Why you aren’t getting return on L&D investment

I’d originally titled this blog ‘the camouflaged elephant in the room’, but my marketing team vetoed it. But in this blog I’m going to talk about that elephant. The one big problem that L&D seem to avoid discussing; Return on L&D investment.

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Why you aren’t getting return on L&D investment
October 14, 2020
Why you aren’t getting return on L&D investment

I’d originally titled this blog ‘the camouflaged elephant in the room’, but my marketing team vetoed it. But in this blog I’m going to talk about that elephant. The one big problem that L&D seem to avoid discussing; Return on L&D investment.  

In a recent survey conducted by Valamis, 34% of learning leaders said money was their top L&D challenge (rising from 28% last year). All the best business leaders keep an eye on the finances and consider return on investment. But when it comes to learning, they often put their heads in the sand. They buy expensive learning technology and hope for the best, and then often find themselves scratching their heads when the return is non-existent. But why are so many business leaders not seeing a return on L&D investment? My honest answer is because they rely on technology too much.

Technology is a huge part of modern life and it’s no surprise that it has spilled over into learning. The learning platform market is already worth a whopping $8.76 billion and experts predict that it’ll grow exponentially in the coming years. But in my opinion, learning tech is a tool to solve the problem, not the solution. Which is where many businesses go wrong.

Getting to the route of the problem

Relying on technology to fix learning and performance problems is simply papering over the cracks – it’s just not going to work. Technology is undoubtedly a support in creating learning cultures and engagement with employees. But it does not in itself educate or facilitate performance change; that change comes from carefully planned and executed learning strategies designed to meet the specific needs of employees and the business.

Content does not equal learning

All too often I’ve seen organisations proudly showing off their ample learning content. eLearning courses, instructor-led training, webinars, videos, podcasts and so on. But they have no strategy. They have no direction for their learning, and ultimately they do not know what performance change they want in their people. This approach is not creating true learning journeys and will waste a lot of money.

Instead of churning out content, L&D must focus on truly embracing the learning revolution. The roots of many ‘traditional’ training approaches still lie in the 18th century industrial revolution. Today, learning must focus on transfer through retention, engagement and application. This is a complex process that requires an understanding of learning science, to inform the best decisions about the physical, cognitive, social and psychological factors of learning.

Changing focus

But to truly create impact (and return on L&D investment) learning must be strategic and revolve around what the business needs. However, this is no easy task, and one that’s made harder if L&D is working as a silo and not considering the wider organisation. According to a recent McKinsey report, L&D’s strategic role spans five areas:

© McKinsey, 2019

To truly cover these five areas and make an impact, L&D must look at the bigger picture. Amanda Nolen, learning strategist and co-founder for NilesNolen consultancy, joined us on a recent podcast and echoed this sentiment, saying L&D leaders must align their learning strategy to the wider business goals, rather than ploughing resources into the wrong direction – such as the rush to convert face-to-face courses to digital training. Amanda mentions this rush for digital transformation for a good reason – if training was not getting results offline, throwing tech into the mix is not the solution (regardless of the current global pandemic).

It’s not the LMSs fault there’s no impact

When business leaders do decide to address the elephant in the room, the technology usually gets the blame. High dropout rates? The LMS isn’t engaging enough. Low user numbers? The LXP isn’t good enough. Murmurings of ‘boring eLearning’ in the organisation? It’s the authoring tool’s fault – “it doesn’t give us the whizz bang we need”.

This mindset needs to stop. The chances are all three of these problems result from  one reason: Your learning is not aligned with business goals, so your people do not care. A new piece of technology is not going to fix that. The real change will come from a focus on learning strategy that is closely tied into business goals.

How to boost return on L&D investment

If you, like any other business leader, are looking to boost the ROI of your organisation then learning in this time of change is an effective way to do it, but, it’s time to look away from the tech. You need to look at your learning strategy and process, to see how it aligns with your business needs. L&D should cease bragging about the abundance of content they have and strive to brag about the change learning has made in the wider organisation. Your employees want learning opportunities at work (none more so than millennials and gen z). If you cater to this demand for learning, strategically align the learning culture  to wider business goals, and get to the root cause of the problem when it comes to the return on L&D investment – you’ll not only see a ROI for learning, you’ll also see how effective learning can truly impact the bottom line.

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