As the economy has grown stronger, interest and investment in corporate learning have also been on the upswing. According to Josh Bersin, principal and founder of Oakland Calif.-based consultancy Bersin by Deloitte, corporate learning and development spending increased 11% worldwide in 2013.
However, more money spent doesn't always mean money well spent, Bersin pointed out. "We find that many companies do not really know where all of their L&D [learning and development] money is going -- and they need to rationalize and improve the effectiveness of this critical investment," he wrote in a recent research report.
The technology that supports learning initiatives is no small factor in this cost. According to Katherine Jones, Bersin by Deloitte lead analyst for human capital management technology, many HR managers are looking to replace dated learning management systems with more agile, modern technology. So how can they get the most bang for their buck?
Experts have weighed in on features to look for and technology trends to keep in mind when evaluating new learning technology and suggested ways to approach the buying process. But according to Donald H. Taylor, chairman of the Learning and Performance Institute, based in the United Kingdom, buyers might also need to check their expectations and find new uses for the technology to reap the maximum benefit.
"LMSes tend to be used to do what they were originally designed to do which was deliver ... courses," he said. But today, "systems [are] out there which in one way or another can be used for informal learning, [or] more accurately to support the 70-20-10 model" of target percentages of on-the-job, informal and formal training.
"If you [buy] a car and never take it out of first gear, you can't complain that it drives slowly," he added.
Integration and analytics key considerations in LMS purchases
Taylor likened purchasing new learning management systems to buying a house. Depending on the company's preferences about features, complexity and size, the tool that's right for one organization might be drastically different from the product of choice for another.
Regardless, he recommended that buyers consider cloud-based options. "You don't want to be hosting technology on your own servers unless there's a very good security reason," he said.
David Forman, chief learning officer at the Human Capital Institute, based in White River Junction, Vt., stressed the importance of mobile capabilities to take advantage of anytime, anyplace learning opportunities.
On a more granular level, Jones mentioned some of the administrative perks in modern learning management systems. For instance, money management has gotten easier, with better ability to process chargebacks and splits between departments. Some systems even have e-commerce capabilities, which she said are useful if an organization wants to extend courses on a paid basis to external parties, such as customers or resellers.
Jones also suggested that buyers look at assessment capabilities and analytics. Although assessments are nothing new in learning management systems, she said they've gotten smarter over the past few years. For instance, some can now point learners back to specific points in the content after incorrect answers.
Analytics can provide insight about both learners and learning content. Using the example of a certification to drive a forklift, Jones said LMS analytics can identify employees whose certifications are expiring soon and alert their managers, and show how long on average the certification takes to complete. Analytics can also give managers information on which courses are most popular and reveal recurring problem areas within content.
Ease of use and ability to customize should be two additional areas of focus, according to Forman. And the importance of integration was mentioned by all three experts.
"The market is much more toward that integrated talent management suite -- learning is linked to performance management, which comes out of my hiring system," Jones said. Although standalone, "best of breed" learning management systems might have differentiating features that set them apart, she said buyers should give higher priority to the benefits of cross-functional analytics.
Forman pointed out that if recruiting, performance management and learning are connected, companies can more easily track a new hire's progress and correlate success with other factors. "That's where you can gain insight and get into predictive analytics as opposed to descriptive analytics," he said.
Attitudes, technology shift from courses to smaller learning instances
But the most cutting-edge features on the market aren't helpful if companies don't use them. HR managers who complain that their LMSes limit their ability to deliver informal or continuous learning experiences likely aren't using the technology to its full potential, Taylor said.
"I have seen large companies use LMSes as the back end for very good collaborative learning [and] doing a variety of things which have nothing to do with the traditional pushing stuff out to people," Taylor said. "The reason those are successful is [because] the people implementing them have chosen to use it in a way that will enable them to support blended learning."
Forman said because the most money has traditionally been spent on training, that's what technology vendors have focused on. "So many of the LMSes are based in a training paradigm where it's about course administration, and yet we know that's not really the best way to learn," he said. "But, in the business, that's where the most money is spent, so there's a little bit of the tail wagging the dog here."
However, attitudes within corporate learning functions are shifting from a training focus to a broader notion of learning, Jones said. While training has been historically course-centric, learning is spread throughout processes in more bite-sized task- or time-relevant pieces.
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And this smaller, more focused method can boost people's retention of content, she said. She relayed the story of a company that displayed short OSHA safety tips on time clocks when employees punched in. "They had a significant drop in accidents just with that reminder."
The ability to embed chunks of knowledge that appear on an as-needed basis is available in some of today's learning management systems, Jones added. For example, she has seen clients use Cornerstone OnDemand's Force.com tool in conjunction with Salesforce.com.
"[If] you're a new sales rep and you need to design an RFP [request for proposal] because you've put in the details of what that customer's looking for, you'll get something that says 'John Doe had a similar customer' or 'Fred was pulled into that account before -- you might want to talk to him' [or] 'Here's an example of an RFP that is tailored to that kind of solution,'" she said. While she specifically referenced Cornerstone, she said other learning systems feature these capabilities as well.
Buying solely on price isn't wise
Features aside, Taylor and Jones offered a few additional suggestions for buyers entering the marketplace.
"A common problem I see [is] people buying cheap," Taylor said. "There's nothing wrong with buying cheap if you're prepared to put up with cheap goods ... [but] you can't buy your technology [solely] on the basis of price. Be prepared to have an argument with your purchasing department."
Taylor also frowned on long-term arrangements. "Don't get your organization tied into multi-year deals if you can avoid it," he said. "The fact is there's an awful lot of stuff that's here today, gone tomorrow."
But buyers should still keep the long view in mind to ensure room for growth, according to Jones.
"So often users buy software that barely fits what they want to do today and doesn't allow for expansion for what they want to do tomorrow," she said. "Figure out where [you] are going with long distance Internet-based education in your organization, and make sure that's readily accommodated."
This was first published in February 2014