Owing to intense competition in an era of rapid
economic and technological change, employers
are closely scrutinizing their spending on
workforce training. Increasingly, human resource
departments and training professionals are being
asked to justify whether training is a worthwhile
investment. Training managers seem to prefer
measuring the effectiveness of their courses and
programmes with data on learning gains, from
criterion-referenced tests, and trainee reactions,
collected by questionnaires. However, higher
management requires that training be further
justified in terms that are important to them,
business (financial) results.
The content of this article is organized into
three component elements and published in twoparts.
The first two elements are provided in this
issue, and the third element will appear in the next
issue of Industrial and Commercial Training.
The first element of this article points out why
some training managers are reluctant to determine
the cost effectiveness of training. It discusses the
need to justify training expenditures with
documented benefits. Element number one also
provides practical details and examples of how to
calculate the direct, indirect, and full costs of
training.
The second element describes four levels of
measurement used to determine the effectiveness
of training. In addition, the need for a cause-andeffect
link between a specific organizational
problem and a performance deficiency is
addressed. This second element of the article also
discusses the selection of outcomes (benefits) to
be baselined before training and tracked after
training in order to determine the payback