ROE (Return of Expectation) is a brilliant and relevant key performance indicator for the organizations I work with. The first good news: ROE is becoming a standard KPI for the HR management of global players. The second good news: ROE is easy to apply.
Learn more about it with this simple metaphor and understand why executives, HR managers as well as external training providers/consultants around the world are using this model successfully.
Imagine you want to climb an especially challenging mountain. In order for your expedition to be successful, you’ll need to thoroughly plan your project and then execute it accordingly. Only very inexperienced – and usually also very unsuccessful – climbers start running towards a peak without any preparation.
Instead, take this safe route to the top:
Which is the peak you want to climb? After choosing it wisely, select a route and establish what to use as your GPS. Example: how are you going to monitor whether you are still on track once you are on your way? Then decide who is going to be part of the team to reach the summit, which will be the target group of the development activity.
Level 4 – Results, leading indicators
Define in which way exactly the group will reach the summit. Which climbing technique to use, which teams to form?
Level 3 – Behaviour
Establish the measures, processes and systems necessary to guarantee and support each individual’s performance – for the climbers themselves as well as for the guides and other involved parties.
Level 3 – Performance drivers
Evaluate what else the participants of your expedition need in order to be optimally prepared to reach the summit. This could be knowledge, skills, attitudes, believes, motivation.
Level 2 – Learning
And if at this point it turns out that training is necessary, only then will you think about the ideal design of training camp at the bottom of the mountain. A camp that enables climbers to pick up relevant skills in a motivating manner and to their own satisfaction which will thus optimally prepare them for their journey ahead.
In order to ultimately reach the summit, you will need to check whether the group is still adhering to the established route and techniques in regular intervals over the course of the ascent. Consistent monitoring helps to readjust the group of climbers and enables them to overcome even unexpected obstacles but still reach the summit as planned.
The combination of and the adherence to the steps described above is not just effective, it also delivers evidence for the measures’ effectiveness and makes it possible to measure the ROE for relevant stakeholders.
In order to successfully work towards corporate goals, HR developers and coaches need to be able to form strategic partnerships with businesses. Both the HR developer and the coach need to understand and question the business side in order to develop a well-balanced package of measures based on the information received. Those resulting methods can go far beyond simple training or – sometimes – not even entail any training at all.
Implementing this approach has yet another benefit: It will also change the perception of trainings – trainings will no longer be seen as a “task that needs to be fulfilled”. Trainings become understood as one of the key elements of effective HR development.
What are your favorite KPIs?