{"id":20304,"date":"2022-01-20T10:55:12","date_gmt":"2022-01-20T10:55:12","guid":{"rendered":"https:\/\/whatfix.com\/blog\/?p=20304"},"modified":"2026-07-16T14:04:16","modified_gmt":"2026-07-16T14:04:16","slug":"phillips-roi-model","status":"publish","type":"post","link":"https:\/\/whatfix.com\/blog\/phillips-roi-model\/","title":{"rendered":"Phillips ROI Model: The 5 Levels of Training Evaluation"},"content":{"rendered":"<p>The cost of formal learning programs in enterprise settings rose <a href=\"https:\/\/lmspedia.org\/corporate-training-budgets-2026-benchmarks\/\">34% in 2024 to $874 per employee annually<\/a>. With L&amp;D budgets growing, executives are rightfully demanding to know if these investments move the needle.<\/p>\n<p>The data says yes: a <a href=\"https:\/\/www.library.hbs.edu\/working-knowledge\/why-employee-training-pays-companies-twice\">Harvard Business School research study<\/a> found that a single targeted <a href=\"https:\/\/whatfix.com\/blog\/types-employee-training-programs\/\">training program<\/a> drove frontline employees to complete 10% more work, while their newfound self-sufficiency significantly boosted the productivity of their managers, too. However, bridging the gap between those operational performance gains and undeniable, bottom-line financial value remains a challenge for most L&amp;D teams.<\/p>\n<p>This article explores how the Phillips ROI model is a powerful training evaluation framework that expands on traditional learning metrics to help you calculate the exact financial return of your training initiatives. We will break down the model&#8217;s five levels, explain how to isolate the direct business impact of your programs from outside factors, and walk through the formulas you need to confidently prove the monetary value of your <a href=\"https:\/\/whatfix.com\/blog\/learning-development-strategy\/\">L&amp;D strategy<\/a> to the C-suite, as well as provide an <a href=\"https:\/\/whatfix.com\/blog\/phillips-roi-model\/#elementor-toc__heading-anchor-1\">interactive Phillips ROI calculator<\/a> for you to benchmark your training program&#8217;s ROI.<\/p>\n<h2>What Is the Phillips ROI Methodology?<\/h2>\n<p>The Phillips ROI Model is a methodology and process for L&amp;D and HR teams to tie the costs of training programs with their actual results. You may see this model also use the words \u201cmethodology\u201d, \u201cprocess\u201d, and \u201cmodel\u201d interchangeably to describe the Phillips ROI Model.<\/p>\n<p>Phillips ROI Model builds on the <a href=\"https:\/\/whatfix.com\/blog\/kirkpatrick-model\/\" target=\"_blank\" rel=\"noopener\">Kirkpatrick Model<\/a>, one of the most commonly used models for corporate training evaluation. It classifies data from different <a href=\"https:\/\/whatfix.com\/blog\/types-employee-training-programs\/\" target=\"_blank\" rel=\"noopener\">types employee training programs<\/a> to measure:<\/p>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\">the reaction of participants<\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\">the actual learning of participants<\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\">the behavior change from these learning<\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\">the final result<\/li>\n<\/ul>\n<p>But organizations that spend millions &#8211; or potentially billions &#8211; of dollars on training programs want more than results. To sanction large budgets, they need to see the monetary actual value of these programs &#8211; their return on investment (ROI).<\/p>\n<p><img fetchpriority=\"high\" decoding=\"async\" src=\"https:\/\/whatfix.com\/blog\/wp-content\/uploads\/2022\/01\/Food-Pyramid-Diagram-Infographic-Instagram-Post.png\" alt=\"Phillips ROI Model\" width=\"1024\" height=\"1024\" \/><\/p>\n<p>The Phillips ROI Model clearly demonstrates the monetary benefit for organizations by adding a fifth layer to calculate each program&#8217;s ROI. This additional level compares learning business impact outcomes to total training costs.<\/p>\n<p>The Phillips Methodology isolates the program&#8217;s effects from other influencing factors at all levels of the training program\u2019s evaluation. This filtered data empowers L&amp;D teams to accurately estimate net monetary benefits for various training programs.