Whether your company’s eLearning efforts are small or large, many eLearning professionals still face an uphill battle in terms of getting the resources needed to produce quality eLearning programs and courses. A surprising number of corporate leaders are still hesitant or skeptical to fully embrace eLearning, and are quick to point out problems. The more you can make a solid business case for the value and benefits of eLearning, the better off you’ll be in the long haul. You have to be able to make the case beforehand for a new effort or project and then show the results afterwards in terms that company leadership understands: return on investment (ROI). This is where eLearning ROI metrics have an important role to play.
eLearning ROI Metrics to Justify the Investment: Relevant KPIs
Key Performance Indicators or KPIs are best tools at your disposal to build a case that justifies an investment in eLearning programs. You can have all the numbers you want in terms of how many courses you’ve developed, how many hours of training have been delivered, the level of participating among employees, successful eLearning program completion rates, employee feedback about the content and so on. Yes, these are all important to include, but none of them make a strong case for whether or not the investment in eLearning was a good one. What company leadership really wants to see are concrete performance results, which is why KPIs need to take center stage in any attempt to either project or capture the ROI of eLearning.
To do this right, you have to spend some time with senior managers or other company leaders to make sure you have a clear understanding of the business goals of the company, as well as what challenges are the most important to address. When you can show that your eLearning efforts will address real company issues and have a positive impact on the company’s bottom line by addressing those issues, you’ll find resistance to eLearning melting away. In other words, you have to make sure that you’re choosing highly relevant KPIs.
Examples of eLearning ROI Metrics
The eLearning ROI metrics and KPIs chosen are going to be different by industry, and will even vary from company to company within industries according to the unique characteristics and business goals at play. Below are some general KPIs, some of which are bound to be relevant to your company:
- Bottom Line Performance Indicators: If a company is highly focused on sales and your eLearning programs are designed to have a positive impact on sales, then you’d want to include KPIs like number of orders (sales) obtained, dollar value of orders taken, number of prospective clients put into the pipeline, and so on. If these KPIs are relevant and important according to your company’s leadership, then you’d want to develop eLearning content that specifically addresses them.
- Indicators of Performance Improvement: Potential indicators here might be how much time is spent developing prospective clients into customers, the rate of errors that occur throughout the sales process, rate of success in properly identifying the needs of prospects in order to offer the right product or service, how much time is spent revising sales quotes (indicating mistakes or misunderstandings on behalf of salespeople) and so on.
- Indicators of Performance Quality: These are among the trickiest to nail down in terms of measurable numbers, but are often also the most powerful towards making the case for an eLearning investment and showing its ROI afterwards. Potential ways to capture quality improvements could be a decreasing number of customer complaints, increases in customer satisfaction statistics, more referrals from existing customers, a reduction in order cancellations, decreasing product returns, less waste produced in a manufacturing process and so on. Be careful when choosing these types of KPIs for your eLearning ROI metrics – you have to be able to show there are gaps in employee knowledge that your eLearning content will specifically address.
Establishing eLearning ROI Metrics
As was hinted at above, choosing relevant KPIs is one thing, but getting them created and set up for use is another thing entirely. Here’s a five-step process that will help:
- Identify and Understand Performance Gaps: Those conversations you had with company leaders and managers about the business goals and challenges to help you choose relevant KPIs need to be deep enough to help you understand the root cause of the gap so that you can properly address it with the eLearning content you will create.
- Choose Multiple Related Metrics to Measure Gaps: If your conversations have led you to believe that one the highest priorities in the company is improving the quality of performance to reduce customer complaints, you’ll need to do a deep dive into metrics such the overall number of complaints, classifying complaints into the most frequently seen topics and so on. You might find that there is one major kind of complaint that is driving the problem, which gives you a clear idea of what your eLearning content will need to address.
- Define and Benchmark the KPI: If you’ve heard of SMART goals, apply the same concept to each KPI you choose, making it specific, measurable, achievable, relevant and time-bound. Instead of “Better handling of customer complaints,” a SMART criteria approach would be something more like “Reduce the number of customer complaints about the ordering process by 75% over the course of six months.” Benchmark where these KPIs are at before you launch an eLearning program to address them so you can have a before-and-after effect to your analysis and reporting.
- Create KPI-Specific eLearning Content: With your eLearning ROI metrics identified, defined, and benchmarked, you can now create and implement the eLearning content to address them. Be realistic about what your eLearning content can achieve! Don’t overpromise on results you’re not sure you can deliver.
- Measure Post-eLearning Results: Once the training you developed and delivered is finished, you can now measure what results you’ve achieved. It’s important to understand that there can be a time-lag between training completion and results. You’ll have to decide what the relevant time-horizon is for the results to emerge in terms of days, weeks, or even months. Just keep measuring and accumulating data for your reports.
The eLearning ROI metrics and KPIs covered in this article are just one aspect of effectively and accurately calculating the ROI of eLearning. For more information on this topic, see my previous 5-part series:
- The ROI of Learning Part 1: Barriers
- The ROI of Learning Part 2: Where to Begin
- The ROI of Learning Part 3: Additional Considerations
- The ROI of Learning Part 4: Methods
- The ROI of Learning Part 5: The True Cost of Learning
Armed with the information contained in all these articles, you’ll be well on your way to making a killer business case for any significant investment in eLearning at your company.