In moments of economic crisis, the first thing that senior management does is to slash the training budget because they frequently do not see the Return on Investment provided by this “expense”. Surely it is the role, if not the obligation, of the HR manager to prove to senior management that training is an investment in ensuring the future of the organization.
HR departments often spend a great deal of money every year on training & development in “soft skills”: communication, negotiation, leadership, etc., where it is more difficult to assess the contribution to the results of the organization. However, the fact that it is difficult does not mean that it should be ignored The money invested in “Hard skills “ is much easier to evaluate: Are the new skills that have been taught on the course being used? The answer is a simple – Yes or NO?
When an organization makes an investment to increase production, there is usually a system designed to critically evaluate the R.O.I. so that management know the “value” of the investment to the company. However, in very few companies are there similar systems to prove to management that the training is contributing to the growth of the organization.
I would propose that there are four main areas that HR managers need to urgently attend to in order to ensure that any training done contributes to the continual development of their organization in a way which enables the senior management to see and understand why training is an investment and not an expense.
1. The HR Manager should demand that K.P.Is are provided by the training provider or, alternatively, provide the trainers with a list of K.P.Is that need to be covered during the training. The training organization should provide the K.P.Is FREE to the client as a part of the training package. It is also helpful if the training provider provided FREE post-course support by email, phone or, in certain cases, by personal visits so that the trainees know that they have additional professional support afterwards.
2. The HR Manager should inform the employees that:
– The K.P.Is will be put in their job description upon completion of the course.
– The K.P.Is will become part of an on-going & continual performance appraisal system.
– Non-compliance or non application of the K.P.Is will affect their performance bonus.
– There is no point in getting angry about being required to apply the new techniques or skills. They are NOT optional, the organization has decided that the new skills are a part of the job requirement and have invested a lot of money to help the employees gain these new skills. So, as we say in the U.K.: “Like it or lump it!”.
3. The HR Manager should ask/tell managers that they are the ones best positioned to see if their employees are using the new skills and to identify whether the K.P.Is are being applied properly. Frequently, the costs of the training courses are divided among the cost centers (departments) that send attendees to the course. Any manager who doesn’t ensure that his budget for training is not used effectively is not acting professionally!
The HR manager could facilitate this task by:
– Providing managers with the K.P.Is for each training course.
– Ensuring that, within reason, the managers do the same training course (in a group composed of other managers) – as their employees or a course at a more advanced level which includes practice in evaluating the application of K.P.Is.
– Organizing a specialized course in the evaluation of K.P.I application.
– The HR department cannot be the only part of the organization that does follow-up on the application of K.P.Is, the managers are the ones who must share the responsibility, too.
4. Many HR managers understand the importance of identifying & proving the R.O.I. on training & development, however, frequently there are other projects / tasks that are more important and are considered a greater priority, which means that they get attended to first. This attitude is understandable because K.P.I / R.O.I. control requires:
– Extra work initially: modifying job descriptions, negotiating with training providers, managers, employees, unions, etc.
– Developing & implanting K.P.I control systems into the performance appraisal programme.
– Ensuring compliance from ALL parties involved.
In these days of financial crisis, any organization with a highly-trained & skilled workforce will not only survive but grow. The use of K.P.Is and their incorporation into job descriptions, performance evaluation processes and the compliance of everyone involved is one way to ensure an effective Return on Investment.
Related article: Applying “Return On Investment” (ROI) to Training & Development.
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© Ian Brownlee, Brownlee & Associates, S.L., January, 2013.