如何通过培训提升人力资源的投入产出比ROI

How to Enhance ROI of Human Capital Through TrainingPresenter:Raymond Lo, Senior ManagerDeloitte Human Capital Advisory Services Limited 21 June 2002How to Enhance ROI of Human Capital Through TrainingAn OverviewWhy Care about ROI of Human Capital? Enhancing ROI of Human Capital Training Initiatives Measuring Training Effectiveness Q&AHow to Enhance ROI of Human Capital Through TrainingWhy Care about ROI on Human Capital?What is Human Capital?Human Capital (“HC”):ƒ is an intangible asset of a companyƒ inspires ideas that ignite valuesƒ financial analysts pay higher attention on HC leverages on measuring the company’s worth¾ E.g. General Electric, Nokia, Microsoft¾ Intelligence and values of employees can generate multi-fold of revenues and are reflected on stock pricesHow to Enhance ROI of Human Capital Through TrainingWhy Care about ROI on Human Capital?Human Capital ComponentsTechnical Know-How &EducationIdeas & InsightsLessons LearntCreativityHuman CapitalKnowledge ManagementUndocumented MethodologiesSkills & KnowledgeMarket ResearchHow to Enhance ROI of Human Capital Through TrainingWhy Care about ROI on Human Capital?Corporate Investment on Human CapitalHuman CapitalCustomer AssetsIntellectual AssetsUS$1.0 – 3.1 TrillionIntangible AssetsBusiness RelationshipUS$10.4 TrillionOrgan’l AssetsTangible AssetsUS$2.0 TrillionMarket ValuesUS$12.4 TrillionHow to Enhance ROI of Human Capital Through TrainingWhy Care about ROI on Human Capital?Why Care about ROI of Human Capital?Management is concerned with:Reducing OperatingCostsHow to Enhance ROI of Human Capital Through TrainingIncreasing Productivity,Efficiency &EffectivenessWhy Care about ROI on Human Capital?Calculating ROITraditional ROI Calculation:ROI =Total Benefits – Total Costs Total Costsx 100%Total Benefits: money saved and generated at directly or indirectlyTotal Costs: include tangible and intangible costsHow to Enhance ROI of Human Capital Through TrainingWhy Care about ROI on Human Capital?Why Care about ROI of Human Capital?Today, employee costs can exceed 40% of corporate expenses (Dr. Jac Fitz-enz)ƒ To measure the effectiveness of resources allocation, it is critical to evaluate the ROI in human capitalManagement needs a system of metrics that describes and predicts the cost and productivity curves of its workforceƒ “Quantitative” measuresƒ “Qualitative” measuresHow to Enhance ROI of Human Capital Through TrainingWhy Care about ROI on Human Capital?Measuring ROI of Human Capital“Quantitative” measuresƒ tend toward measuring costs, capacity and time ƒ tell what have happened“Qualitative” measuresƒ focus on value and human reactions ƒ give ideas of why things happened ƒ also offer insights of results, and drivers orcauses ¾ E.g. Poor product quality Æ increases incosts (e.g. re-work and scrap) and prolongs delivery time Æ reduces customer satisfaction (lose customers) Æ increases marketing costs to attract new customersHow to Enhance ROI of Human Capital Through TrainingWhy Care about ROI on Human Capital?Case Study #1An Australian-based banking institute is experiencing high turnover of staff recently since the new operations of the customer service centre. The turnover rate has reached the historical highest of 40%. Besides high turnover, the absenteeism rate is extraordinary high as compared to other departments.Management is very worried about this situation and urges the HR Department to reveal the underlying reasons. The HR Department has invited a number of customer service centre staff for focus group meetings. They discovered that staff find the customer management system (CMS) difficult to operate and has no clear instructions. They always feel frustration to complete simple tasks by keeping the customer wait for a long time. They also feel no accomplishment on their job.How to Enhance ROI of Human Capital Through TrainingCase Study #1 (cont’d)Questions to ask:1.What do you think is (are) the cause(s) ofhigh staff turnover?2.What resolution(s) would you suggest to theHR Department?3.How should the result be measured?Case Study #1 (cont’d)From the focus group discussion, HR Department realizes thatthe staff lack proper training on operating the system. Not thatthe system is complicated, but the staff are just not familiar with the system interface.Consequently, the HR Department has proposed a number ofsolutions to the management:1.Technical Training on CMS Operation2.High Performer Campaign3.Simplification of the CMS FunctionsCase Study #1 (cont’d)For measuring the improvement of staff’s performance, HRDepartment relies data on:1.Staff Absenteeism Rate2.Customer Satisfaction Questionnaire3.Customer Complaints Rate4.Exit Interviews with Staff ResignedAs a result, the staff turnover rate reduce to 5% andcustomer complaints drops to 3 incidents per 1000 calls.Note: This study was conducted in December 2001.How to Measure ROI of Human Capital?TimeEfficiency without ROI considerationN o . o f O u t p u tzEfficiency with ROI considerationzLooking for ROI EnhancementHC accounts about 20% to 30% of a company’s totalworth (Fortune 1000 companies)Create a Knowledge Management System to fosterknowledge retention within the company¾General knowledge assets –i.e. ubiquitous knowledge¾Business