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The #1 Provider of Training Solutions for Growing Companies!

In this issue:

1. Making the Business Case for Training: Calculating ROI
2. Critical Components of Performance Management
3. Visit Business Training Library at the 2008 SHRM Conference in Chicago
4. Course Review: Continuous Performance Assessment



1. Making the Business Case for Training: Calculating ROI

In order to answer questions from your senior executives and decision-makers about how your proposed training initiatives will help in the overall success of your organization, you'll need to make a business case for training. Business cases are generally designed to answer the question, “what are the likely financial consequences of taking this action or making this decision?” Developing a business case for training essentially tells the decision makers in our organizations “… this is how the training program I’m proposing is going to help our business; this is what it is going to do for the bottom line.”

Whether you’re making the business case for training or making a business case for purchasing new equipment, every business case will present a consistent set of components:

• The benefits of making the expenditure – in the case of training, the benefit is the way the training will ultimately improve the profitability of the business –be it the increased revenue due to salespeople going through sales training, or the reduction in workmen’s compensation due to warehouse workers going through safety training, as an example.
  
  
• The cost of implementing what was learned in the training (this is NOT the cost of the training). In the case of sales training, it may be the extra time the sales people now need to use the call planning process they learned in training. In the safety training example, it may mean the extra time taken to find another person or a hand truck to help lift anything over 50 pounds.
  
  
• The investment in the training (what is actually spent on developing and delivering the training). This includes the dollars spent on the training program, and the fee you pay for the trainer, the value of the time the participants are off the job while in training, the travel and expenditures you pay for the participants to attend the training, etc.
  
  
• The timeline - or how long will the benefits of the training last. For instance, will a person who has received safety training need re-training every other year?

One of the challenges with a traditional ROI approach is that it requires data and information that is typically generated after the training is delivered, and therefore after the money is spent on the training. Unfortunately, decision makers don’t make investment decisions based on an approach that essentially says “… trust me, I’ll ultimately show you this is a good decision once I measure the results after you make the investment.”

Our decision-makers and finance guys do not decide to build a warehouse, invest in a new phone system, or fund a new training program based on the promise that “… we’ll show you after the fact why this is a good decision! So how do we deal with this challenge? By showing what they can reasonably expect to get for their money before they spend it. Our decision-makers need to see the expected return on the investment before they make the decision. What’s needed is a Pro-Forma, or expected ROI analysis.

Access our white paper, "Using ROI to Make the Business Case for Training," and learn how to use pro-forma ROI calculations to speak with your senior executives and decision-makers about the bottom line impact that your training initiatives will have on the organization. 

2. Critical Components of Performance Management

The May issue of Talent Management magazine featured the article, “Four Pillars of Managing Performance,” by Edward E. Lawler. Lawler succinctly describes the four critical elements of managing performance – the process that ultimately separates organizations producing … “adequate results and those that truly excel.” The four pillars that Lawler lists are:

1. Defining Performance
2. Develop Employee Skills & Knowledge
3. Managing Motivation
4. Effective Feedback

We need to begin by determining – and keyword here – defining – what type of performance we’re looking for. This will provide your organization’s leaders and employees with a clear target. Defining the performance expectations, with alignment to your organization’s strategic business objectives, will set everyone on the right path. You’ll need specific objectives that are defined and measurable to determine successes. Put simply … set clear expectations upfront.

The second component that Lawler describes is to develop employee skills and knowledge. In managing your employees’ performance, you’ll need to identify areas of strength and areas where skill gaps exist. Addressing these two components will also provide you with valuable information about your talent management strategy. Lawler suggests that identifying skill gaps will provide you with information about what type of training is needed, and perhaps in some cases, areas where recruiting efforts are necessary. Skills assessments are critical in this phase of managing performance.

The third pillar is managing motivation. Even the most seasoned and highly skilled employees at your organization need proper motivation. Lawler describes motivation as the “capstone to performance,” and says that in order for your staff to feel highly motivated, you must directly link their performance successes to rewards that they value – both internally and externally. Internal rewards include personal gratification, self-esteem, and a general feeling of satisfaction with their performance. External rewards are tangible. An increase in salary and public recognition for performance excellence are both examples of external rewards that employees would value.

