By Jayshree Dexter
In many organisations, Learning and Development (L&D) is still seen as a necessary expense rather than a strategic driver of value. This perception persists even as evidence mounts that well-designed training programs can boost productivity, reduce turnover, improve customer satisfaction, and drive profitability.
The key to shifting this mindset lies in measuring and clearly communicating the return on investment (ROI) and return on expectations (ROE) of training.
Done well, these measurements transform L&D from a cost centre into a recognised engine for organisational growth.
ROI is a classic business metric because it speaks the language of executives and finance leaders. The formula is straightforward:
ROI (%) = (Net Program Benefits ÷ Programme Costs) × 100
If a sales training program costs $50,000 to implement and generates $200,000 in additional revenue over six months, the ROI is 300%. This type of evidence makes it far easier to justify future investment in training.
But ROI is not without its challenges. Some programs, such as leadership development or culture change initiatives, produce benefits that are less tangible. In these cases, quantifying outcomes purely in financial terms can overlook valuable, long-term impacts.
This is where ROE – Return on Expectations – becomes indispensable. ROE assesses whether a programme has delivered the specific outcomes stakeholders hoped for when they approved the training.
These might include:
Where ROI speaks to the CFO, ROE resonates with department heads, frontline managers, and even employees themselves. It offers a more holistic view, ensuring that training is aligned with strategic goals beyond just financial gain.
In my experience, measuring ROI and ROE effectively begins before the training is delivered. Too often, L&D is approached as an “order-taker”. Stakeholders request a course, and the team delivers it without interrogating the root cause of the problem.
A more strategic process looks like this:
This approach not only yields more reliable measurements but also builds credibility with stakeholders who see that their investment is being treated seriously.
A manager once approached me requesting “teamwork training” for his staff. Instead of delivering a generic course, we examined performance data and discovered the root issue was poor client relationship management. We designed a program focusing on client communication, active listening, and service recovery techniques.
Post-training data showed a significant drop in service complaints and a measurable increase in client satisfaction scores. While the financial ROI was modest, the ROE was exceptional. The team’s relationships with clients improved, and the department was recognised internally for service excellence.
While ROI is valuable, it’s not the only measure of training impact. Over-reliance on ROI can lead to undervaluing programs that:
These outcomes, though harder to monetise, often underpin long-term organisational success.
When sharing results:
By combining ROI and ROE in reporting, you speak to both the head and the heart, satisfying the need for financial accountability while inspiring confidence in the broader value of training.
Measuring ROI and ROE is not just a reporting exercise; it’s a mindset shift. It requires L&D leaders to be strategic partners, data analysts, and storytellers. When done well, it reframes training as an essential investment in organisational performance and growth.
As the pace of change accelerates, the ability to demonstrate and communicate the impact of training will not just be an advantage. It will be a necessity.
With a passion for people and performance, Jayshree Dexter has spent over 16 years creating learning experiences that inspire, engage, and deliver results. She combines creativity with data-driven insight to help individuals and organisations thrive.