What is a Learning Management System (LMS)?
A Learning Management Systems (LMS) is an advanced online learning platform responsible for the storage, delivery, tracking, assessing, and certification process of any learning activity. Completing the above-mentioned tasks are very simple. Especially if tried in the traditional manner. I.e.: in a classroom setting through a student-teacher relationship. However, the modern corporate scenario is not that simple. In today’s day and age, employees or learners seldom have the time to learn and develop skills in a traditional classroom training format. Furthermore, due to the prolonged exposure to social media, the internet, and other formats of consuming quick and interesting information, learners do not associate with the age-old concept of books, papers, and pens.
eLearning courses are stored on modern LMSes to train and develop employees. These eLearning courses range from simple to complex and this includes—text-based courses, animated explainer videos, interactive courses, and simulated courses. Courses stored on the LMS are learning materials meant to train and develop a learner’s skills. They can be accessed from home.
All of this happens while the LMS tracks, records, and guides the learners through the entire activity. The data generated via the activities of the learners is processed as information on the learning habits of the employees. The LMS then generates reports that outline the strengths and weaknesses, areas of improvement, and the progress of the learners, which is presented to the administrators (generally the HR and L&D teams) as a bird’s eye view on the entire training activity.
As learners begin to enrol and complete courses, the LMS presents them with certificates of completion.
Certificates are presented to learners who successfully attend and complete a course. These are one-time authenticators or indicators of success. These are yearly or biannual certificates. Learners renew them at the end of the period.
How Does the Modern LMS Help?
Today, the modern learning management system is the most efficient way to carry out many activities that were once carried out in a traditional setting like—onboarding, general training, compliance certifying, training the extended enterprise, and acting as knowledge or data storehouses. Not only do they totally eliminate the need for a teacher and a classroom, but an LMS also eliminates the high costs associated with traditional training, mainly—lecturers fee, rent for the venue, paying for travelling employees, and the time + energy required to achieve this task.
Moreover, traditional training never carried the guarantee of being a successful activity in one go. There was always the issue of repeating the activity, and this meant repeating all of the above mentioned associated costs or completely scrapping the training and declaring it a waste of resources. With the LMS, this is not the case. Learners repeatedly access training from the comfort of their homes, with no extra costs involved.
Today, the LMS is responsible for most training activities that corporates wish to undertake owing to its digital nature where everything is stored and can be measured. It is also the preferred mechanism for corporates to train their regional offices, customers, vendors, and partners located across the globe from a central location.
Is there a Demand for Learning Management Systems and eLearning?
Ever since its inception, the Learning Management System was termed as a revolutionary new way to train, streamline, and structure the unstructured activity of traditional training and development. The market for the LMS has only expanded with time. The market for learning management systems continues to grow and expand as newer systems are added. Today the market for Learning Management Systems is estimated at $5.22 billion, it is projected to grow at a CAGR 24.7% reaching $15.72 billion by 2021. The market is only set to grow even further due to the rise of the millenials.
eLearning is the backbone of modern corporate training. With time it has ascertained its dominance over traditional training activities and has confirmed itself as the centre around which most training activities revolve. The modern learning management system is one of the primary systems on which eLearning courses play the role of content. The market for eLearning is rapidly increasing as well. Given the fact that eLearning can range from anything as simple as a plain text course to an interactive animated course or a simulation-based course, the market is forecasted to reach a staggering $224 billion by 2024 as reported by Global Market Insights.
Why Does Your Organization Need an LMS?
As an HR and L&D authority in your company, training, monitoring, and improving your employees’ efficiency is a very important goal for your organization to work towards collectively. This task can become very cumbersome quickly, especially if traditional On-the-Job Training (OJT) and Classroom Training are the go-to approaches for organizations.
Create a framework for automating and optimizing your training and streamline processes/operations
Organizations have functional areas where processes/operations are followed which facilitate their daily functioning. These operations include Manufacturing, Sales, Customer Servicing, IT, and other small and big processes that are integral to the smooth operations of the organization. Often, the lack of proper training and defining of correct sequenced steps to follow lead to inefficient functioning of the various operations.
Having fully-functioning learning management systems (LMS) in place allows your business to firstly formalize their training function, instead of ad-hoc on-the-job training and inconsistent classroom sessions. Learning Management Systems provide a framework for L&D teams to organize and automate the delivery of training, schedule classroom training sessions and eliminate paper-based assessments. The LMS is the biggest tool at the organization’s disposal. It ensures all employees—new and old—understand the operations at hand. It equips employees to go about achieving the goals of the organization. Studies show effective and regular training increases the efficiency of any operation by 55%!