knowledge assets –i.e. company specificEnhance the knowledge of staff by sharing information amongst them¾Encourage information sharing¾Provide accessibility to authorized personnelTranslation of ROI of Human CapitalPotential AbilitiesTraining Needs Performance / Productivity Return on Investment (ROI)MotivationalDrivesStaff’s EffortsBehaviorsAbilitiesCorporate Assets –Human CapitalEnhancing ROI Through HR StrategiesTraining & DevelopmentEnhance ROI of Human CapitalRecruitment & SelectionEmployee RelationsEmployee MotivationRewards ManagementMotivate right performanceFoster rightcultureReward right behaviorsDevelop right skills / competenciesPlace right people on jobsTraining InitiativesAnalyzing training needsSoft skills training vs. Technical skills trainingManufacturing ServicingI n d u s t r yHiLowLowHiTechnical SkillsSoft SkillsManufacturingServicingTypes of TrainingEffective Communications Problem Solving SkillsPresentation and Public Speaking NegotiationInterpersonal Skills SeriesTrain-the-TrainersEffective RecruitmentBehavioral and Stress Interview Training for Managers HR Management Series Change Management Conflict Resolutions Employee MotivationTime and Project Management Developing Self-Confidence Team BuildingLeadership and DelegationLeadership SeriesBenefits of TrainingCreate a team spiritTeam Building Enhance interdepartmental communications Increase work procedures and process EffectiveCommunications Select higher quality workforceBehavioral and Stress Interviewing Influence and convince others Give confidence to othersPresentation and Public SpeakingIncrease work process and efficiency Time Management BenefitsTrainingCase Study #2An US-based insurance company is expanding its business in Asia.With its century old experience in North America, it gains over 30%market share in the home country. It is planning to growexponentially in Asia, particularly in China, because it foresees thepotential of the Asian market after China’s accession to the WTO.The headquarters has initiated a massive recruitment campaign inHong Kong. The management faced no problems in recruitingbusiness development individuals in Hong Kong, and they would likethe newly recruited business development individuals to exploit theChina market.Case Study #2 (cont’d)Two months after the recruitment process, themanagement realized that the sales volume does notincreased much, even though workforce has beenincreased by 20%. The management is anxious to know the underlying reasons. Thus, a committee is formed toinvestigate the root causes of the stagnant situation. Inthe research report, the committee addresses a numberof issues:1.Unfamiliarity of the industry regulations in Chinack of business development experiences3.No motivation on hitting higher sales targetQuestions to ask:1.Is there a need for training?2.What types of training would yourecommend?3.How effective would the training be?What to be measured?Case Study #2 (cont’d)Case Study #2 (cont’d)The committee has proposed several training initiatives to improve the current status, which include:1.Industrial Knowledge Training2.Soft Skills Training (SalesTechniques and Presentation Skills)3.Teamwork and Motivation OutwardBoundCase Study #2 (cont’d)The committee set out a number of performance indicators to measure theeffectiveness of the training programs. These indicators include:1.Written Test Examination (to test industry knowledge)2.Random Tape-Recording Conversation (to control the sales quality)3.Customer Satisfaction Survey / Customer Complaints Report (to fostercustomer service and professionalism of staff)4.Team and Individual Rewards (to motivate higher sales effort)Impacts of Ignoring Training Investment Reduce work efficiencyStaff with no training normally needs six times the time to take up the same tasks as those who are trained Increase staff turnoverTraining can enhance staff retention as they become more satisfy on their jobImpacts of Ignoring Training Investment (cont’d)Lower gross profit margins andlower income per employeeA four-year study conducted bythe American Society of Trainingand Development shows thatcompanies which spend moremoney on training have highergross profit margin (24% higher)and income per employee (218%higher) than those spend lessMeasuring Training EffectivenessMeasuring training effectivenessPerformance Management System¾Evaluate improvement on work performance¾Count failure rate if work can be quantified¾Qualitative measurement may include: innovation, mutual trust and respect, teamwork, diversityRewards Management¾Reinforce performance improvement¾Foster preferred behaviors by recognitionROI on TrainingExperienced better performanceCompanies spend more on training have 45%better performance than the S&P 500 indexannually (L. Bassi & D. McMurrer forASTD and Saba, July 2001)Companies invest more in trainingexperience lower staff turnover than thoseinvest less (8% vs. 16%) (C. Lachnit,September 2001)Indicators of ROI on TrainingEmployee JobSatisfactionResponses to Problems Productivity / Efficiency Employee Retention Employee Level OperationalLevelProduct Quality Service Timeliness Customer Satisfaction Customer ServiceLevelHow to Enhance ROI of Human Capital Through Training Q uestions&A nswersQ & A。