Learning's Hidden Business Face: What Learning Practitioners Should Know
Everyone appears to have an opinion about effectively validating “learning’s” business effectiveness. Much, if not most, of it is rhetoric and misleading. The only thing most agree on is that learning must be effective and accountable. That’s an obvious conclusion since it is a business activity and how your leaders see learning. The time has come for learning practitioners to prove that learning can be both effective and accountable.
Don’t confuse effectiveness with accountability.
Essentially, accountability is about ‘what’ you do with your resources. Effectiveness is about ‘how’ you apply learning resources to achieve results.
While both are relevant leaders expect learning effectiveness the lead to improving business performance. So, clearly communicating learning effectiveness to leaders is about relating to job application and business impact.
Before getting to job application and business impact, leaders expect proof that internal business activities, like learning, are worthwhile. They will select those activities that contribute to business objectives by maximizing available financial and human resources. Those that don’t, well, will see budgets cut, or worse, be eliminated altogether. Simply put, leaders validate each initiative’s effectiveness, or ineffectiveness, in relation to how well they achieve business objectives.
Learning practitioners, for some reason, come to believe that every learning effort must be accountable and effective. Compounding this misconception is the belief leaders expect to see some form of positive financial return from their learning. Both beliefs are myths borne by Learning and Development' elusive desire to become business ‘credible’.
While leaders expect results, they don’t expect every internal initiative to deliver financial outcomes. Why? Because they consider many internal activities, like learning, cost centers. Furthermore, leaders see learning (or as they refer to it training) in one of 3ways:
- Necessary requirement.
Leaders consider most training activities a necessity, such as on boarding or compliance. Typically, leaders treat these activities as expenses and rarely measure their business effectiveness.
- Part of a major effort (major project).
In this instance leaders view training as one component of a major business initiative (e.g. new product launch). Here effectiveness of the major initiative depends on the effectiveness of its inputs such as key training activities.
- Tangible capital investment (equipment purchases).
When learning request significant ‘equipment’ investments (e.g. Learning Management System or eLearning technology) to deliver long-term business value then leaders require accountability and effectiveness (or a real ROI).
Leaders recognize the need for employee development; however, this is not a blank cheque to do what you want.
eLearning and learning practitioners must start presenting clear business cases within the context of one of these 3 leadership perspectives. Leaders expect business justification why they should accept, let alone implement, an initiative. They must assess competing internal business choices and how they use scarce resources to achieving organizational.
One concept practitioners believe gives them an advantage among competitive internal choices is applying “return on investment” or ROI. Learning practitioners irresponsibly toss around the term ROI without with little regard as to the complexity surrounding its proper use. By inappropriately applying ROI undermines learning’s existing fragile credibility.
You’ll get the ‘eye roll’ if you attempt to convince leaders, with formal business educations, that “training ROI” is valid measure.
Doing so essentially violates core financial and accounting guidelines and concepts.
Leader support begins with building a business case for your learning initiative. First differentiate between training “expenses” and learning “investments”. Don’t waste your time attempting to validate ‘necessary’ training efforts (point one above). Leaders rarely measure effectiveness for these expenses. Evaluate substantive learning efforts when training is a component of a major business initiative or you require a significant tangible investment.
Next, identify key performance expectations. This is simple since operational leaders, your primary clients, know their performance objectives. Here’s a secret, operational leaders are less concerned about the cost of the initiative if you can relieve their performance pain. Honestly, leaders really don’t care how you improve employee performance. What they expect is that your learning effort correlates and contributes to improving employees performance to achieve specific business objectives.
Finally, leaders expect internal activities, like learning, to be financially accountable. Here’s a hint: Υour leaders don’t use ROI for intangible activities. Leaders differentiate between investments and expenses and consider training ‘activities’ an expense, not an investment. What your leaders are actually asking is to demonstrate effectiveness for the resources used. Doing so helps you to build a more credible business case for learning initiatives.
Too often practitioners erroneously argue that learning is an investment since it contributes to long-term growth. The challenge is that because learning is an intangible contribution there is no way to prove that this ‘investment’ tangibly contributes to long-term growth. Although your learning efforts may make a difference, leaders are unable to quantify this difference and must respect fundamental accounting and financial guidelines.
Here’s a typical example of how leaders financially measure training. Lets say you propose a multi-year blended learning initiative involving an eLearning component. Your leaders will account and measure the tangible components (learning technology, Learning Management System) as an investment using specific financial calculation (e.g. net present value, payback, etc.). But they will financially account (not measure) the actual training activity as an expense.
Before deciding to apply any type of evaluation methodology, think through how your leaders perceive your learning proposal’s business case. You’re not their only choice. Leaders are regularly “pitched” many internal business initiatives and select the ones that provide the best opportunity to achieving organizational objectives. These initiatives build clear business cases that compete with your offering. If you don’t step up you’ll diminish leadership support and further undermine your credibility. Become business savvy and see your role flourish.