BMW Manufacturing Corp. Return on Investment Impact Study Gallery Tour � Review the posters with questions that will be addressed at each evaluation level � Complete a Post-It note with additional questions you want addressed today
Let’s Network using the GAINS Profile Presenter: Ylonda Glover, MS Tri-Success Management Institute Founders of GAINS Profile Dr. Ivan Misner & Robert Davis Purpose: To strengthen both new and established relationships Five Elements of the GAINS Profile 1. G oals 2. A ccomplishments (Assets) 3. I nterests (Passions) 4. N etworks (IRS) 5. S kills Results
GAINS Profile Focus on I for Interests � People are the Drivers � Understanding People - Improves ROI � What are your personal and professional interests? � What are you most passionate about or what do you like doing?
Toni Hodges TH & Company -Independent consultant, providing consulting services and workshops to private and public organizations -Formerly managed Measurement and Evaluation for Verizon Communications and Bell Atlantic -Bell Atlantic selected APQC Best Practice for “Measuring the Impact of Learning” -Selected “Training’s New Guard” -ROI Network Practitioner of the Year -Author “Linking Learning and Performance”
Michelle M. Wentz Assistant Manager BMW Manufacturing •Assistant Manager of Training and Associate Development at BMW Manufacturing � 5000-associate company manufacturing the Z4 Roadster and X5 Sport Activity Vehicle � Main responsibilities: Learning Technologies, e-Learning, Computer Applications Training, Training Measurement •12 years of broad-based training and development experience working in the manufacturing and financial services industries •Master of Science degree in Adult Education from the University of Wisconsin •Bachelor of Business Administration degree in Management, also from the University of Wisconsin
Overview 1. ROI Methodology 2. Program Background 3. BMW Process 4. Results 5. Conclusions 6. Recommendations 7. Lessons Learned
ROI Process™ Methodology EVALUATION PLANNING DATA COLLECTION Develop Collect Data Collect Data Develop Evaluation During Solution After Solution Objectives of Plans and Implementation Implementation Solution Baseline Data 1. Satisfaction / 3. Application/ Reaction Implementation 2. Learning 4. Business Impact Provides 6 types of data
ROI Process™ Methodology Tabulate Costs REPORTING DATA ANALYSIS Generate Isolate the Convert Data Calculate the Impact Effects of the to Monetary Return on Study Solution Values Investment 5. ROI Identify Intangible Provides 6 types of data Measures 6. Intangible Benefits
ROI Process™ Calculating the BCR and ROI Benefits / Project Benefits Costs = Ratio Project Costs Net Project Benefits ROI = Project Costs
Leadership Mastery Program Background -To continue leaders’ professional development after the BMW Life Program -Emphasis on business competencies, communication, DISC style adapting and conflict resolution skills -3 classroom days followed by 8 hours of individualized coaching -Target Associates: Managers, Supervisors, and Individual Contributors with Project Responsibilities
Methodology for BMW Process Steps 1. Two focus groups convened to determine potential business objectives (21 LMP participants) 2. Reaction data collected from BMW evaluation form (158 LMP participants) 3. Job Application data collected with 360 Degree Assessment (pre and post data collected from 16 out of 34 associates) 4. Business Impact data collected from Leadership Mastery Program Review survey (128 LMP participants responded) 5. Tangible Benefits collected from Leadership Mastery ROI Survey and actual program costs (24 out of 36 LMP participants responded) 6. All data compiled and analyzed by Return On Training (ROT) Analysis Team (3) 7. Logic Map Task Force convened for input into Conclusions/ Recommendations (2 coaches, 4 associates)
Results Reaction and Job Application -Reaction data high –ratings between 3.8 to 5.0 -Participants saw improvement in 13 of 18 competencies, 4 significantly so: 1. Communicates with Impact 2. Fresh Thinking 3. Positive Disposition 4. Decision Making -Training and Coaching perceived to have a positive impact on meeting business and performance objectives -Those that received more coaching perceived higher impact to business/performance objectives (Impact increased more than threefold for those who had more than 5 coaching sessions)
Results Calculating Tangible Benefits Question Example 1. Select the business benefits the 1. Fewer hours spent in meetings Leadership Mastery program most positively impacted. 2. What is the monetary value of 2. $30 per hour each unit of improvement? 3. What was the change in this unit 3. 4 hours per month over a 30-day period? 4. To what extent do you credit the 4. 70% percent of change Leadership Mastery program for accredited to Leadership Mastery this change? program 5. How confident are you of this 5. 80% confident estimate?