Track employee competency
Employee competency is a term used to understand the level of understanding and efficiency an employee has at a given task. It also defines how well the employee can perform a certain task: with respect to their peers. Understanding how competent the employees are and giving them training in areas where they lack: should be the first task of any organization.
Special or in-depth training is provided to employees based on their competency. Learning management systems (LMS) should be set up in a way, where courses and tests are primarily available to test an employee’s competency. Identifying the capabilities based on tests and course completion rates, allows the L&D Team and HR to fully understand where an existing employee’s knowledge or skill gaps are and provide the training needed to bridge those gaps.
Train new employees
Training new employees is a regular, inevitable process at every organization which the HR and L&D teams face. The ability to train new employees in an effective yet standard manner can be of great advantage to them. Learning management Systems host special training courses to induct new employees. These courses cover organizations in general, its history, its products and services, its customers, its organizational values. They also cover introductions to what is expected of the employee with regard to the position they are filling.
Allowing the induction and new employee training programs to work off an LMS platform helps the HR and L&D teams to impart standard, effective, and carefully crafted training to be delivered repeatedly, whether it be to a single or a group of new employees, without putting too much stress on the organization’s limited resources.
Save costs and increase the ROI
Training programs involve costs that may include venue costs, guest trainer fees, travel costs, etc. Not to forget the cost of time and energy spent by both the trainer(s) and the trainee. Training costs are recurring for new employees joining and also for the company’s latest ventures. In the long run, if the company requires imparting regular training to its employees due to the nature and conduct of its businesses, it stands to benefit greatly from a top LMS platform.
Repeated usage of training material, access to training from anywhere, and the ability to host a trainer over the internet, save the organization a lot of costs as compared to traditional training.
The need to deliver critical training in a timely, accurate, and consistent manner
The essence of good training is in the ability to deliver it when it’s most needed and be very accurate. With traditional training, it is very difficult to keep track of both these parameters. Traditional training relies heavily on being a person-to-person process and the physical availability of a trainer. This creates an issue on two fronts. Firstly, the accuracy and consistency of training imparted (since a trainer may be inconsistent on different dates with different batches of learners). Secondly, getting trained when you most need it instead of when training is available.
A Learning management system (LMS) tackles both these issues effectively. Training can be created, checked, and tested for effectiveness and accuracy. It is stored on the LMS platform, allowing learners to access it when it’s most important and timely. This increases the impact of the training provided by almost 60%!
Once the need for an LMS is identified, it is imperative that the decision-makers put together a task force of key internal stakeholders to select the right LMS.
Some Key Terminologies Associated with the LMS
What are the Types of LMS?
Classifications Based on Use-Case
Top Learning Management Systems (LMS) are differentiated by multiple use-cases
These LMSes are designed and built with the sole purpose of training corporates in a dynamic and ever-evolving environment. The need for continuous training and development is every business’s key to excelling in their specific domain. A corporate Learning Management System is just the tool for this purpose. Built to deliver accurate and timely training to a group of learners who seldom have the time to learn. Especially between work and personal life. This is what makes an LMS the best choice when selecting a system for your organization.
Organizations often shortlist LMSes not built to train employees. Instead, these LMSes stress on training students or e-commerce through the sale of online courses. While these LMSes may appear to be the same and theoretically provide training to employees at a basic level, corporates demand regular training of employees, based on its needs and complexities. These need maybe:
- Onboarding and new hire training induction
- Sales training
- Compliance training
- Training your external partners, resellers, contractors
Corporate LMSes test and assess employees through all levels of an organization, increasing their knowledge and equipping them to do better. On identifying skill gaps through detailed employee competency and course completion reports. The organization can proceed to better train the employees using the same LMS. This is the true definition of a corporate LMS, and as an L&D Head/Manager, it is very important to identify an LMS built to deliver training from an LMS built to sell courses. LMSes such as Abara LMS, Docebo, Litmos, are good examples of corporate LMSes. Key entities in a corporate LMS are the company LMS administrators, managers, internal and external instructors, learners and internal experts etc. Internal corporate applications like HRIS systems, Active Directory and SSO are integrated to the LMS.
Training Company LMS
Some LMSes distribute training and course content as a revenue-generating service. This is usually meant for training companies to sell and license courses to the general public (B2C) or B2B (corporates). The aim is to deliver training content to individuals located across the region. The training company’s responsibility ends with the creation and delivery of the content. From this point, it is the learner’s responsibility to make the most of this Learning Management System. These LMSes are built with the intention of carrying out e-commerce. Hence, they come with features such as shopping carts, payment gateways, and course catalogues.
