How to Build a Business Case for Formalization of Learning Analytics

You can listen to today’s webinar using your computer’s
speakers or you may dial into the teleconference.

If you would like to join the teleconference,
please dial 1.650.479.3208 and enter access code: 923 369 627 #.

You will be on hold until the seminar begins.

#CLOwebinar

Speaker: Jeffrey Berk
Chief Operating Officer
KnowledgeAdvisors

Moderator: Deanna Hartley
Senior Editor
Chief Learning Officer magazine

#CLOwebinar

• Q&A
– Click on the Q&A icon on
your floating toolbar on the
top of your screen.
– Type in your question in the
space at the bottom.
– Click on “Send.”

#CLOwebinar

Polling
Polling question will
appear in the “Polling”
panel.
Select your response
and click on “Submit.”

#CLOwebinar

1. Will I receive a copy of the slides after the webinar?
YES

2. Will I receive a copy of the webinar recording?
YES
Please allow up to 2 business days to receive these materials.

#CLOwebinar

Deanna Hartley
Senior Editor
Chief Learning Officer magazine

#CLOwebinar

Jeffrey Berk
KnowledgeAdvisors

#CLOwebinar

How to Build a Business Case to
Measure the Effectiveness of
Learning Programs

Jeffrey Berk

www.knowledgeadvisors.com

© KnowledgeAdvisors. All rights reserved.

Agenda
Provide brief overview of KnowledgeAdvisors
Describe the challenges of leadership programs
Discuss the types of leadership metrics
Articulate the business case components
Compute the business case and provide examples
Review techniques to further the business case
Conclude with a Top 10 Business Case List

9

Leader in Learning & Talent Analytics

Continuously Optimize
Improve Results

5 CLOs
450+ Clients of the Year

9 of 10 Training 4 of 5 Best
Hall of Fame Places to Work

Onboarding Learning Leadership
EDITION EDITION EDITION

1st Year Retention Expertise & Skills Manager Capability
Speed to Workforce Strategic Vision &
Performance Performance Execution

Capabilities Engagement Performance
EDITION EDITION EDITION

Bench Strength Retention of Talent Goal Achievement
Talent for Future Workforce Organizational
Success Productivity Alignment

Manager Capability
Strategic Vision & Execution

Decision Support

How do we reduce
turnover among leaders?
What are the gaps for our
emerging leaders?
What leadership areas
need development?

Why does it matter?
It’s about having a quality control system for
leadership programs

It’s about ensuring credible executive reporting that
showcases value, impact, and utilization of leadership
programs

It’s about maintaining advanced analytics that provide
data to drive toward high performing leaders

14

Leadership Development KPIs
Outcome Metrics - Business Outcomes
Leader Retention
Employee Engagement
Employee Retention
Leader Performance Rating
Leader Financial Management
Effectiveness Metrics – Program Performance
Delivery Quality
Knowledge Gain
Application to Job
Business Alignment
Value
Efficiency Metrics – Cost and Activity
# of Participants
% of Employees Trained
Total L&D Investment
L&D Investment per Participant
Courses Utilized
Classes Conducted
Instructors Utilized
15
Locations Used © KnowledgeAdvisors. All rights reserved.

Business Case Components
1. Increased leader productivity
– Improved performance in running training like a business
– Improved workforce performance through data driven decision-making
– Research shows 2.4% improvement in performance from analytics

2. Reduced waste (scrap learning in leader programs)
– Over half of training investments are not optimally used
– Most organizations waste .5% to 2% of revenue on under-used training
– Lack of manager follow-through is a significant problem

3. Reduced administration in measuring leader
programs
– Majority of time spent on measurement is transactional and tactical
– Talented practitioners are doing data compilation vs. data analysis
– Data is not provided with any relevant reference points to make sense

16

Performance - Examples
1. Major services firm realized $200,000 increased annual profit by
using predictive analytics capabilities.

2. Through measurement a leading federal agency significantly
increased output and business impact without increasing budget over
a 3 year period.

3. Major telecommunications firm using metrics was able to increase
sales by $1.25 million dollars through better supply chain
management.

4. 15,000 hours in improved productivity by a floral company in
identifying appropriate training investments via data analysis.

17

Performance - Calculation
$1,000,000,000 Revenue
25% Labor Percentage
$250,000,000 Labor Cost
Increased Productivity from
1%
Measurement%
Increased Performance from
$2,500,000 Measurement

18

Waste - Examples
1. 25 retail stores avoided $100,000 of wasted training. Retail store
training measured after first of six weeks saw 1 set of ineffective
trainers and discontinued using them.

