ROI stands for return on investment. It basically means the efficiency of the investment.
Every business activity that requires a significant investment has to undergo an ROI evaluation.
Investing in eLearning has become a necessity for businesses in all industries. Rather than organizing weeklong training, that cost the company a lot, managers and people in charge have been turning to eLearning. Although one of the benefits of eLearning is the reduced cost of training, this expense has nothing to do with the calculation of eLearning ROI.
The advantages of eLearning in comparison to other training methods are plenty. eLearning comes with many benefits like convenience, flexibility, and accessibility to many. E-learning is very much about inclusivity, accessibility, and convenience. Its ability to reach many different people, anywhere at any time, makes e-learning one of the most flexible training methods. Most e-learning programs have flexible access meaning that you can listen, read, or watch the materials anytime, wherever you are.
E-learning has made it very easy for us to keep track of training progress and report the results. A good way to make training more effective is to measure results create reports based on the progress. This is another thing that is beneficial, not only to the employees but also to the people preparing the training.
A good LMS makes it possible for people doing the training to communicate and collaborate. Team building is a core process that is vital to the success of the company. Giving your employees the ability to work together and create a team spirit is one of the best benefits coming out of e-learning.
This advanced training method makes it easier for your employees to give feedback on their experience with the learning materials and the whole experience in general. Having a general idea about how effective your training is can help you make it even better.
When we talk about the cost of eLearning we think about many different expenses. They all differ depending on the type of training, but they mostly have the same types of expenses. If you follow the Addie training framework you will have a 5 step process which will require the involvement of such roles.
To be able to calculate the ROI of your eLearning courses you have to first understand and establish the meaning of successful training. This is why it is so important to define the KPIs and see how much they have changed after the training. By knowing how much they should change and how much they have changed you can see if it is worth to invest in that training development.
To calculate the ROI of online training you’ll need to use a methodology. Kirkpatrick’s Model of Training Evaluation allows you to measure training effectiveness. This model has 4 levels, Reaction, Learning, Behaviour, and Impact. Each level helps you understand every stage of your training’s effectiveness. By monetizing the added value to the productivity and overall performance of your employees. This tells us directly if the training was a good investment.
The reaction level is measured by gathering information about your learners first contact with the training. The first impression has a huge importance on how effective the training will actually be and therefore it is of great importance that we know it. The learners can also give you feedback on how they perceive it and consequently improve its quality.
The learning level consists of the increase in knowledge and skills and the change of behavior towards that particular topic. This level is important because it determines if our goals are being met. It can be measured and determined by various tests, assignments, and demonstrations.
The behavior level is measured after the training is finished and tells us how the behavior alone has changed due to the training completion. Behaviour is important because it tells us how much your employees are implementing their knowledge and skills obtained during the training.
The impact level is something that is measured after the completion of the training. This tells us how much your employees are using their new earned skills and knowledge to better their performance at work. The impact level is a direct reflection of productivity.
eLearning ROI calculators allow us to understand the actual benefits of developing and using these kinds of training methods. Here are a few.
eLearning is the first choice for companies nowadays due to the benefits aforementioned. Not only is it practical that you train your employees by using eLearning but it is less expensive and the preferred way. A key goal during this process by both the employees and the people creating the training should be that we gain as much as we can from it.
The ROI of eLearning can be a factor of many things. The first one is definitely the quality of the eLearning materials and the way that it is presented. Next, it is also the relevancy to the people who will become the learners. Determining all of these can expose us to better training and a bigger ROI. This is why it is so important that we evaluate the need for training, the KPIs, and every little element that goes into it.
eLearning has proven to be beneficial to all parties involved. It is good for companies because it decreases the cost f training their employees and it is good for the employees because it allows them to have access to new skills and knowledge at their convenience. Technology has affected the way we learn, we stay updated and how we connect everything in between. These are the very reasons why eLearning is embraced so much.