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Project Management Blog
Monday, 20 October 2014 16:31

ROI of e-Learning


One of the main reasons organizations utilize e-learning is because they believe it will result in a reduction in training expenditures. E-Learning includes several different methods for training sessions like computer based training (e.g. pre-recorded sessions) and web-based training (e.g. webinars). This type of training can occur at the person’s desk or in a conference room with other students. It can be as simple as clicking on a link to a video or as sophisticated as interactive learning with exercises and discussion that allow the student to be more engaged than in just “listening” mode.

The amount that an organization can save determines an organization’s decision to shift to e-learning. Although this can be a reduction in expenses, it may not be the best way to view e-learning. There are numerous other non-cost related aspects of e-learning, such as flexibility, consistent messaging and reach.

However, a business case for e-learning must invariably show a decrease in cost. A typical cost analysis between e-learning and classroom training appears straightforward:

Classroom Expenses

Facility Costs

  • Room rental
  • Training material
  • Teaching aids
  • Refreshments
Instructor Cost

  • Instructor salary and other benefits (if internal)
  • Instructor fee (if outsourced)
  • Travel and meals
Learner costs

  • Cost of time away from workplace
  • Labor replacement costs
  • Travel and living costs
e-learning Expenses

Facility Costs

  • Incremental desktop computer costs
  • Course development costs
  • Web-enabled LMS costs
  • MIS support
  • Costs of the learners being away
  • Hosting costs
  • MIS support
Though used often, this break-up does not account for the total ROI on e-learning, which also includes efficiency (E) and speed (v).

Some of the efficiencies should include:

  • Reduced time away from the office
  • “Just in time” training on an as-needed basis
  • Elimination of travel time to/from classroom training
The speed perspective represents how quickly the learning can occur compared to traditional classroom training. There is a significant amount of “on-demand” training on product websites (e.g. Microsoft) and more informally on YouTube where users can easily demonstrate common techniques.

From a training delivery perspective, it is become more commonplace for employees to either work virtually or work out of their homes. Being able to deliver training nearly anywhere at any time becomes more of a necessity than an option.

Although some of the real costs (classroom, instructor costs, travel) must be considered in making a business case for a return on investment, there are many other elements of e-learning that can be made in the benefits of this approach.

Classroom training may be a necessity in some specialized cases but there are significant advantages, outside of the primary cost perspective, that can substantiate e-learning as a viable option.

At TenStep we are dedicated to helping organizations achieve their goals and strategies through the successful execution of critical business projects. We provide training, consulting and products for organizations to help them set up an environment where projects are successful. This includes help with strategic planning, portfolio management, program / project management, Project Management Offices (PMOs) and project lifecycles. For more information, visit or contact us at

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From 1945 to 1965, the financial market in the U.S. moved upward. It then moved sideways until 1982, and up again until 2000. Right now, we are engaged in another great sideways movement. It could continue for another decade or so, and as businesses fail and members of congress pound their fists, it is natural to fear for the future.

These types of fears can be especially dangerous for businesses, as management often makes unwise decisions out of panic. For example, they might cut employees or reduce spending on various programs that are good for the company. Consequently, many companies that slash costs in response to an economic recession find themselves unable to achieve top-line growth when the recession ends. 

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Part 2 of a 3 part series…Read part 1 here:

more-lessAccurate Project Costs -- How to obtain them, improve estimates with them and dramatically increase your effectiveness by knowing them.

Critical Business Issue (CBI) – Something that might get me fired or put in jail if I screw it up again.

For most IT managers, inaccurate estimates constitute a CBI.  Why are accurate estimates so important?

  1. Inaccurate estimates cause over-commitment. Have you ever worked in a place where ten percent of ten projects got done instead of 100 percent of one project? Ultimately, nothing is accomplished and everyone is totally stressed out. Inaccurate estimates cause over-commitment of time, yet not much gets done.
  2. Inaccurate estimates cause bad decisions. “Inaccurate” usually means “too low.” When this happens, the return on investment (ROI) calculation shows the project as ‘worth it’ when it is not.
Published in Blogs
Monday, 12 January 2009 17:53

Goal Setting Versus ROI

Motivation begins with setting goals for improved team performance. Often, five or more team members must strive to achieve similar goals.
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