"ROI Matters - How HR can be made a profit center"

Dear All

Grateful to all for you for helping me in the process of writing my book "ROI Matters - How HR can be made a profit center."

This is a great feeling and wanted to express the same.

The book will be released by mid this year.

The book covers basics of ROI and takes care of all that is required to implement a successful ROI process. Now that slowly Indian corporates are getting sensitive to the ROI process and in some companies, ROI is made mandatory, HR people have never been so aware.

Thank you to all of you for helping me with my research and driving the ROI process in your companies.

Until then...take one step to reach your ROI goal!
Sonali

Challenges with Data Collection

Dear Colleagues

It took me almost 2 months to collect data for My Consulting assignment on implementing ROI process at workplace. This is a great experience.

I realised and experienced strongly that 80:20 rule applies here too for the reasons here-with

1.  Only 20 % HR professionals agreed and gave autheticated data that helped me drive results.
2.  Only 20% HR people were genunienly interested in HR research.
3.  Only 20% HR professionals not only did answer the survey, they also did circulate the same among their colleagues.

In my consulting experience I receive a lot of complaints from HR people in the following areas of ROI implementation

1.  People are reluctant to fill the reaction forms and learning forms
2.  When it comes to their confidence level in application, people avoid filling that column
3.  When it comes to following the action plan people are reluctant to follow the same
4.  Employees prefer anonymous survey

The irony is these are the same HR professionals who were reluctant to fill the survey forms. And they expect that the employees who undergo their training should factually fill the data.

My question is to all HR professionals who complaint that HR is considered as a cost, and training is the first thing that is hit when it comes to budget constraints is

ARE WE REALLY READY TO TAKE THE QUANTUM LEAP OF FAITH AND PASSIONATELY MAKE HR A PROFIT CENTER?

Write your suggestions to contactus@exponentialadvisory.co.in

Your suggestions can be a part of our report if you choose to...

Objective Setting

Today I am going to write on Objective setting. As mentioned in my earlier blog, Objective setting forms the corner stone of the ROI process. It is here that the seed of an effective ROI implementation is sown.

Received a lot of emails on how to go about setting objective. I would suggest two things to make things simpler
1.  Begin with the end in mind
2.  Let the end be quantified

Below is an example in Critical Thinking Module at all the 5 levels of Phillips methodology. Critical thinking is a high end module with a very senior level target audience. Critical thinking covers various aspects of rationality and is generally a 2 day module.

1.                     Reaction level

s  Obtain a positive reaction towards the programme

s  Obtain input suggestions for improving programme

s  Inputs regarding the material

s  Action

2.                     Learning level

s  Distinguish between critical thinking and non-critical thinking

s  Steps used for critical thinking

s  State and define the building blocks of critical thinking

s  Which aspect of systems thinking is vastly used in Critical thinking

s  What were the 3 key learning from the video shown

3.                     Application

s  List the instances where critical thinking was applied

s  List the instances, where mental model was overcome

s  Action steps applied 100%

4.                     Business Impact

s  8 out of 10 decisions taken correctly

s  Higher retention on account of good leadership style and unbiased approach

5.                     ROI

s  40%

Similarly, one can use the above example for all the programs and HR interventions initiated.

Thank You

Thank you all, for such a overwhelming response. I will definitely incorporate all your feedback. When I started writing the Blog on HR and Training, I least expected such a response.

The list of people reading my blog is growing day by day. This also motivates me to research more and write more on technical subjects such as ROI, Quantitative techniques in HR, Statistical tools used for HR and on Softwares such as SPSS.


One HR person curiously enquired, if I only write on training evaluation and what is my perspective on evaluation of HR as a department. I tried to to answer him as per below.

There are 2 aspects of any HR department evaluation
First - Quantifying HR parameters. i.e. bringing in maxium objectivity in subjective parameters. This aspect is majorly covered as a part of Appraisal  during setting up Quantified KRAs. Often KRAs are linked with competencies and competency mapping is done.

Second - ROI on HR. This is also easy, once it is a part of the culture. Let us understand on which all areas of HR, ROI can can be calculated
1.  HR policies
2.  Surveys
3.  Meetings
4.  Events
5.  CSR actvities
6.  Appraisal
7.  Recruitment
8.  Exit interviews

The process for ROI on the above HR aspects, will be application of the Phillips Model. If all aspects of HR department are undertaken, with the ROI process in mind, it will be the most profitable department in the organisation.

Do you find excuse to implement ROI process for your training evaluations

Today a Sr. Candidate came for interview for a training profile.

Our client was looking for a person who can guide them and implement the ROI process.
He seemed good and knowledgeable and knew all the models that existed for ROI.

When asked to rate his skill level in implementation of ROI in his existing company, he said I never got time to implement ROI.

The question here is having conceptual knowledge of ROI that we learn at an MBA level and practical application of the same are too very different things. It’s a proven fact that having knowledge does not guarantee the application of the concept, let alone be measuring impact.

Chart below represents 100 HR and training professionals interviewed on the reasons for lack of training evaluation. Y-axis represents percentage and X-axis, the reasons identified for not implementing the training evaluation process.

33% professionals identified No time as a reason followed by lack of management support on 19% .

ROI is the most simple and easy to adopt process, yet training managers are avoiding it because of misconceptions about its application. If ROI is made part of the training process, then everything else follows. Time can be saved in areas such as training need identification, quantified objective setting, accountability of trainers, and questionnaire designing to collect the correct data.

ROI is the backbone of any training or HR intervention. And remember, no ROI is as good as the training has not taken place. Prove it, or leave it!!!