Nonprofit Recognizes Value of Training, Reaps Rewards

Progress happens, even if it is sometimes so slow as to be barely noticeable. A report by McKinsey Quarterly is an example of progress. It recounts leadership training by The Boys and Girls Club of America.

For some time, the nonprofit sector has lamented the focus on funding programs at the expense of funding capacity building. Despite the fact that most donors and funders look at training as "overhead," BGCA stopped talking and took action. 

BGCA undertook an impact-based evaluation of an extensive training program. The impacts were measurable and, when measured, significantly positive because the project included:

•  Looking at training as an investment rather than a cost;
• Assessing organization needs based on specific goals, in this case growth in membership, revenue, and membership retention;
• Evaluating impact (growth in specific locations where leaders had been trained) rather than output (number of people trained);
• Including businesslike attitudes in training (using an" investor’s mind-set toward programs and resource development");
• Real-world, hands-on projects.

BGCA estimates that its return on investment – the impact on revenue divided by the cost of the training – was 2 to 4 percent immediately with a long-term return of 6 to 8 percent. That's a very nice ROI! It's good to see an organization acknowledge and measure the impact of training as an ROI.

That's what managers often fail to realize: Operating expenses, the "overhead" items that don't directly deliver program to clients are investments in the long-term sustainability and effectiveness of the program.

The goals and measurements used by BGCA won't work for every nonprofit or business but the concepts will. Training employees at all levels generates measurable returns as long as the training is geared to the real needs of the organization and has clearly defined goals.

Hats off to BGCA, for taking the risk, for leading the way, for moving us forward.

How does your organization view training? Do we need to have training in how to set goals?