SAP SuccessFactors White Paper Business Briefing Learning and Analytics Why learning with analytics bridges the gaps in your workforce s capabilities, improves performance and delivers a quantifiable ROI
Table of Contents 5 More Training Isn t Necessarily Better 6 Analytics Show You What Real Results You Can Gain 7 Improving Learning Through Workforce Analytics is a Continuous Process 8 Use ADDIE to Guide the Implementation of Learning Analytics 9 Workforce Analytics Gives You Real Intelligence on the Impact of Training 10 You Can Identify Problems and How to Solve Them 11 Conclusion Analytics Equips You to Execute Your Strategy More Efficiently and Profitably 2 / 11
There are always gaps between your strategic goals and your workforce s capabilities. Training will get you part of the way there, but in isolation not far enough to bridge the critical capability gaps. According to an IDC Chief Learning Officer Survey, from 2010 until 2015, more CLOs were dissatisfied than were satisfied with the tools, resources, or data available to them to properly establish training s impact. They found that in organizations that expanded use of analytics to support their business decisions, three out of five CLOs report that their learning and development measurement data is regularly leveraged by divisional leaders and line managers, but only half of C-suite executives review learning measurement data quarterly or monthly. 1 All too often, training is managed without the tools to deliver the right training or measure its impact on the business. How do you know if your training programs are effective? How do you know if they deliver a real ROI for your business? Only when you use business metrics and analytics to support your training programs will you start to see the impact across the business. 1. IDC, Chief Learning Officer Survey: Measuring Learning and Development, Doc# US41067116, March 2016. 3 / 11
The relationship between learning and analytics is often misunderstood and under utilized. Typically, when people discuss analytics they are talking about reporting within a specific learning management system. Reporting only shows evidence that something has been done. They are talking about course completions, scores, pass rates and usage data. While useful, this information doesn t really help you to make the connection with what is happening in your organization, or whether the training is having the desired effect of boosting productivity, improving service and raising levels of efficiency. Training without the right analytics is like driving without a GPS. You know what you want the training to achieve, but you have little idea whether you are delivering the right solution or even providing it to the right people. The use of analytics as part of the process helps organizations: 1. Identify the problems in their business 2. Quantify the cost of the problems 3. Provide evidence that the training was effective. Without analytics, you are at risk of driving your learning strategy blind, and never realizing the results you expect to gain in the process. Differentiating Analytics from Reporting Reporting How many took the training? How many passed the training? How many hours were spent taking the training? Analytics How many failed a specific task on a job? After receiving the training, what was the success rate of the task? How was production in the business impacted by the training? 4 / 11
More Training Isn t Necessarily Better As e-learning took off in the early 1990s, many companies started taking a buckshot approach. Purchasing and delivering e-learning was cheap compared with running face-to-face classroom sessions. So companies bought entire libraries of content, creating huge curriculums for new employees and assuming that by the time they finished, they would be ready to do their jobs or do them better. These companies substituted e-learning courses for classroom instruction, mistakenly assuming the courses were equally beneficial. But without analytics, they had no way of knowing whether the quality and performance of their employees might actually be dropping. Their mistake was assuming more was better. In fact, the more targeted and concise your training curriculum, the more effective it will be. 4 out of 5 enterprises use general training output data (courses, students, hours of training, etc.) to help justify the impact of training. And measurement of learner satisfaction with training programs is used as justification in 7 out of 10 organizations. IDC, Chief Learning Officer Survey: Measuring Learning and Development, Doc# US41067116, March 2016. 5 / 11