Results Tangible Business Benefits - 14 out of 24 respondents were able to estimate tangible benefits (used in calculation) -“Reduced number of issues reported” received highest estimated tangible benefit of $50,284 -“Fewer hours spent in meetings” was the benefit realized most often (2 nd highest tangible benefit) Participant example from Assembly Quality Department � Reduced number of issues reported (Quality Improved) � 10 issues reduced per month at 3 hours each @$30/hr. � Isolation @ 40% � Confidence level @ 60% � Annual monetary benefit = $259
Results BCR and ROI Calculation Benefits Costs ( Perceived Annual Monetary Value from 24 Participants - (Actual Costs for 24 Participants ) Adjusted for Isolation and Confidence) Reduced number of issues reported $50,284 Reduced overtime $46,444 Design and Development: Fewer hours spent in meetings $27,446 ($190.80 X 24 associates ) $4,579 Reduced time to full productivity $14,275 Reduced turnover $13,970 Leadership Mastery Delivery Costs: Fewer associate complaints $9,714 Facilities + Instructor + Materials Improved customer satisfaction $3,200 ($1924 X 24 associates) $46,176 Reduced minutes in rework $300 Improved vehicle quality measures $175 Associate ParticipationCosts: $26,910 Benefit Attributable to Training: $124,008 $57.48/hr (FL IV) X 24 hrs X 4 associates + $53.01/hr (FL V) X 24 hrs X 9 associates + $34.02/hr (FL VI) X 24 hrs X 11 associates ) (fullyloaded hourly rates) Report: $150/report X 24 associates $3,600 Coaching: $250/hour X 75 coaching hours $18,750 $45.02/hour X 75 coaching hours (Participant time in coaching sessions ) $3,377 Total Training Costs: $103,392 ROI Calculation: $124,008 (benefit attributable to training) - $103,392 (training costs ) = .199 x 100 =19.9% $103,392 (training costs) Benefit/Cost Ratio Calculation: $124,008 (benefit attributed to training) = 1.20 = 1.20:1 $103,392 (training costs )
Results Intangible Benefits -Improved teamwork – 83% -Reduced conflict – 74% -Improved clarity of roles and responsibilities – 61% –Improved associate job satisfaction – 39% –Improved associate development plans – 35% –Increased cross functionality – 30% –Others noted: improved customer satisfaction, organizing skills, and communication
Conclusions 1. Participants believed they would be able to apply the skills they learned on the job 2. Leadership competencies improved as a result of the program, according to participants: Decision-making, Communicates with Impact, Positive Disposition, and Fresh Thinking. 3. Training and coaching had a positive impact on participants’ performance 4. Training and coaching may be improved with more realistic and relevant work-related focus 5. A better understanding by participants’ management of LMP skills acquired and value expected would be beneficial 6. The LMP is leading BMW employees toward leadership with a financial return
Recommendations Next Steps 1. Continue Leadership Mastery program 2. Share ROI project results with key audiences 3. Prioritize and implement LMP recommendations 4. Implement the following measurement best practices: - Change our training design process to include the UPFRONT development of business objectives for future courses. Seek input from Senior Management so that training programs can be strategically linked to BMW’s business/ organizational objectives. - Focus measurement efforts on learning and on-the-job application / performance impact - Measure ROI and Business Impact for a few select training programs
Lessons Learned Putting the Pieces Together… •Training Design process must include link to business need, initiative, or improvement area � Learning objectives are not enough � Objective mapping process is key � Provides strategic link to business � Ensures concrete measures
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