How to Measure the ROI on Your IT Training Budget




When it comes to empowering the workforce, enterprises have been using age old in-house training methods for a long time. However, with the evolution of technology, the focus has shifted to innovative methods like online training. Without wasting in-house company resources like infrastructure and manpower, organizations have started using web based training for imparting information and knowledge to their employees. It is believed that online training is as good as classroom training, with the added benefit of being it being economical and convenient. A lot of companies are reaping long term rewards in the form of better ROI by shifting their training endeavors online.

Since we deal in IT training, we will stick to our industry in this article and talk about training in that context.

Better Returns with Online Training

According to a survey by Inside Higher Ed and Gallup, 75% of college faculty members believe that educational technology (comprised of cloud training) is improving the education quality. 63% of instructor, who participated in the conducted survey, concluded that improvements in student learning are a direct result of an institution’s spending on different education tech efforts. The inference of surveys like the one mentioned before is a major reason why online IT training has become so popular.

Analyzing IT Training and Costs

As per a study by Brandon Hall Group’s 2016 Training Benchmarking, enterprises that have 10,000 employees or more spend an average of $13 million every year on training. On the other hand, businesses that have less than 1,000 employees average $290,000 in their training expenditure. This clearly shows that enterprises do recognize the value of training and spend a decent amount of cash on training programs. 

More often than not, IT training is envisaged by mid-level IT managers, who develop a budget proposal for the decision makers to review. As IT budget is always a constant, there is a high likelihood of some training programs getting scraped off, if the return on investments are not up-to-the-mark as per decision makers (CEO, CIO). Hence, IT training programs need to be handled carefully by the management for their sustenance in the company.

The high infrastructure cost of in-house training can raise the expenditure of any IT training program. In order to conceptualize an effective and comprehensive program, the management should figure out the importance of individual training tasks. The managers need to prioritize trainings depending on their urgency and necessity, and then make a decision on courses that need to be delivered in classrooms and the ones that can be imparted online. After every financial year, just like other aspects of businesses, ROI on training should be calculated to learn from the returns gained from the decisions made.

The ROI On IT Training Expenses

ROI for IT training depends on the type of training offered by the organizations to their employees. After observing trends in different organizations, trainings can be broken down into three types: Immediate Training, Skill Upgrade Training and Futureproofing Training.

Immediate Training

This type of training is given on crucial and immediate requirements that go hand in hand with the everyday operations of businesses. As this training fixes prevalent issues in the business, the return on investment is almost immediate and your daily operations receive an instant impetus.

Skill Upgrade Training

Let’s say you want to switch over to Python for performing the tasks quickly and efficiently, however, you do not have the resources right now. In this case, you can upgrade the skill set of your employees by enrolling them in a Python programming course. Such a course will help you meet your goal without hiring high-salaried employees from outside.

Futureproofing Training

This training is generally given in the form of seminars. Futureproofing trainings provide your employees a look into the future of technology. It allows the workforce to be ready for a change and hence, makes the transition to a newer technology a lot easier.

From immediate returns to long-term benefits, all the aforementioned trainings have their own importance. Depending on the budget and expenditure of an organization, the management can ask for necessary funds accordingly. If the budget is low, it is best to focus on immediate trainings. Through immediate benefits from these trainings, it will be easier to show good returns on investment to the decision makers, and convince them on the other trainings. When the budget increases, you can always plan for the future and focus on Skill Upgrade Training and Futureproofing Training.

ROI Parameters for IT Training

In order to measure the actual impact of training, one should ask the following questions and find out the status of ROI parameters:

Ask the Employees

Was the training able to solve issues that we were not able to fix in the past?

Have you learnt new things that are useful in carrying out daily operations?

Ask the Managers

Has the training boosted morale of employees?

Do you feel employees are able to work better than before?

Ask the Decision Makers

Do you feel that your employee base can handle future ventures?

Has the attrition rate gone down?

If the answers to (most of) the above mentioned questions are “Yes”, then it means that the ROI for your company’s IT training was good. If not, you need to work on your training strategy and discover the best online IT training websites.

About The Author
Shamsah
VP Channel Sales at QuickStart

Shamsah Malik

Shamsah is an entrepreneurial, innovative professional with over ten years of sales, relationship management and business development experience within highly competitive SaaS, information technology, and SLED markets.