This document discusses measuring the return on investment (ROI) and impact of workforce development programs on employers. It argues that impact is a better metric than ROI because (1) employers do not usually collect the data needed for ROI calculations, (2) ROI is not how employers make human resource decisions, and (3) determining precise ROI is problematic due to multiple influencing factors. The document provides examples of measuring impact, such as through employer testimonials and surveys on competitiveness, cost reduction, and satisfaction. It also lists resources available through the National Network of Sector Partners.

1. Measuring & Communicating
ROI (or is it Impact?)
Presented by
Jack Mills, Director
National Network of Sector Partners
August 17, 2011
For more information:
www.nnsp.org
jmills@insightcced.org

2. Why Measure ROI/Impact on Employers?
• Who is the audience?
– Internal use: Managing/improving services,
supporting decision-making, obtaining resources
– Employers: Provide answers to “What’s in it for
me?”
– Public officials: Provide answers to “What helps
achieve policy/political goals?”

3. What about ROI?
Information needed for Return on Investment
analysis is:
1. Not usually collected by employers
2. Not the basis for most employers’ decisions
about human resources
3. Problematic (because high rigor is needed to
determine ROI, since things have multiple
causes)

4. Impact: a Better Approach
• Impact can be based on data of various kinds
and opinion; ROI is based on data that can be
“dollarized”
• Internal staff and partners, employers, and
public officials care about impact;
communicating it is powerful

5. Examples of Impact to Measure
• Impact on competitiveness/profitability
• Satisfaction/extent to which employers’
expectations were met
• Reduction of cost and/or risk for employers
• Impact on retention/turnover

6. Examples of Ways to Identify Impact
• Employer testimonials
– Most powerful when they have information about
increased profitability and competitiveness,
decreased cost, etc.
• Post services surveys of employees and their
supervisors that get clear answers about
perceptions of services’ impact
• Pre and post services surveys and interviews
that identify needs/costs, and get clear
answers about impact.

7. Resources
National Network of Sector Partners
– Training and assistance
– Industry-specific peer learning
– Policy development assistance
– Resources and materials
– Etc.
To find our more about services NNSP provides
and/or become an NNSP member
go to www.nnsp.org