The rise of impact-driven L&D: How to bridge the gap between learning and business

Could it be because L&D has a general raison d’être or because L&D is seen as some kind of gratification to the workforce? However, the truth is that only joint consideration of L&D measures and the learning impact at both an individual and organizational level enables the sustainable positioning of L&D.

Return-on-Learning (RoL): The missing business case consideration

With the rapid changes in the world of work, companies are faced with a qualification imperative: by 2030, one billion people globally will have to undergo further training in order to successfully meet their daily tasks.¹ The new work paradigm is driven by Covid-19, advancing digitalization and general skills shortages, demands efficient skilling strategies from companies to empower their workforce. What we often encounter is that companies react with extensive investments in L&D measures, but neglect continuous consideration of the business case: how effective are learning measures, and what is the impact of L&D on individuals, teams, and businesses? Yet, transparency about the business impact of L&D is essential to secure further investments. L&D-focused KPIs are needed along with the possibility to measure and evaluate the impact of L&D measures at both an individual and an organizational level. This is the basis for sustainable L&D design and investment.

You cannot manage what you do not measure

In response to the qualification imperative, companies purchase expensive state-of-the-art technologies (e.g., SABA or degreed) to centrally deliver digital learning experiences. Despite the high costs and implementation effort, the benefits of technology most often remain untapped and unseen. Typically, an imbalance of content richness versus insight poverty exists: a broad mass of learning content is offered and presented online, but only simple data, like participant numbers, is collected, ruling out deeper analysis. Thus, neither HR nor business stakeholders can draw conclusions about individual learning success or learning effectiveness. Like any other return-on-investment analysis, the return-on-learning calculation needs a reliable data basis and systematic collection.

Define your L&D KPI system to gain accurate insights

One rather simple but effective way to measure L&D effectiveness goes back to Kirkpatrick’s four-stage model² (see Figure 1). This model introduces four stages that build upon each other to measure the L&D effectiveness:

In order to derive insights on suitable KPIs for your organization, we recommend a combined approach of top-down and bottom-up evaluation. With a learning maturity assessment, ideas for the improvement of the L&D environment and KPIs to measure L&D impact are collected as a starting point. In the next step, a compiled selection of suggested KPIs is evaluated with representatives of the target group (the learners), leading to valuable insights on which KPIs are suitable for the organization. Two aspects must be considered when defining an organization-specific metrics system: the way learning is perceived and the acceptance of KPIs. This way, L&D ensures the KPI system is in line with the cultural characteristics of the organization. From our experience, only if employees understand, trust, and participate in the continuous data collection process can the KPI system have significance for an organization. In order to sustainably anchor the new process around KPIs in an organization, we support the implementation with a people-centered behavioral change approach. The described approach ultimately results in an L&D KPI system that can provide information about individual learning success (e.g., knowledge acquisition and sharing rate), individual behavioral changes (e.g., application of what has been learned or takeover of new tasks and roles), and business results (e.g., customer satisfaction values, sickness rate, and sales figures). The L&D KPI system again is individual for each organization e.g., in a client case where we supported digital skill building within procurement, the negotiation success was an important L&D KPI whereas in other departments or organizations focus might be different.

Prioritize your KPIs and start implementing

In terms of the implementation effort and business impact, the prioritization of the defined KPIs indicates which metrics should be implemented first. KPIs with low implementation effort and high business impact are low-hanging fruits that are predestined to quickly deliver expected results. For example, the recommendation of training by participating learners (“On a scale from 0 to 10, how likely are you to recommend this training to a colleague?”) represents such a quick win as it is a single question at the end of the training session, providing significant information about quality for the L&D department. Metrics such as shifts in learners’ competency profiles are particularly good at reflecting the impact of learning interventions. But they require more effort and are typically planned for the long term. Metrics that are particularly good at reflecting the impact of learning interventions but require more effort are also planned for the long term.

The technical deployment requires translating KPIs into technical requirements: what aspects (e.g., methods of data collection, sources of KPIs) need to be stored in the system to provide the automated presentation of results? Systems such as SABA and degreed offer corresponding functions that can be configured accordingly.

Return-on-Learning: What to expect

If you dare to measure your L&D´s business impact with a clear “RoL”, you will be able to develop learning around effectiveness in the first place. By measuring the RoL you set the base to continuously improve the L&D portfolio in a data-driven way and provide learner-centric experiences to evolve into a learning organization.

Given the urgency of upskilling strategies to establish a continuously qualified workforce, it is imperative organizations and teams focus on learning effectiveness. We support you as a partner from planning to implementation to make L&D impact-driven and look forward to sharing our experience across industries with you.

Let’s get in touch and discuss how we can bridge the gap between L&D and business.

We look forward to working with you.

Sources:

1. Moritz, R. E. (2020), World Economic Forum, How do we upskill a billion people by 2030? [online]
2. Kirkpatrick, J. and Kayser-Kirkpatrick, W. (2014). The Kirkpatrick four levels: A fresh look after 55 years. Ocean City: Kirkpatrick Partners.