Opinion Leaders: The ROE of Learning

Organisations are, they say, always perfectly designed to produce whatever it is they produce. If the organisation has quality, cost and productivity problems, then that is because it is designed and behaves that way. Behaviours that produce undesirable outcomes are simply reinforced. This is not conjecture; it is the cold, hard reality of human behaviour.

In sense, this is good news. It means that all we have to do to turn things around is to identify the behaviours that produce the undesirable outcomes and set up the processes to stop them. Then, identify the behaviours that produce more desirable outcomes and initiate practices that positively reinforce them.
The challenge of course, is to pinpoint the desirable results and the behaviours that will produce success. Everything important is measurable. All that is needed is reasonable eyesight and the ability to count. The best measurement method involves observation and counting. The accuracy of the measurement approach is not an issue, provided the measurement is done exactly the same way each time.

This approach underpins the concept of, and process for, measuring learning effectiveness. Given the enormous amount of money and time, including lost working hours, that is invested in training and education it is only reasonable that we should be able to measure the return on the investment. I call it the return on expectations from learning (ROE). The process, in my experience, leads to change and hopefully improved behaviour.

To ensure an improved return on their investment in lifting the competencies of their people IBM, Motorola, BHP and many other large corporations have conducted exhaustive research into establishing the return on investment from training and education. Motorola once claimed returns of up to 30 times the investment. The methods used are, however, time consuming, costly and cumbersome. less costly approach is to measure ROE. There is very close correlation between ROI and ROE.

ROE is based on clear identification and understanding of the outcomes expected from training event or education process in behavioural terms. It also requires well-defined follow-up pro-cess with positive reinforcement of the new desirable behaviour.

The process also calls for the establishment of learning contract with the participants taking part in the learning event to ensure not only that learning takes place but, also that the participants “learn to learn” and become proficient in maintaining learning mind set even after the event.

Learning is hard work. The more the learner is actively involved and understands the learning process, the more likely an acceptable ROE can be achieved that benefits all stakeholders.

If the expected return is, as Motorola suggests, 30 times the investment, it should automatically be an alternative to any discerning manager investing in the training and education of his or her people.

At NZIM Auckland we have developed an ROE methodology which includes the concept of learning contract to support participants to achieve more gratifying outcome from participating in learning event. It includes support for managers with people participating in learning events, to introduce approaches in such way that difficult, dull or boring tasks become more exciting, challenging and rewarding.

Changing habits is not difficult – just different. If we do not fundamentally change what we do we get more of the same. It is the definition of insanity to do more of the same and expect different results. To get the right financial outcomes we must manage the behaviours that create those outcomes. scoreboard reflects how well player hits the ball but you cannot progress simply by watching the scoreboard. Success depends on watching the player and improving his or her competency in hitting the ball in winning way. M

Stig Ehnbom, FNZIM, is general manager NZIM Auckland.

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