Learning is essential to any organization’s success because it improves business results,boosts productivity, and increases organizational competitiveness. Learning helps produce positive business outcomes in critical areas and at key moments in an organization’s development, such as during mergers and acquisitions, restructurings, and product launches. Outdated LMSs are holding organizations back, yet they’re often one of the last enterprise software systems to be replaced. For some, it’s seen as a cost center or simply a compliance exercise that only requires the bare minimum investment. That puts the onus on learning leaders and stakeholders to make a strong business case for upgrading. In this white paper, we’ll cover: Indications that you might need a new LMS Benefits of a next-generation LMS Building your LMS business case Preparing for the transition

1. SAP White Paper
Learning
Building the Learning Business Case:
The ROI of a Next-Generation LMS
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Table of Contents
4 Introduction
5 How to Know When You Need a New LMS
5 Considerations and Benefits fo the Next-Generation LMS
9 Building Your Business Case
10 Transitioning to Your New LMS
11 Conclusion
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3. Building the Learning Business Case: The ROI of a Next-Generation LMS
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Face it. Technology change is tough.
And every organization has gone through
painful technology purchases and
implementations.
Sometimes it’s a necessity. If your learning
management system (LMS) is more than
a few years old, you’re likely missing out
on new, important capabilities. This isn’t
just about new fads or cool technology,
it’s about real learning outcomes being
out of reach.
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Building the Learning Business Case: The ROI of a Next-Generation LMS
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Introduction
Learning is essential to any organization’s suc-
cess because it improves business results,
boosts productivity, and increases organizational
competitiveness. Learning helps produce positive
business outcomes in critical areas and at key
moments in an organization’s development, such
as during mergers and acquisitions, restructur-
ings, and product launches.
Outdated LMSs are holding organizations back,
yet they’re often one of the last enterprise
software systems to be replaced. For some, it’s
seen as a cost center or simply a compliance
exercise that only requires the bare minimum
investment.
That puts the onus on learning leaders and
stakeholders to make a strong business case for
upgrading. In this white paper, we’ll cover:
•• Indications that you might need a new LMS
•• Benefits of a next-generation LMS
•• Building your LMS business case
•• Preparing for the transition
More than two-thirds of companies
believe moving to next-generation
learning is urgent or important, yet
only 6% have mastered the technology
and content aspects of learning.
Deloitte
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Many organizations haven’t updated their
learning systems in years. Sometimes, it’s
been a decade or longer.And in some cases, an
organization doesn’t have an LMS and is buying
one for the first time.
After the global recession at the end of the last
decade and the slow recovery that followed,
companies didn’t prioritize learning purchases.
But we’re finally seeing more organizations
seriously consider new LMS options.There are
seven concerns we commonly see that drive
purchases of more next-generation LMSs:
•Organizations have multiple learning systems:
Depending on the task at hand, employees might
need to access three or more systems to get the
training and development they need. Compliance
training might be on one system, competency or
skills training might be on another, and leader-
ship development might still exist solely in videos
or in classroom environments.
•• They aren’t cloud-based: On-premise learning-
solutions were the norm just a few years ago,
but the cloud has allowed employees to work
anywhere — unless they want training from
your on-premise LMS. Training has to be deliv-
ered manually, or when — and if — they come
into an office, behind the firewall.
•• Dated systems hurt learning adoption: Dated
interfaces and clunky experiences don’t en-
courage employees to really engage in learning.
If a system is severely outdated, it also shows a
lack of investment by the organization in
development.
•• Learning content is inaccessible: Your employ-
ees get email and access other company re-
sources from their smartphones or tablet de-
vices, yet they can’t get critical training when
they need it because older systems don’t sup-
port it. Even if your LMS did support mobile ac-
cess, many of the resources — like Flashbased
simulations and videos — don’t work on most
devices.
•• Lack of analytics and reporting: Most learning
systems, even older ones, have the ability to
track course completions for compliance pur-
poses. What many can’t help you understand is
how, where, and to whom training is delivered
so you can measure the efficiency of internal
and external training sources and the overall
impact of training experiences on employees.