These LMSes lack the ability to track and provide comprehensive reports, analytics, and records on the effectiveness of training. These LMSes are built for e-commerce. They offer simple pass/fail and course completed reports. Thinkific, Teachable, SkillSoft, etc, develop corporate training LMS. Skillsoft acquired SumTotal which is a corporate LMS. It still delivers training via its own internal LMS meant for selling and licensing courses. Key entities in a training company LMS are the administrators, customers, learners, and trainers etc. Integrations are usually with CRM systems, marketing automation systems, and other customer relationship management software which are used to manage their customers.
Schools, colleges, universities and other auxiliary training institutes use the LMS to deliver training and subject related information to students. Designed with the intent of delivering purely academic training, it is rare for them to do more than what they are designed for. Mistaking this LMS for a corporate LMS results in switched functions. Teacher-student relations replace the manager and subordinate relations. Branding becomes very tough if not impossible and reaching out to offices and departments located around the globe proves to be a challenge. The UI/UX on both the administrator and user side may involve minimal function and simplistic looks keeping student’s interaction and usage in mind. By far, the greatest issue as a corporate using an educational LMS is the inability to create, update, and change course contents fast.
Educational LMSes are designed with the notion that fundamentals of science, math, and history stay the same. Hence, the need to create, update, and change training and course material, as dictated by corporates, is not what an educational LMS is about. The open source LMSes that are out there such as Moodle, Canvas etc. are good examples of academic LMSes. Key entities in an academic LMS are the school/institution administrators, teachers/professors/instructors, and students. Integrations are usually with student management systems that they use to manage their students. It is recommended that an LMS focused on corporate training at its core is shortlisted. This safeguards you the buyer from future issues which may arise as a result of selecting a mismatched LMS.
Classifications Based on Organization Hierarchy, Size, and L&D Control
Single Location—Single Brand/Entity (Centralized L&D)
The law, regulations, language spoken, and training initiatives are generally the same for organizations operating as one entity in the same region. Apart from a few states where the laws may slightly differ, the organization does not deal with significantly different training needs and varying methods and languages. In this case, a corporate LMS capable of delivering training centrally could work for the organization. Corporations spread across multiple locations and operating under multiple brands and entities possess varying training needs.
Multiple Location—Multiple Brand/Entity (Decentralised L&D)
Most large organizations operate through multiple brands and are located in different countries around the globe. In this case, each country has its own laws and regulations which the local offices and production units have to adhere to. This is especially true for large organizations spread in different countries, and each country has its own financial reporting based in the region, and separate HR and L&D functions. They often also have different training needs as the brands, products, and services of each entity differ. It is crucial to select a multi-tenant cloud-based LMS. It allows multiple subsidiaries, divisions, and branches of an organization to access the LMS.
Each division/brand/entity and its offices located across the globe operate through individual portals, customized to look and feel like the brand and are operated by the local L&D Managers. It’s not just about local laws. It is about a centralized command and control structure vs autonomy. A command and control structure from corporate headquarters does not always work with separate subsidiaries with their own P&L, work culture and language. If these regional offices enjoy autonomy on some matters, it is unlikely that imposing a centralized LMS across the world will work. Purchase an individual LMS to train many subsidiaries/brands/ under one system. This is true when one system cannot handle a global workload
Classifications Based on Implementation
A fully-functioning LMS is stored on the datacenter and servers of the cloud-hosting vendor over the internet. Due to its implementation, it is easy to set up, costs less to manage, and is faster to implement. Organizations strapped on resources benefit greatly from this system. Storage of course material, backup files, reports, and user data are on secure servers. Vendors solve most technical issues, it prevents data corruption and consumes less storage space. Cloud-based systems are suitable for both small and medium scale businesses as well as large enterprises. LMS providers update the system in the cloud during scheduled downtimes with no additional costs to upgrade to the latest version of the software.
These LMSes are stored within the datacenter and servers of the organization. Self-hosting requires the buyer to dedicate resources in order to run a smooth system. The need for a trained IT team on site increases as an issue that may arise is within the organization’s system. In large enterprises, exposing content outside their firewalls is not feasible. IT infrastructure and security requirements are complex, and the organization is multifaceted, and an on-premise application may be the preferred option. Enterprises also look at this from an IT point of view, where they wouldn’t want user data, courses and other information stored in a cloud somewhere. On-premises implementation is the only option for organizations whose training needs are complex and require a heavily customized LMS. With an on-premise LMS, updates and maintenance is a challenge and is often a stumbling block when you need to upgrade to the latest version of the LMS vendor’s version.
