hi if any one could help me how do we calc ROI on training...how do v quantify training...
From India, New Delhi
From India, New Delhi
Hi Sakshi, Calculating ROI is a difficult(Vague) task. I am attaching an interesting article on the same (Have already posted it earlier). Hope it’ll be helpful. Cheers!
From India, Chandigarh
2From India, Chandigarh
Dear Sudhir,
ROI stands for Return On Investment. For training, usually it is measured through the change of performance after the training has taken place.
Its a quantitative measure for training.
Cheers!
Sughosh
From India, Chandigarh
ROI stands for Return On Investment. For training, usually it is measured through the change of performance after the training has taken place.
Its a quantitative measure for training.
Cheers!
Sughosh
From India, Chandigarh
Hi, I am enclosing a PT on ROI on HR Practices. If you have very sound mathematical and analytical background, you can ventrue into this.. all the best..! Regards Sathya
From India, Madras
From India, Madras
hi sakshi..........
i have little material on ROI concept on training........and also the methods used tp calculate training..........
i believe it will help u..........
tak care............see the attachment..
thanks and regards,
vijay.bojja
From India, Bangalore
i have little material on ROI concept on training........and also the methods used tp calculate training..........
i believe it will help u..........
tak care............see the attachment..
thanks and regards,
vijay.bojja
From India, Bangalore
Hallo sudhir,
I'll try to give some information on ROI,though a bit theoretical!
These years, everything boils down to money.Nowadays HRD is looked upon as a valuable tool.It is about investing in humans to attain organisational goals .Any investment should fetch some revenue.
ROI includes any benefits the organization gains from training programs.This makes the results of the training programs measurable.
The 2 most common measures are the Cost Benefit Ratio(CBR) and the Return On investment (ROI)formula.
CBR compares the annual economic benefits of the program to the cost of the program.A CBR of 1 means that the benefits equals the cost.A CBR of 2 ,written as 2:1 indicates that for each rupee spent on the program 2rupees were returned as benefit.
ROI formula is as follows:
Net Program Benefits/Program cost *100
Net Benefits = Program Benefits-Program cost
I hope i could be of some help to you
Regards
Rakhee
I'll try to give some information on ROI,though a bit theoretical!
These years, everything boils down to money.Nowadays HRD is looked upon as a valuable tool.It is about investing in humans to attain organisational goals .Any investment should fetch some revenue.
ROI includes any benefits the organization gains from training programs.This makes the results of the training programs measurable.
The 2 most common measures are the Cost Benefit Ratio(CBR) and the Return On investment (ROI)formula.
CBR compares the annual economic benefits of the program to the cost of the program.A CBR of 1 means that the benefits equals the cost.A CBR of 2 ,written as 2:1 indicates that for each rupee spent on the program 2rupees were returned as benefit.
ROI formula is as follows:
Net Program Benefits/Program cost *100
Net Benefits = Program Benefits-Program cost
I hope i could be of some help to you
Regards
Rakhee
I am loading the attachment again. Hope it come through, this time... regards Sathiyamoorthy Iyer
From India, Madras
From India, Madras
Hello friend,
Training can be evaluated on monetary terms. I am familiar with two methods,
1. HRV( Human Resources Value) method and
2. DIF ( Difficulty, Importance, Frequency) analysis.
The first one is simple and could be explained as follows;
Step 1. Create the Performance Grid for each employee:
The Performance Grid is a matrix combination of two factors, competency and committment. The Grid is expressed graphically, with competency on the horizontal axis and committment on the vertical one. The values are spread from zero to 100 as percentage.
Assume that we want to create the performance grid of employee A.
His supervisor will have to indicate on the grid where he is positioned with regard to competency and committment. Let us assume these values are 60 and 70.
The average grid value is therefore, 60+70 divided by 2 = 65%.
Step 2: Calculate Human Resource Value(HRV)
HRV= Average employee cost x grid value.
Employee cost is the total cost of maintaining the services of the employee at current rates.
Assume that for A the employee cost works out to Rs.1.2 lakh per annum.
