How do you measure the impact of robotics training? Calculating ROI for training can be tricky. Here’s how to do it simply and effectively.
The Return on Investment (ROI) for collaborative robot technology is a straightforward calculation. Our downloadable ROI calculator makes it especially simple. However, Return on Training Investment (ROTI) is not so clear-cut.
Training is about imparting knowledge to your workforce. This is naturally quite difficult to measure.
How much has your workforce actually learned from a training? Does the knowledge translate to real changes in their work? How does it affect the bottom line? These can be tricky to quantify, especially if you are just getting started with robotics and everything is new.
In this article, we show how to measure the ROI of robotics training. With the right tools and knowledge, it’s surprisingly straightforward!
Simple and effective training can lead to a greater ROTI
Measuring return on training investment
At the highest level, measuring ROTI takes three steps:
- Pick metrics which suit your business and are affected by robotics training.
- Track these metrics before and during your robotics training program.
- Use the results to estimate the ROTI of the program and improve the effectiveness of future trainings.
The challenge with these three steps is that they are quite broad. Each incorporates several tasks. The first step (picking metrics) involves picking between hundreds of metrics and some will be more suitable than others.
Let’s look a bit deeper at the process.
Metrics: The key to measuring ROTI
Metrics are one of the most objective ways to measure the performance of a business. Almost anything can be a metric, as long as it can be reliably measured. We showed how to design your own robotic benchmarks using metrics in a recent infographic.
There are hundreds, if not thousands, of different metrics you could choose from to measure the effectiveness of robotics training on your business. Robotics training will affect manufacturing metrics (e.g. cycle time, yield), economic metrics (e.g. revenue growth rate, economic value added), and performance metrics (e.g. customer satisfaction, growth rate).
Training permeates the culture of a business. This means its impact can be far reaching and its financial return is not as clear as with other investments. For this reason, ROTI can only be accurately calculated by measuring the impact of the training on more specific economic metrics.
How to calculate ROTI
There are two ways to calculate Return on Training Investment:
- Using a rule-of-thumb, like the 30-to-1 rule.
- Tracking the change in economic metrics and comparing against the cost of training.
Here’s how to apply these two options:
The 30-to-1 rule
One quick way to estimate the ROTI is to use the 30-to-1 rule for delegating tasks, made popular by author Rory Vaden.
Let’s take a simple example (which I have taken from Module 3 of our learning program): An automation engineer wants to train a line worker to program a robot for a pick-and-place task.
Imagine that the automation engineer has to perform the programming task once a day, and it takes her 10 minutes each time. The 30-to-1 rule says that it will take the automation engineer 30 times longer to train the line worker to perform the same task to the same level of skill. This would mean 5 hours of training. Over one year (250 working days), the automation engineer herself would spend almost 42 hours on the programming task. Therefore, the ROTI of such a training is 37 hours per year (42 minus 5 hours). These are 37 hours that she can spend developing new robotic applications.
To turn this into an economic ROTI, use the following equations:
Training Cost = Training Time x (Trainer Hourly Salary + Trainee Hourly Salary)
ROTI = ROTI in Hours x (Trainer Hourly Salary – Trainee Hourly Salary) / Training Cost x 100%
For our example, if the automation engineer earns $49 per hour and the line worker earns $19 per hour, the ROTI would be:
Training Cost = 5 hours x ($49 per hour + $19 per hour) = $340
ROTI = 37 hours x ($49 per hour – $19 per hour) / $340 = 326%
As a ROTI calculation, this use of the 30-to-1 rule is extremely rough. For example, it does not take into account the economic benefit of the automation engineer having an extra 37 hours to develop new applications. It also is not applicable to trainings which involve more than simple delegation. However, it is quick and the only data you need to know is how long the task takes to perform.
Calculating ROTI using economic metrics
The more accurate method for measuring ROTI uses the same basic equation:
ROTI = Change in Cost of Activity/Total Cost of Training x 100%
You will be able to evaluate the Change in Cost of Activity in the following way:
- Choose economic metrics which will be affected by the robotics training.
- Measure these metrics before your robotics training program begins.
- Continue to measure these metrics throughout the training program and after it ends.
- At any time, calculate the total Change in Cost of Activity by summing the changes in each metric.
To calculate the Total Cost of Training, use the tools provided in Module 3 of our learning program.
The simple process for selecting the right metrics
Here at Robotiq, we want to make it as easy as possible for you to start training your own team of in-house robotics experts.
We have created a series of eBooks to help you out. We’ve taken key business skills, applied them to robotics expertise and thrown away anything which doesn’t affect robotics.
The result? A clear, straightforward process which you can apply immediately to your own business.
The eBooks are arranged into 10 modules starting with module 1. Together they guide you through the whole process of developing a robotics team, from assessing your business needs, to implementing your training program, to measuring the effectiveness of the program.
Module 8 is available to download right now. This hands-on worksheet shows you how to apply metrics to measure the effectiveness of your in-house robotics training program.
First, design and launch your training program
If you haven’t already, you should definitely check out our in-house robotics expertise modules. They guide you step-by-step you through the whole process of implementing a successful robotics training program. They discuss why you need in-house robotics expertise, how to assess the robotics needs of your business, how to get the team on board, and how to build an effective training program.
Next, apply metrics to your training program
Module 8 guides you through the process of picking and implementing metrics. At the end of the module you will have chosen the right metrics for your business as well as the most suitable measurement methods.
There are three steps to this process:
- Selecting the right metrics — The module provides 100 metrics for you to choose from and identifies 29 of the most relevant metrics for a manufacturing business.
- Selecting the right measurement methods — You and your team will then choose the most suitable measurement methods for these metrics and identify which of the stakeholders are involved (Module 4 describes how to identify stakeholders).
- Including the metrics into your regular meetings — As part of the training program, you will have scheduled regular meetings with the key stakeholders in your team. This module provides a framework to assess and discuss your chosen metrics. You can then use these assessments to improve your training program.
Remember the maxim “What gets measured gets done.” Even one or two quality metrics can help you to quantify the ROI of your robotics training.
What would be a good Return on Training Investment for your business? How do you currently measure the ROTI? How are you getting on with the modules? Tell us in the comments below or join the discussion on LinkedIn, Twitter, Facebook or the DoF professional robotics community.