Proprietary or Vendor-Owned LMS
All LMSes hosted in the cloud are proprietary or owned by vendors. The IP belongs to the LMS provider and you are either licensing the LMS or buying a subscription service to access the software as it is the case with all SaaS software. You may be bound by an annual contract or can exit anytime (month on month) by simply switching the account off (as is the case with LMSes below a 1000 users) typically. Most larger LMS will require a long-term contract as the effort involved in setting up the LMS, migrating data, and training administrators to use the system itself will require a minimum commitment to getting up and running. All LMSes that are not open source or custom-built will fall under this category.
An LMS that is available in the open source community for download and installation is an open source LMS. It is usually preferred by individuals, training companies, schools and colleges to run their eLearning initiatives. Though some corporates also look at open source solutions for their training needs, especially for specific use cases, many large corporates do not prefer open source
technology. Unless your IT team can deploy the open source LMS themselves, you may have to rely on a software company that specializes in such open source software. Popular LMSes in the open space includes Moodle, Canvas etc. Totara is built on the Moodle platform and positioned as a corporate LMS. It has since split with Moodle and has blurred the lines between open source and closed source. Though Totara claims to be open source, a subscription is required to license the software.
Though this is rare, it has been known to happen in the past. In recent times, large IT companies have gone ahead and built their own custom top learning management systems (LMS) as well. Organizations with unique needs use custom-built LMSes. It is better to create an LMS from the ground up when multiple vendors cannot accommodate the needed features into their existing LMS. This is not a recommended option for every company. Google, Facebook, and Amazon have built their own custom LMS for specific use cases.
The market space for top learning management systems is ever-evolving. Investing in building your own LMS platform requires vision and a road-map. It should be mission critical to your organization. If you are largely a training or an education business, then this may make sense. As the IP in the LMS may be crucial to your valuation and core to your business. The organization building the Learning Management System should have a well-trained IT team in place. They continue customizing and servicing the LMS post-implementation.
What are the Features of a Good LMS?
Classroom Training and eLearning
The two primary methods of training after on-the-job training are classroom training and eLearning. An organization that does not have a formal training department or relies largely on on-the-job training may first want to organize their existing on-the-job training to formal classroom sessions organized by a training calendar. Or it may choose to convert their on-the-job training programs to more formal programs and move to eLearning.
For those organizations that are already largely doing face-to-face classroom training, moving to a more self-paced eLearning program may be important. Either way, eLearning is not always the perfect substitute for classroom training. If the organization is located in multiple locations with a small workforce at corporate headquarters, then having eLearning may help as well as organizing classroom training at various plants or regional offices.
Virtual Instructor-Led Training
This feature of the LMS works exactly like a traditional classroom. Trainers and students engage in training activities from different regions, sometimes from the comfort of their homes. It is a combination of video conference and e-learning, where the instructor delivers training, followed by regular assessment and tests. The need to arrange for a physical trainer, pay for
the cost of transport, training fee, and venue, are all eliminated. Corporate instill a culture of development through instructor-led training. This feature makes training employees an effective practice. This feature is crucial for organizations that have a multi-location workforce or remote workers for whom coming to the corporate headquarters is not feasible.
Large software companies that need to train their customers, re-sellers or even their sales teams use virtual ILT or virtual classroom very effectively.
Trainers can now record videos of lectures and upload it onto the LMS. This allows employees to access course material at their convenience and help them in self-paced learning. Video training allows L&D Heads/Manager s to break complex lectures into bite-sized formats, which boost the training retention rate and make the LMS learning process more appealing to the employees. Effectiveness of training is boosted by 60% using Video-based courses. They provide an extra dimension of visual learning. Video courses also offer the trainers ability to check their training for maximum accuracy and effectiveness.
For highly regulated organizations, compliance courses are just as integral as induction or onboarding courses. Safety training is a high priority task in oil and gas, manufacturing, and chemical industries. Food safety is a major risk in the food and beverage industry. Employees need to be certified before they can be fully operational. For such companies, having a top LMS that handles certification and re-certification is a key feature.
The ability to set expiry dates and reminders for re certification are very important. This is important in organizations with thousands going through compliance training every year. Ability to print certificates, and even import previously acquired certificates to the system in case the industry has a professional body certifying specialists in that industry is an added plus. So if someone joins your organization in the middle of the year and has a certificate that is going to last another year and a half, it makes sense to be able to import that certificate instead of asking the person to re certify. Specific attention is paid to how the LMS will handle an organization with complex certification needs.
Employees seldom have the time to balance work and personal life, which is why an LMS is a practical approach to training, and now has the ability to deliver training when needed, wherever needed, even while on the move. Research by Statista shows the number of smartphone users has increased from 2.1 billion (2016) to 2.53 billion (2018). This will increase by 100% in 2020. The US currently uses 223 million smartphones. The UK has 53 million users and Western Europe has 271 million users. With figures like these, every corporate LMS should have the ability to integrate onto a smartphone to boost its training initiatives. This also
opens a new avenue where learning is not a tedious, time-consuming activity anymore. Mobile could mean tablets or smartphones. Between 2010 and 2014, it was considered that tablets would be the ultimate training device, but with declining demand for tablets and larger smartphones, it is necessary that smartphones must also be supported by all LMS.
