a simple and compelling form for a board presentation or 'lift speech'. It can be applied to virtually any human capital investment and is relevant for commercial, public sector, not-for-profit and voluntary sectors alike.
Combining a rigorous method (The Radial Method©), expert analysis and a supporting toolset, the approach provides independent, compelling proof of the true return of a human capital programme, but without having to apply extensive effort to do so. A complete study for a significant programme or initiative typically costs only around £2,000, including knowledge transfer, and can normally pay for itself many times over. Studies of complete investment portfolios may also be undertaken, for example examining a department's annual spend, though typically these may cost a little more.
Comprehensive approach
Assessing return on people investments is not about hunting down a 'magic number', nor just taking a snapshot at a particular moment in time. Our approach allows you to understand what benefits your programme is delivering over a period of time - the financial, performance and intangible returns - as well as giving insights into how and why it's directly impacting what's happening on the ground. A study can normally be extended to show how these returns actually contribute to an organisation's performance - in other words, how they impact on the bottom line.
When used to evaluate training programmes, the approach addresses many fallacies found in various methods aiming to determine learning and development return on investment (such as learning analytics), whilst putting its focus on levels 3 and 4 in the well-known Kirkpatrick learning evaluation model - behavioural change and organisation impact.
Common fallacies in ROI appraisal are described in our white paper 'Fallacies and Fixes', which may be viewed by clicking here: 'Fallacies and Fixes'.
The mix of perspectives usually taken include:
- Return on expectations analysis
- Pure financial return on investment (ROI*), ROI threshold and/or opportunity cost analysis, accounting for tangible costed benefits
- Structured analysis of carefully elicited anecdotes
- Comparative, anonymous 180 degree analysis
- Examination of intangible performance indicators
- Correlation of stakeholder perceptions and experiences
- Correlation against any other available data, such as employee satisfaction surveys, coach observer score-sheets and Kirkpatrick analysis
- Resolution of any conflicting data inputs.
The approach draws on established consulting and investment analysis models and techniques, and has been developed with the help of different sponsor and managers' perspectives, as well as taking account of evolving thinking on human capital valuation. Account is taken of how you've implemented your programme or policy and the maturity of the implementation. Inquiry lines are fully customisable to your specific objectives and needs. Anecdotal evidence is given special emphasis, applying a well proven consulting model for drawing insight from a potentially wide range of observations and experiences. This means that anecdotes aren't just quoted in isolation as odd examples, but are related to how they impact individuals and the organisation generally: analysis gets to the 'why' an impact has been felt as well as the 'what', and pins down why a particular initiative has brought about a difference as opposed to other possibilities.
A robust toolset supports analysis, combining:
- Checklists to ensure study efficiency
- An index of common soft indicators, measures and key performance indicators (KPI's)
- A data bank of 180 degree survey questions
- Comprehensive analysis and reporting templates.
Both the method and the toolset have been extensively piloted, enabling refinement and customer-driven specification.
Clear insights
Clear, striking reports present key information graphically, as well as providing a full commentary and 'drill-down' breakdown of the detail. The information provided therefore offers both powerful case study stories to relate as examples of business impacts and compelling statistical, costing and other data for the financially-minded.
Financial and other key measures of performance or impact are reported, but so too are crucial insights into the effectiveness of an initiative or portfolio of programmes, perceived and actual business impacts, and specific 'war story' and other anecdotal examples to illustrate these impacts. Typical outputs include:
- Key metrics, presented graphically
- Effectiveness appraisal, including SWOT analysis and recommendations
- Comprehensive detailed analysis, backed by Microsoft Excel data tables
- Comprehensive listing of anecdote 'stories' (anecdotes of real impacts and experiences)
- Simple, instantly-explained graphical and narrative reporting for senior executives (including a brief Microsoft PowerPoint slide-set).
This provides powerful knowledge, and where relevant highlights possible areas you might want to focus on, for example to enhance your programme's performance, as well as giving tangible data to support the continued case for your on-going investment.
Sample reports (click to view)
The approach allows easy customisation to cater for specific study interests. Analysis can be restricted to particular areas of a business or stakeholder groups if required. A study is easy and quick to implement and priced at less than many organisations charge for just one day's training consultancy.
Broad application
The approach is designed to help HR, Learning and Development, Organisation Development and Talent Managers prove the value of their people investment choices, as well as providing powerful information for any other sponsors, budget allocators and CFO's.
The approach is suitable for any programme, though is typically best applied to initiatives which have impacted 20 or more people and which are intended to be sustained or extended. Examples include:
- In-house coaching and mentoring programmes
- Core training programmes
- Culture change and integration projects
- HR policy impacts
- e-learning programmes
- Induction programmes
- Graduate training programmes
- Support for training accreditation applications
- Organisational development and change programmes
- Talent management
- Validation for a supplier's value pricing criteria
- Leadership development programmes.
Please click here for a fuller list of topics which are suitable candidates for analysis: Radial Method© applications.
The return on ROI
Return on investment studies can pay for themselves many times over, allowing crucial decisions to be made on what to continue and what to change (often small tweaks can have a large impact), as well as providing quantified insights of what will be effective for future initiatives. The impacts of these decisions can then be valued to project future returns and savings. Being able to reassure sponsors with more than a good feeling allows funding decisions to be made with confidence.
Our expertise allows data to be gathered quickly, reducing the time usually expected of participants in evaluation studies (although of course, in-house resources may also be used for this task).
Further information
For more information or to discuss the possibility of arranging a free, no-obligation meeting to explore your needs, please call us now on +44 (0)1273 467615 or email info@proactivestyle.com
*The term 'Return on Investment' or 'ROI' is usually applied to measure the pure financial benefits of carrying out a particular course of action, such as a coaching programme. In the case of human capital initiatives, absolute measures aren't always possible or even desirable, whilst it's usually highly relevant to take account of intangible returns such as improved staff motivation and changed behaviours also.
We therefore use the term in a general as well as in an absolute sense, and may suggest that measuring return on expectations (ROE), achievement of ROI thresholds or examining opportunity costs may be most appropriate. Further information on this topic is given in our article, 'Measuring Return on People', which may be viewed by clicking here: Measuring Return on People.
The Radial Method©. Click here to download a printable information sheet.
References for statistics and survey-based statements quoted on this page: People Management, March 2008; NESS Survey, Learning and Skills Council, June 2006; Ford and Weissbein, Performance Improvement Quarterly, 1997; PDI, Coaching at Work, March 2008; Human Capital Evaluation, CIPD, Summer 2007.
