# New Convergence Training Viewer Screenshots

I had saved a bunch of screenshots in various places over the last few weeks and needed to pull them all together in one location so I could get to them all easily. Roman (Director of Sales here at Convergence) also needed some for an email he was putting together. I thought since I have them all together I would post some of the shots with comments.

New screenshot with only a few modules installed, you can see the icon for presenter mode on the First Aid modules:

This screenshot shows modules in various stages – installed content, content being installed, and content that is currently downloading:

There isn’t much new with this one, but it does show the details of our integrated catalog:

# Considering Hard and Soft Benefits in ROI

### Hard Benefits and ROI

Benefits can be broken down into hard benefits and soft benefits. Hard benefits are those that (a) can be attributed solely to the training program and (b) can be assigned a specific financial value. Soft benefits are those that (a) cannot be solely attributed to the training program and/or (b) cannot be readily assigned a specific financial value.

An example of a hard benefit of a training program is the reduction in total costs of that program when compared with the previous program. In the examples above, the Convergence training program costs \$420,000 and the company’s current training program costs \$600,000 over the same period. A hard benefit of the Convergence program, then, is the \$180,000 saved.

Because soft benefits are difficult to assign a financial value to, some companies stop here when determining ROI.

Placing our figures in the equation, we get:

ROI = [Benefits/Costs] x 100, we find that:
= [\$180,000/\$420,000] x 100
= .4285 x 100 = 42.85 percent over the eight-year time period

We can convert the ROI over the eight years to an average of 5.35 percent per year (42.85/8 = 5.35). Considering only the hard benefits of the Convergence training program, the break-even point is just under twenty years.

### Considering Soft Benefits in ROI

To create a more accurate assessment of ROI, many companies go on to consider the training program’s soft benefits as well.

The soft benefits of a more efficient, effective training program could include things like increased company productivity, safer workers, reduced absenteeism, greater customer satisfaction, an improved reputation amongst the company’s customer base, and higher employee morale. In each case, it’s reasonable to assume that a more effective training program could contribute to the outcome, but it’s impossible to say the training program was solely responsible and/or to assign a financial value to the benefit.

One way to assess the soft benefits of a training program is consider them in the context of the achievement of specific, quantifiable goals. A company considering a new training program could identify areas where improvement could be achieved and set a goal to address each area of concern.

For example, one goal might be to decrease the downtime of a paper machine. Statistics measuring the machine’s downtime, before and after the training program is implemented, can be compared providing one measure of the training program’s soft benefits. More sophisticated analyses would take multiple factors into consideration—machine downtime, savings from regulatory infractions, savings on employee sick pay resulting from injuries, and more—to find more soft benefits of the program.

For demonstration purposes, assume that before implementing a new training program, a facility’s paper machine typically produced 7 tons of tissue per hour, and that tissue was sold at a market rate of \$2,000 per ton. Downtime, lost time, and quality issues resulted in an overall machine efficiency rating of 90 percent, meaning that the machine produced saleable rolls only 90 percent of the time. The ten percent downtime over one year equates to \$12,264,000 in lost revenue.

Now assume the company installs a new training program and sets a goal to increase the overall machine efficiency by two percent. Assuming the goal is met, the increase in the machine’s efficiency will result in \$245,280 of additional revenue in the first year. Over an eight-year period, the increased revenue totals \$1,962,240; Chart D below illustrates the increase in revenue.

It is not possible to attribute all of this increased revenue solely to the training program, yet it is reasonable to assume the training program played a role and some portion of the increased revenue should be considered a soft benefit of the training program. Some percentage of the \$1,962,240 in increased revenue over the eight-year time period could be assigned as a soft benefit of the training program; each company will make its own decision how much.

Businesses typically assign anywhere from 10-50 percent of the value of their soft benefits to ROI calculations. For demonstration purposes, let’s make the conservative estimate that only 20% of the soft benefits of decreased machine downtime can be assigned to the training program’s ROI. That means the training program’s soft benefit would be an increase in revenue of just over \$380,000 over the eight-year period.

We can now adjust our ROI calculation to the following:
ROI = [(Hard Benefits + Soft Benefits)/ Costs] x 100
= [(\$180,000 + \$380,000)/\$420,000] x 100
= [\$560,000/\$420,000] x 100
= 1.33 x 100 = 133 percent over eight years

We can then convert the ROI to a figure for one year: 133/8 = 16.625 percent per year. Using this ROI calculation, the break-even point of the training program is just over 6 years (100/16.625 = 6.01).