Finally, pulling all of these components together – your employees need effective feedback. Providing effective feedback is the fourth pillar that Lawler denotes, and it goes beyond the annual review process. In an effective performance management strategy, employing these four components, employers are providing immediate and ongoing feedback to their employees. The annual appraisal is still critical and vital to the success of each employee’s development and overall performance, and should be documented with information including: competencies, skill gaps, performance goals, development objectives and their work history. Just don’t forget to revisit these objectives throughout the year, and catch your employees ‘doing it right’!

Access the Talent Management article, “The Four Pillars of Managing Performance.”



3. Visit Business Training Library at the 2008 SHRM Conference in Chicago

Stop by booth #957 & #958 at this year's SHRM Conference at the McCormick Convention Center in Chicago, Illinois. We look forward to seeing you at the conference!

Take a look at this year's conference highlights & keynote speakers at SHRM.org.



4. Course Review: Continuous Performance Assessment

Course Group
Management 

Course Code
MGMT0341

Media
e-Learning

Target Audience
Supervisors, managers, and human resource managers with responsibility for conducting performance appraisals

Course Overview
This course shows you how to make performance appraisal a continuous process. The first stage of continuous performance assessment is planning. Appraisal must be linked to performance goals that matter, and these goals need to encompass both the organization and the individual before a performance plan can be agreed on by appraiser and appraisee. Even with conventional roles and relationships this is a challenge, but for many organizations, the role of the employee is more flexible, and reporting arrangements are more remote. The 21st century manager has to plan to appraise employees he may rarely see. The second stage is changing the annual performance meeting into ongoing communication about performance between the manager and employee. The manager must review and monitor performance, and respond to it by motivating the effective worker and helping the less successful worker. In this way, performance appraisal becomes one of the major managerial tools. Then, and only then, is the manager in a position to assess the performance of a worker. This third stage prepares specifically for the annual performance appraisal meeting by collecting data. The course examines the common evaluation methods, which most organizations use to evaluate performance data, including how to successfully use self-evaluation data in the assessment. Many people think that performance appraisal consists of just the actual meeting between manager and worker. This is a very limited view, which is almost guaranteed to result in ineffective appraisal. In fact, this blinkered approach is responsible for many of the negative experiences that many workers have of appraisal. This course is designed to change appraisal into a positive experience for both manager and worker by emphasizing and detailing the preparatory steps that make appraisal into a more ongoing and valuable process.

Expected Duration
3.5 hours

Megan's Rating

5 Stars (Out of 5)

Megan's Review
Continuous Performance Assessment is a great course for every business unit manager – particularly those who’ve struggled with the performance appraisal process in the past. When managed correctly, appraisal is a vital management tool. However, when managed incorrectly, performance appraisals are viewed by both appraiser and appraisee, as a pointless chore. This course shows you how to effectively prepare for appraisals and make it a positive instrument to develop performance.

Using a continual appraisal process creates open dialogue between manager and employee about performance standards and outcomes. With this approach, you’re constantly in touch with the performance of all employees on your team. You can identify performance problems at an early stage, give feedback on performance to all employees, motivate the employee who is performing well to achieve more, and support the underperforming employee.

Visiting performance appraisals once a year is a really outdated approach that assumes that if you set employees on a path – they simply follow it. In changing business climates, your employees will need to respond to changes and adapt their performance standards and goals to better meet your organization’s objectives. In order to be effective, they need continuous performance appraisal and support. This course gives a number of effective strategies for creating continuous open dialogue that will create a more productive and rewarding work environment for both the manager and employee!

Megan Pack is the Marketing Manager at Business Training Library.

Preview this e-learning course today! 

Business Training Library - 285 Chesterfield Business Parkway - Chesterfield, MO 63005
888.432.3077 - Fax: 636.534.1001 - http://www.bizlibrary.com