How much will e-learning cost me? This is a question that most Operations Executives, HR Managers and Training Managers ask at some point. It’s not an easy question to answer since there are so many possible variables. A better question and one that can be answered with a degree of certainty is “What is the cost of NOT training?”
I recall many years ago when I was finishing my basement and I felt comfortable doing much of the work myself. Rough carpentry was fairly simple, running conduit was easy, attaching lights was not hard, screwing drywall was quick and forgiving. But there was one thing I would not tackle, drywall finishing. I recall watching the contractor putting on the mud and carefully scraping it away until it was perfectly smooth. As I watched him I commented how good he was at this and I’ll never forget his response: “Hey, I’m a professional, I do this for a living”.
I’ll bet you’re not surprised to hear that the answer is “it depends”. Let’s look at a possible scenario. We’ll use as an example a growing company with 500 employees that needs an eLearning module on regulatory compliance that all employees must complete. The three options they explore are to build it themselves, to purchase a generic library course at $20.00/learner or to have a custom content developer build a highly interactive course module just for them for the cost of $15,000. They reject the first option because they wisely recognize that they lack the skills and resources they need to do it well. So, for option two the math looks simple. 500 X $20= $10,000. Clearly less expensive than option three, right? Yes, for year one, but remember, we said that they are growing so let’s say they add 100 employees a year for the next 5 years. That’s an additional 500 and an additional $10,000. So now the total investment in the library course is $20,000 and growing each year. Meanwhile the custom content is still $15,000.