It’s reasonable to assume the training program would provide additional soft benefits beyond merely the increase in paper machine operating time. To more accurately assess ROI, those additional soft benefits should also be considered. Examples could include such hard-to-quantify elements as improved employee morale, greater customer satisfaction, and a resulting increase in the company’s public reputation. Adding these additional soft benefits to the calculation would increase the ROI and reduce the break-even point even more.

# Training Programs and Return on Investment

At first glance, calculating the return on investment (ROI) of a product, including a training program, is relatively simple. You begin by assigning a monetary value to the benefit gained from the product. Next, you divide that benefit by the cost of the product. The result, expressed as a percentage, is the ROI.

In equation form, ROI = [Benefit/Cost] x 100.

Let’s consider an example. Say your company spends \$100,000 in one year to establish a new division. By the end of the year the division has returned a total of \$125,000 in revenue. The cost is the money spent over the year on the new division: \$100,000. The benefit is the revenue brought in minus the cost: \$125,000 – \$100,000, or \$25,0000. Now let’s plug those figures into our simple ROI equation:

ROI = [Benefit/Cost] x 100
= [\$25,000/\$100,000] x 100
= .25 x 100
= 25 percent

Because our time frame was one year, the ROI is 25 percent per year.

You can then use the ROI to determine the break-even point of the investment. In our example, the new division with an ROI of 25 percent per year has a break-even point of four years (100/25 = 4).

However, calculating ROI is not always that simple. It can be difficult to accurately assign financial values to the cost and benefits of any product, and that’s true for training programs as well.

### Costs of a Convergence Training Program and Your Current Training Program

To calculate the potential ROI of a new Convergence training program, you’ll need to determine the costs of both the Convergence program and your current training program. Determining the cost of your current program is important because the cost savings between a Convergence program and your current program is one part of the benefit of the Convergence program (but not all of the benefit).

Some costs of a training program are easy to identify. For example, if your company currently pays a consultant to create a training program, that’s part of the program’s cost. Alternately, if Convergence created a training program for your company, your payment for that program would be part of the cost.

But many companies significantly underestimate the costs of their current training program. For example, they may think their costs are no greater than the fees paid to a consultant to create their program. But this neglects many other costs that should be assigned to the training program as well: the salary paid to supervisors who deliver the program; the wages—including possible overtime wages—paid to operators who take the training; administrative costs to track and report on the training as well as to create records of training; facility and/or equipment rental; the expense to create documents, and more. These expenses often wind up allocated in the wrong budget, making training appear much less expensive than its true cost.

The two hypothetical case studies below demonstrate how to assess the costs of your current training program and a Convergence training program and illustrate how a Convergence training program can save money on training costs.

### Training Costs Scenario 1 (Hires Retired Operator to Create Training Program)

In Scenario 1, a facility hires a retired operator to work as a consultant and put together documentation that will be part of a training program for qualifying future paper machine operators. The company tasks its own engineers or operators with presenting the material the retired operator creates, and schedules employees working through train-up ladders to attend classroom sessions in large groups to receive the training.

The first cost the facility faces is paying the contractor on an hourly basis to put together the training information. That cost can be significant, even though there’s no guarantee the contractor has the specialized skills necessary to create effective training materials suited for adult learning styles.

The second cost the company faces is the expense of the salaries and wages paid to the engineers or operators while they present the material. This cost is often kept in the general operating budget instead of being correctly assigned as a training expense.

Additionally, the facility incurs the cost of paying the workers to attend training sessions. Because the training is presented to large groups of workers in a classroom scenario, the workers may have to attend after their regular hours in order to make the schedules work, necessitating overtime pay. This is yet another cost that some companies neglect to consider when totaling their training expenses.

Finally, the company must factor in all of the other costs result from the training program. Some facilities employ a full-time worker just to coordinate the schedules of the trainers and trainees. Additional expenses can include the costs of renting a facility or equipment, creating training documentation, travel expenses, and more. Again, many companies fail to allocate these expenses correctly.

A thorough assessment shows that training expenses in Scenario 1 are \$75,000 per year. Over an eight-year period, training costs total \$600,000.

### Training Costs Scenario 2 (Convergence Creates Training Program)

The next step is to calculate the costs the same facility would pay with a Convergence training program. The hypothetical case study below demonstrates the process.

In Scenario 2, the facility tasks Convergence with capturing the key training information from a variety of sources, including operators, existing documentation, technical drawings, verbal discussions, and visual inspections. Convergence then creates an interactive, visually compelling, self-paced study program that is available for employees at the facility 24/7 and is easily monitored and measured by people in supervisory positions. The program supplements online information with the ability to track and record traditional methods of training via structured lists of tasks that require supervisory approval as well as a method to credit time to individuals participating in class sessions.

