L&D ROI: How to Measure Learning and Development Impact

Proving return on investment for L&D programs is incredibly valuable, and relatively rare. You can see the impact of your learning and development strategy through anecdotes and individual performance, but it’s hard to quantify this effect.

Metrics like completion rates and satisfaction scores can be a good starting point, but they don’t tell the full story—or show the real value L&D brings to the business.

When you can’t clearly demonstrate ROI, it’s harder to justify your budget or secure leadership buy-in. This can put your role—and your programs—at risk. 

To stay ahead, you need to move beyond surface-level metrics and start measuring what truly matters. This article explains how to shift your approach to performance-driven impact so you can confidently showcase the real business value of L&D.

Why measure the ROI of L&D?

It’s almost clichéd to claim that “being data-driven” is a core focus for your company. Every business wants to make sound, informed decisions based on real data. And most importantly, they want to show that their investments are paying off. 

Learning and development is undoubtedly a positive influence on virtually all companies. But L&D leaders still need to show return on investment, particularly where the learning program is large in scale. 

Being able to show ROI helps you: 

• Ensure that your current program is working, that your efforts and energy are having a real impact
• Secure future budget and further investment based on past results
• Know which initiatives have had the best effects
• Tell a compelling story about your L&D team’s work, and the broader value of this function in the business

L&D is too often seen as a “nice to have,” and can be one of the first functions at risk during downsizing or reorganization. If you can show that your work makes a tangible difference to the business—perhaps even on revenue—the risk of being cast aside or overlooked is diminished. 

How to measure the ROI of L&D programs

Of course, this is not an easy task. There are real metrics we can point to and performance we can measure in L&D. But it’s very rare to be able to attribute a specific dollar contribution to a learning and development team. And that’s really not the most important thing, in the grand scheme. 

So to show the ROI and impact of your work requires a mix of concrete metrics and storytelling. Metrics on their own are nowhere near enough to prove return on investment. But pure storytelling fails to meet the goal of building a “data-driven” organization. 

So you need both. 

Measuring ROI 1.0: Basic metrics

Because everyone wants hard data, we’ll start with a few useful—if unsubstantial—numbers to look at. These numbers on their own can show how effective your L&D strategy is compared with industry averages. But on their own, they don’t really tell you (or your executives) whether your programs are worth the investment. 

Useful L&D indicators include: 

• Course completion rates. Industry averages are around 20-30%, so figures in a higher range suggest that you’re engaging employees and evangelizing your courses well.
• Satisfaction (NPS) scores. If team members rate your courses highly—consistently—it suggests that the content is well targeted and that they’re likely taking the material in. 

The numbers above are where most L&D professionals start when trying to prove ROI. It’s also where too many stop. 

But completion rates and satisfaction scores don’t tell you whether your programs are creating change. You won’t know whether people have actually learned anything, or if these new skills lead to better business performance.

So they’re a good starting point to share with HR leaders and other L&D professionals who know what they’re looking for. But they don’t truly reflect the value of your work—they’re purely indicators, not meaningful success measures. 

That’s why we sometimes call these “vanity metrics”—they suggest that good work is being delivered, but don’t actually measure its impact. 

Measuring ROI 2.0: Performance KPIs

Truly successful L&D programs drive meaningful change in organizations, leading to better business performance. That’s the surest way to prove value and, indeed, ROI. 

So what are the kinds of business metrics that L&D can directly impact, and how can you measure this? 

Because every business has its own KPIs, we’ll offer examples rather than an exhaustive list. 

Some of the more common ones include: 

Reduced employee turnover

In recent years, companies have struggled with a high level of employee turnover. This was most pronounced during “The Great Resignation,” but it’s still very common for team members to last one or two years before moving on. According to LinkedIn Learning, 93% of companies say retention is a concern. 

Learning and development are key drivers in increasing employee retention. 

But how can you measure your specific impact? It’s best if you have specific initiatives. For example, if you created a program specifically to upskill your customer success teams, does this correlate with a reduction in retention among these employees? 

As we’ll see in further examples, if you can link a specific training initiative to a corresponding performance improvement, you’re doing it right. 

Increased revenue (in specific areas)

It’s definitely too lofty a goal to try to tie top-line revenue growth to your L&D program. Frankly, your finance team just won’t believe it. But what if you can show increased revenue in precise areas following a particular training course? 

