ROI CALCULATION

The ROI calculation requires several data points. Here are the different variables calculated up to this point:

O Total variation (before and after) of opportunities closed and won revenues

= $39,870,785.68

O Estimated contribution by participants = 15.6%

O Additional revenues attributed to the program = $39,870,785.68 x 15.6%

= $6,299,584

O Fully loaded cost of the Sales Simulator training program = $392,225

However, in order to be as conservative as possible, Future-Tel's CFO decided to use the net contribution of the project as the number to be compared to costs.

Using Future-Tel annual reports from the last three years, the lowest net profit over the three years was 9.8 percent.

O 2009 Operating Revenues: $17.735 million

O 2009 Net Earnings: $1.738 million

O 2009 Net Profit Margin: 9.8 percent Therefore the real contribution of the Sales Simulator program is: additional revenues attributed to the program x net profit margin:

$6,299,584 x 9.8% = $617,359

ROI calculation based on real monetary benefits and fully loaded cost:

Consequently, each $1 invested in the Sales Simulator program created a return on investment (ROI) of $1.57.

To compensate for seasonal variations in sales, we also calculated the ROI based on adjusted revenues. Using financial data (2009–2010) provided by Future-Tel's CFO, a negative variation rate of 9.7 percent was calculated. Consequently, the real contribution of the Sales Simulator program becomes: $617,359 x (1 – 0.097) = $557,475.

ROI calculation with adjusted revenue according to sales seasonality:

Consequently, each $1 invested in the Sales Simulator program created a return on investment (ROI) of $1.42 (adjusted for seasonal variations).

INTANGIBLE BENEFITS

The intangible benefits were also captured throughout the impact study. Figure 8.7 presents the intangible benefits identified by the participants (multiple answers were allowed).

Note that four of the intangible benefits obtained over 40 percent of support:

O better preparation for business presentation

O better team work

O greater capability to discover client's concerns

O higher capacity to create value for clients.

Figure 8-7. Intangible Benefits

LESSONS LEARNED

A High Retention Level Yields a High Impact on Sales

Some learning level questions were included in the application level questionnaire in order to verify the participants' level of retention regarding specific concepts. The results obtained were very revealing. It appears that the questions that received the highest scores overall were about market knowledge and business opportunity development strategies.

In addition, the same application questionnaire revealed that both of these concepts were identified by the respondents as having had the greatest impact on their work. As shown in Table 8-13, it can be concluded that there is a strong correlation between the elements that had the greatest level of retention and those that had the most impact on business development.

This shows the importance of measuring the retention level immediately after the training sessions as well as later on. Both sets of data show a strong correlation with the content elements that have the most impact for the participants.

Table 8-13. Retention of Key Concepts