When it comes to eLearning, instructor-led virtual and interactive classrooms with two-way video and audio are the gold standard. Sure, passive video modules which play a recorded session will meet regulatory requirements for things like safety training and basic company procedures and they have several advantages, the first being they’re cheap to make and can be used over and over ad infinitum bringing their cost per deployment down to pennies. But if the content is complex and involves analytical concepts and value judgments or involves messages for middle and upper management, then a virtual classroom with a live instructor is the optimum solution. It may cost a little more but given the level of complexity and the critical demand to get the dissemination right the first time, it is the only solution which almost guarantees success. Costing out a program starts with mapping the complexity of the material required, the lifespan – is this a one-off product launch or something which will be evergreen. Lifespan is important because it will affect how the startup cost will be amortized. Obviously, an evergreen program will be spread over more years and have less impact on budgets. For example, on-boarding videos can be done fairly quickly and without a major investment since they are passive self-paced videos. And they are also generally, evergreen, in that the content doesn’t need to be updated frequently and if it does, then it’s fairly easy to change.
Still, beware of the hidden costs of doing it wrong. One, on-boarding is an area where ROI is too often negative. It’s sadly neglected strategy and results in the loss of up to 25 percent of new hires within a year, reports the 2012 Allied Workforce Mobility Survey. Given the cost of hiring at an average of $10,731, it’s an expensive mistake to have an underperforming on-boarding process. The Aberdeen Group: Onboarding Benchmark Report, notes effective on-boarding boosts retention by 52 percent and time to productivity by 60 percent. Further, employee retention, as one of the goals of ongoing eLearning, is a critical ROI that doesn’t always show up in the top line numbers. Training Magazine, for example, heralded Discover Financial for its training innovation after the converted 70 percent of their instructor-led programs to interactive eLearning. Employees felt valued and less likely to look for a job elsewhere.
Staffing agency Robert Half says training and career path management go hand in hand in employee retention. Again these are soft ROI with prices tags which don’t necessarily show up as an eLearning benefit. One way to calculate your ROI is to use an equation. Average Salary Per Employee divided by Hours worked per year then multiplied by the hours saved per year across the organization. From that deduct the cost of the eLearning program. If there’s already a training program in place the cost of eLearning can be compared and savings noted since there won’t be any travel and accommodation costs.
Finally, the costs of starting up and implementing an eLearning program across the organization may seem daunting at first glance. However, it’s critical to consider the costs of not implementing a program and asking the question: Can we afford to risk the negatives, both in terms of bottom line dollars and loss of high-value employees, by not starting one?