An international organization launched a program that would impact millions of lives across Africa including Nigeria. They decided to train young population sets in critical skills needed to compete in a modern business world. Here is the case study discussing the total return of investment of this program for its key stakeholders.
The Total Return on Investment (TROI) of the initiative was 3:1. This means that for every 1 Naira spent, a total value of 3 Naira is realized. This includes all value realized by the stakeholders included, as a sum of the total value realized by each stakeholder group.
To calculate this ratio we made a number of assumptions. We used a sample set of stakeholders, identified the changes they would like to see, what inputs they invested, the outputs and the outcomes from those outputs. We then valued these outcomes, how long they would last, less any negative changes that were coincidental, plus any positive changes that were coincidental, and arrived at the total value created per total investment made.
It is important to note that while the government may not have invested in the program directly, they realized value from such a critical program as this because it directly affected the population of the country.
The scope of our TROI analysis was the organization’s initiative to teach critical skills to millions of people across Africa.
The identified stakeholders included:
- The Organization
- The Trainees
- The Government
There were other stakeholders but we focussed on the above 3 stakeholders.
We made the following assumptions to guide our impact assessment:
- The stakeholders identified were all impacted by the program or they impacted the program.
- We assumed that the organization invested 50 Million Naira into creating the program.
- We assumed the time invested by the trainees was 20, 000 Naira each.
- The Government may not have directly contributed to the program but they were stakeholders as they would be impacted by reduced unemployment, greater economic activity which contributes to the national GDP, and so much more.
The outputs of the program included the training itself, certificates of learning, increased confidence from the training, increased brand awareness and positive association with the organization’s brand, as well as networking.
Outcomes also included increased job and business opportunities, increased contribution to the national GDP, trainees training other friends, colleagues, family members in their new skills and more.
Even when a program is creating positive value, the reality is it can also create negative value. Other outcomes included outcomes not as a result of the program but from other programs, organizations and/or people.
One outcome from the program was the absence of jobs for the newly skilled workforce. This is where collaboration with other organizations, corporations and the government was important.
Another outcome was with the new skills and attendant confidence, some trainees rushed to leave jobs they already had fully expecting to get better jobs almost immediately. As part of the conclusion of the program, counseling the trainees on how to go about looking for new employment and business opportunities while keeping their current opportunities would have helped the newly skilled workforce manage their expectations and next steps better.
Our summary Total Impact Assessment or the Total Return on Investment (TROI) of the Organization’s initiative based on our assumptions was 3:1. This means that for every 1 Naira invested in the program, 3 Naira was realized (currency used can be substituted). Three Naira represents the total value returned, including both economic and non-economic value, for all stakeholders.
This meant that this program was very valuable to its stakeholders. However, a comparison of this program with similar programs within the organization, and across the industry, may reveal more information about the total impact of the program.