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January 26th, 2022 · 5 min read

5 critical ROI metrics for your learning and development strategy

Challenges of measuring ROI for learning and development

  1. A modern approach
    There’s a clear need to design modern L&D initiatives that are strategic and ensure robust reporting capabilities and access to analytics. 
  2. More clarity
    It’s necessary to define ROI metrics that give real insight into the connection between employee learning and overall organizational performance. 

Establishing the right L&D metrics to show ROI

  • Talent mobility
    Talent mobility is the process of employees moving between roles, learning, improving and contributing to multiple aspects of your organization. Whether participating employees are taking on new positions and/or advancing within the company, mobility is typically a strong long-term indicator of how your L&D initiatives are performing.  
  • Turnover
    Turnover refers to the loss of talent in the workforce over time. Look at turnover rates as well as the kinds of jobs and companies your employees may be leaving for. What reasons do employees provide for leaving the company? Did these employees participate in any L&D programs during their time at your company? Do these other companies offer stronger L&D initiatives? 
  • Employee productivity
    Employee productivity is the amount of work an employee can do in a given amount of time. Strategic L&D will ideally align with your business goals to help your employees support the acceleration of your business. The rate and volume at which your employees are using their new skills and competencies will tell you whether your investment in L&D is paying off in a palpable way. 
  • Program engagement
    This metric refers to the number of employees currently enrolled in an L&D program, as well as their level of progress. For a modern organization, this data should be readily available. Avoid data loss or reporting issues by making sure you’re looking for the latest technology available when selecting an employee education or learning solution
  • Employee feedback
    Employee feedback entails the exchange of information related to performance, skills or other key aspects of work. This qualitative metric can give you critical insight into what aspects of your L&D initiatives are working or need improvement. And you don’t have to wait for an exit interview to ask for it. Work with your people managers to request frequent, candid employee feedback as part of regular check-ins. 

A traditional metric you should consider retiring:

  • Time to completion
    While this is a straightforward way to evaluate L&D program progress, this metric doesn’t speak to the quality or effectiveness of the learning.

    Additionally, employee development is most effective when it’s prioritized on a continuous basis — rather than a “one and done.” While it’s true that tracking the time spent on learning is important, it doesn’t paint a full picture when it comes to demonstrating ROI.

Getting buy-in for L&D from C-staff 

  • Show how departmental performance was improved by team upskilling or reskilling initiatives.
  • Demonstrate savings gained by promoting upskilled talent internally rather than sourcing external hires. 
  • Reverse-engineer business goals and show how they can be achieved through investment in employee education
  • Highlight the critical skills gap among your current workforce, the long-term cost to your business and the programs you have in place to address them.
  • Showcase the increase in employee output and productivity that results from L&D program participation.
  • Establish and quantify the connection between L&D and decreased employee turnover. 

The importance of L&D ROI metrics

You can address talent development challenges