ROI has been a big catch-cry for businesses large and small during the noughties and particularly post the GFC. What happens when you try to wrap the concept of ROI around Training and Development programs? At Courageous Leaders we’ve noticed a few articles and formulas emerging on this topic and in response our latest newsletter shares the thoughts, opinions and research of our Courageous Leaders facilitators to the debate. Subscribe for your copy of our newsletter.
These articles are to stimulate your thinking and we invite your feedback and comments – what’s your perspective?
We received this great response from Craig:
ReplyDeleteHi Mandy,
I think this is a great topic, and there are some great articles here.
Some thoughts occurred to me as I read the article on “cost savings” and I might some topics for future discussion/comment:
1. Waste as a result of not training people properly – my father works in a manufacturing environment and he once observed that the company he worked for would spend a lot of money on machinery and then literally employ “any idiot off the street” and then “let them loose” on the machines. Needless to say there was a lot of downtime as machines were repaired, not to mention the employees were unproductive and there was a lot of material waste as well. Companies spend money on hard assets and then waste and/or damage them by having untrained people let loose on them. The same concept can also be applied to managers, where some companies will spend up on the talent, and maybe even train them at their jobs, but then “let an idiot loose” on them and waste the staff or worse, damage (possibly literally, with psychological damage) the staff by effectively convincing them to be unproductive and leave. Hence the need for management and leadership development.
2. Leverage – Great leaders have a great impact, terrible leaders the opposite. Since the influence of leaders spread across their teams and their organisation leaders are a form of leverage. The effect of their actions is multiplied. The same as financial or operating leverage, leadership leverage makes a huge difference. A small positive change at this level can yield huge benefits.
3. Tolerance of Bad Management – Many organisations still tolerate “amateur” managers. An untrained accountant, doctor or mechanic is not hired (unless they are still in training, in which case they receive the training and development). Management still seems to be one role where amateurs are appointed and then not trained.
Hi Craig,
ReplyDeleteThank you so much for your insightful response - value the perspective you bring to this challenging topic. Especially liked the use of the leverage concept - great ROI concept - determine the value of the combined salaries within a leaders team and then decide that say 10per cent of this value must be invested back into leadership development for this person.
Invest time to analyze the current leadership leverage they create and determine a development plan to improve this leverage - thanks for sharing this insightful thinking.
Also want to thank you for taking the time to respond and look forward to even more insightful conversations as we continue to explore this topic with more people and also as we open up and explore more topics - your suggestions are always welcomed.
Cheers,
Mandy