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HR & ROI: Step One

The first in our ROI series – Existing Customers.

When people ask us about ROI in people development, our starting point is to find out what is being measured and what change business leaders are looking for.

Often the response is about culture or engagement, so the change is to improve staff retention, engagement survey scores or how people describe the company – is this a great place to work?

But making a more direct link to ROI means translating those people metrics into sales and profit.

Of course there are complexities with this as we can never determine which marketing, advertising, people development or new product launch etc has been chiefly responsible for a change in sales figures, but that does not mean it’s not worth exploring.

For a start, when introducing skills workshops, do we make clear enough why this particular skill is important?  Many workshops launch into teaching good management skills, giving feedback, coaching or personal effectiveness, emotional intelligence – without taking the time for delegates to understand why such behaviour is beneficial to them.

There is still the sense that these things are soft or added extras to the hard basics of getting the job done and delivering results.  So we would do well in learning environments to make more of the links for our delegates, helping them see why a change in their behaviour can impact them, their team and the bottom line (and therefore their bonus if the business works in that way).

 

The probability of selling to an existing happy customer is up to 14 times higher than the probability of selling to a new customer.

- , Marketing Metrics

So how are your people making sure existing customers are happy?  What is the quality of service?  How are managers ensuring people are feeling safe and positive at work, enabling them to provide a better service?

We know from research on the service-profit chain that there are strong correlations between happy people, happy customers and happy profits, so let’s make use of those links in our people development.  Let’s help managers understand that the team spirit they create is having a direct impact on the bottom line through the quality of service and therefore customer experience – whether this team serves internal or external customers.

We may never be able to prove without question that learning has improved sales, but if we can get our delegates more bought into the need for them to change, it’s a great step in the right direction.