2. Instructor compared herself to other instructors and changed approach. 6
months of additional sessions performed better to avoid at least $100,000 in
scrap learning.

3. $500,000 in funding gained by measuring scrap learning. Services firm
measured training results and found high quality but low impact. The
program was retained and additional funding rewarded to consult with
managers on increasing impact.

19

Waste- Calculation
Description
$1,000,000,000 Revenue
1% L&D as % of Revenue
$10,000,000 L&D Investment
50% Waste or Unrealized Value %
$5,000,000 Waste or Unrealized Value
5% Waste Reduction from Measurement%
Waste Reduction from
$250,000
Measurement

20

Admin - Examples
1. 75% reduction in administration costs from automating measurement
process vs. manual measurement.

2. 15 minutes to retrieve actionable data for decision-making vs. 15
hours prior to automating the measurement process. This
automation of 1 report alone saved over $36,000 per year.

3. $400,000 savings by major accounting firm that used smarter
measurement in a practical way to yield similar results compared to
complex and burdensome alternative measurement techniques

21

Admin - Calculation
Description
$55,000 Salary of 1 FTE admin for metrics
$50,000 Cost avoided from unnecessary analysis
$50,000 Cost to replicate fraction of benchmarks
Admin savings from measurement and
75%
benchmarks
Administration Savings from
$116,250
Measurement

22

Summary – Business Case
Value Summary
$2,500,000 Performance Gain
$250,000 Waste or Scrap Avoided
$116,250 Administration Savings
$2,866,250 Total Quantified Value

23

A Tale of Two Programs
1. Company A went back 2 years… and identified
that they had 1,019 people rated #3, “needs
improvement” in recent performance reviews
2. They calculated that they spent an average of
$13,090 per year on highly visible leadership
development (Coaching, counseling, mentoring,
retraining and manager time) to elevate them to
#1’s ,“high performers”
3. They identified 2 years later… the number that
were currently ranked as #1’s, was ZERO

24

A Tale of Two Programs
Leadership program with optional ‘project’
Determine if optional project influenced
employee retention in leadership program
Employees with no learning projects
averaged a turnover rate of 21%
Employees with 2 or more learning
projects averaged a turnover rate of 2%
Clearly the control group vs. learning group
shows a difference
25

Furthering the Case
Create a 1 page business case (simple and
concise). Emphasize productivity, waste and admin.

Put a brief scorecard together that has at least 1
metric for outcome, effectiveness and efficiency
data.

Do a pilot of analytics. Evaluate your training in an
analytics tool, compare to benchmarks, view results
in reports, dashboards and scorecards.

26

Dashboard/Executive Reports

27

Top 10 Business Case List
1. Alerts. Metrics should alert you to breakdowns.

28

2. Predictive Measures. Metrics should forecast value/ROI.

29

3. Social Learning. Metrics to validate informal learning.

30

4. Qualitative Analysis. Harness feedback quickly.

31

5. Business Outcomes. Measure alignment to results.

32

6. Cycle Time. Automate reporting to stakeholders.

33

7. Cost Savings. Reduce admin and increase data use.

34

8. LMS ROI. Combine LMS data for powerful reporting.

35

9. Waste Reduction. Identify scrap and ways to reduce it.

36

9. Waste Reduction. Identify scrap and ways to reduce it.
10. Business Insights. Data-driven decisions.

37

Next Steps Just ask and we can….
• Send you a business case
Thank you for explaining
your needs to us template
Provide a sample leadership
dashboard and sample
leadership executive report
Provide a business case white
paper emphasizing
quantifiable benefits to
analytics in L&D

38

Contact Us
For further information contact:
Jeffrey Berk
+1 312 676-4411
jberk@knowledgeadvisors.com
www.knowledgeadvisors.com

39

Join Our Next CLO Webinar
Virtual Learning Environments: Redefining
the Training Experience
Tuesday, April 9, 2013
CLO Webinars start at 2 p.m. Eastern / 11 a.m. Pacific

Register for upcoming CLO Webinars at
www.clomedia.com/webinars

Join the Chief Learning Officer magazine Network
http://network.clomedia.com/

#CLOwebinar

How to Build a Business Case for Formalization of Learning Analytics

Recommended

Recommended

More Related Content

What's hot

What's hot (20)

Viewers also liked

Viewers also liked (20)

Similar to How to Build a Business Case for Formalization of Learning Analytics

Similar to How to Build a Business Case for Formalization of Learning Analytics (20)

More from Human Capital Media

More from Human Capital Media (20)

How to Build a Business Case for Formalization of Learning Analytics