Analytics Show You What Real Results You Can Gain When deploying a modern Learning Management System (LMS), business metrics should be used to show what actual value the organization gains, and not just to use analytics which traditionally measures the amount of training completed. EFFECTIVE INSIGHTS SHOULD SHOW THE LINK BETWEEN: 1. Training completed and revenue earned. This may be for revenue generating roles or between organization units. You should look at the best and worst sales people and analyze what training they are taking and when. Then compare that to their sales performance and see if training is making a difference. 2. Compliance training and safety performance. Are you reducing the number of accidents and issues? 3. Training completed and performance ratings. Are the top performers completing more training or scoring better? 4. Training completed and salary increases. Do individuals who excel in training get higher salary increases? Do those who don t complete the training, or get poor results, get lower salary increases? 5. Training completed and the development and retention of high performers. Is training a good engagement method to keep your top performers at the company? 6. Training completed and development of new career paths to develop the future capability required by companies, rather than the continued building of historical competencies The key to successfully using Analytics with Learning is that you must combine the traditional training reporting with business data from other systems (e.g. CRM and ERP systems). This business data is critical to understanding the business impact of training otherwise you are just reporting on training completions and such. To increase the impact of learning, CLOs must demonstrate through metrics and business language that every learning investment is helping the enterprise achieve some portion of its strategic objectives. IDC, Chief Learning Officer Survey: Measuring Learning and Development, Doc# US41067116, March 2016. 6 / 11
Learning and Analytics Improving Learning Through Workforce Analytics is a Continuous Process It s become clear that learning management systems must have integrated analytics and metrics, to allow continual evaluation of the training s impact. More importantly, the LMS must be integrated into a business full suite of applications, along with workforce analytics, to determine exactly what the entire business gains from the investment in training. For decades, training departments have used methodologies like ADDIE (Analysis, Design, Development, Implement, and Evaluation) to clearly define what to teach and what s going to be of most value. ADDIE was extremely effective, but fell out of favour with the arrival of e-learning because of the amount of time it took to do ADDIE properly. What the industry did not recognize was that, with the proper use of learning management and analytics, ADDIE becomes a continuous process, instead of a once per curriculum type event. The ADDIE Model for Instructional Design Evaluation Analysis Implementation Design Development 7 / 11
Use ADDIE to Guide the Implementation of Learning Analytics The first step, when developing a training program, is identifying what business problem you are trying to solve. By using analytics, you can then actively measure the key metrics related to the problem, whether working in a manufacturing or an office environment for example, and how they improve. This Analysis stage is the A in ADDIE, which helps you determine who and what training needs to be done. The Design and Development phases are up to the training department to define and create. The Implementation phase is typically done within the LMS, when training is deployed to employees identified during the analysis phase. Once the learners have consumed the material, the Evaluation phase begins. The effectiveness of the training is measured by looking at the impact on the problems first identified. As before, the Evaluation phase is performed with an analytics package. Whether you use ADDIE or a different methodology, it is always good practice to know: What are the business problems within your company? Can the problems be solved through training? Once the training has been delivered, was it effective? What was its impact? The best way of answering these questions is through the use of workforce analytics to continually measure your company s performance, and the only way to truly measure impact on company s performance is to incorporate business data and metrics in your analysis. 8 / 11
Workforce Analytics Gives You Real Intelligence on the Impact of Training Historically, companies collected and visualized performance data using business intelligence tools. But training departments rarely used this data to guide their curriculum. Often, you would find the LMS feeding data in but almost never taking data out to direct future training. But with the addition of true business metrics, beyond just standard analytics and reporting, this has begun to change. FEEDING DATA BACK IN WILL IMPROVE THE DATA YOU PULL OUT To maximize your organization s performance, workforce analytics needs to be integrated into a full suite of applications with both workforce metrics and analytics capability. This is where the true insights will be gained. For example, using analytics with learning strategies you can determine: What is the relationship between span of control, learning and revenue? Can departments that complete all of the training have a larger span of control, less overhead costs and greater profitability? What is the relationship between learning completed and the ratio of high performers and revenue? Do departments that have completed the training have a higher ratio of high performers? Does this result in higher revenue and revenue growth? Do these departments have lower levels of poor and marginal performers? What is the relationship between the types of training and their business impact? Does sales and product training correlate with higher revenue, higher ratio of higher margin sales? Does program content training within a government department correlate with higher levels of program outcomes within the community, such as placements within a children s community department? What is the relationship between training completed and career paths? Do departments that have completed all the relevant training have a higher ratio of internal promotions to external recruits? If so, do we than reward managers who develop their staff more? Do we reward managers who export talent more than those who import talent? These are just a few examples of how everyone, from line managers to executives, can benefit from insight into the impact training is having across the enterprise, and not just a status report on how much training was delivered. 9 / 11
