The Phillips ROI Methodology is a training evaluation framework that extends the Kirkpatrick Model with two additional levels: program inputs and a financial return on investment calculation.
Why it matters#
The Kirkpatrick Model stops at business results. The Phillips methodology goes one step further — it converts those results into a financial figure and compares it to the cost of the program. This makes the value of training legible in the language that sponsors and executives use to make decisions.
The six levels#
| Level | Name | What it captures |
|---|---|---|
| 0 | Inputs | Participation numbers, program costs |
| 1 | Reaction | Learner satisfaction and perceived relevance |
| 2 | Learning | Knowledge, skills, and attitudes developed |
| 3 | Behaviour | Application of learning on the job |
| 4 | Results | Business impact driven by the training |
| 5 | ROI | Financial return, calculated from Level 4 data |
Levels 1–4 are inherited directly from Kirkpatrick. Levels 0 and 5 are the Phillips additions.
ROI calculation#
ROI is calculated as:
ROI (%) = (program benefits − program costs) / program costs × 100
Program benefits are derived from Level 4 data — for example, reduced error rates, increased sales, or reduced time-to-competency — converted into a monetary value. Program costs include development, delivery, and participant time.
Isolating training impact#
A core requirement of the methodology is isolating the training’s contribution from other factors. If performance improved, it could be due to the training, a new process, a change in management, or market conditions. Common isolation techniques include control groups, trend analysis, and participant or manager estimates.
Key facts#
- Level 0 makes costs visible. Tracking inputs ensures the full cost of training — including participant time away from work — is included in the ROI calculation, not just development and delivery costs.
- Level 5 is only as good as the Level 4 data. If business results are not measured rigorously, the ROI figure is not credible. The financial layer depends entirely on the quality of the outcomes data beneath it.
- Isolation is the hardest part. Attribution is genuinely difficult in complex organisations. The methodology requires explicit effort to separate training effects from other variables — without it, any ROI claim is speculative.
- Not every program warrants a full Level 5 evaluation. The methodology recommends applying the full ROI analysis only to high-cost, high-visibility programs. Simpler programs can stop at Level 3 or 4.
When to use it#
- When a sponsor requires a financial justification for training investment
- When evaluating a large-scale or high-cost program
- When the organisation needs to compare training ROI against other investments