How To Measure The ROI Of Online Training? - EI Design

http://www.eidesign.nethttp://www.eidesign.net
How To Measure The ROI Of Online Training?
Part of ROI Series
Presented by
www.eidesign.net
Author-Asha Pandey
Chief Learning Strategist, EI Design
apandey@eidesign.net
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http://www.eidesign.net
About EI Design (www.eidesign.net)
2
Years of Learning Solutions
Expertise
14
6500 Hours of eLearning
Developed
390
Hours of Localisation
In 26 Languages Developed
82.3%
Customer
Retention Rate
20+ Industry Verticals
Serviced
Countries – The Breadth of Our
Customer Base
16
750
Hours of Mobile Learning
Developed

Our portfolio and the range of our services
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Core services:
Core services: Our rich portfolio includes:
1. Custom Course development eLearning /
mLearning
2. Migration of legacy courses to HTML 5
3. Localisation
4. ILT / VILT and Blended Learning
5. Performance Support Tools
Off-the-shelf Products:
1. Suite on Instructional Design
2. Suite on generic Compliance
Value added Services : Comprehensive evaluation
strategy (cuts across various training formats)
1. Efficacy of learning (the learnability and gain
for learners)
2. Impact of training (the gain for business)
3. Return of Investment (ROI) on training
Beyond Learning: We also offer several Learning
Support services that can be used to promote
eLearning adoption or specific mandates like change
management.

How To Measure The ROI Of Online Training?
Today, most organizations use eLearning as a
significant part of their training delivery. As
traditional eLearning moves towards mobile
learning or mLearning and provides learners the
flexibility to learn on the device of their choice
(notably tablets and smartphones), the eLearning
adoption is gaining further momentum.
eLearning and mobile learning provide several
benefits to organizations. However, the focus is
now shifting to determining its impact and the
Return On Investment or ROI of online training.
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Measuring The ROI Of Online Training
In this article, I will begin with a quick summary of
the benefits that eLearning offers, what ROI is,
and how you can measure it. I will also outline the
ROI methodology we use.
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I am quoting extensively from my earlier article Return Of
Investment (ROI):
Are You In?. This article had originally appeared in
CrossKnowledge’s Learning Wire Blog. Do refer to this article. It
also outlines the measures to maximize the ROI.
Over the last two decades, most organizations have made
investments in eLearning primarily for the following benefits:
• Anytime, anywhere access (on demand availability).
• Self-paced, interactive, and more engaging learning
(learner perspective).
• Less disruptive delivery (in contrast to ILT).
What Are The Advantages Of eLearning?

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Over the last two decades, most organizations have made
investments in eLearning primarily for the following benefits:
• Cost-effective (particularly when reaching out to a large
audience).
• Consistency of message and easy updating of content.
• Easy tracking of learner progress and completion (business
perspective).
What Are The Advantages Of eLearning?
(Continued…)
While the eLearning advantages are well accepted, increasingly
organizations are seeking ways and means to determine its
impact on learners as well as on business. Let’s see what Return
Of Investment (ROI) is and how you can assess if your eLearning
or online training initiatives are generating the required ROI.

What Is ROI?
ROI is the return on investment that an
organization makes (ROI = Gain or Return/Cost).
It can be determined through two factors
namely the Investment made (or cost incurred)
and Value/Gain accrued (or return).
A successful eLearning initiative should be able
to demonstrate gains that are more than the
investment.
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How To Determine Costs And Assess Returns?
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Costs are fairly easy to define and would normally include the cost of eLearning course development as well
as associated costs of team members (including teams that are associated with the development process and
Subject Matter Experts).
Typically, there would also be associated costs of the supporting delivery (Learning Management System,
Administrative cost of managing the initiative, and other related infrastructure required for delivery).

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Determining the “value” or “gain” is far
more tricky. We nail this by looking at the
gains for the organization as well as for
the learners.
• Organizational perspective.
Let’s begin by re-looking at the gains most organizations seek
when they adopt eLearning and see how many of these translate
to reduction in costs and hence improvement in returns.
• Less disruptive delivery.
This translates to man-days available now to the organization
that would have been allocated to travel and training in the
ILT mode.
• No associated costs for trainers.
These can be identified easily.
• Reduced travel costs.
These can be determined easily.

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• Learners’ perspective.
Next, let’s take a look at the gains that
accrue on account of effective eLearning
course designs:
• More learners across the organization can be trained in lesser
time (while they get the flexibility to learn at their own pace).
• Coupled with tracking, the eLearning initiatives can be
scheduled and completed faster as compared to ILT sessions.
• Immersive and engaging learning translates to better
assimilation. This in turn leads to proficiency gain and a
tangible increase in productivity.

What ROI Methodology Can Be Used?
Most of us are familiar with Kirkpatrick’s model of
evaluation. In today’s context, adding Phillips’ ROI
calculation as the fifth level makes this framework even
more useful and relevant. By using Level IV evaluation data,
we can convert the results into monetary value. Then we
can easily compare them against the cost of the eLearning
program and determine the ROI.
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Kirkpatrick’s model

To give you a sense of how it can be practically used, let me
summarize the approaches we typically adopt:
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• Level 1: Reaction is measured by taking feedback from
learners. We have used online surveys in the past but
now we add features of “Like the course” and
“Recommend the course” options within our eLearning
course framework.

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• Level 2: Learning can be easily measured through scoring
patterns in the end of course assessments.

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• Level 3: Behavioral changes are certainly more difficult to
assess. We use a combination of techniques to assess
how much of the newly acquired learning is being applied
on the job. This could be measured through
improvements in efficiency or doing the same task with a
new approach.

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• Level 4: Business impact is generally measured through
productivity gain, impact on quality measures through
reduction in re-works, getting higher number of work
assets first time right, and so on.

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• Level 5: ROI is normally calculated by converting the
business impact gains (as shown in level 4) to a
monetary value.

What Is ROI?
I hope this article was useful in understanding the ROI
definition and more significantly, what ROI methodology
will enable you to measure the ROI of online training. At
EI Design, we do workshops that can enable you to adapt
the standard ROI methodology to your organization. Do
reach out to me if you need further details.
I will be sharing tips on how you can maximize your ROI
in my next article.
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http://www.eidesign.net19
EI Design Pvt Ltd
Corporate Office and Development Centre
#160, Arun Arch,
9th Cross, Indiranagar 1st Stage
Bangalore - 560 038, India.
www.eidesign.net
Asha Pandey,
CMD and Chief Learning Strategist
Tel (Direct): +91-80-25202679
Board: +91-80-25202677 / 25202678
Mobile: +91-98450-61484
Email: apandey@eidesign.net

How To Measure The ROI Of Online Training? - EI Design

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How To Measure The ROI Of Online Training? - EI Design