TRAINING

AND
DEVELOPMENT
Training Evaluation
Chapter - 6
1
 Learning Objectives
By the end of this unit, students will:
Determine benefits of a training program.
Calculate benefit/cost ratio.
Calculate return on investment (ROI).
Identify when ROI evaluation is not
appropriate.
Use other methods to verify training
value when ROI is not appropriate.
SHRM
2
2009
 Introduction
Training effectiveness refers to the
benefits that the company and the trainees
receive from training.
E.g. Benefits for trainees are new skills and
behaviours. Benefits for the company could
mean increased sales and satisfied customers.
Training outcomes refer to the measures
that the trainer and the company use to
evaluate training programs. 3
 Introduction
Training Evaluation refers to the process
of collecting the outcomes needed to
determine whether training is effective.
Evaluation Design refers to the collection
of information-including what, when, how
and from whom-that will be used to
determine the effectiveness of the training
program.
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 Training Evaluation
Reluctance to evaluate:
Managers are unwilling to devote time to
evaluation.
Lack of know-how or no importance.

Reasons for Evaluating Training

Why evaluate?
Link to organizational strategy.
To create a competitive advantage through
the use of knowledge. 5
Reasons for Evaluating Training
Effectiveness of training.
Research indicates training has a positive
link to human resource outcomes (e.g.
motivation), organizational performance
outcomes (e.g. performance) and financial
outcomes (e.g. profits).
Return on investment
Provides a way to understanding the
investments that training produces and
provides information needed to improve
training. 6
Reasons for Evaluating Training
Formative Evaluation refers to the
evaluation of training that takes place
during program design and development.
Formative Evaluation helps ensure that:
a) The program is well organized and
runs smoothly
b) Trainees learn and are satisfied with
the program. 7
Reasons for Evaluating Training
Formative Evaluation
Involves collecting qualitative information
(e.g. opinions, beliefs).
Involves getting information from
customers, managers, trainees and SMEs.
Is usually conducted either individually or
in groups before the program is made
available to the rest of the company. 8
Reasons for Evaluating Training
Summative Evaluation refers to an
evaluation conducted to determine the extent
to which trainees have changed as a result of
participating in the training program.
Includes measuring the monetary benefits
(also known as Return on Investment or
ROI) gained by the company.
Usually involves collecting quantitative data
through tests or ratings or through volume of
sales, accidents etc. 9
 Evaluation Process
Conduct a needs analysis.
Develop measurable learning
outcomes and plan for transfer
of training.

Develop outcome measures.

Choose an evaluation strategy.

Plan and execute the evaluation. 10

Outcomes Used in the Evaluation
of Training Programs
1. Reaction
2. Learning or Cognitive
3. Behaviour and Skill-Based
4. Affective
5. Results
6. Return on Investment
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Outcomes Used in the Evaluation of
Training Programs
Reaction Outcomes refer to trainees
perception of the program, including the
facilities, trainers and content.
Typically collected at the end of the program via
questionnaire or interviews.
A reaction measure should include questions
related to the trainees satisfaction with the
instructor, training materials, etc.
Smile sheets.
Informal comments from participants.
Focus group sessions with participants. 12
Outcomes Used in the Evaluation of
Training Programs
Learning or Cognitive Outcomes are used
to determine the degree to which trainees are
familiar with principles, facts, techniques,
processes and procedures (the knowledge)
emphasized in the training program.
Information collected by typical pencil-and-
paper tests.
Pre- and post-tests scores.
On-the-job assessment.
Supervisor reports. 13
Outcomes Used in the Evaluation of
Training Programs
Behaviour and Skill-Based Outcomes are
used to assess the level of technical or motor
skills and behaviours.
Skill transfer is usually determined through
observation.
Transfer of training.
On-the-job observation.
Self-evaluation.
Supervisor and peer evaluation.
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Outcomes Used in the Evaluation of
Training Programs
Affective outcomes includes gaining an
understanding about attitudes and motivation.
Information about tolerance for diversity,
motivation to learn, safety attitudes and
customer service orientation are collected.
E.g. attitudes toward career goals and interests
might be an appropriate outcome to use to
evaluate training focusing on employees self-
managing their careers.
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Outcomes Used in the Evaluation of
Training Programs
Results are used to determine the training
programs payoff for the company.
E.g. increased production
E.g. reduced costs related to employee
turnover rates

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Outcomes Used in the Evaluation of
Training Programs
Return on Investment refers to comparing
the trainings monetary benefits with the cost of
the training.
Direct costs includes salaries and benefits for
all employees involved in training.
Indirect costs are not directly related to the
design, development or delivery of the training
program. E.g. equipment needed.
Benefits are the value the company gains from
the training program. 17
Levels of Evaluation vs. Value

18
Return on Investment: Benefit-
Cost Ratio
Benefit-Cost Ratio:
Aids in decision-making process.
Consistent analysis across programs.
Information difficult to obtain.

19
 Return on Investment
Return on Investment/Benefit-Cost Ratio:

Program Benefits
Benefit-Cost Ratio = ----------------------------
Program Costs

$2,500
Benefit-Cost = 2.5:1 -----------
$1,000 20
 What About ROI?
Return on Investment ROI (%)

Program benefit: $2,500

----------- = 2.5 x 100 = 250%
Program cost: $1,000

ROI = 250%

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 Determining Benefits
Measuring training benefits:
Benefits must consider training objectives.
Literature summaries of benefits of
specific training.
Assessment of pilot training programs.
Observations of successful trainees.
Estimates from trainees and managers.
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 Programs Best Suited for ROI
Analysis
Training appropriate for ROI analysis:
Clearly identified outcomes.
Not one-time events.
Broad-based and highly visible in the
organization.
Strategically focused.
Training effects can be isolated. 23
 END
OF
THE
CHAPTER

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