Measuring Mentoring Return-on-Investment (ROI)
Well-constructed mentoring and coaching programmes that are sponsored by senior management pay for themselves by increasing the likelihood of people staying with the organisation. But how do you know if your programmes are effective in improving your organisation’s performance? How do you know if your investment in mentoring and coaching is paying off?
First, ask yourself these questions:
- What does it cost to recruit a new staff member?
- How much does it cost to replace an experienced staff member? (research indicates this is at a cost of 3x the salary of a current employee who is not talent-managed)
Measuring return-on-investment (ROI) is about making the case for expenditures related to mentoring and coaching. So, what are some metrics that can be used to determine the ROI of your programmes? Here are a few examples:
- The number of employees receiving mentoring and coaching who meet/complete set milestones
- The number of action plan goals completed
- The percentage of high-performing employees who have been mentored and retained
- The number of mentees who are receiving important assignments that impact on their career development
Other indicators that can be used to measure progress, performance and outcomes from your mentoring and coaching initiatives – measuring your ROI – can include:
Impact of mentoring & coaching on the individual:
- Increased job satisfaction
- Progressive career development
- Upskilling opportunities
- Increased professional networking
- Increased self-confidence
Impact of mentoring & coaching on the organisation:
- Improved staff satisfaction
- Increased staff commitment
- Staff retention
- Transfer of knowledge and skills across the organisation
- Cost reductions
- Increased revenue
- Shorter time of probation integration of new staff
Mentoring and coaching ROI is most clearly demonstrated by examining productivity and turnover rates before and after implementing a mentoring and coaching programme. This indicates that trialling a programme first is a strategic approach to determining how mentoring and coaching will impact on the organisation. A pilot programme can be of any duration, however I recommend a six-month time-frame. This allows for:
- Completion of a thorough needs analysis (click here to see a sample of needs analysis questions)
- Development of programme resources such as programme guidelines, and templates for the mentors and mentees
- Involvement of a group of volunteer staff to engage in mentoring partnerships and activities over the pilot period during which time their feedback is collected on what is working well and any challenges they experience
- Ongoing and final evaluation of the programme.
The volunteer participants’ engagement in mentoring and coaching, and their feedback on their experiences, are valuable mechanisms for evaluating the effectiveness and outcomes of mentoring and coaching and the impact of these on the organisation – the ROI.