June 27, 2017

Is LMS Software Worth the Investment?

Tags: HR

There’s no denying that corporate learning is in the midst of a revolution.

In fact, leading talent management and enterprise learning expert Josh Bersin stated in his HR Disruptions of 2017 report that there’s been a significant shift away from traditional instructor lead training (ILT) methods. In 2009, 77 percent of trainings were ILT, but in 2016, that number was only 32 percent.

Why is this happening? Let’s take a look.

A Changing Learning Environment

Bersin eludes to several different reasons driving the change in the learning environment. One is the struggle with income inequality and the lack of skill distribution. Another is that “the rate of job change is now faster than ever before.”

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Today’s jobseekers, particularly millennials, cite the ability to learn on the job as being a critical factor in choosing a new position. Without adequate learning and development opportunities, they stagnant and feel like they aren’t contributing which impacts their ability to drive growth and makes employers at risk for losing top talent.

Training must not only be readily available, it should cater to different learning styles. That’s a tall order since the average employee can only devote 1 percent of the work week to professional learning. Broken down, that’s 24 minutes a week or 4.8 minutes a day of a 40-hour work week – not a lot of time to be wasted.

However, emerging learning trends such as mobile learning, blended learning, social learning, and gamification allow employees to review information at their own pace, as well as retain more information than sitting in a room with an instructor. But implementing these techniques can cause new administrative and organizational challenges for HR and training managers.

That’s where a learning management system (LMS) can help.

Benefits of LMS

LMS solutions have a plethora of benefits, to name a few:

  1. Saves time & money – From researching new techniques and standards to setting up an in-person session, employee training can be an extensive and expensive process. An LMS contains developmental and administrative features that streamline the process, such as assigning courses and tracking progression. Also, since LMS is an online tool, it reduces the time and expense of hiring an in-person instructor.
  2. Centralizes course management – LMS software allows administrators to easily set prerequisites, create training schedules, and manage course enrollment and distribution all on one platform. Beyond that, the solution can store all training materials in a central location, making them easy to access and update when needed.
  3. Improves onboarding and retention Nearly one third of new hires leave their company within the first year. Many times, it’s due to a lack of mentoring, a poor onboarding process, or unclear expectations. LMS software has tools that blend onboarding processes and training materials, giving new hires a better sense of the company’s culture and expectations. After onboarding, an LMS can help keep employees engaged by offering training that will advance their development and challenge them to the next level.
  4. Flexible learning and increased engagement – Many modern LMSs are cloud-based and mobile, allowing learners to access and review materials when and where it’s most convenient. LMSs are also built to harness the benefits of social learning and knowledge retention through features such as gamification, discussion-based forums, and video seminars. This flexibility offers learners and instructors a dynamic platform to engage with each other about content and ask questions.
  5. Ensures up-to-date compliance – LMS solutions simplify tracking course progression and performance. Many also notify administrators when an employee needs to renew a certification or have additional training for compliance purposes. This keeps anyone from falling through the cracks in industries that require continued education or have regulatory compliance standards.

The ROI of an LMS

LMS solutions used to only be available to enterprises. This isn’t the case anymore. Many LMS vendors have moved to cloud hosting, which lowers initial and maintenance costs considerably, and some even offer free versions for companies that only need the basics.

For a better idea of your LMS return on investment (ROI), measure these three areas:

  1. Cost savings – Cost savings can take many forms, including reducing IT infrastructure needs, avoiding compliance penalties, reducing travel and accommodation costs, and lowering training expenses like hiring an instructor or shipping learning materials.
  2. Time saved – LMSs are built to make training more efficient. Consider measuring the time saved locating and accessing eLearning materials versus physical ones, or how much faster learners and instructors can communicate to answer questions or participate in discussions.
  3. Improved productivity – Productivity can be measured in several ways. For example, you can measure how much employee turnover has been reduced or how many internal certifications were completed.

Is LMS Worth the Investment?

In most cases, yes. But it’s important to remember that while an LMS is beneficial and affordable, implementing the software alone won’t magically make your employees more engaged and knowledgeable. The solution provides the right tools to improve the effectiveness, and efficiency of training. It’s up to you to choose the solution that’s right for you and adopt it with the same enthusiasm you’ll want your employees — your greatest asset — to have.

Are you ready to make the investment but not sure where to begin? Use our product selection tool, or call an unbiased Technology Advisor today for a free consultation.


Elizabeth is an editor with Better Buys, a trusted source of business software news and research. Follow her at @ElizMazenko for more on enterprise software and related technology research.

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