Human Capital & Training ROI
Human capital is the sum total of individual intelligence built on the acquisition of skills, training, and educational experience over a lifetime.
Between 2010 and 2020 every nation on the globe faces the crucial challenge of increasing the talent pool for technology-based economies that are increasingly dependent on producing high-value products and services for future growth and prosperity.
Imperial's Human Capital ROI Nine-Step Worksheet allows companies to accurately estimate the monetary returns both before and after most skill, training, or education programs.
It addresses three serious issues that until now have compromised accurate financial training measurement:
1. Training Effectiveness versus Other Business Variables: Did the results come from the training program or some other business factor?
2. Training Transfer: Unless you have a way to calculate the "average" training transfer back on-the-job, you will inflate the training's ROI.
3. Depreciation of Training: Even the best training programs do not permanently improve a business. You need to depreciate a training program's benefit over time.
This worksheet was designed by an interdisciplinary team consisting of: Kevin Hollenbeck, Senior Economist, The W.E. Upjohn Institute for Employment Research; Robert M Naiman, CPA, J.D., Boyd Owens, Business Process Improvement Lead, Motorola; and Ed Gordon, Imperial's President.
Practical Considerations
To use the Human Capital ROI Worksheet, data on profit margins, gross revenue and other operational data must be obtained. This assumes the cooperation of other business units within an organization. They may include the accounting, engineering, and marketing departments as well as general management.
The ROI worksheet is a file to be used in an Excel spreadsheet. It can be downloaded free of charge in two forms from this site. The example worksheet takes data from a Kaizen training program to illustrate how the ROI is calculated. The blank worksheet allows you to enter your own training data to make ROI calculations.
To aid the design team in our continuing research on ROI measurement of training or education programs, a registration form is the first step in obtaining the ROI software.
Imperial can assist your organization in striking a balance between meeting short-term profit goals and investing in its long-term sustainability. We can coach you on developing five basic strategies aimed at achieving your talent creation and management goals:
- Using internal/external continuous education, training, and development programs for achieving core business requirements
- Offering a blend of classroom and technology-based learning
- Collaborating with community partners to broaden the local education-to-employment talent pipeline
- Measuring the return-on-investment of both these internal and external learning programs.
- Budgeting investments in human capital and physical capital to achieve the goals and objectives of the business.
Imperial Consulting's goal is to help clients both recruit and develop more highly talented people and enhance their innovation capabilities. This will assist increasing the performance, productivity, and profit (3Ps) of your organization.
Highly Talented People
Increased Performance and Innovation |
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High Tech Workplace
Advanced Technology Raises Productivity and Lowers Fixed Costs |
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People Performance
& Productivity Increased |
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Profits Increased |
Press Contact Us to inquire about obtaining Imperial's assistance in the areas of human capital development and training ROI.
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