The problem with R.O.I? It's often M.I.A.

Sep/10

The problem with R.O.I? It’s often M.I.A.

by ReThinkHR.org | Leadership, Work, HR & Inspiration by @BenjaminMcCall under Business Impact

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HR Is No Different Then Marketing!

Like Marketing, Communications, PR, Sales and any other part of a business or initiative… we are always trying to figure the R.O.I! Executives and line managers are constantly asking for how you plan on measuring and showing it. Many times they ask you

“So What”s the ROI” or “How are you going to measure this?”

I am often asked with the person on the other end having know idea themselves what or how to measure?

When You Have No Idea What You Want To Measure

When people do not know what should be accomplished, R.O.I. is often M.I.A. This is especially true when people don’t know what they want, understand how the end result should look, or are clueless on what to measure for success.

Outside of cost and sales over time, the metrics and results we try to pinpoint for R.O.I. are often hard to do. It doesn’t matter what field you are in. R.O.I. is a term that is nice to hear but often very hard to prove!

Yeah it is hard to do in Training, HR, and OD - but don’t get it twisted - it is also hard to do in any other field. People just assume that the results directly connect to a sale, operations being cut, or an initiative being launched; but really the true connected is often someones opinion rather than based on the fact.

Ask Anyone

Don’t believe me… Ask any decision-maker that is a high-level manager and they would tell you that what their unit did is what increased the sales and productivity. Then ask them, can you show me how you did it… that will tell you more!

What do you think? Asking for what you want is very different from getting what you ask for!

Comments

comments

Business Impact, HR, learning, Measuring Results, Metrics, PR, Return on Investment, ROI, Sales, Training

Anonymous

I wish more could understand or take the initiative to understand the business. It is getting better!
Anonymous

That is one great way to do so but when people can’t even do that… then Houston… we have a problem!
http://www.chinagorman.com ChinaGorman

Another blogger this week (I’m horrified to say I don’t remember who. In my defense, I have 85 HR blogs in my GoogleReader.) discussed that “starting with the end in mind” was one of the c”liches” they were done with. But if we’re talking ROI, starting with the end in mind isn’t a clieche, it’s a great place to start because it can lay out clearly (or it should) the outcome you’re trying to achieve. If you can’t succinctly describe it; if you can’t set the appropriate metrics (we’ll be successful if…); if you can’t quantify the cost to get there; then there’s no way you can justify it to the people who will pay for it, put resources (time, attention, etc.) to it or ultimately approve it. Building business cases isn’t rocket science, it’s pretty basic stuff. If you can balance your check book you can put together a simple business case — and the last part of a business case is the ROI calculation. Good post, as always, Ben!