Friday, June 24, 2022
How to Compute Return on Investment in Instructional Design
9 minute read
Defining Return on investment (ROI) in Instructional Design
Return on investment (ROI), as it relates to instructional design, is a performance metric used by businesses to assess the efficiency and profitability of their training investments. The cost of planning and implementing learning solutions is weighed against the value or benefits gained, resulting in a financial justification for the expenditure. To call an eLearning project a success, you must be able to show that the benefits outnumber the cost. The benefit (or return) of an investment is divided by the cost of the investment to compute ROI.
Quality vs. Quantity
Quantity
Quantitative data is based on numbers — facts that can be counted or totaled. To analyze quantitative data, one might ask questions like:
How many people participated in the training?
What was the total number of items?
How many signatures did you get?
How many people clicked the link?
What was the total number of times the video was shared?
Because quantitative data is backed by cold, hard data, measures like these are relatively simple to consider.
Quality
Qualitative data, as opposed to data that can be readily entered into a calculator, is information that provides feedback and necessitates in-depth investigation. When it comes to qualitative data, how do you even know what to measure? What data is crucial to the success of your company or institution? This is dependent on the precise aims and objectives you've set for your establishment, but even so, how do you combine quantitative and qualitative data into something useful? Fortunately, there are ways to transform data into actionable information about your ROI regarding instructional design.
Qualitative measures describe the benefits of instructional design that affect the company and should be considered properly, even if they are difficult to quantify. There are, however, a slew of strategies to improve your qualitative measurement game. Creating thought leadership content establishes you as an organizational resource and can equate to higher ROI.
Quantitative and Qualitative data, taken together, show how your instructional design efforts are assisting your organization’s growth. Some measurements show how well your content is received by your target audience. To assure your progress, this information can be used to set development goals. You can examine these indicators individually to see which procedures need to be improved or changed in order to optimize your strategy.
Maximizing ROI in Instructional Design
Learning and development solutions are increasingly viewed as a long-term investment because relevant knowledge and skill are now being recognized as valuable assets to organizations. A favorable way to retain the most skilled or talented individuals and capitalize on the revenue generated by an organization’s workforce is to foster a vibrant learning culture. Most employees that care about the work they do aren’t just in it for a paycheck. Competent employees want to be valued for the expertise they bring to the table. Demonstrate to employees that their efforts are valued by acknowledging their existing competencies, and helping them develop both personally and professionally by offering various forms of learning and development solutions.
A good learning culture ensures that the knowledge and expertise of 20% of the most knowledgeable staff are shared with the other 80% of staff, resulting in increased workforce productivity and proficiency.
Organizations must always be on their toes in an intensely competitive and developing market with frequent technological advancements. Because of the narrowing margins, maximizing ROI is a primary priority. Instructional design can help you get the most out of your training budget in a variety of ways:
Determining organization/employee needs
Linking outcomes directly to performance goals
Consulting with SMEs to enhance learning opportunities
Creating context, rather than content
Evaluating instructional materials and programs before launching
Providing opportunities for social learning
Instructional Design Assessments - Gauging ROI
The quality and effectiveness of instructional design (ID) materials, learning experiences, and outcomes are crucial to learner success and can be determined by implementing relevant evaluation processes. There are various forms of instructional assessments that aid in understanding course effectiveness, strengths, and areas of improvement--ultimately testing ROI. Learning tools and experiences developed with instructional design must include relevant assessments for determining the effectiveness and efficiency of instructional design efforts.
Evaluation in the Instructional Design Process
Learning environments of all kinds can benefit from the evaluation of processes, resources, and outcomes. Assessment and reiteration of instructional design can significantly improve learning experiences. In navigating educational technology (EdTech), instructional designers must employ assessment methods that are innovative and original. Assessments for instructional design are typically focused on the following:
Learner-Centered Instruction
Educational Technology Evaluation
Organizational Improvement
Formative and Summative Assessments
Formative assessments are employed to examine student progress. The feedback from educators in a formative assessment format enables students to identify strengths and weaknesses to improve their learning as they go. This form of assessment can also assist in improving teaching efforts. Formative assessments allow educators to identify areas of improvement and find or develop solutions to address relevant needs directly.
