Computing the ROI training

STEPS IN COMPUTING ROI TRAINING

1. Determine the course objective and goals in term of gains and benefits derived from the course.
• Identify the best practices to be adopted and the standard output they have achieved.
• Measure the current performance in term of efficiency or output or outcome measures.
• Compare before and after training performance of the trainees
• Accumulate the value until say for three years i.e whatever duration where values are drawn from training.
2. The KPI of the job holder would be a good measure of expected performance gains and opportunity cost.
3. Compute the course/ workshop/ seminar costs which include the opportunity costs of trainees
4. Divide gains or profits or benefits from training divide by the cost of training to arrive at the return on training. 
5. IF the benefits or gains to be derived from training is more than 1 year, the IRR and NPV is a better criterion in justifying training.
6. In general, the ROI on training has always been proven to be higher than 100% per year.

SYNOPSIS of ROI Training 

The purpose of this workshop is to impart knowledge and skills in measuring the effectiveness of training.  ROI is said to be the ultimate measure on the impact of training.

Since the benefits, accruing to training extends more than a year, the IRR would be a better indicator in measuring the impact.

The first day of this two day course shall focus on the ROI and the accumulation of costs and the benefits accruing from training.

The second day shall see the projection of benefits in terms of cash flows into the second and the years ahead.

Ready Templates and models (excel based) has have been designed for this course.

Performance improvement in Sales and Production departments as an impact of training are ter easy to calculate as compared to other department.

Profit center accounting must be prepared for each section and departments showing its income statements.

We believe that every job has more than one KPI measures.  The output or outcome could be calculated with each respective KPI measure.

References:http://traininginmalaysia.blogspot.com