5 Responses

1. A rose by any other name.
   Words is important Peter and should be used proper like what I do.

   Define the term ‘Justification’ in this context Peter.

   Do you mean a report filled with wonderful anecdotes and terms like ‘ increased pro-activity’, ‘better self awareness’, ‘cultural enhancement’ etc etc spun by trainers, consultants and HR managers as evidence and ‘justification’ for their spend on training?

   Or ‘justification’ formed around base line measures, predetermined key result areas and presented in the form of verifiable data?

2. Another long road:)
   Garry

   It all depends!!! Justification could be a detailed spend report (in triplicate) or a conversation over coffee. It will depend on the amount of spend and the likely implication of that spend as to how much justification is required.

   I just did a quick thesaurus in Word and thought ‘explanation’ was a possible alternative but felt one could explain without justifying. Word also suggested the phrase “give a good reason” but then that doesn’t sit nicely with a 3 letter acronym:)

   And recalling your talk at our conference last year “I’m on your side of the fence:)”.

   Regards

   Peter

3. Or just a dead end?
   I understand the argument and don’t undertake ROI for every piece of training I do, but JOS in some of the forms you have suggested it might take is not the equivalent or in the same vein as ROI.

   I fear Justification of Spend is in some cases a ‘get out clause’ for woolly indeterminate responses that appear to give this kind of analysis some credence, which on some occasions provides no actual justification and often merely platitudes.

   I appreciate you support ROI analysis of some aspects of training I’m just giving you my view of this alternative, which I think is a perfectly good and valid approach to reviewing training but is not a substitute or equivalent for ROI.

4. ROI – New Definition Offered
   In the spirit of Peter’s original post about the use of words, and noting also that mention of ROI seems to get people ‘hot under the collar’, I’m tempted to suggest an alternative definition of ROI:

   Return On Incandescence(!)

   I suspect that any firm assertion about whether ROI is worth it or not, or valid or not in the training context, will generate from some quarters a fair amount of heat – even incandescence!

   To maximise my ROI (new definition) I offer the following assertions – discuss!

   (1) ROI is a total red herring and we should leave it well alone
   (2) ROI is very worthy AND impossible to do with any credibility
   (3) Everybody should do ROI on pain of death

   That should upset most persuasions, if not most people – a good ROI perhaps? (new definition that is…)

   More seriously, I’ve recently begunr eading Richard Cassidy’s interesting missive ‘Accountability: A Noun Or A Verb’. I’m thinking about accountability because its stem is ‘ACCOUNT’ and that easily for me connects with money and on to investment.

   ROI is I think usually referred to as a noun – e.g. WHAT is the return on investment?

   If we think of it more in terms of a verb, which is now about action, we get something like ‘demonstrating the value of the training’ and implicit in this I suspect is the notion that the training will be an appropriately efficient (i.e. minimum resource usage or ‘investment’) way of achieving (i.e. being ‘effective’) directly or indirectly, the outcomes required by the customer/manager/shareholder.

   Just a thought…

   Cheers

   Martin

5. RoI
   For what it is worth (I’ll leave it to you to judge whether the effort in reading this is worth the return), I would distinguish between RoI and evidence of RoI.
   Return on investment is a valuable concept. It implies you should know what the investment is in time, money and effort. And it implies that you should work to secure a (worthwhile) return, whether in immediate job performance, long term capability, individual confidence, improved organisational citizenship or bottom line business impact.
   I would suggest that we should put most effort into optimising the relationship between this investment and that desired return. Getting evidence to show that the return was worth the investment is a secondary issue, but one that seems to attract most of the air time.
   I am fully aware that having good evidence is helpful in being able to continuously improve the relationship between the investment and return ie learning to get better at it. And, of course, in securing credibility, support and funding from senior managers.
   But my argument is this: if you are not red hot at turning learning investments into business returns, what is the point of evidence? All you will get, as is often the case, is half-baked data that is either unconvincing or, worse still, proves categorically that you are a waste of space.
   I’m not an RoI junkie. It has its place, but there are other important issues too. I’d just welcome more debate on how to secure a good return and less on how to measure it (which may well be easier, as well as more fruitful, if there really is a solid and valuable return).
   As to semantics in general. I think that taking care to communicate precisely is a good thing. And debates about particular words and their meanings can be fruitful if they are about crucial principles. However, I take the point that sometimes we get hung up on relatively unimportant issues of phrasing and pay less attention to those things which are fundementally important or most useful. I guess that is part of my concern around RoI.
   Thats my ‘investment’ over for the moment!
   Graham