder the intervention (or that might be responsible for the ‘success’ happening anyway, regardless of the intervention)?

Where there are clear objective means of measuring the outcome of an intervention, this is great. Sometimes we can easily measure in terms of financial savings or income generation. Or perhaps we might measure specific time savings of using a new system.

The challenge is when we are measuring the performance or quality of an intervention. Ideally, we would have something tangible (e.g. a template, a working example or a benchmark) that we can compare the result to. Amongst other things, quality can be measure in terms of specifications/features (number of), performance (does what is defined), finish (appearance – e.g. looks good, is mistake/tarnish free) and model/template (how close is the result to the template)?

In order to generate some form of benchmarking (and possibly to justify the intervention to senior management), over the next three articles we will be exploring three methods of ‘measuring the intangibles’.

Tune into the next article: ‘Profits, Gains, Savings and Benefits.’

By Joe Cheal

joe@imaginariumdev.com