David Vachell, speaker at the World of Learning Conference 2010, sheds light on how HR and L&D practitioners can tackle the ever-demanding issue of ROI.
As the new government cuts swathes through public sector spending plans, it is clear that 'soft' targets like learning and development (L&D) will find it hard to resist the axe. Regardless of whether the source of funds is private or public, the training budget is often among the first to feel the pinch when belts tighten.
Most of my experience has been in the private sector where the tangible bottom line is often cited as being the main driver and measure of organisational performance. Whilst it is true that the hard metrics of profit and capital provide the speedometer and the odometer for many in the corporate sector, I believe that these are only a small part of the equation used by senior leaders in making major decisions and that this process is actually a much more complex affair.
In many cases, major spending decisions are actually made on criteria that are around less quantifiable metrics than increased revenue or avoided costs. Factors such as transformation, strategic imperatives, plain 'business sense' or even personal ambition for the enterprise are more commonly the drivers. However, rational arguments are then engaged to provide post-hoc justification. If L&D executives are to be successful in standing up for what they believe in, then they need to really understand what constitutes value to their decision-making stakeholders.
It is a simplistic truism to say that all organisations are about people and therefore if you want to make them more efficient and effective, it is crucial that the people who are responsible for this know what to do and are suitably engaged, motivated and aligned to do it themselves. This means that they are able to learn that what worked yesterday will need to be different tomorrow and how the organisation creates an environment that enables them to learn this most easily is the stuff of learning strategy.
"If L&D executives are to be successful in standing up for what they believe in, then they need to really understand what constitutes value to their decision-making stakeholders."Many L&D departments still see themselves as deliverers of training, but this simply won't do in a world where fundamental change has become the norm. According to Capita (Learning to Change, 2010), half of the senior leaders in UK companies think that their L&D organisation is unable to deliver the changes needed for the recovery. If this situation is to be reversed, then L&D leaders need to spend less time worrying about technicalities such as delivery methods or simplistic evaluation as proof of past success and start thinking more like strategic account managers for the most complex and valuable service solution available to their prospective clients.
L&D executives should be able to understand and engage with the strategic agenda of their parent organisation. They must be able to translate that into a strategy for learning about how that agenda is to be promulgated throughout the organisation with maximum speed and efficiency. They need to include as a part of that strategy a plan for plotting the in-flight progress using evaluation techniques that deliver timely and relevant information and making course corrections as appropriate. Only then will their 'clients' start to see L&D as a part of tomorrow's solution rather than one of yesterday's problems.
The ability to demonstrate the value of what they are doing is a major part of this strategy. The techniques for achieving this are well established in the L&D field, but still not well used. I believe that the reason for this is two-fold.
Firstly, many in the L&D world do not possess the numeracy skills that are deemed to be the main evaluation methodologies.
Secondly, the time that lags between intervention and quantifiable result is longer than the client will tolerate.
Both of these assumptions are fatally flawed. When responsible for delivering sales training I made sure of two things. Firstly, that the evaluation output was delivered in terms that the senior execs really related to; for one week spent on the training course, the participants delivered five weeks of improved productivity. Secondly, that the evidence of outcomes could be delivered without waiting for the final result. Since sales cycle times were typically 18 to 24 months, this required that we understand the system and how to utilise 'leading indicators' to predict outcomes – both in quantifiable and qualitative terms. By doing this, we prevented the programme suffering from cuts inflicted across the organisation when times were hard and ensured that the strategic agenda of changing the culture of the sales force was achieved.
In the public sector, the desirable outcomes of L&D sometimes seem more diffuse. However, L&D executives are well positioned to be the leading agents of sustainable change. What is needed is a mindset amongst our own profession that is finely attuned to the value creation agenda and is willing to demonstrate how what we do is capable of creating value in those terms.
David will co-present 'Facilitating and dealing with change through learning' with Adrian Price, Learning & Development Manager at TUI Travel UK & Ireland, on Tuesday 28 September at the World of Learning Conference 2010 in Birmingham's NEC.
Speakers include Ruth Spellman OBE, Chief Executive at the Chartered Management Institute; Jayne Stokes, Head of Learning at Santander; Omar Ismail, People Development Director at Radisson Edwardian Hotels; and David Morris, Head of Learning at HSBC. The full programme is available here.
Visit www.learnevents.com or call +44 (0)20 8394 5171 to book your place.
