Meghawadhwa
Working With A Training Consultancy

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hello everybody,

myself Megha Wadhwa. i am working with a Training consultancy where

we do training programs for our clients. for example, we are working

with this big client which is a telecom sector. we have trained all

the call center executives on a program where are main purpose was to

release internal creativity, energize and motivate employees and also

to create a common understanding of customer centricity and develop

initiatives and action plans. it is a crossb departmental and

functional workshops on customer centric beagviors and attitude.in

other words its a big OD initiative.

now my concern is that we don't have formalized measurement procdure

except the measurement on LEVEL 1 i.e the reactions. can you help me

that if at this stage when the programs have already been conducted.

i would like to do an ROI analysis for this initiative.for this i was

plaaning to identify some parameters where i can ask the 30% of the

participants what % of change have they felt after attending the

program for the parameters defined.

it will be very nice of you if you could guide me how to go about;

what kind of parameters to identify and is there any other way i can

do the ROI

Since i am very new in this field it will be very nice of you people

if you could guide me.

From India, Ghaziabad
Hi Megha

In finance, the return on investment (ROI) or just return is a calculation used to determine whether a proposed investment is wise, and how well it will repay the investor. It is calculated as the ratio of the amount gained (taken as positive), or lost (taken as negative), relative to the basis.

With this same concept you need to calculate the ROI on training..

The process of calculating ROI

To calculate ROI you must first make estimates or obtain measurements of the costs and benefits associated with a training programme. As you will see, the calculation of ROI is then a relatively simple process. Let's start with the costs …

Forecasting and measuring costs
  • Design and development costs

    Promotional costs

    Administration costs

    Faculty costs

    Materials

    Facilities

    Student costs

    Evaluation costs

Forecasting and measuring benefits
  • Labour savings

    Productivity increases

    Other cost savings

    Other income generation

Calculating return on investment

Return on investment tells you the percentage return you have made over a specified period as a result of investing in a training programme. On the assumption that benefits will continue to accrue some time after the training, then the period that you specify is critical to the ROI figure you will obtain. You may like to specify a period that fits in well with your organisation’s planning cycle – perhaps a year or two years. On the other hand, you may wish to calculate the period to correspond to the lifetime of the benefit, in which case you will need to know how long the average student stays in a position in which they can continue to apply the knowledge and skills being taught.

It is relatively simple to calculate return on investment:

% ROI = (benefits / costs) x 100

Payback period

Another way at looking at ROI, is to calculate how many months it will take before the benefits of the training match the costs and the training pays for itself. This is called the payback period:

payback period = costs / monthly benefits

Payback period is a powerful measure. If the figure is relatively low – perhaps only a few months – then management will be that much more encouraged to make the training investment. As a measure, it also has the advantage of not requiring an arbitrary benefit period to be specified.

From India, Ahmadabad
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