A method of applying traditional game-playing elements such as scoring points, competing with peers, and earning rewards to training initiatives makes training fun and impactful. According to Gartner, more than 60% of organizations that manage innovations will use some form of gamification to boost their productivity. This shows the future of gamification-based training will only become brighter. As learners interact with the LMS, completing courses while earning badges, points, and securing positions on the leaderboard, creates an environment of social learning. The success of peers at training activities boost the internal competitive nature of the human being, motivating them to compete and train more. Organizations that hire younger workers or millennials should also pay careful attention to these features. Besides certification, recognition via badges or leaderboards is an important aspect to help motivate and create a culture of learning within the organization.
Course Integration with Legacy Software
Many organizations use course materials designed using legacy software. These courses may still be relevant, and as the organization implements an LMS, they need it to integrate with the system. This makes selecting a top LMS that allows seamless integration of legacy courses, saving costs, time, and efforts very important. This holds true when organizations have a repository of courses that can be re-used. The ability to re-use courses is actually future-proofing the system. As old courses lose their relevance, they can be stored for future use.
At the core of a top LMS is its ability to track, record, and maintain the employee’s progress. This allows the L&D and HR teams to maintain comprehensive reports on the performance of employees, with respect to the training provided organization-wide. Reporting features identify skill-gaps, employee competency at given tasks, the ability to understand new processes, and the ease in executing everything learned. It is vital for the corporate LMS to have comprehensive reporting features. It is a feature that can track the performance of the training program on a micro level—for individual employees and managers, to a macro level—for division/branch wise performance, and compare them.
Who are the Stakeholders in Selecting an LMS?
The LMS is an enterprise-wide system, and the selection process of this system mandates the involvement of a group of people. This group is responsible for shortlisting and implementing the LMS, followed by the administrating of training programs on this new system. We call them stakeholders. Their involvement is important for the LMS’s success.
The role of selecting a top LMS should ideally be the L&D and HR team’s responsibility with inputs and commitments from other stakeholders throughout the process.
What are the Primary Uses for an LMS?
Onboarding and New Hire Training
In organizations and industries where the attrition rate is high, there is a constant need to train new employees regularly. HR and L&D heads, prefer training to be delivered only over top learning management systems (LMS) since this saves them cost, time, and effort. It needs a simple platform where induction content is uploaded for new employees to access. At the end of the course, a simple test to understand the effectiveness of the training is adequate. Building learning plans, automation of learning assignments, and training sessions are emphasized. Using a top LMS for onboarding and new hire training is common amongst organizations.
Another important use for a top learning management system (LMS) is compliance training. This is true for industries with significant risk profiles such as oil and gas. Highly regulated industries such as banking and financial services, and chemical industries, are included as well. Since compliance training carries more importance than induction training, this LMS needs features which help authorities track the employee compliance training.
certification. The LMS usually requires courses covering many general topics, and an LMS with a course catalogue can display most of them. The key emphasis is using the LMS to manage the compliance calendar across the organization and managing recertification and audit trails. The need to change courses, add new training material regularly, instructor-led training (ILT), etc. is not as important. The organization can save a lot of costs by understanding the purpose of purchasing an LMS and using it appropriately. Usually, induction and onboarding training and compliance training are the two key drivers for buying an LMS.
Another key area for using an LMS is to manage sales training effectively. Sales training usually has the best ROI case in the organization with a direct linkage to the top line of an organization. An LMS designed for sales training is ideal for large corporates with sales and customer-facing teams. Often, corporate L&D acts as a business partner to sales organizations and help sales teams organize and deliver training content. Often sales organizations prefer to have their own LMS or sales enablement platform in case the corporate LMS is too complex and going through the corporate L&D LMS may be challenging. Key features meant for sales-driven organizations are powerful sales enablement and gamification tools with mobile delivery option. In industries like pharma, insurance, and retail, a significant workforce is sales and therefore you may see some sales teams taking a separate LMS run and managed by sales operations.
A top LMS is a highly versatile tool. Apart from the above-mentioned uses, it is a software for general employee training. Soft skill training, training on manufacturing processes, learning new software are just some of the types of training that true top learning management systems (LMS) can also be used for. It is the ideal software system to handle all kinds of training, and all it requires is an administrator capable of understanding the right way of putting it to use.
