AEE 577: Evaluation in Agricultural and Extension Education

NC STATE UNIVERSITY

"Measuring the return on investment is becoming a truly global issue. Organizations from all over the world are concerned about the accountability of training and are exploring ways and techniques to measure the results of training".

(Phillips, J. J. 1997. p.4.)

Class XIII:  Cost-Effectiveness, Cost-Benefit and Return on Investment (ROI) Analysis

The Cooperative Extension is paying more attention on cost-benefit and return on investment analysis. This is a challenging task in Extension evaluation because the estimation of accurate costs and relating those costs to specific measures of total benefits demand time and effort considerably. This class will look at ways to measure both cost-effectiveness and cost-benefit/ROI analysis.

Instructional Objectives:

Upon completion of this lesson, students should be able to:

• Compare and contrast cost-benefit versus cost-effectiveness.

• Estimate program costs.

• Describe difference between tangible and intangible benefits.

• Estimate program benefits.

• Describe the key steps in conducting a cost-benefit analysis.

• Conduct a cost benefit/ROI analysis.

• Discuss the common issues and problems with cost-effectiveness and cost-benefit analysis.

Required Instructional Activities

1. Read this Cost-Benefit analysis extension article.

2. View Class XIII Power Point presentation. It provides an overview of cost-benefit analysis.

3. Read "Cost-Effectiveness and Cost-Benefit Analysis" (pages 506-541) in the course text, Handbook of Practical Program Evaluation by Wholey, Hatry, and Newcomer (2004).

4. Read the following articles on assessment and cost-benefit analysis:

O'Neill, B., & Richardson, J. G. (1999).  Cost-benefit impact statements: A tool for Extension accountability.  Journal of Extension, 37(4).  Available http://www.joe.org/joe/1999August/tt3.html.

Richardson, J. G., & Phillips, R. E. (1992). Developing costs and benefit estimates.  Raleigh, N.C.: North Carolina Cooperative Extension Service. Available http://www.ces.ncsu.edu/resources/education/sd8/.

Suggested Instructional Activities

1. Read John Richardson's article on Determining extension program economic benefit values.

2. Read Michael Score's article on Social impact assessment in Extension educational programming.

Required Assignments

All items, unless otherwise noted, are due by 12:00 noon on Monday following the week of the class.

1. Post your questions or comments on the Web CT Vista discussion board and reply to at least two postings submitted by your classmates.

2. There is no reading assignment in this week. Next wek reading assignment will cover materials you learned in this class.

References

O'Neill, B., & Richardson, J. G. (1999).  Cost-benefit impact statements: A tool for Extension accountability.  Journal of Extension, 37(4).  Available http://www.joe.org/joe/1999August/tt3.html.

Phillips, J. J. (1997). Return on Investment in Training and Performance Improvement Programs, p.4. Gulf Publishing Company, Houston, Texas.

Richardson, J. G., & Phillips, R. E. (n.d.). Developing costs and benefit estimates.  Raleigh, N.C.: North Carolina Cooperative Extension Service. Available http://www.ces.ncsu.edu/resources/education/sd8/.

Score, M. (1995).  Social impact assessment in Extension educational programming.   Journal of Extension, 33(6).  Available http://www.joe.org/joe/1995december/tt2.html.

Wholey, J. S., Hatry, H. P., and Newcomer, K. E. (2004). Handbook of practical program evaluation (2nd edition).  Jossey-Bass, San Francisco, California.