“Job training empowers people to realize their dreams and improve their lives.”

Sylvia Mathews Burwell

I recently came across an article in Harvard Business Review titled “A Better Metric for the Value of a Worker Training Program”. The article focuses on recommending a new worker training program measure, Cost Per Employed Day (CPED), designed to measure the cost-benefit of a specific worker training program by measuring both the cost and job placement, but also how the student is going 6 months later. While I don’t intend to discuss this specific measure at length it did highlight one recurring Performance Based Contracting (PBC) question; how to measure and drive positive training performance.

In many circumstances, training, while critical for business operations, is part of enabling services and as such is routinely outsourced. In acknowledging the critical nature of these services these outsourced arrangements are candidates for PBCs requiring the design of training specific performance measures and payment regimes.

The solution may seem simple; something like, the “number of students that successfully complete a course”. While at first glance this is OK, it has a number of unintended consequences, especially if linked to money.

For example, if payment is linked to “successful completion of the course” this may drive organisational behaviour to reduce the performance levels (e.g. exam marks or standard of the exam) to make sure success and therefore payment. However, if the tests are standardised and outside the control of the training organisation, it may increase the ‘prerequisites’ for students attending the course to make it highly likely that everyone succeeds (e.g. you need a masters degree before attempting the course). Alternatively, the organisation may focus on teaching to the test as opposed to giving the student the necessary knowledge and skills for competency in the workplace.

Many of you may feel this is an overly pessimistic perspective of our training institutions, however, there are numerous examples of training organisations including national universities that have been guilty of elements of the above to ensure continued student rankings and funding.

So what is the solution? Unfortunately, there is no simple answer. As described in the article it is about a holistic approach to measuring the whole training process including:

• education process such as training facility and instructor availability, course materials, exam results, etc.;
• long-term competency as measured by workplace at least 3 months (preferably 6 months) later;
• student experience including instructor participation, course administration, etc.; and
• (potentially) the cost.

This approach lends itself to a number of performance measures, many of which will be subjective informed by student, manager and workplace surveys.

In summary, in measuring training performance we need clarity about the outcome we want to drive, and align this with the performance measures used. Otherwise, we run the very real risk of driving behaviours and outcomes we neither intend nor want.