Measuring the business impact of learning

Measuring the business impact of learning was a key focus at the NetDimensions EMEA User conference in London in May. According to Fosway’s Learning and Talent Analytics: Practical Strategies to Drive Real Outcomes 2015 Study, 85% of companies say HR Analytics is a medium or high priority. In addition, recent research conducted by LEO found that more than 85% of L&D professionals want to use analytics to improve their learning programs, while over 77% believe that it’s possible to demonstrate learning’s impact. However, L&D departments are still unsure about how to effectively measure the business impact of their learning activities.

 

Why measuring the business of learning is important

As budgets inside large organizations are decreasing, it’s becoming increasingly important for L&D to demonstrate its impact to top management. We now have the capabilities and the tools to actually analyze the connection between Learning and Development activities, and business performance. According to the Brandon Hall Group’s Learning Analytics 2017 Study, as much as 51.5% of organizations only analyze their learning program’s data annually or on an ad hoc basis. Only 14.4% of organizations continuously analyze their learning program’s data. Organizations need to move away from a snapshot analysis, which quickly becomes outdated over time, to a more sustainable process where big data is used strategically to make business decisions.

The technology to measure the business impact of learning is now available in the market but organizations are struggling to put in place a sustainable strategy to measure and then demonstrate that impact.

In the interview below, Piers Lea, Chief Strategy Officer at NetDimensions’ partner company LEO and Donald H Taylor, Chairman of the Learning and Performance Institute, talk about why measuring the business Impact of learning is important and why L&D managers should begin the journey now.

 

Who needs to be on board in the organization for the strategy to be adopted?

The involvement from organizations’ top leadership in planning the L&D strategy is still pretty low, but it is growing quite fast. L&D should be leading the way and actively use big data to make business decisions. If L&D continues to lags behind, the business will take actions without involving the L&D function in strategic decisions. At the moment, there’s a huge opportunity for L&D to establish credibility and get a seat at the top management table. The trend clearly shows that L&D departments are becoming much more central to business strategy, but this won’t happen without L&D playing an active role in the process.

In the video below Piers Lea and Don H Taylor talk about the different stakeholders who should be involved in the organization for an effective L&D strategy to be adopted.

 

Is there any example of companies that are effectively measuring the impact of their learning activities?

MedStar is a US-based company in the Healthcare sector. They use learning analytics to evaluate the effectiveness of training on clinical metrics. In the video below, Piers Lea talks about this example.

 

What are the steps to start measuring the business impact of learning?

There is a step-by-step process to go through but every organization should start on that journey now.

The first step to measuring the business impact of learning is making sure your organization is collecting the right data. It might take years to gather enough data before it will actually be relevant for the organization. Look into that data to identify patterns and then progress up to advanced data evaluation. All this should be done before you can actually bring in correlating data from the business.

The L&D function is willing to take on that journey but there is a clear shortage of skills in terms of the ability to both organize and analyze data. According to Fosway’s Learning and Talent Analytics: Practical Strategies to Drive Real Outcomes 2015 Study, 90% of organizations see the lack of skilled resources as a challenge in progressing with HR Analytics. According to the Brandon Hall Group’s Learning Analytics 2017 Study, only 18% of organizations have a data analyst dedicated to learning.

In the video below, Piers Lea and Don H Taylor talk about the step-by-step process to start measuring the business impact of learning.

 

The importance of measuring the business impact of learning

The ability to deliver proven results is a huge focus for L&D at the moment, with a view to ensure that learning should be moving to the heart of the business strategy. Some experts think that the reason why large organizations will continue to exist is actually because of their ability to scale learning. Learning is becoming one of the key areas of competitive advantage, so measuring the business impact of learning is a vitally important subject, one which continues to grow in importance.

Did you enjoy this blog? Then you might also be interested in our “Maximising the Business Impact of Learning” report from Fosway Group. Download it now. If you’d like to speak to a NetDimensions consultant about the importance of measuring business impact, get in touch here.