The initial investment of setting up the initial training is \$200,000. However, the Convergence program includes several features that drastically reduce the annual costs associated with the current program. Because the employees can take many courses at a computer, the company is able to cut down the use of supervisors and engineers as instructors. In addition, since individual workers can take courses on their own during slow periods of their day, overtime payments for training are significantly reduced. Finally, the tracking, reporting, and archiving features of the Convergence LMS help to cut the administrative costs of the current program. Therefore, the annual costs are reduced from \$75,000 to only \$20,000 per year. As a result of the savings, the facility can have the materials updated every 3 years at an expense of \$40,000 per update. Over the same 8-year period, the costs of the Convergence training program are \$420,000.

Chart C illustrates the costs of the two training programs. The higher initial costs of the Convergence program are quickly offset by its lower annual costs, creating a total savings of \$180,000 over the eight-year time period.

My next post will discuss hard and soft benefits and how those would affect your decision making when it comes to implementinga training soluion.

# Our Training Philosphy in a Nutshell

I wanted to briefly and summarily describe the process that we go through when creating training to help you get an idea of our training philosophy.

When we develop our computer-based courses, we start with the basics. Whether describing an entire diaper machine, or an individual component such as small as a bonder, we first answer the question, “What is this component’s role in the larger picture and how does it affect the final product?” Next, we build and use three-dimensional models to show where, within the larger system, the component is physically located.

Next we describe how that component functions. The theory and principles behind the operation of each important part of the process are explained as the equipment itself is shown and described. Once the component’s role and principle of operation are understood, we go on to describe the major points of proper operation and the impact of that operation on the rest of the system.

Presenting ideas in a logical and meaningful order is the basis of good training material. The inclusion of engaging multimedia content, including 2D and 3D animations, videos, pictures, and professional audio, enhances and completes the learning experience. The use of meaningful visual content both fills in the gaps on difficult-to-understand concepts, and reinforces the text and narration.

# New Tools for Trainers – Presenter Mode

In addition to self-paced training, you can now take advantage of presenter mode to present training to groups, meetings and classrooms!

• In self-paced mode, students login to Convergence Training Viewer (CTV) and take computer-based training at their own pace. The content displays the video training as well as text and standard navigation controls. Students complete the training by taking and passing tests.
• In presenter mode, an administrator logs in and launches training in a full-screen environment. The video-training plays in one continuous feed and can be paused and discussed with the group as needed.

Training inside of CTV can be used in either mode, and presenter mode is the first of a set of new features designed to help trainers focus on training.

I’ve uploaded to YouTube several samples from one of our recent training modules – Compress Air Fundamentals. The full module includes almost 20 minutes of training about subjects such as gas fundamentals, including the relationship between pressure, temperature and volume, and gauge vs. absolute pressure, benefits and uses of compressed air, compressor design and operation, air quality considerations and processes, including cooling, drying and filtering. This module will soon be included in our Online Catalog featured in Convergence Training Viewer

To view the latest samples, you can view my channel here: http://www.youtube.com/kdellavalle

# Free Training-Course Offer

Good News! Convergence Training is offering our users a unique opportunity to receive a copy of one of our Environmental, Health and Safety courses ABSOLUTELY FREE!

Over the past year we have been working hard to develop a brand new training delivery tool – Convergence Training Viewer (CTV). With Convergence Training Viewer you can download some of the most contemporary and highly-effective training content available. Our easy-to-use setup wizard will guide you through the installation process within minutes. Once CTV is installed you can download selected titles from our integrated catalog and train as many users as you want using your personal computer.

# Presenter Mode

After receiving feedback from MSHA representitives, customers, and independant trainers, we’ve added Presenter Mode to Convergence Training Viewer. Presenter mode takes advantage of our high-quality training, but gives trainers a tool to use in group settings such as classrooms, meetings, or presentations. Presenter Mode will enable Convergence Training Viewer to be used by students to take self-paced computer based training, but will also allow independent trainers to take advantage of our product to train one or many clients.

Presenter Mode is slated to be released the second week in December. Stay tuned for further updates including screenshots and a How-To for Presenter Mode.

# MSHA Videos Posted to YouTube

We went through our Surface Miner Training curriculum and pulled a video from each module. We have updated our YouTube channel (http://www.youtube.com/kdellavalle) to include all of these video samples. The samples show the type of content that we produce and show how much more interesting and engaging our training is versus the other MSHA training out on the market. If you are sick of videos from the 1980’s and 1990’s being out of date, old, and unprofessional, I suggest taking a look at our samples. For even more details, you can download Convergence Training Viewer for free and install a fully featured demonstration version of our Surface Miner Training curriculum.