For example, a software business might have a goal to increase annual deal size (SaaS companies call this ACV). To achieve this, sales reps need specific negotiation practice, and a better understanding of the industries and kinds of companies they’re selling to. 

Which is exactly what a sales enablement-focused L&D program could provide. 

If, after a few months, you’re seeing more revenue per customer in the way your learning program anticipated, you have a sound argument that L&D is partially responsible. 

Skills gaps closed

This metric assumes you have a skills-based approach to learning—something we highly endorse and recommend. If so, you’ve hopefully already mapped out skills gaps across the organization, and have plans in place to address these.

Once you have executive buy-in that these are a priority, you can measure and communicate as each is closed. Focus on the skills areas seen as business-critical, and highlight the possible outcomes if you hadn’t successfully closed them.

In particular, highlight the cost savings from developing these skills internally, rather than hiring or outsourcing. 

Time to productivity for new hires

Brace yourself: according to Gallup, it takes 12 months for a new employee to reach full productivity. Others suggest eight months. Meanwhile, most onboarding programs last one-to-three months, with the level of effort decreasing significantly after the first few weeks. 

From a financial perspective, that time to productivity is a cost. So the shorter you can make it, the better.

Of course, it can be difficult to quantify when an employee is truly “productive.” But if you’re using skills-based methodology, you could say that productivity (or autonomy) is achieved when they demonstrate all the necessary skills to perform in their new role. 

So first, you define what a truly productive (or fully onboarded) employee looks like in each role, and then deliver programs to reduce the time to reach that state. 

That’s a highly impactful and strategic way of positioning L&D as a business performance driver. 

Improved trust & approval of managers

Most modern businesses conduct internal employee engagement surveys. And one all-too-common challenge arising from these is a low sense of trust or belief in managers from their direct reports. 

This is often the result of insufficient or rushed management training, with new managers thrust into the role to fill a vacancy or because teams are growing. 

Continuously upskilling managers is a core aim for L&D teams. But again, the success metric shouldn’t be the percentage of managers who complete your courses, or their satisfaction with the material. 

A far better KPI is the change in feedback coming through those quarterly or annual surveys. These will tell you both which individual managers have successfully built trust with their teams, but—more relevant here—the percentage of managers across the organization who are performing to the standard required. 

Compliance certificates achieved

Compliance training is perhaps the simplest example on this list, because in most cases it’s binary: either staff are certified or not. If your industry dictates that most or all employees have a certain certification, then there’s a clear business case for delivering this training. 

This may be the rare example where course completion rates actually are a high-value metric. If you can show a clear increase in attainment across the workforce following a particular training program, that proves the value of your approach to corporate L&D. 

Tell a clear, precise ROI story

A quick note of caution about these performance measures: focus on what you can actually impact. Learning and development touches the entire organization, and it’s tempting to prove your value across every key business goal. 

But some company objectives are out of your control. 

For example, we mentioned revenue growth above. L&D isn’t normally thought of as responsible for revenue, but good sales enablement or customer success training can make a big difference. So to prove impact, identify one or two specific revenue levers you want to help improve: average deal size, average time to close, or the number of deals coming from a new industry. 

Draw a direct line between your dedicated training program and improved performance, and you can then show ROI. But trying to take credit for broad performance increases won’t work. We did sales training and then our sales improved just isn’t going to win the argument, and you risk pitting yourself against the rest of the organization who’re delivering in their own right. 

Choose a learning platform that focuses on performance

High-performance L&D requires good tools. And many learning platforms will highlight their reporting capabilities as proof that they help you deliver value. 

But too many learning platforms rely on those same basic, vanity metrics we saw above. Again, course completion rates and basic employee engagement statistics are helpful, no doubt. But they only give a glimpse into your program’s impact. 

When you’re considering the right LMS and/or LXP platform for your organization, ask the following questions: 

• Can I clearly connect the reports provided to my company’s performance goals? 
• Can I customize learning paths to target those specific goals? 
• Do these metrics help tell my larger story about the impact L&D is having?
• Will this platform save me the time I need on course authoring and facilitation, to dedicate some to reporting and storytelling? (Automation is key here)

In most cases, the more generic and “off the shelf” your platform is, the harder it will be to tell your story. While the best learning platforms do incorporate external content libraries and pre-built courses, they also let you author original material and tailor learning journeys quickly and easily. 

That’s the difference between a simple learning library and a truly tailored learning platform. 

To see how 360Learning helps you excel as a performance-driven L&D—and prove the value of your work—talk to us today.