Extended Enterprise Training
The LMS is best to train an extended enterprise workforce of an organization like—vendors, suppliers, distributors, and resellers. It provides vendors with their own unique log-in portal that allows them to log-in and train or complete compliances courses that are mandatory for them to complete in order to continue working with their partner organizations. The parent organization’s log-in portal, sensitive information, and data are separate. I.e.: training materials and other information are kept safe.
Organizations are now able to train their customers using the LMS as well. Learning Management Systems have eliminated the need to set-up manual training courses. Clients can now simply log-in to the training portal and learn all that they need to about the service or the product they have just invested in. E.g.: Users log-into unique portals. It allows learners to use the software from either their workstations or the comfort of their homes. It reduces the costs of facilitating travelling employees or even the cost of facilitating travelling trainers. Instead, it provides the learners with access to permanent and reusable information.
Things to Remember and Do as a First-Time LMS User/Buyer
Being a corporate looking to purchase an LMS for organization-wide training and development, it is crucial to identify and select a Corporate LMS.
These LMSs are designed and built to train corporates in a dynamic and ever-evolving environment. The need for continuous training and development is every business’s key to excelling in their specific domain, and a corporate LMS is just the tool for this purpose. An LMS delivers accurate and timely training to a group of learners. These learners seldom have the time to learn between work and personal life. A corporate LMS tests and assesses employees through all levels of the organization. On identifying skill-gaps through individual employee competency and course completion reports, your organization can proceed to better train the employees using the same LMS.
Understanding the Use-Case
Determine the reason why the LMS is being implemented. It could be for any of the following reasons:
- Compliance Training ‘
- Sales Training
- Enterprise-Wide Training
- Extended Enterprise Training
Select Based on Features
Determine if the following features are present-
- Virtual instructor-led training
- Video-based training
- Mobile Integration
- Course integration with legacy software
- Reporting features
Things to Do as a Repeat LMS Buyer/Switching from One LMS to Another
Understand Your Current LMS
Since you, the user, have a first-hand experience of operating the existing LMS and are considering a switch, it is important to first analyze the reasons for switching. Is there any must-have feature that your current LMS is missing? Alternatively, is there a major reason why your users are not using the LMS (E.g., poor UI, lack of an offline mobile App)? Identify the shortcomings of your existing system. Make a not of the useful features. It’s beneficial to switch to an LMS which addresses the limitations of your current system while having all the features you enjoy using. This leads to the selection of a well-rounded LMS.
Switch to a Future-Proofed LMS
The time and effort required to select, implement, migrate user data, courses, and reports from the existing LMS and the cost of implementing a new system often reiterates the fact that an LMS is a long-term investment. Future-proofed and relevant LMS are integral. Some must have features in a modern LMS are:
Ensure training is accessible while on-the-go over multiple devices like smartphones, tablets, iPads, and laptops.
Modern UI & UX
Clutter-free interface and easy navigation—looks futuristic for years to come
Powerful reporting mechanisms
Learners can upload videos, audio, and other supported files of their learning, while the administrators can assess the overall outcome of the training
The ability to integrate third-party systems allows the LMS to communicate with these platforms. Also, transferring useful information with regards to changes, additions, and deletion of data. These systems commonly share them.
Create a Data Migration Plan
When switching systems, an LMS which readily accepts user data, existing course material, and reports, is a good option. This saves you the time and energy required to invest in manually entering the user data. It also saves the extra costs of re-creating courses.
Ensuring the smooth transition of legacy courseware helps in recycling useful content. Especially while setting up the new LMS with ready-to-go content. It is important to migrate only that data, which is critical for your training and development initiatives.
As the transfer of unrequired data will make the new LMS a sluggish system. When it comes to migrating data from the existing system, it is important to ask your current vendor on how they plan to help you. At the same time, it is vital to discuss data importing options with your new vendor. The existing vendor may try and talk you out of switching the system. However, they must support you in exporting your data.
Selecting the Right Vendor
One of the biggest reasons why organizations look to switch their LMS is poor vendor support and relations. Often, organizations find themselves working with vendors who are very rigid in what they will and won’t do. Often, these LMS companies aren’t very keen on customers below a certain size. Even if you do get onto their system, they may offer you very little. Mostly with regards to after-sales support. If you find yourself in such a situation, it results in you buying and paying for an LMS over which, you have very little control. Even worse, they consider you too small to address your queries and support needs.
Carrying out a detailed background check on the vendor’s after sales and support services is an excellent way to safeguard yourself from future hassles.
Make sure your vendor has:
Customer Success Teams
A team which ensures your new LMS is a success.
Strong customer support that doesn’t consider you too small to address regular issues.
Flexible, economic licensing model
Flexible licensing plans which make your LMS an economically viable system to use and implement.
