Building the Business Case for an LMS
Whether you are considering your first LMS, or you need to upgrade an existing solution where there’s no alternative to building a solid business case. Each organisation will have its own particular requirements for what should be included in a business case, but there are some things that will be common to them all.
What do people need?
There’ll be a whole range of stakeholders, from executives and managers through to the learners themselves. Not forgetting IT, and the trainers, administrators and others who will actually be using the system.
From the start it’s critical that you find out what they need, and I’m very deliberately saying “need” and not “want”; the two things are often very different.
If possible, take the time to develop user cases for each group of stakeholders. These can be very helpful in explaining the potential benefits of an LMS, and identify what impact it may have on each group.
What will it enable?
Unfortunately, too many people build their whole business case around cost savings, when they should be focussing on what improvements they believe it can bring to the organisation, such a greater productivity, increased sales and improved customer satisfaction.
To be successful, a business case needs to get buy-in from everybody, and the way to do that is to sell the benefits. Again, I’m being very deliberate here in referring to benefits rather than features. It’s very easy to trot off a list of the features that an LMS has, but that’s not as competing as the benefits it will bring to the organisation.
Instead of saying “you can group activities together as learning plans”, try “we can present employees with the training materials specific to their role”.
Focus on how it will enable the organisation to meet its goals. Really try and get to the heart of the problem that has led you to consider an LMS, and then list credible ways that it can help to solve them.
Assuming it isn’t a core driver, don’t forget to include other requirements such as legislative compliance that may benefit from adoption of an LMS.
If this is your first LMS it can be tempting to look at how they have benefitted other organisations. There is always some merit in this, but be careful not to depend on this too much, as the focus of the business case should be on what it will bring to your organisation.
What about costs?
Although a strong business case shouldn’t have to lead on cost, it does need to be included somewhere.
A word of warning; if you are going to major on cost reduction, be clear about what’s involved in realising any savings. If you want to reduce face to face training costs, or improve the efficiency of administration, you need to understand that any savings may well remain theoretical unless you reduce headcount.
Introducing an LMS doesn’t have to be about cost saving at all. It may be cost neutral, or if the benefits are great enough, it may even increase overall costs.
What are the risks?
There are risks in any project, particularly large scale IT implementations, but there is nothing uniquely risky about an LMS. Ensure that all genuine risks are considered, and that contingency plans are in place.
What if we don’t do this?
Finally, every good business case will give consideration to the question “what if we don’t do this?”. The answer should cover alternative approaches and the associated pros and cons, as well as the risks of not doing anything.