You Can Identify Problems and How to Solve Them Workforce analytics also gives you insights into what problems are occurring within the business or if there is an increased number of incidents, and how you can solve them through training. In addition, it gives you a transparent way of calculating the ROI across the entire company, instead of just within your training department. Traditionally, training departments have been measured by how cheaply and effectively they can deliver training. However, with the use of analytics against company metrics, you can now measure the impact of training in terms of how much money you save the company per training dollar spent. For example, if you identify a $500,000/ year problem that can be addressed through $50,000 worth of training, you can easily justify the budget through the results you can achieve. QUANTIFYING THE IMPACT OF TRAINING ON SALESFORCE REVENUE In one example company used data from their core HR, LMS, Performance Management and Customer Relationship Management (CRM) systems to draw insights into its onboarding and mentoring initiatives for newly hired sales representatives helped fine tune its mentoring program so: New sales reps who engaged with their mentor on day 1 of hire had almost a 300% improvement in deals closed Time to achieve average quota attainment was cut in half New sales reps made 3x more quota as compared with new hires in prior year First year attrition of new sales reps was down 80% compared with prior year Overall, significant improvement in sales performance was achieved as compared to new hires in prior years in terms of revenues booked per month, average deal sizes, and conversion ratio. 10 / 11
Conclusion Analytics Equips You to Execute Your Strategy More Efficiently and Profitably SAP SuccessFactors has always had a firm belief that data-driven, targeted learning methodology helps drive business breakthroughs by focusing on key areas of development and delivering measurable business impact. SAP SuccessFactors makes this simple and practical by providing the backbone, integrated solutions for Learning and Workforce Analytics, and providing support to bring in business data. Combined, they can offer a tremendous amount of insight for your training department, as well as delivering a powerful business performance measuring tool. In today s economy, this type of intelligence allows you to be more effective with your budget, and to increase the impact of training across the entire business. The integration of Workforce Analytics and Learning will generate insights which in turn create a real and sustainable competitive advantage while demonstrating the value to the business. SIX STEPS TO SUCCESS: 1. Deliver fact/data based business cases for what training you are doing and why. 2. Demonstrate why investing in training program X, will help the company execute on its strategy and deliver ROI through authoritative insight. 3. Engage the business leaders, HR, finance, sales and operations with business metrics to really show what impact training is having and what needs to be measured. 4. Embrace workforce analytics as an integrated part of decision making and combine multiple data sources from finance, sales, HR and training, to allow you to measure the relationship and impact training has on the strategy, alignment, people performance and productivity of your organization, thereby linking your training strategy to the business. 5. Embark on a transformation journey a phased development with each phase representing a more mature use of workforce analytics and a more specific strategic business impact. Move from reporting (understanding what s happening today) to analytics (why it s happening), to planning (how do we take action today to ensure we have the right workforce trained for tomorrow). 6. Proactively engage with HR and the business to uncover potential problem areas and ensure that they can quantify the impact of interventions. Ultimately, you ll be able to identify the gaps in your workforce s capabilities, and to bridge them with the right training. Performance will improve across the business as a result, and you will be better equipped to execute your strategy more efficiently and profitably. The financial business case is real and significant. When you can fine tune how you manage your most strategic asset human capital it leads to results. LEARN MORE To learn more about how SAP SuccessFactors Learning and Workforce Analytics can help you improve performance and deliver quantifiable ROI, visit http://www.successfactors.com/ en_us/solutions/analytics.html. vq216 11 / 11
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