<\/p>\n<div class=\"involveme_embed\" data-project=\"phillips-roi-calculator\" data-title=\"Phillips ROI Calculator\">\t\t<div data-elementor-type=\"section\" data-elementor-id=\"91871\" class=\"elementor elementor-91871\" data-elementor-post-type=\"elementor_library\">\n\t\t\t\t\t<section class=\"elementor-section elementor-top-section elementor-element elementor-element-6a563c6 elementor-section-boxed elementor-section-height-default elementor-section-height-default\" data-id=\"6a563c6\" data-element_type=\"section\">\n\t\t\t\t\t\t<div class=\"elementor-container elementor-column-gap-default\">\n\t\t\t\t\t<div class=\"elementor-column elementor-col-100 elementor-top-column elementor-element elementor-element-2e963a3\" data-id=\"2e963a3\" data-element_type=\"column\">\n\t\t\t<div class=\"elementor-widget-wrap elementor-element-populated\">\n\t\t\t\t\t\t<div class=\"elementor-element elementor-element-3c0854e elementor-widget elementor-widget-html\" data-id=\"3c0854e\" data-element_type=\"widget\" data-widget_type=\"html.default\">\n\t\t\t\t\t<div id=\"roi-calculator\" style=\"max-width: 600px; margin: 20px auto; padding: 25px; border: 1px solid #e2e8f0; border-radius: 8px; font-family: inherit; background-color: #ffffff; box-shadow: 0 4px 6px rgba(0,0,0,0.05);\">\n  <h2 style=\"margin-top: 0; margin-bottom: 20px; font-size: 1.5em; color: #333;\">Phillips ROI Model Calculator<\/h2>\n\n  <div style=\"margin-bottom: 15px;\">\n    <label for=\"calc-participants\" style=\"display: block; font-weight: bold; margin-bottom: 8px; color: #333;\">How many people participated in the training?<\/label>\n    <input type=\"number\" id=\"calc-participants\" value=\"10\" min=\"0\" style=\"width: 100%; padding: 10px; border: 1px solid #ccc; border-radius: 4px; box-sizing: border-box; font-size: 1em;\">\n  <\/div>\n\n  <div style=\"margin-bottom: 15px;\">\n    <label for=\"calc-benefit\" style=\"display: block; font-weight: bold; margin-bottom: 8px; color: #333;\">What is the cost-benefit per each employee trained?<\/label>\n    <input type=\"number\" id=\"calc-benefit\" value=\"1500\" min=\"0\" style=\"width: 100%; padding: 10px; border: 1px solid #ccc; border-radius: 4px; box-sizing: border-box; font-size: 1em;\">\n  <\/div>\n\n  <div style=\"margin-bottom: 25px;\">\n    <label for=\"calc-cost\" style=\"display: block; font-weight: bold; margin-bottom: 4px; color: #333;\">What is the total cost of the entire training program?<\/label>\n    <div style=\"font-size: 0.85em; color: #666; margin-bottom: 8px; line-height: 1.4;\">(A summation of design and development costs + venue costs + training material costs + travel costs + other administrative costs)<\/div>\n    <input type=\"number\" id=\"calc-cost\" value=\"5000\" min=\"0\" style=\"width: 100%; padding: 10px; border: 1px solid #ccc; border-radius: 4px; box-sizing: border-box; font-size: 1em;\">\n  <\/div>\n\n  <div style=\"margin-bottom: 25px;\">\n    <button onclick=\"calculatePhillipsROI()\" style=\"width: 100%; background-color: #26233c; color: #ffffff; padding: 12px; font-size: 1.1em; font-weight: bold; border: none; border-radius: 4px; cursor: pointer; transition: background-color 0.2s;\">\n      Calculate ROI\n    <\/button>\n  <\/div>\n\n  <div style=\"background-color: #f8fafc; padding: 20px; border-radius: 6px; border: 1px solid #cbd5e1;\">\n    <div style=\"margin-bottom: 12px; font-size: 1.1em; color: #333;\">\n      <strong>Net Program Benefits:<\/strong> $<span id=\"calc-net-benefits\">10,000.00<\/span>\n    <\/div>\n    <div style=\"font-size: 1.3em; color: #f55800;\">\n      <strong>ROI:<\/strong> <span id=\"calc-roi-percent\">200.00<\/span>%\n    <\/div>\n  <\/div>\n<\/div>\n\n<script>\n  function calculatePhillipsROI() {\n    \/\/ Grab the inputs exactly when the button is clicked\n    var partInput = document.getElementById('calc-participants');\n    var benInput = document.getElementById('calc-benefit');\n    var costInput = document.getElementById('calc-cost');\n    var netDisplay = document.getElementById('calc-net-benefits');\n    var roiDisplay = document.getElementById('calc-roi-percent');\n\n    \/\/ Ensure elements exist\n    if (!partInput || !benInput || !costInput || !netDisplay || !roiDisplay) return;\n\n    \/\/ Extract values\n    var participants = parseFloat(partInput.value) || 0;\n    var benefit = parseFloat(benInput.value) || 0;\n    var cost = parseFloat(costInput.value) || 0;\n\n    \/\/ Perform math\n    var totalBenefits = participants * benefit;\n    var netBenefits = totalBenefits - cost;\n    \n    var roi = 0;\n    if (cost > 0) {\n      roi = (netBenefits \/ cost) * 100;\n    }\n\n    \/\/ Update display\n    netDisplay.innerText = netBenefits.toLocaleString('en-US', {minimumFractionDigits: 2, maximumFractionDigits: 2});\n    roiDisplay.innerText = roi.toLocaleString('en-US', {minimumFractionDigits: 2, maximumFractionDigits: 2});\n  }\n<\/script>\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t<\/div>\n\t\t<\/div>\n<h2>The Five Levels of the Phillips ROI Framework<\/h2>\n<p>The Kirkpatrick Model was the de facto model of training evaluation in the 1970s and 1980s. With his <a href=\"https:\/\/www.goodreads.com\/book\/show\/2032790.Return_on_Investment_in_Training_and_Performance_Improvement_Programs\" target=\"_blank\" rel=\"noopener\">book on training evaluation<\/a>, Jack Phillips expanded on its shortcomings to include considerations for the return on investment (ROI) of training programs.<\/p>\n<p>As discussed earlier, Phillips\u2019 expanded approach to the Kirkpatrick Model is used to build the Phillips ROI Model. The ROI model of training evaluation that Jack Phillips proposed includes five steps:<\/p>\n<ol>\n<li style=\"font-weight: 400;\" aria-level=\"1\">Reaction<\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\">Learning<\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\">Application and Implementation<\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\">Impact<\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\">Return on Investment<\/li>\n<\/ol>\n<h3>Level 1 &#8211; Reaction<\/h3>\n<p>At the first level in the Phillips ROI methodology, training managers use short surveys to gather data about participants\u2019 reactions to their training. This step is not too different from the Kirkpatrick Model, but the data gathered here doesn\u2019t offer too many direct benefits to the organization. Positive data on this level is an indicator of how cohesive your <a href=\"https:\/\/whatfix.com\/blog\/learning-development-strategy\/\" target=\"_blank\" rel=\"noopener\">L&amp;D strategy<\/a> is.<\/p>\n<h3>Level 2 &#8211; Learning<\/h3>\n<p>In this step, participants complete multiple-choice questions (MCQs) surveys or quizzes before and after the training. Training managers interpret the responses to determine how much knowledge they\u2019ve acquired. Once again, the Kirkpatrick Model evaluates learning in the same way.<\/p>\n<h3>Level 3 &#8211; Application &amp; Implementation<\/h3>\n<p>Unlike the Kirkpatrick Model, the Phillips Model doesn\u2019t only collect data to find if the training worked or not. The new ROI-based model also evaluates the WHY behind the success\/failure of the training.<\/p>\n<p>When a program fails, the Kirkpatrick model data doesn\u2019t tell organizations what went wrong, why it happened, and where it occurred. However, the Phillips Model adds qualitative feedback to the data process to help organizations improve their training programs. Training evaluation teams can thus understand what specific changes to the program will improve its output.<\/p>\n<p>For example, let\u2019s say 50 new recruits in the software developer pool receive training for a new programming language. If they pass level 2 (same for both models), we know they learned the language well. If their assignments don\u2019t produce results due to faulty input data, the Kirkpatrick Model level 3 will only tell you that students failed them. Level 3 in the Phillips ROI model will also tell you the <i>cause<\/i> of these failures.<\/p>\n<h3>Level 4 &#8211; Impact<\/h3>\n<p>On level 4 of the Kirkpatrick Model, only the business results and impact is measured. The Phillips ROI model expands the focus of level 4 from unilateral results to multi-dimensional impact. The new model lets you analyze the impact of training content and other factors that contribute to participants\u2019 final performance.<\/p>\n<p>In the programming language training example above, the Phillips ROI model could analyze the impact of YouTube creators or other programming trainers on participants.\u00a0 Companies also use innovative techniques to <a href=\"https:\/\/whatfix.com\/blog\/measure-training-effectiveness\/\">measure training effectiveness<\/a> and overall impact.