“Sending employees on personal development programs are nice but far too costly for a small to medium sized business like ours.” This statement is repeated more times than enough by countless business owners every week. Unfortunately, the statement is based on a business myth.

The myth:

“personal development (facilitated learning programs) are an expense”.

The truth be known, the development of your employees is an investment, much like investing in new computer hardware / software or facilities.

Before you dismiss paying for employee development, provided either by an internal learning & development group or external consultant, take the time to do the math. Consider the cost for the programs being funded for employees. Add back in savings able to be directly linked to the improvement in knowledge; skill set; attitude and motivation of the staff. I believe the result will be a positive ROI (Return on Investment).

Leaders then ask: “how do I begin to do the calculation of my Return on Investment for employee development.” First, you need to know what the outlay would be for programs such as those to improve the leadership skills of existing or recently promoted members of your leadership team. Perhaps you want to send your staff on a program to learn how to evaluate their day to day processes then recommend and implement time and cost saving solutions. Another area could focus on improving staff time management (personal productivity) skills. You might also want to focus on client service training or making them more aware and accepting of the diversity in today’s workplace.

To calculate your return on investment you need to consider the reduced cost of recruiting and hiring new staff; the value add in performance from employees that are satisfied; the improved productivity from becoming aware of how to manage their time; the value of increasing your business because your customer service is better. One final item to consider is the positive impact on operating expenses.

Of course, it is easy to say DO THE MATH, but without a template to follow, it is just another thing to do on your already heavy workload. Therefore, the following template is offered for your consideration.

Less: Investment in Employee Development:

– Leadership Skills Program = $

– Communication Skills Program = $

– Process Improvement Training = $

– Personal Productivity Training = $

– Client Service Training = $

– Diversity Awareness Training = $


Plus: Return on Investment:

– Improved Employee Satisfaction = $

– Reduced Turnover/hiring Cost = $

– Improved Productivity = $

– Improved Customer Service = $

– Increased Business = $

– Decreased Operating Expenses = $



I urge you to look to the future of your organization and DO THE MATH.