CLASSROOM VS. ONLINE TRAINING

SESSIONS  - HOW TO MEASURE ROI?

By Sandisha Sai on behalf of KelpHR

Objectives of this sessionWHY

WHAT

HOW

WHICH

HOW MUCH

Does an organization need training?

Are the types of trainings available?

Type suits you best?Effective is it?

ROI?

Some statistics : Glimpse of how organizations spend on training and development

North American and European organizations have the largest share of spend on training ~ 75%. Asia comes in with 17%. India spent US$21.5 billion on training in 2013, which is ~ 7% of the global share in spend on training activities

The global spend in 2014 was US$322.2 billion Large organizations ( >10000 employees) spend approx.

US$838/employee* Mid-size organizations (500 to 9999 employees) spend

approx.US$838/employee* Small organizations (<500 employees) spend

approx.US$1,888/employee Projected annual spend on training in India for the year 2015 is

US$1.5 billion

Why is training important for the organization?

Training Employee retention and enhanced performance

Increased revenue and organizational competitiveness

Why do Organizations invest in Training Change in workplace Improvement in quality Introduction of new technologies and upgradations

What are the types of organizational trainings?

Top management training sessions - Leadership programs

Middle management development sessions

Employee training sessions Induction On the job Coaching Mentoring Job rotation Job instruction technique Lectures Role playing Simulations / audio visual Self-instruction

It is important to ask:

Is the training program beneficial to the company

What type of training is

better suitedCan it be quantified

Does it have the buy-in of the employee

What type of training does he/she need

Charting out a training plan

Is there a need?Who needs to

be trained?

Is the training aligned to the

overall objective?

Who will conduct the

training?

How can they help transfer knowledge

on the job?

How will they monitor and evaluate the

training?

What form of training will they adopt?

What is classroom training?

What is online training?

Types of sessions for both

Classroom OnlineInduction Simulation Roleplay Webinar Seminar Workshop Lecture Self instruction Coaching/mentoring

Advantages and disadvantagesCLASSROOM TRAINING ONLINE TRAINING

Face-to-face Remotely conducted and accessedInteractive One way participation or

participation via web conferencingLesser need for technology Lesser need for physical

infrastructureResources and audience have to be present at the stipulated time

Sessions can be taken up anytime, anywhere

Fixed date and time On demand access to sessionsCourse content can be flexible and changed to suit the audience

Specially designed content for e-learning

Easier to evaluate and measure effectiveness

Online surveys and activities can map the level of participation

Easier to measure completion rates, behaviour changes and learner engagement

Courses have to be dynamically designed to keep the audience tuned in

Advantages and disadvantages (cont’d)

CLASSROOM TRAINING ONLINE TRAINING

One time session Session can be revisited any time the employee wants to brush up his/her knowledge

Cost of travel/stay/training can be very high

Online web conferencing services unite participants from any part of the globe

Non verbal communications are possible. Role plays, simulations, etc.

Self-paced online, on demand sessions

Personalized feedback loops Online feedback surveys

Focused on all participants Focused on the individual learnerInstructor can control and adapt Trainee is in controlLearning is also spontaneous as it is in real time

Trainees can revisit the module/modules

Concept of blended training

Blended or hybrid learning combines e-learning with the traditional classroom training.

Advantages of blended learning

It offers the best of both worlds It enhances corporate training effectiveness It simplifies corporate training logistics It is cost-effective  It allows your employees to have control over their training It enhances employees soft skills It facilitates corporate training feedback

CASE STUDY 1 - Selecting the right training module

MakeMyTrip - Here is a typical case of a small organization that shot to success overnight. Their revenue and FTE base grew so fast that their existing training capabilities could not catch up. They were hiring by the thousands all over the country and their orientation programs were unable to meet the demands. Plus the cost of taking the new employee to the training was also proving very expensive.

What they did and how they did it

They hired an external training solutions provider to design some online modules for their requirements, which were:

• Consistency in training across locations• Scalable solution to meet growing workforce• Increased rate of employee engagement

The external solutions provider took their existing training modules and revamped them to suit online training programs. This helped them:

• Cut down costs of module development• Costs of physical training• Expedite training across locations• Quicker on the job

• As a result: 26% employee engagement 97% completion rate

Case Study 2: Managing employee attritionZig Ziglar a great US

motivational speaker said, “What’s worse than training your workers and losing them? Not training them and keeping them!”

