The Biggest Challenge Facing L&D, in 2 Stats

February 10, 2017

ROI is preventing L&D teams from accomplishing what they want to accomplish.

CEOs want to develop their people, for two main reasons:

Yet CEOs – particular CEOs of public companies – are under extreme pressure to produce. So while they might want a robust L&D program, they need to be able to see it is producing real results.

And, for L&D professionals, showing those results hasn’t been easy. Or so that’s what the stats show.

The two stats that highlight the biggest problem L&D faces

When surveyed, CEOs said they most want to see business impact from their L&D teams, followed by ROI. The problem is that only 8 percent of CEOs said they see business impact from their L&D program and only 4 percent said they see ROI from L&D.

This is the issue for L&D teams. If you, as a department, aren’t giving the top decision-maker at your company – the CEO – what they are looking for, it's difficult to get funding.

We saw that problem manifest itself when we asked 500 L&D professionals the top challenges they face, as part of our Workplace Learning Report. Here are the results:

Three of the top four – a limited budget, having a small L&D team and demonstrating ROI – are directly related to not getting executive buy-in. Because L&D teams are having trouble demonstrating ROI and business impact to senior leadership, they aren't getting the budget or the people they need to accomplish what they want to accomplish.

How L&D can overcome this problem: metrics, metrics, metrics

This isn’t a particularly easy problem to solve. Ultimately, it comes down to somehow measuring how much an employee has learned while at your company – and, even beyond that, how much they learned specifically from your L&D program.

That’s no easy feat. It’s difficult enough to measure performance, furthermore improvement on performance attributed to, say, taking a course.

However, there are some steps L&D teams can take to start making that happen. We outline a more complete solution in our Workplace Learning Report, but ROI is dependent on tabulating the right metrics.

What types of metrics, specifically? Well, a good place to start is retention and engagement. But a few others to consider:

  • The retention and promotion rate of people who use your voluntary learning programs, versus those who don’t. Hopefully, the people who use your learning programs advance within your organization.
  • The effectiveness of your managers. The biggest reason companies invest in L&D is to improve their managers, according to our research. Hence, if you can show an improvement in manager effectiveness over time through employee surveys, particularly among managers who used your learning program, that’s huge. LinkedIn itself has done this to measure its “ManageIn” program.
  • The amount of outside consultants you have to hire. Our research found smaller companies in particular invest in L&D to close skill gaps. To measure that, you can look at the amount of outside help your company needs to bring in to accomplish specific tasks, and hope to reduce it through workplace learning.

Of course, the metrics you are measuring depend on what your L&D team is trying to accomplish. But the more compelling your metrics are, the better chance you have of giving your CEO what he or she most wants to see: business impact.

Looking for strategies on improving your L&D program? Download our Workplace Learning Report today for free, where we surveyed 500 L&D leaders to find what’s working (and what’s not).