# Laser Safety Training Updated and Released

Today, we have released a new and improved version of Laser Safety. This module is part of our Environmental, Health and Safety course library. The Laser Safety module covers laser light, how lasers work, types of lasers, laser classifications, laser hazards, low-power laser hazards, and laser pointer safety guidelines. Reference: STD 01-05-001 – PUB 8-1.7.

The course includes 16 minutes of training and is now being offered for \$39.00 for use in Convergence Training Viewer and is competetively priced per user for use in SCORM compliant LMSs.

You can see a video preview of the module on YouTube here: http://www.youtube.com/kdellavalle. You can also download CTV and have a 5-day free trial of the module.

# Convergence Training Reps Visit NY and WI

Next week (week of 12-8-08), representatives from Convergence Training (Roman Battan, Director of Sales, and Randy Kohltfarber, Director of Product Development) will be on the road visiting existing and potential future customers in New York and Wisconsin.

If you are in the area and are interested in speaking with a Convergence Representative, you can give us a call toll-free at 1.888.634.7346.

# Hidden Costs of Overtime Training

As 2009 ramps up, it’s time to get the safety manual out and dusted off for another year. Schedule the overtime, print the packets, and warm up the PowerPoint presentation right? WRONG!

Although classroom training or facilitating a safety meeting is a simple process, there are many hidden costs that are consistently overlooked. The most notable expense is overtime wages.

In most cases, overtime wages do not directly affect a department manager’s annual operating budget. Because safety compliance training is required and is a justifiable part of operation; the cost burden is shifted to HR as a wage expense. This allows departments to continue on as usual and eliminates further accountability for recurring annual overtime expenses. In addition, it also removes the incentive for department heads to seek more efficient ways to deliver training.

What’s wrong with Paying Overtime?

Safety is a pressing issue in manufacturing and training the workforce on overtime has emerged as the best known cost alternative compared to halting production. Shutting down operations to deliver training could cost millions of dollars per year, so a few hours of overtime makes sense right? WRONG!

Most overtime wages are paid at a rate of 1.5 times the hourly rate for non-salaried employees. When multiplied over hundreds or thousands of employees throughout the year, the expense begins to balloon very quickly. Also, as annual wages increase, so does the cost of providing training to the workforce. In the long-run, paying overtime will prove to be cost prohibitive.

How Expensive Can it Really Be?

In order to shed some light on the cost of overtime expenditures, it’s important to look at the cost driving factors behind wage expenses relative to training:

1. Number of Non-salaried Employees
2. Average Hourly Wage
3. Number of Hours Trained per Year

From these three contributors, we can begin to put together an analysis and see how the cost of safety training really adds up. As an example, let’s take a company with only 200 non-salaried employees that have a safety meeting that lasts for one hour per month on overtime hours. Let’s assume an average hourly wage of \$17.00, which would put their overtime rate at \$25.00. Just for one hour per month, the annual cost per employee is \$300. Three-hundred dollars doesn’t sound like a lot, but for a 200 employee site, the expense is \$60,000 per year and an astounding \$300,000 after 5 years. These figures don’t account for the cost of employing a trainer, potential workforce wage increases, or record maintenance and storage expenses.

What Else is Out There?

Over the last decade, communication has become lightning fast. Internet connections have higher bandwidth capacity, software designs are more focused and refined, and real-time data tracking is a standard part of operations. It is no wonder that the next wave in work-force education is web-based training. Delivering training over the web enables companies to significantly reduce overtime expense and more efficiently deliver and track employee learning with very little required resources.

How Much Cheaper Can it Be?

Having a web-based system allows the workforce to access training virtually any time during their shift by simply logging into a network computer. This means that employees can complete their required training during breaks or downtime, this eliminating the need for managers to schedule overtime wages for annual, semi-annual, or quarterly refresher training.

Training content delivered over the web can vary in price depending on which vendor supplies the training. The quality of web-based training is a subject for an entirely different article, but to provide a meaningful comparison, lets assume that a system capable of training 200 employees with 12 hours of safety training costs around \$50,000 up front. This seems like a big one-time expense, but the cost averaged over 5 years is only \$10,000 per year, vs. \$60,000 per year of overtime training. The cost savings over the 5 years would be approximately \$250,000. In reality, not all classroom training can be eliminated by implementing an online training system. Depending on utilization rates, savings can range anywhere from 30% – 80% of the cost of overtime-based training.
The cost of delivering visitor/vendor/ service representative/contractor training can also have many hidden costs. Try out our online calculator to see these hidden costs on our website: http://www.thinkconvergence.com/contractor-training/features.aspx
Or, to receive a free, customized sensitivity analysis of your current training program, call or email Convergence at:

• Phone: 1 (360) 834-0991 x241
• Toll Free: 1 (800) 634-7436 x241
• Email: sales@thinkconvergence.com