Why L&D Needs a Budget for Learning Measurement (and How to Get One)

In other words, having a budget is critical for building the learning analytics required to apply data-driven insights to your learning strategy.

This blog post reveals results from our Measuring the Business Impact of Learning survey to illustrate these points. We’ll also explore how to move from being an organization without sufficient budget and resources for learning measurement to one that does.

The state of learning analytics: Our approach & methodology

This blog series explores the State of Learning Analytics, combines the results from two recent surveys, which provide insights from more than 1,000 L&D professionals on applying learning analytics in their organizations.

1. Measuring the Business Impact of Learning. Since 2016, Watershed has partnered with LEO Learning to conduct the annual Measuring the Business Impact of Learning (MBIL) survey.
2. Adopting Learning Analytics: Closing the C-Suite/L&D Language Gap. Watershed teamed up with Chief Learning Officer magazine to survey its readers on topics relating to L&D and learning analytics.

It’s important to set aside a budget for learning measurement, but we don’t

Though virtually everyone wants to prove that their L&D efforts have a meaningful impact, only a quarter say they work for organizations that allocate budget towards finding that proof.

Well-budgeted teams are twice as likely to feel pressure from the executive level to apply data to their L&D strategies, and evidence points to them being more agile in our ongoing age of disruption.

The link between having budget and analytics capability is clear—if not unsurprising—so why is the demand not being met?

Let’s look at the numbers…

73% of our survey respondents agreed that it’s important to set aside a budget for learning measurement, with only 5% disagreeing or strongly disagreeing.

Yet only 27% agreed that their organizations set aside a measurement budget, and 45% disagreed. In fact, even just looking at organizations that do not set aside a budget for measurement, nearly two-thirds (63%) agreed it was essential to do so.

That’s a huge disparity and represents many organizations where those on the L&D team believe that having a budget for learning measurement is important.

But, still, they haven’t convinced the business to provide that budget. So, why do L&D teams believe that a budget for learning measurement is essential?

Organizations with budgets know learning measurement works

First, most organizations want to prove learning’s impact (94%) and believe it’s possible to do so (84%).

In fact, organizations with a budget for learning measurement are even more likely to want to prove learning’s impact (99%) and believe doing so is possible (94%).

But measuring the business impact of learning requires resources such as people and technology. That’s why so many organizations say having a budget is critical.

Having a budget means having a learning analytics team

Responses to our survey question about learning analytics capability illustrate the relationship between budget and people.

Organizations with a budget are twice as likely (58% of organizations) as organizations without a budget (29%) to have analytics capability on their L&D team. A budget enables you to hire for learning analytics and provide your people with the required tools.

With budget comes expectation

There’s also a relationship between having a budget and senior leaders having expectations for L&D to provide learning analytics.

Nearly two-thirds (61.1%) of respondents with a budget agree that they feel executive pressure to measure learning’s impact, compared with just over a third (34.5%) of respondents without a budget.

However, the data doesn’t show how the relationship between executive pressure and budget operates.

For example, do senior leaders in organizations with budgets pressure L&D departments to show the results of that budget? Or do senior leaders who expect L&D to measure learning’s impact approve a budget for that measurement?

Based on conversations with our clients and prospects, we believe it’s typically the latter. When executives understand the value of learning analytics, those organizations get a budget for learning analytics to fulfill executive expectations.

How L&D can get a budget for learning measurement

Getting executive buy-in for learning analytics is a precursor to getting a budget. As a result, this means that many L&D teams believe that budget is essential but don’t have it because they haven’t gotten executive buy-in.

Convincing senior leaders of the value of learning analytics requires building a business case to prove the value. A business case shows how learning analytics will benefit the business, justifying how and why the benefits outweigh the costs.

Up Next: What learning analytics are you doing?

Next, we explore survey questions about what learning analytics organizations are doing.

We’ll reveal the most popular approaches to learning measurement and compare the types of learning analytics organizations currently use against those they would like to use. We'll also explore how organizations can shift their learning analytics toward these desired approaches.