number of different factors when determing the best training
delivery approach for their staff or organization. Factors
include: efficiency, timeliness, consistency and appropriateness
of the delivery method. The key factor for most organizations,
however, is program cost. Program cost may be comprised of a
number of related sub-factors, too, which may include:
development costs, instructor time, materials, travel, and
opportunity costs for the students and participants. All these
factors can have a wide variance, even in similar programs, due
to the delivery method used.
Managers may want to develop their own mathematical model to
better understand the relationship between costs and delivery of
their training programs. Many managers have found a common key
element when they have analyzed the costs of their learning
programs. Their key finding: e-learning is less expensive to
deliver almost regardless of the participant population. For
example: in populations where the participants number 100 or
more, e-learning had clear cost advantages and as the population
number increases, so does the cost advantage. Cost advantages
were still measureable in groups of 100 or less and even with
classes as short as one hour in length. In a corporate study
conducted by Catepillar, they determined that e-learning was 40%
less expensive than the tradiational classroom models.
When preparing to conduct a cost analysis study, managers should
be prepared to understand all the different factors involved
with the development and delivery of training programs and then
develop a customized list of factors that are applicable to the
organization’s training needs and environment. For example, the
costs associated with a physical classroom can widely vary
depending on the geographic and physical plant characteristics
of the company. For some organizations, it may not be relevant
to conduct any sort of market analysis if their niche market is
highly specialized or small. On the other hand, factors such as
timeliness, travel costs or development costs may be very
relevant for the organization to consider say, for example, if
they are outsourcing their training programs.
After the manager has created their unique “model” or list of
factors or variables for analysis, they are ready to begin the
comparison process. Gather data from comoparable organizations
or training delivery programs, preferably from those using like
and differening models. This will help in benchmarking the
organization’s costs to that of comparable companies. If the
organization or department has specific regulatory or quality
assurance standards, such as Cancer Registry departments as part
of a healthcare organization, the costs associated with training
(or not providing training) for compliance may also need to
included in the analysis process.
e-Learning may not be the best delivery method for all training.
For example, programs that require role-playing, individual or
group interaction or observation of the participants are not
conducive to online learning. On the other hand, the total cost
of delivering instructor-led classes to many students must be
taken into consideration whenever the organization begins
planning a large training program. Cost analysis may reveal that
a combination of both e-learning and tradiational classroom can
deliver the optimal training delivery needs of the organization.
Once the manager has completed the cost comparison process
results should be documented carefully and used for future
comparative studies or even for training program justification
and strategic planning purposes.
Copyright 2005, M. A. Webb. All Rights Reserved
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