What Tesco did right

Criteria for measuring training success

Numbers

Reactions

Income

received

Efficiency

Behaviour

change

Performance chang

e

Measuring the effectiveness of the session

The Kirkpatrick Four levels of evaluation method uses just four parameters to measure the effectiveness of a training program

Reaction Learning

Behaviour Results

Quantifying the success

Non-monetary measures

Monetary measures

Why evaluate and measure training?

To validate training as a business tool To help improve the design of training To help in selecting training methods To justify the costs incurred in training To ensure that the ROI in training exceeds the investment

Forecasting and measuring costs

Costs of designing and developing the program Cost of promoting the program Cost of administration Cost of training Cost of content and materials Cost of infrastructure/technology Cost of employee attendance Cost of evaluation

Forecasting and measuring benefits

Cost of labour Increase in productivity Increase in income

The ROI method

TRAINING

Costs

Benefits

Four levels of impact for ROI model

ROI

BUSINESS IMPACT

APPLICATION

LEARNING

ENGAGEMENT

Calculating ROI

ROI = BENEFITS – COSTS /COSTS * 100 orBCR = Programme benefits / programme costs

How to decide what is better for your organization

Why should we be quantifying training initiatives

Dip in economy Steep competition Rising cost of business Organization wide cost cutting Inability to quantify the benefits of training Inability to quantify the value add

How to justify your budget spend?

Learning drives business outcomes

CASE STUDY 3 - Measuring ROI on Classroom trainingIndian Oil Corporation conducted approximately 2434 in-house training sessions in behavioural and functional training in order to improve the attitude sets and skill levels of its employees, as well as improve their competencies in the core functions. Their primary motivation for driving the training enterprise-wide was:• Improve attitude sets• Upgrade skill levels• Positively impact business bottom lineThey chose two programs for the analysis:1. Threshold program for mid to top level management to drive

general management skills. 30 participants2. Excellence in Project Management Program – how to optimise

investment in the face of challenges. 30 participants

They chose the following parameters:• Questionnaires to ascertain the degree of success• Trainees estimate of cost incurred to put them through the training

• The latter included the following subdivisions:• Faculty honorarium• Cost of flight, stay, food• Cost of material, stationery, giveaways• Daily allowance• CTC

• For the Threshold program, the total cost was Rs. 15,49,989

For the Threshold program, the parameters that estimated the cost impact were better decision making, efficient management, efficient handling of situations, better teamwork and the total cost attributed was Rs. 32,50,000

ROI = benefits – cost/costs * 100 32,50,000 – 15,49,989/15,49,989 *100 =109.68%

Case Study 4: Training success story

The IT industry is the largest user of Training and Development and spends anywhere between 3 to 5% of their revenue on training as opposed to non-IT sectors who spend around 0.5 to 2% on their training initiatives.

One of the most famous stories in the training industry is that of IBM. They have always been known for their zest towards developing their employees and in the 1990s, their spend on training alone crossed USD1 billion. In an effort to lower their costs of training but at the same time not compromise on their employee development, they came up with the idea of e-learning.

Within one year they saved USD166 million By 2001 they saved about USD350 million after implementing e-

learning The ROI earned from their basic Blue e-learning course was as high as

2284 percent By 2002, IBM was listed as first company to have the largest

enrolments into e-learning courses While their e-learning courses did not completely replace their

traditional courses, the impact was undeniable Later, IBM identified this as a business opportunity and started

developing e-learning products for other organizations as well

Training is a continuous process as is learning

Way forward…..

For the fiscal year 2015…. Accenture has made an investment of US$800

million to build skills and develop their workforce TCS has begun an online instructor led training

program called iClass and their investment of RS.360.9 crores last year has already gone up by 19% this year. Their employees spend an average of 10.3 days/year in training

At the associate level, employees in Infosys spend an average of 37 days/year in training

For more information on how to identify your training program and justify it, reach out to us at info@kelphr.com