By considering these factors while selecting an LMS, you, as an organization, are ensuring the same mistakes wouldn’t be repeated!
How to Choose an LMS Vendor?
Implementing a top learning management system (LMS) is as much about your relations with the vendor as it is an investment in their product. It does not start with a sales pitch and end with you buying an LMS. There is more to selecting an LMS vendor than one may initially think. The LMS is implemented from anywhere between a year to a lifetime. Interactions between you and the LMS vendor are unavoidable.
More often than not, organizations often find themselves compromised when dealing with specific vendors. This is primarily because the vendor doesn’t consider your organization’s billing a sizeable amount to nurture a relationship with you actively. They focus on larger clients who account for a greater billing cycle. Small organizations or companies with lower billing amounts are often left out. Furthermore, there are other considerations to keep in mind when selecting a vendor, and it goes beyond simple relationship nurturing.
The trick is to create a list of top LMS vendors based on how well they score in specific segments. In order to score vendors, it is advisable to look for vendors who are well balanced and proactive. In most cases, the top LMS vendor for organization ‘A’ is not the same as the one for organization ‘B’.
So, How do you choose an LMS vendor?
The LMS Vendor’s Credibility
Like any selection process, credibility plays an important role. However, time or experience in itself is not the sole factor which determines credibility. Vendors with a history in the LMS industry often possess an old outdated LMS close to reaching its product lifecycle end. Current-tech features on these systems are additions. They are crammed into the system making it clunky and difficult to navigate. Credibility is more than experience; it is the culmination of client testimonials + vendor transparency + first-hand experience of the system (free trials, demos).
Vendor’s Client Portfolio
A client portfolio provides a good look into the vendor’s historical activities, it mirrors the vendor’s experience with different sized clients and the industries they have operated in. Look for vendors with experience in your industry. It is a clear indication of a capable LMS. It is also good to look for vendors with considerable experience with customers from other sectors, as this indicates a flexible LMS system capable of addressing dynamic scenarios.
System Trial and Demo
Trialling the system thoroughly helps identify a worthy LMS. The trial process must follow with a free demo of the system. It sheds light on the simplicity of the system, allowing you to make the most of your free trial. There is no point in trialling a system you cannot operate. Just like buying a car without test-driving it, since you cannot drive in the first place. The free trial should last from anywhere between 20 – 30 days. Users cannot get accustomed to the system in 20 days. Additionally, it is a marketing trick to pressurize you into purchasing the system by creating the illusion of you running out of time.
Probably the penultimate factor to choose an LMS vendor is their size. To choose an LMS vendor is to match them to your own size. Big vendors and small organizations with smaller billings may not be a compatible relationship. Big vendors usually prefer big spenders. The service a more prominent client gets may drastically differ from what your organization may receive if you do not provide the kind of business the vendor wants. Good client portfolio + efforts to understand you + system demos are the signs of a good vendor. Providing smaller vendors with large billing amounts, guarantees exceptional services. Furthermore, smaller vendors can accommodate heavy customizations for your LMS since the greater billing cycle justifies this. The service is better, and products suit your needs. Large vendors possess good LMS platforms, but their services are the same as any large corporation would provide. Long waiting times and impersonal customer service are definitely expected.
The Ability to Understand Your Needs
This is one of the most important aspects of selecting an LMS vendor. Discussions and the ability to understand your unique needs is very important for a vendor. It helps them understand the kind of service you expect. Vendors may seem uninterested from the start. They may show a lack of motivation when dealing with your organization. It is a sign they consider your organization as being a small business to deal with. Also, customer support and other vendor solutions take a back seat. Especially when expectations are not set straight. The LMS is one of those systems where customization and help with operating the system are inevitable. Some form of support in these departments is always necessary.
The best way to choose an LMS vendor is by thoroughly testing the system. Selecting a vendor with the ability and interest to serve you is also good. It is really important for smaller organizations to match their size with a credible vendor of the same size. It secures the kind of support and help required as a first time LMS buyer and user. A small thing to also remember is – age does not signify greatness as mentioned above. Older players usually have dated systems and all the latest features you see in the system are add-ons; rather cramped in to make it modern. This means the system is clunky and hard to navigate.
Some Common LMS Vendor Licensing Models
As a first-time buyer, it is essential to understand the following pricing model:
Pay for a fixed number of users (also called registered users) annually
Under this form of pricing, the vendor allows you to purchase a fixed number of user accounts. You pay per user account purchased. Basically, if your organization has a strength of 500 employees and the vendor charges an amount of $1 per user per month, the total amount you pay is 500*1*12 = $6,000.
You only pay for the number of user accounts you need, based on the strength of your company.
