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Workplace Learning: What’s It Worth?

Civic Nation

Companies spend a lot training their employees to be more efficient and effective at their roles. Last year alone, businesses and organizations in the United States spent nearly $100 billion on workforce learning. And it’s growing fast: by some accounts, industry training grew a whopping 32.5% in 2017. This is a positive trend: the corporate sector is the bedrock of adult learning and development, with an unparalleled ability to provide access to skills and credentials (including affordable access to degree attainment, as is central to the College Promise Campaign).

With such a monumental investment, you might think corporations would have a better sense of the tangible benefits of investing in training opportunities for employees. And yet, workforce learning is an investment often made blindly by companies, with little understanding of how it will quantifiably improve the employee’s performance or, more importantly, the performance of the organization.

In certain cases, we can draw a direct line between training in the workplace and measurable outcomes. Train a salesperson to sell more, for instance, and they’re likely to bring in more revenue; train a customer service representative to be more efficient and empathetic, and you can track improved customer satisfaction. But actually calculating ROI on employee training can be burdensome and complex, and the associated headaches often result in leaders not even attempting the calculation. And if it’s this difficult to quantify the results for sales and customer service jobs, doing it for more abstract work, like team management or computer engineering, might feel impossible.

The result is that we’re pouring billions into corporate training without truly understanding what that money gets us—in other words, we have no clear proof of a return on learning investment, or ROLI. Without data that clearly indicates the monetary value of learning, thousands of hardworking learning professionals are unable to tailor training toward specific, actionable goals: employee learning and development is usually done blindly, with no useful accountability or feedback. Perhaps even worse, many organizations resist investing in their employees entirely, unable or unwilling to make a compelling case for it.

We can—and must—do better. There’s no reason why workplace learning needs to remain in the dark. It’s time for rigorous, practical analysis of the direct impact that newly-acquired skills have on an organization. One organization, the ROI Institute, has worked to better understand the relationship between learning interventions and ROI since 1992, certifying thousands of individuals in their ROI Methodology and generating hundreds of published case studies in the process. They reported that formal learning programs have resulted in a positive ROI nearly half the time; in the other half, negative ROI usually leads to the learning being improved, rather than abandoned.

There’s no reason why leaders across industries and sectors can’t work together toward a simpler, more replicable model to evaluate learning ROI.

While proving a direct link between specific learning and the bottom line may be an elusive holy grail, we can take several crucial steps in the right direction—the first of which is to rigorously identify, test, and capture intermediate metrics such as learning, employee retention, and performance evaluations, all of which contribute substantially to an organization’s value. This will allow us to propose leaner, more practical models and toolkits that allow leaders to make more informed, data-driven decisions about their learning investments.

What would this process look like in practice? Our proposal is simple:

  1. Isolate a specific organizational metric (for instance, employee retention or employee performance evaluations) that leaders agree is central to the success of the function/business.
  2. Define the skills and competencies that you believe have a high likelihood of moving that metric.
  3. Develop learning programs that train those skills and competencies: for instance, short lessons on collaboration basics and quick opportunities to practice those basics in a safe setting.
  4. Monitor the chosen metric to test whether the learning program has had an effect.

By working backwards, we can ensure that we’re creating programs with specific outcomes in mind, which will enable us to determine not only correlation but perhaps even causation between adult learning and organizational success. In the process, we’d be advocating powerfully for one of the most effective ways we have of increasing social and civic mobility, making education more accessible to all. Organizations have already shown a willingness to invest in adult learning; with this approach, we’ll be well on the way to making investment in adult learning a vital cornerstone of the professional world.

Find out more about the College Promise Campaign by visiting collegepromise.org.