<\/p>\n<h3>Level 5 &#8211; Return on Investment (ROI)<\/h3>\n<p>On the fifth level, the Phillips model uses cost-benefit analysis to map impact data to tangible monetary benefits and a set of intangible benefits. Training managers can use this data to measure and communicate the benefits of their program to other departments in the company and provide hard evidence to executives on the value of their training programs.<\/p>\n<h2>How to Calculate Training ROI with The Phillips Model<\/h2>\n<p>Throughout the first four levels of the Phillips ROI Methodology, data helps identify reasons for positive or negative ROI in the resulting fifth level. This model suggests that the final ROI of the training program is a result of a series of events:<\/p>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\">Transfer of knowledge and skills (in level 2)<\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\">Application of learned knowledge and skills (in level 3)<\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\">Business impact of training (in level 4)<\/li>\n<\/ul>\n<p>Assuming the program clears level 1, each next level evaluated under the Phillips ROI Model checks if the change was a result of the program or various external factors.<\/p>\n<p><b>To show the calculation of ROI under Jack Phillips\u2019 model, let&#8217;s reiterate our previous example of 50 software developers receiving training on a new programming language.\u00a0<\/b><\/p>\n<p>Let\u2019s put the use case through the Phillips ROI model and see how to calculate the ROI of this training program.<\/p>\n<h3>Consider these precautions before following the Phillips ROI Model for training evaluation<\/h3>\n<p>The Phillips Model presents a complex and sensitive process. Make sure the following conditions are met before you put the process to use:<\/p>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\">Conduct a needs assessment for your training program. Don\u2019t use the ROI method when no needs assessment data is available.<\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\">Include one or more strategies to isolate the training effect.<\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\">Base the estimates only on the most reliable and credible sources.<\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\">Calculate costs and benefits with a conservative approach.<\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\">Don\u2019t compare the training ROI with other financial returns until it\u2019s absolutely essential.<\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\">Don\u2019t isolate the management from the ROI calculation process.<\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\">Be cautious in deciding what\u2019s measurable and what\u2019s not. Take input from business teams on inclusion\/exclusion of sensitive factors.<\/li>\n<\/ul>\n<h3>Step 1 &#8211; Gather data before the training starts<\/h3>\n<p>Before software developers start their training, they fill out a questionnaire to assess any trends over 6 months until the start. The questionnaire also examines their pre-training knowledge in concepts related to the new programming language. This will help understand how the training program helped different types of learners.<\/p>\n<h3>Step 2 &#8211; Gather data after the training ends<\/h3>\n<p>Post-program data comes from performance records of the company and\/or through follow-up questionnaires of the following types:<\/p>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\">Participants fill out questionnaires<\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\">The company assesses its performance<\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\">Subordinates, peers, and supervisors\/seniors of participants fill in observational surveys<\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\">Other relevant internal\/external groups.<\/li>\n<\/ul>\n<p>Collect this data for all model levels as required.<\/p>\n<h3>Step 3 &#8211; Isolate the effects of lessons from the training program<\/h3>\n<p>The Kirkpatrick Model assumes improvements come from the training program. The Phillips ROI Model attempts to find other causes for training results, including the training impact. Some of the possible factors that contribute to improved post-training performance include:<\/p>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\">Recent performance bonuses<\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\">Competitive conditions in the company\/department (for example, were there any impending promotions after the training program?)