LMS Buying Process - Learning Management System Business Case

Once the due diligence of market research has been done, it’s time to develop a learning management system business case to define why a learning platform will benefit your employees, contractors, channel partners and organization as a whole.

What is a learning management system business case?

The term “business case” is in the vernacular of executives who approve budgets and large expenditures. Since an LMS isn’t cheap, it will likely require the approval of several executives who will want detailed information about what this expenditure is, why it’s necessary, how long it will take to select and implement and what measurable business results can be expected.

A good learning management system business case should be in the language that executives understand and is the quickest way to gain budget approval.

Why buy a new LMS?

Most likely, your organization is experiencing one of these two scenarios that’s driving the need for a new LMS:

  1. The existing LMS is more hindrance than help. This means the old, dull learning management system needs to be replaced because you’re paying too much, getting too little, and doing too many manual, administrative tasks. If you’re getting learner complaints on functionality, have difficulty supporting multiple training audiences (such as customers, partners or global entities), or are spending a lot of time compiling reports, it’s time for a new LMS.
  2. There is no system, everything is done manually. It’s time for your first LMS. Small and medium-sized businesses (SMBs) can often start out with a spreadsheet system, but quick growth makes manual administration of employee learning unsustainable. The new work-from-home environment, contractors filling in to handle workloads, channel partners or customers who cannot rely on salesperson visits for training are all scenarios driving the need for a first LMS purchase.

No business case? Request denied.

It’s tempting to skip the learning management system business case altogether. As a learning professional, perhaps a business case is not in your skillset so it sounds like overkill. Maybe you think it will be easier to discuss in a meeting and come to a consensus. It’s not. You need a business case.

The business case places a knowledge document behind your request for a new learning management system. Yes, the discussion and Q & A will happen, but the document summarizes all the options and details that could be forgotten and keeps the main reasons for this acquisition top-of-mind.

Lack of a business case usually results in many setbacks to the LMS selection process, including:

  • A lot of new LMS platform discussion and comparison happens each year, but the budget approval never comes through to move forward with a new LMS purchase.
  • Senior management thinks it’s too much trouble and won’t deliver enough benefit to justify switching platforms.
  • You’re unable to show a link between measurable business results and the cost of a new learning management system and lose the attention of executives.
  • The cost of manual administration and lack of efficiency isn’t specifically quantified, so the LMS acquisition gets put off again as a “nice to have.”

How to create a learning management system business case

As you can see, a learning management system business case is necessary! Not only does it help solidify your position on why a new LMS is necessary, but it also helps senior management ask informed questions and select a team to focus on identifying the best learning management system – rather than solely focusing on if an LMS is even needed.

Let’s discuss how to create a business case that will sell senior management on the need for a new LMS.

  • Focus on use case – Many learning management systems are designed for certain types of organizations, learners (employees, contractors, channel partners), or training to be implemented. Define and describe details for learners and how you want them to interact with the LMS and content.
  • Define your priorities – Odds are, you need a learning management system for both internal and external users. But is it more important to focus on customer training or employee training at this point? Do you need an LMS that can handle both?
  • Conduct research within your organization – Talk to other division or department heads about their perspectives on learning and training in your organization, what they think is working well, and where gaps exist and what those gaps cost the organization. Discuss what options they would like in an learning platform, and take time to jot down verbatim quotes to help solidify your business case.
  • Conduct market research – Learn what competitors and organizations like yours are doing, achieving, measuring and more. Do they have LMS native integrations? How are they growing online learning? These are great questions to start asking.
  • Complete the business case key steps – We’ve created a helpful microlesson for our Premium Members which will take you through the key steps to complete your business case.

There’s a lot more that goes into creating an impressive business case to convince senior management that your organization needs to grow its online learning. And Talented Learning is here to help with two different memberships.

Join the Talented Learning Center

Benefits of Membership

If you are shopping for an LMS or other learning system, join the Talented Learning Center to access deep, fiercely-independent research and education needed to succeed.  We have free and premium membership levels outlined below:

Become a Basic Member

Many resources in the Talented Learning Center are available when you sign up for FREE as a Basic Member. You’ll have access to content such as:

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Become a Premium Member (7-day free trial)

As you’re proceeding through the Learning System Buying Process, you’re likely to face some obstacles and uncertainty about how to proceed. Once again, we’re here to help! Premium Membership in the Talented Learning Center includes many more resources to help you at every stage of the LMS or learning systems buying process. Try it FREE for 7 days when you sign up for Premium Membership, where you’ll receive all the benefits of Basic Membership, plus:

  • Ask John Leh Videos – Learn about learning systems technology one question at a time with our library of short informational videos.
  • Microlessons, Courses and Certifications – Get up to speed with our library of over 20 (and growing), 15-minute, microlessons on learning systems use cases, stages of the buying process and key functional capabilities.
  • On-Demand Webinars – Get in-depth expert advice with our deep catalog of webinars and panel discussions on a wide variety of topics from buying, implementing and improving your learning system initiatives

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