Sunday, January 25, 2009

Measuring Business Impact of Learning by Michael E. Echols, Ph.D.


In its one-year-plus existence, the Bellevue University Human Capital Lab has funded research on how best-practice companies are using measurement of learning's business impact to support their talent management and strategic objectives. Here is what's happening at some of those companies.
Business Issue: Employees Quit Their Supervisors

At ACS, multivariate statistical methods were used to determine the impact of learning on call-center performance. The first phase of the research documented that training is a key factor impacting employee retention. The method used to derive this conclusion addresses a key measurement issue: how to be sure the improvement in business outcome - in this case, retention - was directly related to the training and not something else. Based on the initial business implications, ACS extended the analyses to additional dimensions of the business including recruiting.

Business Issue: Leadership Pipeline

The business challenge addressed here is one way a geographically dispersed global retail organization identifies highly engaged associates and delivers learning to this hourly and salaried workforce at thousands of locations. In this case, the focus is a customized retail-management program leading to a bachelor's degree. The program is co-designed by retail subject matter experts in conjunction with Home Depot executives to provide maximum impact on current associate performance and on future career capability.

This program integrates the corporation's tuition assistance benefits into its leadership career development strategy. The key element of this program is the opt-in nature of the highly engaged associates. The business-impact measurements at the company include the tracking of the percentage of future store management that emerges from the customized program vs. more traditional channels.

Business Issue: Tuition Assistance as a Strategy

One of the most advanced companies in the use of tuition assistance is Verizon Wireless. Under the leadership of Dorothy Martin, LearningLINK program manager for Verizon, the corporation already has monthly dashboards that document business impact. The four key business outcomes measured include recruiting, retention, job performance and job mobility.

These are key human capital factors for any company. All four parameters show favorable outcomes for employees utilizing tuition assistance relative to the general Verizon Wireless employee population. Especially dramatic is the fact that the strategy has produced as much as a 10 percent improvement in retention. This result is important because it is directly opposite to the "educate them and they will leave" opinion widely held among operating managers.

To extend the impact of tuition assistance, Verizon Wireless is collaborating in the development and deployment of a customized retail management program targeted at accelerating the development of future leaders in critical retail operations. Calibration of the impact of the custom program on the business outcomes listed above is part of the deployment.

Business Issue: Sales Training Redesign and Redeployment

Few industries face the challenges seen in the auto industry today. Innovation, a key concept in many markets, is more than a mere expression at Chrysler Academy. First presented to the public in detail at the Fall 2008 Chief Learning Officer Symposium, the corporation has deployed an innovative approach including:
a) Performance maps for high performers.
b) Gap analysis.
c) Sales training redesign and new deployment model.
d) Measured business impact.

Answering questions around learning's impact has motivated senior Chrysler management to extend the analysis to dealership management programs that reach far beyond sales training.

In summary, these best-practice companies are walking the talk when it comes to innovative learning strategies and the related business outcome measurements that show the value of the investments. Validated in the first phase, these measurement initiatives are being leveraged to impact even broader strategy issues - the true seat at the table.

[About the Author: Michael E. Echols, Ph.D., is vice president of strategic initiatives at Bellevue University and author of "ROI on Human Capital Investment."]

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