<\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\">Any marketing\/employer branding programs<\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\">Any other seasonal\/non-seasonal programs that offered incentives to participants<\/li>\n<\/ul>\n<p>To isolate the effect of the training program, some techniques include:<\/p>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\">Trend line analysis<\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\">Control groups<\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\">Forecasting models<\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\">Training impact estimation from participants, supervisors, experts, and customers.<\/li>\n<\/ul>\n<h3>Step 4 &#8211; Extract the monetary benefits of the program from the data<\/h3>\n<p>After filtering the data and isolating training program effects, the monetary dimension lets us move one step closer to ROI.<\/p>\n<p>In the example of training on a new programming language, we assume a profit of $5,800 per developer from the new project that employs 50 trained developers. This profit margin considers the effect of only the training program; overall profit figures may be higher due to other factors<\/p>\n<p>Total profit from the training program = $5,800 \/ developer X 50 developers = $2,90,000.<\/p>\n<h3>Step 5 &#8211; Add up all program costs<\/h3>\n<p>This is a straightforward calculation that brings together all costs for the training program. The total program costs will be a summation of the following categories:<\/p>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\">Costs to design, develop, and administer the program (including payment to training staff and their travel, lodging, and miscellaneous expenses)<\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\">Training venue costs<\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\">Training material costs (physical paper, electronic hardware, training, and evaluation software, and other administration costs)<\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\">Travel, lodging, meal, and miscellaneous costs of participants<\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\">Salary of participants and their employee benefits for the time they will devote to training<\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\">Other administrative costs incurred during the training program.<\/li>\n<\/ul>\n<p>In the example of training on a new programming language, let\u2019s assume the total program costs were $2,34,900.<\/p>\n<h3>Step 6 &#8211; Calculate the return on investment (ROI)<\/h3>\n<p>ROI (%) = (Net benefits of the training program \/ total program costs) X 100<\/p>\n<p>= (($2,90,000 &#8211; $2,34,9000) \/ $2,34,900) X 100<\/p>\n<p>= ($55,100 \/ $2,34,900)\u00a0 X 100 <b>= <\/b><b>23.457%<\/b><\/p>\n<h3>Step 7 &#8211; Find the intangibles<\/h3>\n<p>A training program will have more than monetary benefits alone. Such intangible benefits are often more valuable than the hard data coming out of the ROI calculation process.<\/p>\n<p>You can identify such abstract measures at any stage of the ROI calculation process through discussions with the project\u2019s sponsors.<\/p>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\">during the needs assessment<\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\">when you convert data into monetary values (step 4 in this section)<\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\">in a separate follow-up evaluation.<\/li>\n<\/ul>\n<p>Each program type will have its own set of intangible benefits. The table below mentions the common categories.<\/p>\n<table style=\"border-collapse: collapse; width: 100%;\">\n<tbody>\n<tr>\n<td style=\"width: 16.5858%; background-color: #fef6ec;\"><strong>Benefits category<\/strong><\/td>\n<td style=\"width: 83.3333%; background-color: #fef6ec;\"><strong>Relevant indicators<\/strong><\/td>\n<\/tr>\n<tr>\n<td style=\"width: 16.5858%;\">Customer service<\/td>\n<td style=\"width: 83.3333%;\">Customer satisfaction surveys, customer complaints, customer response time.