Return on investment in intercultural training: three insights from modelling training impact

Sep 17, 2020  · by

A business person holds the globe, surrounded by currency symbols

Topics: Business case, CultureConnector, Intercultural competence, Return on investment

Project notes on the development of CultureConnector’s tool for modelling training impact in the intercultural field.

For a curious mind, it’s thrilling when something unexpected happens. There’s something new to be probed and understood. So it was with our project to model the real-world economic impact of intercultural training.

After years exploring the available, relevant research and testing different approaches to the mathematical model, I expected diminishing returns from each addition research sprint. The law of diminishing returns is the observation which says the deeper you dive into a new thing, the less reward you get for each additional kick.

The opposite happened. As the model started to spit out results to our research questions, the answers became more interesting and more enlightening.

Here are three striking observations from this work so far.

1. The power of an intercultural lunch and learn

What is the gold standard training format for intercultural competence? A full 3-day module on a year-long leadership development programme, perhaps? A multi-year relationship with an inspirational coach? A multi-channel, multi-session blended learning programme, based on adaptive online learning tech? Yes, these promise impressive results for the learner. Gold standards indeed.

By comparison, a lunch-and-learn intercultural briefing, delivered to busy executives under heavy time pressure, seems like the poor cousin of those Gold Standard formats.

But wait, our training impact model is telling a different story. Based on a new analysis of the cost-side of the ROI equation, a rapid injection of new intercultural knowledge can generate excellent return on investment for organisations which use this method. While the absolute returns on a lunch and learn may be smaller than a full transformational intervention, the rate of return on investment is one of the best, and certainly a good pathway towards more ambitious forms of competence development.

2. An intimate training for 508 participants

The joy and the challenge of modelling intercultural competence are the network effects inside organisations. When a freshly-trained participant starts a collaboration with a colleague who has a low level of intercultural competence, some of the benefit of the training is enjoyed by the non-participant, who gains from more effecient interactions with the trained colleague, and potentially other benefits in achieving their mutual goals.

In this way, intercultural training can impact hundreds of non-participants, who are colleagues of participants. The number in the pool depends on the diversity of the organisation and the participants, the level of isolation of clusters of participants and other assumptions, such as the amount of outward-facing interactions. There can even be benefits of intercultural training for people of the same culture where differences are individual, not cultural.

When your training class attracts just an intimate (small) number of participants, keep in mind that potentially hundreds more who don’t attend will also benefit.

3. The trainer’s bill is a small part of the investment

You can charge the top-end of your price range for your time and provide a gourmet lunch for participants, perhaps with travel and comfortable accommodation, but still the trainer’s and logistical expenses are likely to be dwarfed by the cost of taking productive employees away from their core work tasks, while they participate in your training.

Line managers and anyone with profit and loss accountability knows this. There is some price sensitivity in the market for intercultural training, especially when the procurement department get involved (they are probably not at your meetings to learn about icebergs or onions …). However, what we can see from our model is the importance of looking at the impact side, when an organisation chooses a supplier or selects its own internal training methodology.

Squeezing the trainer’s bill down will have little effect on your return on investment rate. You can truly shift the needle on your return on investment by working together with the intercultural consultant to set the training up for success in achieving performance gains.

The CultureConnector intercultural training impact modelling tool is now available as an early-access programme for customers and contributors in the CultureConnector community.

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