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Why organisations misallocate training budgets – e-learning feature

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Christiaan Heyning, General Manager of ICUS UK, suggests that companies are leaping in before they know how e-learning can work for them, and ignoring the change
management requirements.


Increasingly, almost all companies are engaging in some kind of eLearning, or are in the midst of implementing it. For example, in 2001 European companies spent GBP 224million
on e-learning projects, with 50 percent of that expenditure in the UK, according to figures from Enterprise Ireland, the Irish government's trade and technology body.

Unfortunately, if past performance is anything to go by, much of the time and money spent on these projects is wasted. Not because e-learning is a useless hype (far from it), but because companies are falling into one, or sometimes even two, traps: to start with spending on technology without having proven the concept of e-learning first; and a corollary to that, ignoring the change
management requirements.

Let’s look into the first trap: spending money on technology without having proven the eLearning concept first, usually by acquiring a Learning Management System (LMS). Not only does this often lead to companies buying technology that does not fit their needs, it also raises the bar for judging eLearning since implementing an LMS is very disruptive and capital intensive. Clearly, the organisation expects something big in return for all that pain!

Research firm Gartner has estimated that worldwide, firms waste as much as 20% of the USD2.7 trillion spent annually on technology; spending on an LMS indeed falls into this
category of wasteful expenditure. A consequence of focusing on the technical side of eLearning is the neglect of the change management and communication aspects in eLearning implementation. Far too many companies think that if they make courses available on-line, the participants will be naturally induced into enrolling and finishing these courses. Unfortunately, this is far from the truth: an informal straw-poll revealed that take-up rates of courses placed on-line are 15% at best in these cases. Of course, this is not surprising when you think about it: why would employees do an on-line course if the benefits of doing it are not clear to them?

The good news is that both traps can be avoided. An obvious alternative to buying an LMS as the first step in an eLearning project is to use an LMS-hosted by a specialist provider, at least for the duration of a pilot. This way, the energy (and money!) can go into finding or developing relevant and engaging content, and using this content in a pilot to gauge user reaction to, and satisfaction with eLearning. This approach will save you money. More importantly, it will also indicate how the organisation will react to a large scale e-learning implementation, the functionality required from an LMS, and the type of content needed.

Armed with this knowledge, you can now either decide to continue with the hosted LMS solution, or buy one yourself; but at least you now know that you are buying something you
really need.

The second trap (ignoring change management and communication aspects of eLearning) can also be addressed but is trickier as it is largely culture-dependent. Sure, e-learning needs to technically work but that is only the first step. Since it is safe to say that by-and-large
employees are already pressed for time, eLearning will have to compete with other business activities. So, two things must be assured for eLearning to ‘win’ this competition for
employee time and effort: firstly, employees must be convinced that the eLearning courses on offer are of benefit to them; and secondly, employees must be assured that the organisation rewards them for doing the courses.

To achieve these two goals companies must do a change management and communication campaign when implementing eLearning. This campaign should not only be targeted to the
prospective learners; it is also important to target their managers as well. The managers, after all, will have to give the rewards and provide day-to-day stimulation and encouragement. Senior management must also be won over since they have to ‘walk the talk’ and extol the benefits of eLearning as a strategic initiative.

If you follow the advice above, and stay clear of the traps, you can then divert your attention to what are truly crucial matters in eLearning projects: where to get effective content; how to achieve organisational support for eLearning and when to integrate eLearning with face-to-face training.


Christiaan Heyning
General Manager, ICUS UK

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