Measuring ROI on Soft Skills Training

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One of the most frequent questions we’re asked by training managers is, “How do I measure the return on investment from training?”

On the face of it measuring the return on investment from soft skills training seems like a near-impossible task. After all, how do you quantify the financial benefits of more assertive behavior, better listening skills or negotiating tactics?

You might think that simply looking at an individual’s overall performance after the training is a good indication of whether or not it was effective, but then what exactly about the training was effective? Where exactly has the individual improved and how can this be given a value in rands and cents?

To measure the return on investment from soft skills training you need to be very specific about why you are training, what you hope to achieve at the training and understand how this relates to productivity and sales in your organisation.

You may have identified a trend whereby the sales department is outsourcing work when customers request services you do not offer, instead of trying to sell the client to an alternative that you do offer, and can possibly customise.

This lost revenue CAN be measured and its decrease can be directly attributed to a more assertive sales team.

Alternatively, a company may identify a problem whereby an individual or team is having to repeat or re-attend 15% of their work because the instructions from the client are not being followed properly (e.g. the menu at the top of the website is supposed to be turquoise, not blue, and the large graphic should be on the right and not the left of the screen), costing the company in wasted time.

With this specific problem identified a training manager could send this individual or team on a Customer Care Training workshop where active listening is covered, and immediately begin to measure the return based on a drop in repeat work.

Understanding the reasons that you are training is the first step in being able to measure the monetary return from any training course.

Even when training for what we consider to be the wrong reasons (and unfortunately sometimes the most common reasons for training), such as for BEE points, the return on investment can easily be measured.

If the reason you need your BEE points is so that you can qualify to offer your services to governmental departments and large corporates (or to improve your BEE rating and move onto a higher level), the return on investment from the training will show on your balance sheets.

However, as you may already be able to see, the more areas you focus on measuring improvement in, the more you will start to see how it all relates to financial gain.

Consider that, generally speaking, training your staff has the effect of reducing psychosomatic illness, stress and the ‘victim stance’ among employees, as well as increasing motivation and loyalty to the company, all of which contribute to lower absenteeism rates overall (also measurable financially).

Training also leads to reduced turnover of staff, decreasing the costs of recruitment as well as initial training.

And on and on it goes…

However. A word of warning.

We need to remember that it’s not just a numbers game – our human assets, or employees, are our most important assets and return on investment should not be the only factor taken into consideration when training. One should also look at broader aspects such as impact on community, creative license and 3rd party perceptions.  These last issues being just a few of those that should be taken into account in a well thought out ethical decision.

By Staff Training, a South African soft skills training company.

 

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