© 2001, Jerome J. Peloquin

Training and Training and DevelopmentDevelopment$210 Billion$210 Billion

Human CapitalHuman Capital

Dollar Amount Spent in America ...

Formal EducationFormal Education$238 Billion$238 Billion

Health CareHealth Care$355 Billion$355 Billion

© 2001, Jerome J. Peloquin

Human CapitalHuman CapitalCost Factors

Analysis and Development•Course Design•Material Development

Delivery•Instructor Time•Materials•Administration

Trainees•Wages•Benefits•Overhead

© 2001, Jerome J. Peloquin

Human CapitalHuman Capital

Cost Factors

© 2001, Jerome J. Peloquin

Human Capital Human Capital

Money Must Be Kept Busy!

© 2001, Jerome J. Peloquin

Human CapitalHuman Capital

Efficiency, (E1) - How Fast

Effectiveness, (E2) - How Well…

© 2001, Jerome J. Peloquin

Human Capital

DeliveryTrainees Development

TypicalTypicalInstitutionsInstitutions 90%90% 9%9% 1%1%

85%85% 12%12% 3%3%

95%95% 5%5% 0%0%

US CompanyWith LargestDevelopment

Costs

InstitutionsWith Little Or

No FormalTraining

© 2001, Jerome J. Peloquin

Human Capital

How IT Could BeHow IT Could BeHow It Is NowHow It Is NowCost CategoriesCost Categories

DevelopmentDevelopment $.01$.01 $.05$.05

$.09$.09 $.20$.20

$.90$.90 $.30$.30

$1.00$1.00 $.55$.55

DeliveryDelivery

TraineesTrainees

Total CostTotal Cost

© 2001, Jerome J. Peloquin

Average Performance

Exemplary Competence

Start Training

End Training

Productivity Growth

HireDate

Human Capital

© 2001, Jerome J. Peloquin

• The ratio of Average to Exemplary

• PIP = Y(Average) to X(exemplary)

Human Capital

E2

• PIP (Performance Improvement Potential)

= Training Effectiveness

© 2001, Jerome J. Peloquin

Human Capital

Average Exemplar

© 2001, Jerome J. Peloquin

Human Capital

Average New Average

Greatly Improved Productivity

EconomicGain

© 2001, Jerome J. Peloquin

CertificationPerformance Assurance Process

Participant POACompleteExercises

Register w.Internet

Counselor

Begin MonitorPOA Process

Guided PerformanceSupport

Approve Selected Materials

Internet Supported ActivitiesClass Supported Activities

Internet

• Conduct Client Agreement Meeting

• Create System/Job Models

• Create Economic Model

• Write Performance Opportunity

Report (POR)

ApprovedWork Output

Certification

© 2001, Jerome J. Peloquin

Performance Opportunity Report...

Cost of Analysis: $135,000Cost of SME’s: $8,100

Total Cost to Date: $143,100

Opportunity ExplanationRoot

CauseCounterMeasure Cost R.O.I

Schedule

Start End

InformationTechnology

New computersand software

NMG cut off electronically

Convert platformsTrain Axxociates $10,000 180% Oct 97 Nov 97

Cycle TimeReduction

Cross PlatformCommunicationStrategies

Lack of Abilityto Share Data

Improve data transfer

$2.8M 1400% Nov 97 Mar 98

$1,125M

440%OperationStandards

Turnover leadsto more processerrors

UnclearOperationStandards

Improve Trainingand OperationsStandards

Feb 98 June 98

Cost of QualityQuality feedbackproblems

Data collectiontimeliness, usefulness

Update QICSInstall monitorsDesign reports

$800,000

320% Oct 97 Dec 98

© 2001, Jerome J. Peloquin

The Six Cell Performance Engineering Model

1 Information 2 Tools/Resources 3 Incentive

4 Skill/Knowledge 5 Capacity 6 Motivation

Directional

Feedback

Hand

Mind

Monetary

Constraints

Psychomotor

Cognitive

Physical

Intellectual

Survival

Values