eLearning as a Profit Center
Companies everywhere are expecting more and more from their learning departments. They want them to equip the workforce with the skills and knowledge they need to better achieve business goals, and to prove that learning initiatives are having the kind of positive, quantifiable impacts intended. If you can make this happen at your company, then you can begin to transform eLearning from it’s oft-perceived second-class status into a vital profit center of your organization.
So how do you go about proving your eLearning initiatives (or any learning initiatives for that matter) are fueling business growth? The key is in your LMS. There’s no substitute in this case for robust reporting capabilities in an LMS, so make sure yours is top-notch in that regard.
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But there’s a vital step that must occur before grabbing an LMS with top-notch reporting capabilities. You have to first know what it is you’re trying to measure, and that means making sure that the company’s business goals are clear.
Take the case of Techtronic Industries Inc. (TTI) as an example. This is a $3.7 billion global company with 20,000 employees focused on the design, manufacture, and marketing of portable power products. It was in 2007 that the company achieved clarity on its business goals, which included increasing market share and profits worldwide. This in turn would depend on the company’s ability to increase the speed of both product development and sales.
With such a massive undertaking, TTI wanted a completely integrated system that could handle not only the usual LMS tasks, but also content authoring and content management, all of which could be scaled globally. It wound up selecting the CERTPOINT Systems learning platform called CERTPOINTVLS.
Implementation definitely took some major time, but the payoff has been huge. In 2011 sales increased by 11% and profits on those sales by 70%. Even if just a conservative estimate of 2% of that growth is attributed to the new learning initiatives, it’s a tidy sum. Using the new system for focused training on how to handle product returns resulted in cutting returns nearly in half over two years, from 4% to 2.2%, which represents savings of $35 million. Reducing the amount of instructor-led classroom training by 33% represents more significant savings. If you add up the dollar figures from increased sales, reduced product returns, and learning cost reductions, you come up with $46.2 million, while the cost of implementing a new learning system over four years was less than $1 million.
As you can see, taking the time to link your learning initiatives clearly to business goals can result in transforming your eLearning initiatives from being what many perceive to be a drain on the business in terms of cost to a vital profit center that fuels business growth. Then, if you can start making your eLearning courses available to customers and partners who would benefit from them, your eLearning initiatives can even begin generating their own stream of revenues.
For more information on how to make this happen see my article, Level 4 Evaluation for eLearning: Results. Stay tuned for more articles on the nuts and bolts of how to measure the business impact of your eLearning initiatives. It’s the Holy Grail when it comes to corporate learning efforts, and it’s more possible than ever before with 21st century technologies.