Considering training ROI, Is there evidence showing this declines over time or is there a permanent 'step up' improvement?
steve geary
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Considering training ROI, Is there evidence showing this declines over time or is there a permanent 'step up' improvement?
steve geary
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2 Responses
declining ROI?
Hi Steve
In what way?
If a person learns a skill, and a ROI has been achieved the return has been achieved – how can it decrease?
What do you mean step up – do you mean improve the roi from an existing programme?
Mike
Depends…
Steve,
Some training will reduce in value over time, but not necessarily all. For example, a particular skill may be seen as less valuable over time as the market moves on.
However, as Mike points out, when you’ve acquired a skill or particular behaviour that is valued, it’s largely acquired.
An ROI of say £10K on a spend of £5K, will always be a £10K return on a £5K spend. It is quite possible that the returns vary over a number of years, and it is not unusual for ROI to be negative in the first year (sounds bad!!) but be big in the second year – spend on training in Yr 2 is nil, as the training was done in Yr 1, but benefits are still being reaped.
This is why often ROI is considered over just the first year, and why knowledgable evaluation practitioners will consider other measures of return than the standard ROI formula.