Building the Business Case for a Learning Management System

Oct 14, 2024 | AI, Articles

In an era where the landscape of learning technology is evolving at a breakneck pace, many organizations are looking to overhaul their learning technology strategies. Brandon Hall Group recently authored a brief that provides guidelines for creating an LMS business case, and a roadmap for adopting next-generation learning systems.

Building a strong LMS business case

In the brief, Brandon Hall Group outlines the essential steps that potential LMS buyers need to take to build a compelling business case for advanced learning systems. Here are some of Brandon Hall Group’s recommendations for potential LMS buyers:

  • Identify a champion: Those on the hunt for an LMS should secure a leader outside of the Learning & Development (L&D) team, who can advocate for the desired solution and bridge the gap between the learning organization and the rest of the business.
  • Build an internal team: Assembling a team that includes stakeholders from various departments during the selection process is an important step for choosing the right LMS.
  • Set a realistic timeframe: Establishing a clear timeline for system selection and implementation is key, especially for organizations that are considering replacing or upgrading existing systems.
  • Define LMS “must-haves”: Most organizations make a list of “must-haves” that include essential functionalities, technical requirements, and viability criteria for potential learning systems. These priorities will depend on the industry, size, and geography of an organization.

How to convince a buying committee

An internal team of stakeholders will likely be involved in making the LMS buying decision. Brandon Hall Group’s brief identifies the following groups as key decision-makers: HR/Learning professionals, IT professionals, managers, and learners.

Illustrating the potential benefits of an LMS to these internal stakeholders is critical for getting buy-in for an investment. Brandon Hall Group lays out the interests, relevant metrics, and desired outcomes per internal stakeholder, as they relate to potential learning solutions. The brief also encourages leaders to ask a few key questions before investing in a new LMS:

  • How is this LMS different from our existing training technology?
  • What LMS capabilities have the potential to improve our business outcomes?
  • How will these systems support our overall organizational objectives?

Budget considerations for buying an LMS

Next-generation learning management systems provide an extensive range of capabilities that cater to the needs of both administrators and learners. Each organization is bound to prioritize different factors when budgeting for new learning solutions.

Here are just a few of the elements that learning leaders are advised to consider when choosing an LMS:

  • LMS ROI: Consider metrics like employee performance, increased productivity, reduced training costs, and employee retention.
  • LMS scalability: Consider whether the LMS will track with your organization’s growth and evolving goals.
  • LMS integrations: Consider whether your LMS integrates with existing HRIS and ERP solutions and what strategies will be needed to ease integration.
  • LMS user experience: Consider whether the LMS has user-friendly features.
  • LMS security and data privacy: Consider how a new a LMS fits into industry requirements and overall company strategy or policies.
  • Adaptability of the LMS to emerging learning trends: Consider whether an LMS can keep up with trends that your organization might prioritize, such as gamification, microlearning, or AI for adaptive learning.

When choosing an LMS, buyers must consider more than functionalities. They should be asking which tools will meet the diverse needs of their learners and match their business goals.

Questions to ask before investing in an AI-Powered LMS

More than two-thirds (67%) of those surveyed for Brandon Hall Group’s Learning Benchmark Study predicted that “Learning & Development” as the most likely use of AI in Human Capital Management. AI capabilities are becoming table stakes for organizations facing increased complexity and a need for more flexible, personalized learning options.

However, with so many next-generation learning platforms adopting AI capabilities, there are many questions that buying committees will want to answer before choosing the right AI-powered LMS, such as:

  1. Budget: What is our budget for learning-management technology? What do we currently invest in and what are we planning to invest in for the future?
  2. Implementation: Do we need third-party support for implementation? What is a realistic implementation timeframe? Will HR or IT own implementation? Do we need post-implementation training? Do we need a global implementation strategy?
  3. Pricing: What is the cost of a next-generation system and what pricing model is available to us (pay-per-user, subscription, licensing, implementation fees, etc.)? What happens if the price rises after the first year?
  4. Timeframe: When should we revisit our existing contracts with technology providers? When do we need to upgrade our HRMS or ERP technology?
  5. Delivery Model: What is our preferred delivery model? If we currently use on-premises solutions, what internal resources do we need to support SaaS or cloud-based systems?
  6. Metrics: How do you measure the real impact for your organization? What metrics are required to measure the effectiveness of our learning management system? How will this system enable competency and skills progression as well as productivity and performance?
  7. Integration: How will we handle integration? What existing solutions need to be integrated with and how will this integrate with our ERP or HRMS?

Buying a new organizational learning platform takes research, planning, communication, and (often) a bit of persuasion. Brandon Hall Group’s latest guide gives learning and business leaders everything they need to get started.

Need to build a business case for buying your next LMS? Check out Building the Business Case for Learning Management Systems to get started!