As HR continues to find concrete ways to connect in with the bottom line, the question inevitably returns to finding the ROI in training. So how does your organization do it? Does it measure ROI in training? Does HR play a strategic role in the business leadership? These are the questions that human resources professionals must be prepared to answer, because while there are clear linkages between learning and development and between employee engagement and profits—as we reported in an earlier blog post on productivity—in reality, training and people development is still a tough sell.
A recent article from McKinsey points out a few key ways that organizations are looking to find the ROI in training, starting with focusing HR on business priorities—“PNC’s team, for example, asked line executives what they saw as the highest-value opportunities for improving talent management. From these discussions, the analytics team distilled a top-20 list of business questions and hypotheses to test.”
This kind of analysis and drilling down is a critical marker for the role of HR in accentuating ROI in training, employee development, and other aspects of talent management. The article pointed to another factor for looking at ROI and training, citing Google’s testing on how management behaviors related to the performance of their teams. This is an incredibly valuable approach because it can be a starting point for advanced analysis. You can check out an article from the New York Times that goes into more detail on Project Oxygen (Google’s own name for the study) here.
Let’s take Google’s findings, for example, as to a few other behaviors they found that good managers exhibited (and that were thereby potentially able to drive ROI):
- Have a clear vision and strategy
- Help your employees with career development
- Be productive and results-oriented
- Making connections
Hmm…doesn’t sound like rocket science, right? But these findings become even more significant if you can actually pinpoint managers’ approaches and thinking styles. Do those managers who score highly on “having a clear vision and strategy” also exhibit Conceptual thinking preferences? Do those who help employees with career development exhibit Social thinking and a stronger affinity for Expressiveness?
If so, a company can track managers via their thinking and behavioral preferences and know where to provide training, pinpointing it either to accentuate strengths or provide learning opportunities for behaviors and tendencies that managers may not immediately go toward. All of a sudden, training becomes more defined, with greater end goals and more specific measurable aspects. In other words, you can start to find the ROI in training.
Of course, management is complicated beyond belief, not least because managers and companies are inherently dealing with ever-changing landscapes and human emotions. But the more companies can approach training with an eye on ROI, the better off they’ll be in the grand scheme of organizational development.