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The Bottom Line Impact of Training and Development

Special Issue of Spice of the Month Accelerated Learning Ezine

Accelerated Learning and ROI Series

by Anne Thornley-Brown, President, The Training Oasis, Inc.


Training: A Big Ticket Item

Throwing Away Your Investment

Why Bother with Training?

The Role of Team Leaders

The Role of Trainers

More About Training & ROI

Training: A Big Ticket Item

Training can be a very expensive proposition. If you factor in all direct and indirect costs, training can quickly become a big ticket item. When you consider how much money your company is investing in employee development, it is important to identify strategies for obtaining as high a return as possible on this investment.

To get a complete picture of the impact of training on your company's bottom line, it is necessary to look beyond such direct expenses as seminar prices and the cost of training material to such indirect costs as:

  • travel and mileage
  • hotel expenses meals
  • compensation costs
    (salary and benefit load for each employee involved in the training
  • opportunity cost
    (for example, while a salesperson is attending a training session, how many potential sales are not being closed)

For internal courses that are administered and facilitated by your own employees, it is also important to include compensation costs for the facilitator, administrative support staff and the training management team in order to determine the full value of your investment.

bottom line, roi, accelerated learning, training and development

  • Is your company throwing away 96% of its training and development investment?

  • Is the primary method of instruction in your company lecture and presentation?

Unfortunately, the research is not encouraging. With traditional, presentation based, training and development, it's virtually in one ear and out the other.

Consider this figure:

People remember only 20% of what they hear.

Studies have also indicated that if there is:

  • No coaching or follow up by the immediate supervisor
  • No opportunity for skill practice

Within 30 days, employees forget 80% of what they've learned.

bottom line, roi, accelerated learning, training and development

So, what's the bottom line?

20% x 20 = 4%

Your people will retain only 4% of what they learn.

If your training department can't demonstrate its value in bottom line terms, you'll be open to cutbacks and downsizing in a turbulent economy.

Why Bother with Training?

So, why bother with training? There's a very good reason to invest in training. If it's done well, it can be very profitable. Companies that invest in their executives, managers and employees through training reap the rewards with a healthier bottom line.

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Anne Thornley-Brown is the President and founder of The Training Oasis, Inc., a Toronto based consulting firm for rapidly changing organizations. Our clients have included CIBC, Telus Mobility, Ingram Micro, The Royal Bank of Canada, and IKEA. Anne has toured Asia 16 times and offered seminars to over 2000 executives, managers and HR professionals in Malaysia, Singapore, Thailand, and India. Petronas, Malaysian Airlines, Digi, Mobil/Exxon, Samsung, Thai Airways, and Dell Computers are among the organizations that have sent delegates to her sessions in Asia. Anne is available as a keynote speaker, instructional designer and facilitator for seminars and team building.

Anne Thornley-Brown

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