<\/td>\n<\/tr>\n<tr>\n<td style=\"width: 16.5858%;\">Employee satisfaction<\/td>\n<td style=\"width: 83.3333%;\">Attitude surveys, employee grievances, discrimination complaints, stress reduction, organizational commitment<\/td>\n<\/tr>\n<tr>\n<td style=\"width: 16.5858%;\">Employee withdrawal<\/td>\n<td style=\"width: 83.3333%;\">Employee churn, absenteeism, transfer, tardiness<\/td>\n<\/tr>\n<tr>\n<td style=\"width: 16.5858%;\">Team effectiveness<\/td>\n<td style=\"width: 83.3333%;\">Quick decisions, smooth communication, reduced conflicts, better cooperation<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n\t\t<div data-elementor-type=\"section\" data-elementor-id=\"91871\" class=\"elementor elementor-91871\" data-elementor-post-type=\"elementor_library\">\n\t\t\t\t\t<section class=\"elementor-section elementor-top-section elementor-element elementor-element-6a563c6 elementor-section-boxed elementor-section-height-default elementor-section-height-default\" data-id=\"6a563c6\" data-element_type=\"section\">\n\t\t\t\t\t\t<div class=\"elementor-container elementor-column-gap-default\">\n\t\t\t\t\t<div class=\"elementor-column elementor-col-100 elementor-top-column elementor-element elementor-element-2e963a3\" data-id=\"2e963a3\" data-element_type=\"column\">\n\t\t\t<div class=\"elementor-widget-wrap elementor-element-populated\">\n\t\t\t\t\t\t<div class=\"elementor-element elementor-element-3c0854e elementor-widget elementor-widget-html\" data-id=\"3c0854e\" data-element_type=\"widget\" data-widget_type=\"html.default\">\n\t\t\t\t\t<div id=\"roi-calculator\" style=\"max-width: 600px; margin: 20px auto; padding: 25px; border: 1px solid #e2e8f0; border-radius: 8px; font-family: inherit; background-color: #ffffff; box-shadow: 0 4px 6px rgba(0,0,0,0.05);\">\n  <h2 style=\"margin-top: 0; margin-bottom: 20px; font-size: 1.5em; color: #333;\">Phillips ROI Model Calculator<\/h2>\n\n  <div style=\"margin-bottom: 15px;\">\n    <label for=\"calc-participants\" style=\"display: block; font-weight: bold; margin-bottom: 8px; color: #333;\">How many people participated in the training?<\/label>\n    <input type=\"number\" id=\"calc-participants\" value=\"10\" min=\"0\" style=\"width: 100%; padding: 10px; border: 1px solid #ccc; border-radius: 4px; box-sizing: border-box; font-size: 1em;\">\n  <\/div>\n\n  <div style=\"margin-bottom: 15px;\">\n    <label for=\"calc-benefit\" style=\"display: block; font-weight: bold; margin-bottom: 8px; color: #333;\">What is the cost-benefit per each employee trained?<\/label>\n    <input type=\"number\" id=\"calc-benefit\" value=\"1500\" min=\"0\" style=\"width: 100%; padding: 10px; border: 1px solid #ccc; border-radius: 4px; box-sizing: border-box; font-size: 1em;\">\n  <\/div>\n\n  <div style=\"margin-bottom: 25px;\">\n    <label for=\"calc-cost\" style=\"display: block; font-weight: bold; margin-bottom: 4px; color: #333;\">What is the total cost of the entire training program?<\/label>\n    <div style=\"font-size: 0.85em; color: #666; margin-bottom: 8px; line-height: 1.4;\">(A summation of design and development costs + venue costs + training material costs + travel costs + other administrative costs)<\/div>\n    <input type=\"number\" id=\"calc-cost\" value=\"5000\" min=\"0\" style=\"width: 100%; padding: 10px; border: 1px solid #ccc; border-radius: 4px; box-sizing: border-box; font-size: 1em;\">\n  <\/div>\n\n  <div style=\"margin-bottom: 25px;\">\n    <button onclick=\"calculatePhillipsROI()\" style=\"width: 100%; background-color: #26233c; color: #ffffff; padding: 12px; font-size: 1.1em; font-weight: bold; border: none; border-radius: 4px; cursor: pointer; transition: background-color 0.2s;\">\n      Calculate ROI\n    <\/button>\n  <\/div>\n\n  <div style=\"background-color: #f8fafc; padding: 20px; border-radius: 6px; border: 1px solid #cbd5e1;\">\n    <div style=\"margin-bottom: 12px; font-size: 1.1em; color: #333;\">\n      <strong>Net Program Benefits:<\/strong> $<span id=\"calc-net-benefits\">10,000.00<\/span>\n    <\/div>\n    <div style=\"font-size: 1.3em; color: #f55800;\">\n      <strong>ROI:<\/strong> <span id=\"calc-roi-percent\">200.00<\/span>%\n    <\/div>\n  <\/div>\n<\/div>\n\n<script>\n  function calculatePhillipsROI() {\n    \/\/ Grab the inputs exactly when the button is clicked\n    var partInput = document.getElementById('calc-participants');\n    var benInput = document.getElementById('calc-benefit');\n    var costInput = document.getElementById('calc-cost');\n    var netDisplay = document.getElementById('calc-net-benefits');\n    var roiDisplay = document.getElementById('calc-roi-percent');\n\n    \/\/ Ensure elements exist\n    if (!partInput || !benInput || !costInput || !netDisplay || !roiDisplay) return;\n\n    \/\/ Extract values\n    var participants = parseFloat(partInput.value) || 0;\n    var benefit = parseFloat(benInput.value) || 0;\n    var cost = parseFloat(costInput.value) || 0;\n\n    \/\/ Perform math\n    var totalBenefits = participants * benefit;\n    var netBenefits = totalBenefits - cost;\n    \n    var roi = 0;\n    if (cost > 0) {\n      roi = (netBenefits \/ cost) * 100;\n    }\n\n    \/\/ Update display\n    netDisplay.innerText = netBenefits.toLocaleString('en-US', {minimumFractionDigits: 2, maximumFractionDigits: 2});\n    roiDisplay.innerText = roi.toLocaleString('en-US', {minimumFractionDigits: 2, maximumFractionDigits: 2});\n  }\n<\/script>\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t<\/div>\n\t\t\n<h2>Advantages of Using the Phillips ROI Model for Training Evaluation<\/h2>\n<p>It\u2019s best to compare the Phillips ROI model with the Kirkpatrick Model to bring out the advantages of the former.<\/p>\n<h3>1. Traces the complete chain of impact<\/h3>\n<p>According to Jack Phillips, the model&#8217;s creator, the business impact observed in level 4 and the ROI calculated in level 5 are not independent. Data across all preceding levels affects the final ROI produced by the model.<\/p>\n<p>A chain of impacts develops as participants gain skills and knowledge (level 2), apply them on the job (level 3), and generate business impact (level 4). So, measuring data across all levels helps evaluate the training program with high precision.<\/p>\n<p>If level 5 produces positive ROI, data from past levels will show the specific impact of the training program without any other factors. Without this data, the success of the training program would only be guesswork.<\/p>\n<p>Also, detailed data from the chain of impact allows the training program to be debugged if level 5 produces a negative ROI figure. Training managers can pinpoint the exact reason for failure.<\/p>\n<p>None of this is possible with the Kirkpatrick Model.<\/p>\n<h3>2. Measures intangibles<\/h3>\n<p>The Phillips ROI model accepts that you cannot measure certain outcomes in monetary value and the final ROI won\u2019t represent such outcomes.<\/p>\n<p>Outcomes such as customer satisfaction, employee satisfaction, and team bonding are hard to measure in numbers. Therefore, the Phillips Model measures such \u201csoft\u201d outcomes in addition to \u201chard\u201d numerical outcomes.<\/p>\n<p>The Kirkpatrick Model measures business impact in only numbers and does not consider intangible benefits during evaluation.<\/p>\n<h2>Disadvantages of Using Phillips ROI Model for Training Evaluation<\/h2>\n<p>While the Phillips Model is a significantly better way to evaluate training programs than the Kirkpatrick Model, it is not without its fair share of criticisms.<\/p>\n<h3>1. Late measurement of ROI<\/h3>\n<p>The ROI of a training program evaluated with the Phillips Model is not known until the training program is over. It would be impossible to make changes if we find out that the training program was a failed project <i>after<\/i> the project is over.<\/p>\n<p>Jack and Patti Phillips address the problem of delayed ROI in their 2010 book \u201c<a href=\"https:\/\/www.amazon.com\/Consultants-Guide-Results-Driven-Business-Proposals\/dp\/0071638806\" target=\"_blank\" rel=\"noopener\"><i>The Consultant&#8217;s Guide to Results-Driven Business Proposals: How to Write Proposals That Forecast Impact and ROI<\/i><\/a>\u201d.<\/p>\n<p>This book presents strategies to help estimate ROI, determine goals, plan execution, and set a budget for a training program. These strategies help to predict training outcomes before the organization decides to make a large financial commitment.<\/p>\n<h3>2. Useful for only 5-10% of training programs<\/h3>\n<p>The Phillips Model provides more than enough data until level 4 to know how successful or unsuccessful a training program is. The ROI calculation in level 5 is good to know, but it\u2019s not necessary in most cases.