Thank you for e-mailing your helpful comments on last month's issue of Focus Forward, which covered writing white papers. Many subscribers found the issues informative and useful since white papers are an important element in many companies' overall marketing programs. This month's issue is the first in a series about eLearning. Other issues will appear in the upcoming months. Have a comment? Send me your feedback.

This issue discusses these essential topics:

For New Subscribers

Welcome to Focus Forward, the monthly newsletter of Tim Rosa Associates. If you like what you're reading, stay with us. Each issue of Focus Forward will feature a viewpoint on a critical customer topic. We'll focus on what's happening and what's coming down the line. These are issues that you've told us keep you up at night. Though we work with clients in the technology, healthcare, and financial services industries, we hope the newsletter will be informative to all.

eLearning: Global Reach, Local Touch

According to IDC, worldwide eLearning revenues will surpass the $23 billion mark by 2004—extraordinary considering the market was less than $2 billion at year-end 1999 (1). In addition, the European eLearning market is expected to reach almost $6 billion by 2005 (2). As personnel in global organizations work in a geopolitical climate fraught with a heightened sense of security and regulatory demands, they need to approach the training needs of their employees, customers, and partners with a new perspective. Many companies are evaluating computer- and Web-based training solutions that are typically grouped under the general name of “eLearning.”

At Tim Rosa Associates, we developed a blended (classroom- and Web-based) training solution for a technology client that converted training from a loss leader to a profit center in less than 1 year.

Has your company started the eLearning journey? Even if you're continuing the quest, you're likely to still ask these questions:

• What is eLearning?
• How do you make a business case for eLearning?
• How is eLearning different from traditional training methods?
• What are the most popular authoring tools for eLearning?
• Can you re-use existing materials in an eLearning environment?

These are all great questions, and thousands of pages have been written trying to provide answers. In this and upcoming issues of Focus Forward, we'll give you some things to think about and add our own perspective.

What is eLearning?

How does your organization define “ eLearning”? This may seem like a simplistic question, but names and labels really do make a difference. If you Google “What is eLearning?”, Google returns 975 hits, comprising tens of thousands of Web pages (3). The many definitions vary widely and have different points of focus, including:

• Visionary: “Use of Internet technologies to deliver a broad array of solutions that enhance knowledge and performance.” (4)
• Technology: “A form of instructional authoring that can be delivered through a CD-ROM, over the LAN, or on the Internet. ” (5)
• Process-oriented: “The process of combining content with support and community.” (6)

Once your company defines what eLearning means, it can provide structure, clarity, and a mental framework for communicating its business objectives internally to employees and externally to its various constituencies.

Making the Business Case for eLearning

Developing a business case for eLearning is an essential element of its value proposition. Your business case should be centered around a quantifiable, reliable, and compelling estimate of the Return on Investment (ROI). The key to producing a credible ROI lies in determining the hard cost, hard revenue impact, and soft competitive benefits.

Hard Cost Savings

Hard cost savings are quantifiable in financial terms. Most companies should be able to estimate or measure these savings. When accumulating the total hard cost savings, consider these factors:

• Travel: Traditional classroom-based training requires personnel to travel to one central location. The hard travel savings are easy to calculate—airfare, hotel, meals, car rental, etc., and multiply by the training headcount.
• Facilities: Savings on renting the training facility.
• Instructor fees: Savings of paying a trainer from your company or an outside instructor.
• Course materials: Savings on printing, distribution, and storage of training support materials.
• Reduction of customer support costs: Start with the average cost per minute for support calls.

Hard Revenue Impact

Hard revenue impact is the total revenue value of the solution that you can estimate or measure. When examining hard revenue impact, think about these issues:

• Lost revenue (opportunity cost): Inadequately trained sales personnel.
• Increased productivity: More efficient job performance for employees after completing the training or more revenue-producing days per sales rep.
• Reducing time to market: Shortening the training ramp expands the front end of a product life cycle, resulting in increased revenue.
• Increased revenue: Increasing the effectiveness of partners who sell your product or service.
• Increased revenue opportunities: Delivering fee-based training and/or certification to customers, partners, and suppliers, and the ability to deliver more revenue-generating courses to more customers.

Soft Competitive Benefits

Though soft competitive benefits can be as forceful as hard cost savings and hard revenue impact, they are difficult and sometimes impossible to quantify and measure. When added to the “hard numbers,” the soft competitive benefits can provide a more complete view of total ROI. Consider the following values:

• Immediacy: Since education is treated as an ongoing process and not an event, knowledge transfer is always only a Web browser away.
• Consistency: Automated, technology-based approaches to large-scale knowledge transfer are inherently more consistent in their delivery than human interaction, which can vary from trainer to trainer and event to event.
• Certification: Web-based eLearning is a cost-effective medium for certifying knowledge on a large scale.
• Ongoing assessment: Knowing whether employees, customers, and partners are “getting it.”
• Increased morale: With simultaneous training, students in different parts of the world are not relegated to second-class roles.

Summary

eLearning has become an excellent training option for technology, healthcare, and financial services companies worldwide. Though challenging for even the most robust training department, crafting well-planned, professionally executed training materials increases revenue, educates customers, enhances brand loyalty, and increases employee productivity. Having a shared definition of what eLearning is and understanding how to calculate the ROI for eLearning inside your organization are critical to your company's success.

¹ IDG's Press Room
² e-Consultancy
³ Google search results on March 30, 2004.
⁴ eLearning Alliance
⁵ School for Champions
⁶ Chief Learning Officer Magazine

Resources

Learn More

With broad expertise in instructional design methodologies and the latest eLearning technologies, Tim Rosa Associates can quickly and efficiently develop training courses and materials for you. Tim Rosa Associates works with dynamic and influential companies in diverse technology markets, including hardware, software, security, media, and information technology services. We bring to our technology clients broad industry experience and insight gleaned from hundreds of successful projects. To find out more, go to www.timrosaassociates.com/L2_training.html.

Thanks for reading,
 

Tim Rosa
617.332.7895

Focus Forward Copyright © 2004 Tim Rosa Associates. All rights reserved.