The Hindu Business Line : Train the ROI gun on training

ROI means king in French. As a metric, though, ROI is far from a happy ruler among ratios. "Some professionals are frightened by the notion of evaluating ROI for training and development, performance improvement, or human resources. They have anxiety about how the ROI may be interpreted and used," writes Jack J. Phillips in the foreword to Understanding the Basics of Return on Investment in Training, by Patricia Pulliam Phillips, from Kogan Page (www.vivagroupindia.com).

Training is no small activity, nor is it an insignificant expense; approximately $57 billion was spent on training in the US in 2001, representing an increase of 5 per cent over 2000, informs the author. Try looking for the Indian numbers for this expense head.

In a discussion titled `ROI on the ROI', Phillips notes that most training organisations spend less than 1 per cent of their direct budgets on measurement and evaluation processes, mainly through `post-programme analysis'. Instead, interject accountability throughout the programme, she advises, even if such an exercise needed "closer to 4 to 5 per cent of the total training and performance improvement budget".

What are the benefits? You can prevent unnecessary programmes, redesign the ongoing ones, and expand the implementation of successful ones. A challenge for practitioners is to convert soft data through measures of intangible benefits such as improved public image, increased job satisfaction, reduced stress, shorter response time, and enhanced technology leadership.

Useful literature to justify essential training activities and identify the chaff.

Finance sans finesse

THE World Bank has brought out through Macmillan (www.macmillanindia.com) India's Financial Sector: Recent Reforms Future Challenges, a book edited by Priya Basu. The problem is with `recent' because the publication is old even as it emerges from the press, because it draws from papers presented at a conference organised by the Bank more than three years ago. But for a smattering of references to 2005 in the citations, that too in Basu's chapters, the rest of the book has, therefore, the stale feel, especially when set against the dynamism that one normally associates with any discussion of the financial sector, subject as it is to frequent changes.

The intro seems to offer nothing new, though the following snatch about Indian Bank may stir some interest. "If weak institutions have good branch networks and good staff, they may be sold to, or consolidated into, another bank. Indian Bank, for example, would probably have been a prime candidate for takeover, given its strong reputation with consumers and its branch network," writes Basu.

She is of the view that the large sums invested over the years in re-capitalising Indian Bank should not be judged simply by the eventual improvement of the bank, but by whether such investments were needed had the bank been taken over by another bank.

A good book if you could imagine yourself seated in a conference hall, having transported yourself back in time, because what can now fall flat as platitudes might well sound quite profound: such as "competition in the financial sector has to keep pace with developments in the real sector, where deregulation and privatisation have resulted in good progress"; "the outlook for financial sector reforms is positive, thanks to India's strengths in information technology"; and "a sound financial system should ultimately be judged on solid information processing".

NPO governance

WANT to do something good? How about helping a voluntary, non-governmental organisation in its governance? Because, there are about two lakh such institutions in India and governance isn't getting the attention it deserves, alert Vijay Padaki and Manjulika Vaz in Management Development in Non-Profit Organizations: A Programme for Governing Boards, from Sage (www.indiasage.com).

The book helps with chapters on the basic framework of NPOs, relevant statutes, role of the top management, and growth issues. Questions are provided at the end of each chapter in the form of FAQs. Such as: What is a good time for a board to consider a management development programme for itself? How to form a society under the Societies Registration Act? Does the Income-Tax Act allow an NPO to carry out income-generating activities? Is PR an NPO board function? And when is restructuring needed?

The authors add further value through case studies and questionnaires that are ready takeaways for readers. Towards the end of the book, Padaki and Vaz deplore the poor record of most NGOs in providing decent social security, by exploiting loopholes in law.

Profitable read!

BooksOfAccount@TheHindu.co.in

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