save the company approximately $1.2 million. Identify and Collect Metrics to Show Training Success How does a company determine whether training and development activities actually con- tribute to the business goals? This determination involves identifying and collecting out- come measures, or metrics. The metrics that are typically used to identify training success or effectiveness include trainees’ satisfaction with the training program; whether the trainees’ knowledge, skill, ability, or attitudes changed as a result of program participation (cognitive and skill-based outcomes); and whether the program resulted in business-related outcomes for the company. The business-related outcomes should be directly linked to the business strategy and goals. Business-related outcomes could evaluate, for example, customer service, employee satisfaction or engagement, employee turnover, number of product defects, time spent in product development, number of patents, or time spent filling management positions. Some companies use the balanced scorecard as a process to evaluate all aspects of the business. The balanced scorecard is a means of performance measurement that pro- vides managers with a chance to look at the overall company performance or the per- formance of departments or functions (such as training) from the perspective of internal and external customers, employees, and shareholders. 22 The balanced scorecard consid- ers four different perspectives: customer, internal, innovation and learning, and finan- cial. The emphasis and type of indicators used to measure each of these perspectives are
68 Part 1 The Context for Training and Development based on the company’s business strategy and goals. The four perspectives and examples of metrics used to measure them include: • Customer (time, quality, performance, service, cost). • Internal (processes that influence customer satisfaction). • Innovation and learning (operating efficiency, employee satisfaction, continuous improvement). • Financial (profitability, growth, shareholder value). Metrics that might be used to assess training’s contribution to the balanced scorecard include employees trained (employees trained divided by total number of employees), train- ing costs (total training costs divided by number of employees trained), and training costs per hour (total training costs divided by total training hours). For example, EMC Corpora- tion, a technology company, uses a balanced scorecard to track and measure learning. 23 Company performance is tracked quarterly with metrics measuring business alignment, work-force readiness, time-to-market, globalization, and effectiveness. The company has also implemented performance metrics that are directly linked to present and future busi- ness needs. Employees are given individual development plans that are based on an analy- sis of their jobs. Ingersoll Rand requires its business units to make strong business cases for new spending.
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