The concept of investment means that if you invest, you expect to receive a return on your investment (ROI). In other words, you get back more than you invested. This applies to any investment in people in an organization. When you invest in people, you expect the return to be measured in certain ways, such as increased productivity, revenue generation, cost savings, employee wellness, safety, innovation, management, and competitive advantage.

The question is not whether investing in people pays off. There is plenty of research and literature written on the fact that investing in people does pay off enormously. The question is: What kind of investment pays off? To get a ROI, you must select the investment that will produce a return. This is true, whether you invest in financial markets or in people.

Long-term investments usually pay off better, and with higher returns, than short-term investments. You've probably heard this before, because that's how the stock market works. The problem is that most people think long-term investments are more risky, because they take time - lots of time - to pay off. It's much harder to see the ROI in the short term, and much easier to write off the investment as not working. The reality is that short-term investments are actually more risky than long-term investments, because short-term investments are likely not to produce ROI. But short-term investments seem easier and more effective. That's the illusion and seduction of short-term investments.
 

 

Risk management is about making decisions and investing in high-leverage options. This means that you manage risk by investing in a way that optimizes your ROI and minimizes the chances that you will lose your investment. Most people know this when it comes to money. But most people don't use the same logic when it comes to investing in people.

There is an illusion about risk when you invest in people. For example, short-term investments, such as one- and two-day training courses, appear to be low-risk. You're not spending as much money, your people are not away from their work for long, you're in line with your colleagues who are doing the same thing with their people, and the people are getting trained - or so it seems.

Why is it that most short-term training events do not produce any lasting results that translate into higher performance? It's because short-term investments are an effective illusion. They fit our view of learning in organizations, even though short-term courses don't work very well in changing thinking and behaviour. One week after the course, everything is back to the way it was before the training occurred. In fact, if you decided on a short-term course, you probably threw most of the investment down the drain, even though it doesn't feel like you did.

This doesn't mean that short-term training events don't work. In fact, given the right conditions, they work very well. For example, if the training event is designed using whole brain learning design principles, the learning is ready to be assimilated into the workplace. What learners need is a way to translate what they have learned once they're back at work. Follow-up is the key to cementing the learning into long-term memory that is also useful and accessible. For example, let's say that three members of a team attend a one-day session on dealing with conflict. Two days after they get back to work, at a team meeting, these learners spend two hours teaching the other team members what they learned, and how it applies to their work. The team leader then meets with each of the learners to jointly develop a performance plan that will make sure that the learners continue to apply the learning in the workplace. Guess what? The team leader is actually doing a long-term investment in what appears to be a short-term strategy (i.e., a one-day training session).

If you're the person who's making a long-term investment in people, the illusion is different: you appear to be taking a greater risk, when in fact you're taking a different risk. It looks like you're spending more time and more money, with little short-term results. In fact, with the right long-term program, you can earn your investment back in as little as six months, and start generating a ROI that will astound everyone, including you. The risk lies in how well you stand by your decision while the organization, your colleagues, senior people, and other departments form an immune response to your decision.