One of the hot topics in L&D right now is establishing an organization’s return on investment (ROI) from training offerings. This can feel daunting, especially if your L&D department lacks bandwidth. With increasing demands to do more with less, finding time to do the legwork to gather and compile all the data can feel like the final straw on the camel’s back.
The good news is that you can incorporate gathering information you will need to compile ROI into the process many of us currently use when developing training content: ADDIE.
What is ROI?
ROI is a method for helping to demonstrate to key interest-holders and clients that your work is valuable to the organization. You can use this information to advocate for your team and additional resources. ROI can seem like a lot of data-gathering and number-crunching, and while it is, you can also incorporate it into your process.
When considering calculating ROI, it is best to focus on one of your department’s more extensive programs. For larger programs, you typically have a bit more runway to design the course and consider how you evaluate it, which gives you time to plan strategically for gathering and compiling data. Think of leadership development training or upskilling workshops rather than one-and-done eLearning or Just-In-Time training materials. It’s also good practice to avoid mandatory training programs, such as compliance, since your organization is required to conduct those.
Incorporating ROI into ADDIE
Most of us are aware of the ADDIE process, which is the iterative flow of Analysis, Design, Development, Implementation, and Evaluation of our learning products. While this process is not necessarily linear, each stage addresses a different training and content development level. Let’s break down questions and practices related to ROI that you can incorporate into the ADDIE process.
1. Analysis
The analysis phase is where learning designers begin to ask the big questions about their audience, the problem being solved, and what success looks like at the end of the training. For ROI, that last part is essential to define clearly. According to the organization and key interest holders, what will be different when someone completes this project?
This is the phase where you can begin understanding how to connect your training to calculating ROI. Ask yourself:
- What is this problem currently costing the business?
- How much money is the company losing due to this issue?
- How many people are affected by the problem they are trying to address?
- What are the metrics for success?
2. Design
Many learning professionals see themselves in the design and development phase. Within this phase, the problem is clearly established, a learning intervention is determined, learning objectives are set, and a scaffold of the intended training plan is defined.
During this phase, you can begin to relate to ROI by asking:
- How many hours do you predict the L&D team will invest in developing and implementing this training?
- How much time are we asking learners to allot to participate in this training?
- Will any costs for facilities or materials be incurred to develop this training?
3. Development
Development is a bit self-explanatory. This is where the content is developed. This includes any storyboarding and creating training materials such as slide decks, eLearning courses, handouts, and reviews by subject matter experts (SMEs).
For ROI, during this phase, ask yourself:
- How many hours did the team spend developing this content?
- How many hours did SMEs devote to reviewing the content?
- Did any new software or subscriptions need to be purchased?
4. Implementation
Implementation is where the rubber meets the road, or when the learners interact and engage with your learning content. This is when you conduct the workshop or host the training.
Many learning professionals begin to think about evaluation and ROI at this point. They conduct participant surveys either live, in the moment, or send them out just after the program concludes. These can include things like Likert scales on how confident learners feel, a pre- or post-knowledge check, or polls conducted in the session.
But for ROI, you can take this a step further:
- What did learners know before the session versus after the session?
- How many individuals were in attendance as learners and facilitators?
- What were the total costs for hosting the training (i.e., facilities, catering, printed materials, etc.)
5. Evaluation
Evaluation does not necessarily begin directly after a training has concluded. You need to go back to the questions you asked in the analysis phase to determine your program's success.
So, for instance, you developed project management training that focused on time and budget management to solve the problem of projects consistently running over schedule and budget. You won't know whether the training was effective right after the training has concluded. Instead, you will need to take a bigger picture view and see how projects are faring 3-, 6-, and 12 months after the program. You'll need to compare results from both participants in your program and those who did not attend.
The evaluation phase is also where you gather all the answers to the questions you asked yourself throughout the ADDIE process. You can begin to compile the cost of the program: Consider the tangible perspective of materials and facilities costs—and also the hours it took for the program design, development, and implementation.
At this phase, ask yourself:
- Were the metrics for success met for the program?
- What effect does it have on business outcomes if the program succeeds?
- How much total time and cost were incurred to deploy the program?
- What were the cost savings as a result of the program?
Start small
This approach can seem like a lot, especially when you already have an overflowing plate. The key to this type of evaluation is to begin doing the work, incorporate it into your existing processes, and recognize when it is relevant or practical to conduct. Start small, and ask yourself these questions as you create your training. Keep a spreadsheet or log of your answers as you go through the process and revisit it a couple of times a week or during a regular meet-up about the project. The most important part is to start asking the right questions so as the process becomes more second nature to you, you can begin to develop and fill out the details to present the ROI of your products without overwhelming yourself or your team.
Image credit: ribkhan