Less than a Minute Life Lesson-2410 Promotion and Character

How can training be measured in Terms of money?

Let’s classify training into three types for the purpose of the discussion

1. Technical
2. Functional 
3. Behavioural  

How do we measure the training in terms of money for the above three?

Technical: Let’s take a situation where a company is facing wastage of material during production which is beyond the prescribed tolerance level. At this juncture the production team has to define what is the percentage/cost involved in wastage and how much would they like to reduce. This detail should be given along with the training need.

Once the technicians are trained, their performance should be measured in terms of wastage and arrive at the percentage/cost involved in the wastage.

For example: The production tells we need bring down the wastage to 3% in each shift at the end of each shift the wastage % needs to be recorded. If the wastage is brought down to 3% in all the shifts and the same rate is maintained constantly for a period of 40plus days, it indicates training has improved the skill set of the technicians.

Similarly, we can also consider the time as an element of savings pre and post training.

Functional: - Let’s take a situation where there is a delay in completion of documentation for statutory purpose which results in delay of receiving tax credits which is due lack of knowledge in understanding the statutory norms. In this situation we can define the areas where the concern team or person is not effective and this can be basis for designing the training program.

After the training if the company is able to send the documents as per fixed deadlines and if the company is able to get the tax credit in time, that is the return on investment for training.

Behavioural: - Behavioural is not as easy to measure like the above two, but with well-defined objectives and changes they would like to see will be instrumental in measuring the training in terms of money.

Let’s take a retail stores where the sales team should do a cross sell, in this situation the floor manager should arrive at the rupee value that he/she would like to achieve post the training. These figures can help the training department to measure the effectiveness based on comparing the figures with before and after training.

 However, let’s have one thing in mind, every training might not give immediate results but will definitely develop a culture that might result in positivity and harmony in workplace, which cannot be measured in terms of money.

In manufacturing there is a preventive maintenance cost to avoid break-down hence an amount is set aside for preventive maintenance, whether the machine might fail or not is question mark, but the company does set aside funds.

 Similarly, certain behavioural training is offered to ensure people carry themselves positively, whether they will change or not is debatable but all we need to ask is what will be the impact of poor behaviour in terms:

•             Employee morale

•             Team work

•             Customer centricity

•             People development etc

Certain impact is costlier than the cost of the training

Written by: M.L. Narendra Kumar