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One of the nice things about social media is that every once in a while you get to say “he said it, not me”.
Thomas Stone of Element K! in a review of the article Jay Cross and I co-authored several months ago.
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Increasing Discussion of Learning Evaluaton and ROI, Part 2
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And finally, in the July 2009 issue of Chief Learning Officer magazine, Jay Cross and Jon Husband take the discussion of ROI in a truly path-breaking direction with their article “Productivity in a Networked Era: Not Your Father’s ROI.”
The authors begin by setting up the discussion:
“The network era now replacing the industrial age holds great promise. Networked organizations are reaping rewards for connecting people, know-how, and ideas at an ever-faster pace. Value creation has migrated from what we can see (physical assets) to intangibles (ideas). …Understandably, seasoned executives, chief learning officers among them, are having a devil of a time shifting from the industrial age mindset of logic, certainty, and bounded constraints to the network gestalt of interaction, self-organization, unpredictability, and fewer limits to potential. …We are shifting into an era in which knowledge work and learning occur where re-engineered business processes collide with a participative and interactive ecology of information flows.”
Cross and Husband then introduce a new concept as follows: “In an environment of continuous flow and interaction, there’s a need to consider an emerging metric: return on investment in interaction (ROII). The working definition of ROII is the observable development of capacity and capability to create economic values out of intangibles.”
In the rest of the article, the authors describe what traditional ROI was, persuasively convince the reader of the increasing value of intangibles, and note the inherent clash between this trend and the demand for ROI metrics. They describe the essential characteristics of business networks, and argue that ROI is simply not up to the task. They then give some assumptions for their analysis of ROII and describe some of the potential components that would be quantifiable. In doing so they include illuminating examples from such companies as Cisco, Ford, and Capgemini.
In closing, they frame the challenge as being: “Network returns are asymmetric, so simplistic count-’em-up approaches are no longer viable. But how can one make a solid network-era case to an executive who is still playing by yesterday’s rules?”
Read this entire article to learn their initial advice on how to answer that question, and to understand this ground-breaking conceptual proposal for the L&D industry.
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Like I said, it wasn’t me .. he said it. But it is appreciated 😉
It’s also true that we are not alone in “breaking the path”. Valdis Krebs, Patti Anklam and Matthew Hodgson are some people aI know who have explored the ways to obtain (economic) value from the activity and interactivity in networks … and no doubt there are others as well.
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