Summative assessments are implemented in order to evaluate whether the most crucial outcomes have been achieved once instruction has concluded. Summative assessments can also evaluate the long-term benefits of learning, the effectiveness of instructional methods, and how participants reacted to the learning experience.
Simply put, formative assessments tend to focus on improving learning along a student’s academic journey, while summative assessments emphasize the final result. Furthermore, it would be most appropriate to implement summative assessments at the end of a course or program.
The Kirkpatrick Model
The Kirkpatrick Model is utilized by instructional design experts to accurately assess the effectiveness of learning and development programs. The model is based on four levels of criteria that evaluate the reaction, learning, behavior, and results of both strategic and natural learning methods. Let's take a deeper look at the Kirkpatrick Model's four stages and how you may utilize them to calculate ROI:
Level 1 – Reaction. Reaction is the first level of criteria. This level measures how students perceive and respond to training. The student’s response will determine whether students find the experience engaging, satisfactory, and/or relevant to their educational needs. The reaction level puts emphasis on the learner’s experience. For example, surveys provided to participants after trainings focus on what the learner gained from the experience and what the learner thinks can be improved.
This analysis of learner reaction gives educators an idea of how learning methods either provide advantages or disadvantages to students. By using your LMS to build a post-training survey, you may record your learners' feedback and recommendations. The reaction level is significant since it indicates whether your learners considered the course to be relevant and alerts you to any necessary improvements.
Level 2 – Learning. Learning is the second level of criteria. This level measures the effectiveness training has on knowledge and skill acquisition. Each student is evaluated based on whether the intended learning objectives are achieved. There are various forms of evaluation; for instance, pre-training and post-training evaluation are common in learning spaces.
These types of evaluation aid in identifying and understanding pre-existing knowledge and course accuracy for knowledge acquired during the learning experience. The learning level is significant because it allows learning and development specialists to decide whether their training objectives have been fulfilled, as well as identify knowledge gaps so that course content may be improved.
Level 3 – Behavior. Behavior is the third level of criteria. This level assesses whether students were actually influenced by the instruction and whether they have the know-how and skill to apply what they’ve learned. By observation and assessment of changes in behavior, educators or employers are able to determine student understanding and whether what was learned during training can be practically applied in the real-world. The behavior level is significant because it confirms your organization's training commitment, but it might be more difficult to analyze than the previous levels. An increase in efficiency amongst students or employees is an example of such validation.
Level 4 – Results. Results is the fourth and final level of criteria. This level measures the direct results of learning efforts. The results level determines how effective learning efforts are by reviewing institutional or organizational outcomes. Learning and development professionals typically measure this by establishing intended outcomes before training implementation. This could look like anticipated increases in ROI, decreases in ineffective practices, and/or increased demand for a product or service.
The result level assesses the ultimate outcomes that were achieved as a result of the learners' involvement in the program. In most cases, this is assessed in terms of increased production.
The Kirkpatrick Model is a great way for instructional designers and other learning and development professionals to organize and develop a relevant and actionable evaluation plan that has the ability to outline multiple objectives, assess outcomes, and identify areas of significant impact.
Computing eLearning ROI
You may calculate your eLearning ROI by following Kirkpatrick's four-level evaluation approach. Determine your eLearning ROI by monetizing the benefits or value added from training and assessing if it is greater than the investment made. This is accomplished by contrasting the 4th level with the total costs of developing, delivering, and managing training.
Conclusion
All instructional design and learning and development efforts can benefit from the incorporation of assessments, specifically the Kirkpatrick Model. Thorough assessments, like this one, can assist educators and learners in understanding strengths and areas of improvement when it comes to both teaching and learning approaches.