The "So What?" of Enterprise Learning

by Mansi Shah

As the Senior Manager of Customer Success here at Pathgather, I spend a lot of time working with our customers and their organizations. One topic that comes up very often is measuring the ROI of learning. There seems to be two main schools of thought in this arena - some organizations seek to understand the bottom line impact, while others take a “learning for the sake of learning” approach. At Pathgather, we believe that enterprise learning does indeed have a very real bottom line impact, but perhaps not in the way it’s traditionally understood.

Employee engagement, satisfaction, and retention

According to a 2011 PwC report titled “Millennials at work: Reshaping the workplace,” over 1 in 4 millennials expect to have six or more employers over their career and, by 2020, millennials will make up 50% of the global workforce. When asked to rank the three benefits millennials would value most from their employer, training and development came out on top (KPCB Internet Trends 2015 - see below).

Further, the cost to U.S. companies for each new hire is $4,000 (Bersin by Deloitte, Talent Acquisition Factbook 2015). The combination of these four insights is worth paying attention to.

If we know that millennials are highly mobile and an increasing plurality in the workforce, and that training and development is the #1 thing they value from employers, and that recruiting is expensive and time-consuming, shouldn’t this dictate every company’s retention strategy? Providing your employees with valuable learning opportunities could save your company thousands - perhaps millions - of dollars annually, build an attractive culture of continuous learning, and improve employee retention.

Skill development

Modern enterprise learning is sometimes viewed as hard to understand in aggregate. That’s understandable, especially in environments where learning is encouraged to be largely self-directed. But consider this example - you have an internal sales team full of relatively capable but not exceptional sales representatives and the leader of that team is scheduled to retire next summer. This challenge is probably not uncommon. Deloitte’s 2015 Human Capital Trends reports that organizations worldwide are struggling to develop an adequate leadership pipeline. Suppose Melissa, a sales representative on that team, recognizes this leadership gap and decides to pursue this opportunity to ensure she is fulfilling her greatest professional potential. Using her company’s learning platform, she discovers two TED talks on leadership, takes a month-long Coursera course on customer-centric selling, and reads three articles on negotiation over the course of six weeks. In addition, she is able to connect with mentors in other parts of her organization. Fast forward a few months, and Melissa has revealed herself as a potential candidate for the head of the department position. To us, that’s the connection between learning and development opportunities and your business’s bottom line.

Spreading the wealth

Another benefit of providing your employees with the right learning tools and resources is that you can begin to create a network effect with the increased knowledge and skills in your organization. According to the 70-20-10 model of learning and development, about 70% of workforce learning happens via on-the-job interactions with peers, teammates, and managers. This means that if some subset of your employees are taking advantage of tools to learn and track their growth in the enterprise, there’s a good chance their peers are benefiting from this second-hand. For the same reasons listed in the previous section, the more your employees are keeping their skills relevant and up-to-date, the more likely you are to be maximizing the return you get out of employing them in the first place.

Conclusion

So what does this all mean? It means that the latest research about the L&D industry seems to support the idea that robust learning programs actually support your organization’s bottom line - and therefore your organization’s health and future growth. We applaud those companies who take a “learning for the sake of learning” approach, but we believe it’s time to acknowledge that the bottom line is important too. To those who have always considered the bottom line, we encourage you to view your enterprise learning environment through the lens described above - the true impact of quality enterprise learning is that it keeps your employees engaged, develops critical skills within the organization, and creates a network of informal, on-the-job learning. 

 

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