Joanna M. Caballero 22 October 2021 5 minutes

What is a Learning Management System and why does your business need one?

What is a Learning Management System (LMS)?

Often referred to as an LMS, a Learning Management System is a software application that provides an environment to manage all aspects of the learning process. It is a platform where you can host, deliver, and track all your training activities.

There are two main types of LMS, SaaS (Software as a Service) which is a web-based LMS, and on-premises LMS. A SaaS or cloud-based LMS means that your Learning Management System is hosted on a web server, not a local server. It is therefore your LMS provider who is responsible for your platform’s operation, the management of your data and overall management of the LMS. It is also your provider who is responsible for the evolution of your platform, the addition of new modules and new features.

The on-premises LMS is hosted on a local server, for example, a hard drive. In this case, the company is fully responsible for the management and operation of the LMS. In this sense, the LMS is completely customizable to the needs of the organization, however, it is much more expensive to manage.

LMS are used by companies as well as by educational institutions such as school service centers, colleges, CEGEPs, and Universities. They are suitable for any organization that wishes to improve the skills of its employees, partners, and customers to increase its growth.

As we have just mentioned, Learning Management Systems have various objectives based on different targets, such as:

Employee training and upskilling: Employees are at the core of the company's performance. It is essential to put their well-being and professional growth at the center of your concerns to assist their professional development. This will in return increase their productivity and be beneficial to the organization's profitability. A Learning Management System (LMS) helps employees develop and expand their skills, and thus promotes internal career development and retraining.

Partner training: When dealing with business partners, it is essential to maintain consistency in your processes to accurately reflect your brand. Integrating a learning management system allows you to remotely train your reseller network through standardized content so that they can learn and sell your products and services better.

Customer training and onboarding: Training your customers means they can fully benefit from the advantages of your products and services, and thus increase their satisfaction. Furthermore, as is often the case with online software providers, when new functionalities are added, an LMS makes it possible to inform customers directly so they can enjoy the new benefits right away.

Employee onboarding: The LMS is a perfect solution for integrating and preparing new employees for their new position as well as for introducing them to the company and its stakeholders. Using entertaining training content such as videos, games or quizzes, new workers can quickly and easily integrate your company's values, and thus be more efficient and productive faster.

Compliance training: For many organizations, such as those in the transportation or healthcare industries, ensuring employee compliance training is critical to their business. Organizations need to keep employee certifications up to date to ensure they have the necessary skills. With its scalable and customizable interface, an LMS can be configured in such a way that administrators can make compliance training more entertaining, automate training and set up alerts to anticipate expiring certifications. Finally, they can generate customized and accurate reports.


Why should you integrate a Learning Management System (LMS) into your organization?

To keep their business going and to grow, organizations must digitize and automate learning processes to improve productivity and employee engagement. That is why integrating an LMS into their processes should be at the heart of their strategy. Let us review the reasons why your company should consider having a learning management system:


Profitability
The integration of an LMS reduces training costs. Indeed, traditional classroom training requires logistical costs such as transportation for learners and trainers, as well as room reservations. With e-learning, these often-considerable costs can be saved. On the other hand, trainer-related costs can also be reduced, as remote learning does not always require the need for a trainer, depending on the structure and the activity. Numerous research studies have found that remote learning can save up to about 45% of the time spent on traditional on-site training.


Flexibility
With the emergence of cloud-based Learning Management Platforms, information is centralized and easily accessible. Learners can access their data anytime and from anywhere, whether it is on their computer, tablet, or smartphone. This not only ensures the accuracy of the data, but also prevents any loss of information.


Productivity
A Learning Management System provides in-depth training to help employees gain efficiency and productivity. A Learning Management System also ensures that multiple users are trained simultaneously at the same pace, as well as providing them with learning paths tailored to their professional development. Productive employees become profitable ones.

HR Magazine reports that companies investing $1,500 or more in training per employee each year have on average 24% higher profit margins than others. The American Society for Training and Development (ASTD) collected training information from more than 2,500 companies and found that companies that provide comprehensive training have 218% higher revenue per employee than others.


Measuring the Return on Investment (ROI)
The key issue when it comes to training is to make sure that the budget spent on the training program has improved the company's performance. A Learning Management System is designed and delivered with the objective of providing companies with an increased return on investment in multiple ways. The main one being to replace traditional on-site training. The LMS acts as a learning hub, with the capacity to host an infinite amount of training content. By integrating a scalable Learning Management System - that can add specific features or modules according to current or future needs - companies significantly improve their business results and ensure sustainable growth.

Finally, the LMS provides accurate reporting to identify existing training inefficiencies and allows learners to focus on the training content needed to develop their skills. This way, LMS ensures employee retention and as a result reduces employee turnover significantly.


To face the future of work and to upskill the workforce, companies now have no choice but to rethink their training management. Learning Management Systems are designed to help organizations address the new reality of work due to the COVID-19 pandemic, with the aim of supporting their growth.


To learn more about the benefits and features of an LMS, feel free to contact us to get your free demo.

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Joanna M. Caballero

Senior Director, Product Development