Identifying the ROI of Team Building

Step 1: Identify Situations Focusing on the past year, please identify 3 specific situations, events or circumstances involving members of your team that could have been handled more effectively. Pinpoint the impact on business and results: Examples: • reduced efficiency and effectiveness in decision making • increased costs • difficulty in completing an initiative • delays Step 2: Situational Analysis For each situation, identify what it cost the company in terms of: • time and money to resolve the situation • opportunity cost (examples: customers or business opportunities lost due to poor decision making or because the team did not work cohesively) • quantify time lost by multiplying time vs. the salaries of the parties involved in the situation Step 3: Pinpoint Indirect Costs Factor in indirect costs of situations such as negative impact on morale, turnover & and productivity, customer, & revenue losses due to poor decision-making or the erosion of team cohesion. Step 4: Identify & Calculate Value of Opportunities Identify opportunities that can be generated by more cohesive team work and pintpoint their value. This video gives a particularly strong example of a specific piece of business that was generated by improved teamwork as well as comments about team building from a variety or business owners: Step 5: Total Impact Add up the amount that would have been saved or generated if the team had been able to work together more cohesively. Step 6: Calculate Proposed Investment in Team Building Use these figures to: • determine time and budget requirements • determine what it would be worthwhile to invest in team building • set time and budget parameters Step 7: Compare cost & time benefits to proposed investment content by Anne Thornley-Brown, M.B.A.