Proving Value

Training assessments are performed to determine if the learner has acquired the skills or is displaying the behavior changes that the training was developed for. If the end results are not the desired ones, the training itself is evaluated and changed. In addition to the learning objectives, the training needs to show a viable Return on Investment (ROI).

According to Jack Phillips' Handbook of Training Evaluation book, companies are good at performing levels one through four, but not at determining the ROI for their training costs. His 5 Levels of Evaluation are as follows:

Jack Phillips: Five Level ROI Framework
5 Levels of Evaluation
Level Question

1. Reaction & Planned Action: What are participants’ reactions to the program, and what do they plan to do with the material?
2. Learning: What skills, knowledge or attitudes have changed, and by how much?
3. Job Applications: Did the participants apply what they learned on the job?
4. Business Results: Did the on-the-job application produce measurable results?
5. Return on Investment: Did the monetary value of the results exceed the cost for the program?

Phillips explains an ROI Process Model, which begins with first determining the purposes for your training evaluation. The purpose determines the type of data collected, type of data-collection method, the type of analysis, and the communication medium for the results. The type of collection instruments are planned for early in the ROI process and should be familiar to the organization.

Data for Levels one through four is collected during the training program to accurately determine its effects. This data is then converted to a monetary value. The program cost is then tabulated, based on all resources that contributed to it. The cost is then used to determine the ROI.

The Calculations

High ROI is calculated using the program benefits and costs. The ROI uses net benefits divided by program costs. The value of training is assessed according to its fulfillment of objectives, as well as its value compared to the resources used to create and deliver it. Businesses are demanding this more and more.