1. Human Capital
Dollar Amount Spent in America ...
Training and
Development
$210 Billion
Formal Education
$238 Billion
Health Care
$355 Billion
© 2001, Jerome J.

2. Human Capital
Cost Factors
Analysis and Development
•Course Design
•Material Development
Delivery
•Instructor Time
•Materials
•Administration
Trainees
•Wages
•Benefits
•Overhead
© 2001, Jerome J.

3. Human Capital
Cost Factors
© 2001, Jerome J.

4. Human Capital
Money Must Be Kept Busy!
© 2001, Jerome J.

5. Human Capital
Efficiency, (E1)
- How Fast
Effectiveness, (E2) - How Well…
© 2001, Jerome J.

6. Human Capital
Trainees
Delivery
Typical
Institutions
90%
9%
1%
US Company
With Largest
Development
Costs
85%
12%
3%
Institutions
With Little Or
No Formal
Training
95%
5%
© 2001, Jerome J.
Development
0%

7. Human Capital
Cost Categories
Development
How It Is Now
How IT Could Be
$.01
$.05
Delivery
$.09
$.20
Trainees
$.90
$.30
Total Cost
$1.00
$.55
© 2001, Jerome J.

8. Human Capital
Exemplary Competence
Average Performance
End Training
Start Training
Hire
Date
© 2001, Jerome J.
Gr o
uctivity
Pr o d
w th

9. Human Capital
E2
= Training Effectiveness
• PIP (Performance
Improvement Potential)
• The ratio of Average to Exemplary
• PIP = Y(Average) to X(exemplary)
© 2001, Jerome J.

10. Human Capital
Average
© 2001, Jerome J.
Exemplar

11. Human Capital
Average
New Average
Greatly Improved
Productivity
Economic
Gain
© 2001, Jerome J.

12. Certification
Performance Assurance Process
Class Supported Activities
Participant
POA
Complete
Exercises
Internet Supported Activities
Register w.
Internet
Counselor
Internet
Approve
Selected
Materials
Guided Performance
Support
• Conduct Client Agreement Meeting
• Create System/Job Models
• Create Economic Model
• Write Performance Opportunity
Report (POR)
© 2001, Jerome J.
Begin Monitor
POA Process
Approved
Work Output
Certification

13. Performance Opportunity Report...
Opportunity
Explanation
Root
Cause
Information
Technology
New computers
and software
NMG cut off
electronically
Cycle Time
Reduction
Cross Platform
Communication
Strategies
Lack of Ability
to Share Data
Operation
Standards
Turnover leads
to more process
errors
Unclear
Operation
Standards
Quality feedback Data collection
timeliness,
Cost of Quality problems
usefulness
Cost of Analysis:
Cost of$135,000 $8,100
SME’s:
© 2001, Jerome J.
Total Cost to Date: $143,100
Counter
Measure
Convert platforms
Train Axxociates
Improve data
transfer
Improve Training
and Operations
Standards
Update QICS
Install monitors
Design reports
Schedule
Cost
R.O.I
Start End
$10,000
180%
Oct 97 Nov 97
$2.8M
1400%
Nov 97 Mar 98
$800,000
440%
Feb 98 June 98
$1,125M
320%
Oct 97 Dec 98

14. The Six Cell
Performance Engineering Model
1 Information
Directional
Feedback
2 Tools/Resources
Hand
Mind
4 Skill/Knowledge 5 Capacity
Physical
Psychomotor
Cognitive
© 2001, Jerome J.
Intellectual
3 Incentive
Monetary
Constraints
6 Motivation
Survival
Values