<\/p>\n<p>According to Jack Phillips:<\/p>\n<ul>\n<li style=\"list-style-type: none;\">\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\">All programs need level 1 evaluation<\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\">About 90% of programs need level 2 evaluation<\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\">About 30% of programs need level 3 evaluation<\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\">10-20% of programs need level 4 evaluation<\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\">Only 5-10% of programs need level 5 evaluation<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n<p>Various factors such as visibility of the training program, its goals, and its costs will decide if a level 5 study is necessary. Jack also remarks that these 5-10% of programs are usually the most expensive training programs with the largest audiences and an extraordinary amount of time and resources.<\/p>\n<p>With the Phillips ROI model, you get precise data on how effective your training program is and how much profit it can generate. It also allows you to gauge intangible benefits arising from your training programs. Impact and ROI forecasting strategies can help you predict which profitable training programs to start and which unproductive ones to drop.<\/p>\n<h2>Drive Training ROI with Whatfix<\/h2>\n<p>The Phillips ROI Model provides a powerful framework for proving the financial value of your training programs, but <em>measuring<\/em> ROI is only half the battle. To actually maximize those returns, organizations must move beyond traditional, forgettable training methods and adopt strategies that guarantee knowledge retention and application.<\/p>\n<p>When training directly translates into improved productivity, fewer errors, and lower support costs, your Level 4 (Business Impact) and Level 5 (ROI) metrics will naturally soar. That is where a <a href=\"https:\/\/whatfix.com\/digital-adoption-platform\/\">digital adoption platform (DAP)<\/a> becomes your ultimate L&amp;D asset.<\/p>\n<p><a href=\"http:\/\/whatfix.com\">Whatfix<\/a> helps L&amp;D leaders transform static learning into hands-on practice and guidance in the flow of work that drives training ROI. With Whatfix, you can:<\/p>\n<ul>\n<li><strong>Improve user readiness pre-launch:<\/strong> Leverage risk-free simulation training and AI roleplay so employees can master complex software and soft skills before they ever touch a live system.<\/li>\n<li><strong>Provide guidance in the flow of work:<\/strong> Replace lengthy manuals and classroom sessions with interactive, step-by-step walkthroughs that guide employees through processes exactly when they need to perform them.<\/li>\n<li><strong>Offer self-help support at the moment of need:<\/strong> Empower users to find answers instantly through an integrated knowledge base without ever leaving their applications, drastically reducing friction and IT support tickets.<\/li>\n<li><strong>Identify training improvements and gaps with analytics:<\/strong> Track user behavior, drop-offs, and engagement to pinpoint exactly where employees are struggling, allowing you to continuously optimize your training content and maximize its impact.<\/li>\n<li><strong>Accelerate time-to-proficiency:<\/strong> Cut down on direct training costs and time-away-from-desk by delivering contextual, bite-sized learning that makes employees productive from day one.<\/li>\n<\/ul>\n<p>Ready to see how Whatfix can transform your training outcomes and prove your L&amp;D impact? <a href=\"https:\/\/whatfix.com\/request-demo\/\"><strong>Request a demo today!<\/strong><\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>The cost of formal learning programs in enterprise settings rose 34% in 2024 to $874 per employee annually. With L&amp;D budgets growing, executives are rightfully demanding to know if these&#8230;<\/p>\n","protected":false},"author":42,"featured_media":62336,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[18],"tags":[],"class_list":["post-20304","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-employee-training"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v26.9 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>Phillips ROI Model: The 5 Levels of Training Evaluation<\/title>\n<meta name=\"description\" content=\"5 steps of Phillips ROI Model, ROI calculation with the Phillips Model using an example, its advantages &amp; disadvantages.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/whatfix.com\/blog\/phillips-roi-model\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Phillips ROI Model: The 5 Levels of Training Evaluation\" \/>\n<meta property=\"og:description\" content=\"5 steps of Phillips ROI Model, ROI calculation with the Phillips Model using an example, its advantages &amp; 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