Measuring the ROI of Training in the Hotel Industry
By Justin Sun Compensation Analyst, Lockheed Martin | March 17, 2013
The biggest challenge that hotel companies must overcome when launching training programs is tying the benefits of learning to business results and the bottom line. As a training manager or learning coach, you should base your training programs upon your company's business strategy with clear-cut expectations for what you and your trainees should expect to get out of the programs. Your learning initiatives should support your organization's goals from the top.
Numerous hotel companies are realizing the benefits of training as shown by the time and resources that they are allocating to learning activities. In upscale properties, such as the Four Seasons and Ritz Carlton, for example, executive teams are starting to create a stronger connection between workforce development and corporate performance. The benefits of training may not be immediately noticeable, but they can be measured in the long term through a variety of metrics, such as customer satisfaction scores and employee feedback.
Increasing business demands in the hospitality industry now require organizations to align their learning programs with their business strategies in order to achieve organizational success. Before you implement any kind of training program, you should make sure that training is truly the solution to your problem and not just a "quick fix" to your problems. Assuming that training is, in fact, the best means of resolving the issue, you should ensure that the training program that you design is aligned with your organization's strategy before starting to create the program. For example, Mark Brewer, corporate university director of PBS&J-an engineering and project management firm-worked with different business divisions at Motorola University to "determine what human performance improvements or enhancement would impact business objectives."
With a similar focus in mind, you can come up with a list of individual strategic objectives to determine whether training is a necessary part of the process to achieve critical business objectives for your hotel. Brewer explains, "If you can't articulate how a business objective is measured, it's especially difficult to determine the impact of performance interventions." Without business goals, you do not have a convincing basis for defending training, so breaking down business objectives into concrete, measurable training goals is very important.
Furthermore, you should tie your training function to specific business units to ensure that learning initiatives are tied to the bottom line whenever possible. Frank Nyugen, a senior learning technologist at Intel Corporation, worked with a training organization that was seen as a "cost center" and that "supported another support organization and was not directly aligned with a business unit that generated revenue for the company, such as manufacturing and sales." To create a stronger connection to the dollar return on your training, you should demonstrate how training can serve as a revenue generator rather than as a cost to your company. If you draw a connection between important functional business units and your learning programs, you can make the promotion of operational objectives easier for your company. Being a part of the business and getting close to customers and your employees who deal with those customers can help you to make more effective decisions about which training programs to implement.
Training programs should also focus on integrating learning into the organization's culture and all processes that contribute to the bottom line. Ted Prince, CEO and founder of The Perth Leadership Institute, recommends that you "don't simply show people how to read a balance sheet; show them how their intrinsic behavior impacts the organization's financial outcomes."  You should reinforce learning by holding employees accountable for what they have learned, and "communicate the numbers" from your ROI to employees "allowing them to see how their actions are impacting the company's financial well-being." For example, if your training program is focused on reducing accidents in the workplace, you might highlight in your training the average cost that can be saved through reduced workers' compensation, medical expenses, and legal expenses.