If your organization is one where the number of employees stays the same, this pricing model should work very well. You know exactly how much the LMS is going to cost on a monthly or a yearly basis. Ideally, if you are aiming for your learners to use the LMS to its fullest, and hopefully throughout the year, then this is the perfect model for a corporate. The number of users = number of employees with the ability to add users if required.
The downside to this, however, is the lack of flexibility. There may arise a point where not all your 500 employees use the LMS, and you end up paying $6,000 for just 100 employees using the system during the year. Hence, ensuring employee motivation, adequate content, and a slight nudge from the L&D department and their managers, will go a long way in extracting the most out of an LMS with this pricing model.
Pay based on the active number of users (monthly/annually)
Different vendors have different definitions of what an active user is. For the sake of understanding, and what most if not all vendors define an active user as, is- an employee who interacts with the LMS in any form. This could be as simple as just logging in.
A vendor can also define active users on the following metrics:
An employee who starts a new course.
An employee who gets certified etc.
The intention here is for the user to interact with the LMS in order for the vendor to bill the buyer.
Most LMSes that offer active user pricing models allow for unlimited registered users. In this pricing model, the organization can register all its existing employees on the LMS. Allowing them the ability to use the system. The organization then proceeds to select a pricing plan based on the number of users (from within the registered group). This is an estimate of the number of people they think will use the LMS during any given billing cycle. So, if an organization has 500 employees, and it is sure that not more than 100 employees will use the LMS at any given time. They can register all 500 employees on the LMS, and opt for a pricing plan where only 100 of those 500 registered users can become active users. Hence, they select a pricing slab within which they want to be charged.
The caveat with any LMS company that charges on the basis of an active user model is that there is a higher cost/user for every additional user who interacts with the LMS beyond the original 100 active users limit.
To better understand this- once the organization registers all 500 of its employees on the LMS, and purchases a plan where 100 of those 500 registered users can become active users, charged at $1 per active user.
If the number of active users exceeds the original limit of 100, the vendor charges $2 for every extra active user. Which is more than the original $1 per user. This model will vary in costs to the organization. It depends on the number of users who choose to interact with the LMS within the billing cycle.
If you’re an L&D Head/Manager selecting a top LMS and want to create a culture of continuous learning and development for all your employees. Choose a plan where every employee becomes an active user. Do not worry about extra for additional users.
If you have chosen an expensive LMS counting on low usage, you may end up discouraging users from logging in. Vendors sell active users licenses training companies. It may or may not be the best model for some corporate organizations. Especially the ones that wish to embed a continuous learning culture.
Duration-based licensing (based on user slabs or unlimited)
Under this form of pricing, you purchase a license to use the LMS for a specified duration (1–3 years). On expiry, you renew it. This model does not consider the number of interactions an active user has with the system. Instead, it focusses on the commitment of the buyer to purchase the license for an extended period. It also looks for a guarantee on the minimum number of active users—sometimes both, in order for unlimited user access.
The vendor allows unlimited usage of the LMS once the buyer agrees to purchase the license for extended periods. The number of minimum active learners using the LMS is important as well.
The only catch here is the vendor may license the product only if you agree to use the LMS for an extended duration. Which may last for up to 3 years. With or without a guarantee of a minimum number of users.
For an organization with a robust L&D budget and large employee size, this is a good option. Watch out for the lock-in period. The cost to exit. And data migration, in case you choose to look for an alternative system.
All of the pricing models listed above revolve around cloud-based LMSes, while perpetual licensing is a model for on-premises systems. This form of pricing generally involves an initial one-time cost of licensing the LMS. It also covers implementation on the organization’s internal servers or datacenter.
Post-implementation on site, the organization pays a maintenance fee to the LMS vendor. This fee is either annual or if they choose to upgrade and scale the system. The vendor may price this out for a specific version of their LMS. Automatic updates or upgrades are mostly not be involved. They may also charge you a percentage price of their latest version, in order to update the older one.
Custom Pricing Model
Small and medium-sized business prefer this model as they do not find any of the aforementioned pricing models viable. Vendors are increasingly working towards understanding the organization’s budget constraints. Based on which the LMS they offer is not a complete version of the actual system. By limiting the functions of the LMS to its basic features, the vendor charges less than the cost of the complete LMS. This is just one of many ways in which vendors offer customized pricing models.
The key is in understanding your own usage patterns, and what you as the L&D Head/Manager want to instil in your learners. If a culture of continuous learning and development is what the organizations want to head towards. Selecting a plan based on an active number of users may not be the best option. As the need to train and develop human resources is ever-evolving, enabling each learner access to the LMS without extra costs to the organization, is the best option.