Average employee cost = 1.2 lakhs divided by 12 months = Rs.10000.
Hence HRV for A = 10000x 65% = Rs.6500.
It means that even though we are paying Rs.10000 to maintain A, we are getting only Rs.6500 value from him.
Step 3. Send A for training to improve gaps in competency.
Step 4. Make fresh performance grid after training and calculate HRV.
Assume that after training, his supervisor assesses him at 70 on competency and 80 on committment; the average grid value becomes 75%.
New HRV after training = 10000x 75%= Rs.750
Step 5. Calculate incremental increase in HRV after training.
In this case, 7500-6500= Rs.1000.
This incremental increase represents the ROI on training for A.
Taken for a whole group, gives the ROI for that particular training programme.
Step 6. Calculate, in the above manner the ROI for all the training programmes in a calender year to give the total value.
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The above scheme is ideally suited for a small organisation where these calculations could be effectively done.
The success depends on how well the supervisors evaluate the performance of their subordinates.
The scheme has a subjective content in the evaluation process so the values obtained need not be considered as accurate, but a trend value useful for our contextual purpose.
The whole scheme even with the subjectivity errors discounted, gives a tangible indicator regarding effectiveness of training.
I hope this is of use to you.
best wishes
Rajeev.V
From India
Training can be evaluated on monetary terms. I am familiar with two methods,
1. HRV( Human Resources Value) method and
2. DIF ( Difficulty, Importance, Frequency) analysis.
The first one is simple and could be explained as follows;
Step 1. Create the Performance Grid for each employee:
The Performance Grid is a matrix combination of two factors, competency and committment. The Grid is expressed graphically, with competency on the horizontal axis and committment on the vertical one. The values are spread from zero to 100 as percentage.
Assume that we want to create the performance grid of employee A.
His supervisor will have to indicate on the grid where he is positioned with regard to competency and committment. Let us assume these values are 60 and 70.
The average grid value is therefore, 60+70 divided by 2 = 65%.
Step 2: Calculate Human Resource Value(HRV)
HRV= Average employee cost x grid value.
Employee cost is the total cost of maintaining the services of the employee at current rates.
Assume that for A the employee cost works out to Rs.1.2 lakh per annum.
Average employee cost = 1.2 lakhs divided by 12 months = Rs.10000.
Hence HRV for A = 10000x 65% = Rs.6500.
It means that even though we are paying Rs.10000 to maintain A, we are getting only Rs.6500 value from him.
Step 3. Send A for training to improve gaps in competency.
Step 4. Make fresh performance grid after training and calculate HRV.
Assume that after training, his supervisor assesses him at 70 on competency and 80 on committment; the average grid value becomes 75%.
New HRV after training = 10000x 75%= Rs.750
Step 5. Calculate incremental increase in HRV after training.
In this case, 7500-6500= Rs.1000.
This incremental increase represents the ROI on training for A.
Taken for a whole group, gives the ROI for that particular training programme.
Step 6. Calculate, in the above manner the ROI for all the training programmes in a calender year to give the total value.
---------------------------------------------------------------------------
The above scheme is ideally suited for a small organisation where these calculations could be effectively done.
The success depends on how well the supervisors evaluate the performance of their subordinates.
The scheme has a subjective content in the evaluation process so the values obtained need not be considered as accurate, but a trend value useful for our contextual purpose.
The whole scheme even with the subjectivity errors discounted, gives a tangible indicator regarding effectiveness of training.
I hope this is of use to you.
best wishes
Rajeev.V
From India
Hi,
ROI can be measured once the person is on the job... and by having a comparision regarding his current performance & past performance.. the skills that he has acquired from training programme and whether he is using that skills in his job or not. That's the best way in my opinion...
Regards,
Derek Gomes
From India, Nagpur
ROI can be measured once the person is on the job... and by having a comparision regarding his current performance & past performance.. the skills that he has acquired from training programme and whether he is using that skills in his job or not. That's the best way in my opinion...
Regards,
Derek Gomes
From India, Nagpur
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ROI Training.zip
Training ROI Calculator.xls