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Chapter 2: Return on Investment of Training Program Essay

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Chapter 2: Return on Investment of Training Programmes When you can measure what you are speaking about and express it in numbers, you know something about it; but when you cannot measure, when you cannot express it in numbers, your knowledge is of a meagre and unsatisfactory kind; it may be the beginning of knowledge, but you have scarcely in your thoughts advanced to the state of science, whatever the matter may be. —Lord Kelvin (1824–1907 Nowadays, a company’s human capital is accepted as one of their most valuable assets. In the ever increasing competitive and globalised business environment, a company’s people are ever increasing accepted as the foundation of their competitive advantage. A study by the American Society for Training…show more content…
In Ireland, a study carried out by the Economic and Social Research Institute, showed that training directly contributed to increased productivity (Barrett and O'Connell 2001) In the current times of continuous cutbacks and cost savings, training programmes are often the first to be axed. The problem for HR departments is proving their activities have and produce monetary value for the company. The literature on evaluation of training has been dominated by Kirkpatrick’s evaluation model (Kirkpatrick 1959). Under it he defined four levels at which an organisation should assess their training programme. Level 1: Reaction, satisfaction and planned action - measures the reaction and namely satisfaction of the participants to the training, usually measured using surveys at the end of the training, it also analyses whether participants intend to put their training into practice. A positive outcome at this stage does not necessarily guarantee the participants will use their new skills on the job. Level 2: Learning - measures and analyses the skills and knowledge achieved by the participants, this is usually assessed using pre and post training tests, skill practices, role plays, simulations, group evaluations and other assessment tools, this stage evaluates actually how much the participants have learned. Similar to Level 1, a positive evaluation at this stage does not guarantee a lasting effect of training. Level 3: Behaviour,
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