•• Discontinuing or lagging vendor support: Many
legacy vendors are discontinuing support for
their on-premise solutions as they move on to
updated editions and cloud-based solutions.
That leaves organizations using third-party sup-
port providers to get the help they need, some-
times at a premium cost.
•• Learning isn’t integrated with other talent man-
agement modules: All organizations want to at-
tract, hire, onboard, develop, align, and reward
every employee to maximize engagement and
retention. Being able to do this from one inte-
grated talent management suite is key not just
for efficiency but because it can inform other
critical areas like performance and succession
management.
Ultimately, you’ll know you need a new LMS when
the current system has significant shortfalls and
is hampering learning and business outcomes.
How to Know When You Need a New LMS
Building the Learning Business Case: The ROI of a Next-Generation LMS
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Building the Learning Business Case: The ROI of a Next-Generation LMS
So you understand how your current, outdated
system is holding you back. But what should you
look for in a new system?
Though technology is always changing and shiny
new technologies will always get most of the
attention, there are some basic features to be on
the lookout for:
•• Ability to consolidate learning systems: If you
have many LMSs for a wide variety of learning
tasks, one of your chief goals should be to re-
duce that number to one. That means looking
for an LMS that has a wide swath of capabilities
for compliance, development, and even extend-
ed enterprise capabilities.
•• A next-generation system with great ease of
use: Most cloud-based solutions have been up-
dated in the last few years to meet the usability
standards end users demand. The critical point
is that your employees don’t have time for com-
plicated or convoluted software. It has to be
easy enough for your employees to log in and
know exactly what they’re supposed to do,
without deep instruction.
•• Comprehensive mobile access: Ultimately, a
fully responsive solution that looks great on any
device would be the optimal solution, but the
ability to easily complete learning activities on a
smartphone or tablet device is a component
that any modern learning solution should have.
•• Robust analytics and reporting: Learning bud-
gets are not easing up anytime soon. That
means dedicating internal resources to projects
such as developing courses or revisiting past e-
learning activities needs to be based on da-
tabacked use and need. Push providers to tell
you what’s possible with analytics, beyond
mandatory reporting.
•• Support infrastructure: If you’re going to be in-
vesting in and revamping your learning sys-
tems, you want a partner that will be there with
you. Understand where their support begins
and ends, both before and after implementa-
tion. Also, learn more about their partner net-
work of providers that can help support you be-
yond the product.
Considerations and Benefits of the
Next-Generation LMS
Companies that invest highly in their
employees — including training and
development — decrease turnover by 65%.
Great Places to Work
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7. Building the Learning Business Case: The ROI of a Next-Generation LMS
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•• The potential to integrate other talent manage-
ment systems: At some point in the future, you
may want to integrate with recruiting and on-
boarding, performance and goals, compensa-
tion, succession and development, and even po-
tentially a core HR system. Make sure you
choose an LMS that is part of a world-class HR
system.A world-class HR system must not only
support processes for HR, but all the data, infor-
mation, content, and processes to ensure that
each stakeholder group has what they need to
get the job done. Or, in other words, to maximize
their engagement.
•• The ability to move from a top-down to bottom-
up approach: An organization that has truly ad-
opted a learning culture has the tools in place to
make every employee both a learner and a
teacher. However, many organizations today still
have a top-down learning approach where train-
ing departments push training to employees.
This approach, while effective to an extent, fails
to take advantage of the vast amount of knowl-
edge the employees have themselves. By provid-
ing tools that enable employees to create and
share content, organizations can incorporate
bottom-up learning strategies with top-down ap-
proaches, which will help transform the
company.
Although these are the seven building blocks for
any next-generation LMS, there will be specific
use cases your organization needs to solve. For
example, if you have oil workers on the North
Slope in Alaska or in the Arabian Sea, Internet
access may be a barrier you must deal with in
order to effectively deliver learning.
Think about your specific needs as you work to
build a business case.
By providing tools that enable employees
to create and share content, organizations
can incorporate bottom-up learning
strategies with top-down approaches,
which will help transform the company into
a learning-centric organization.
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8. Building the Learning Business Case: The ROI of a Next-Generation LMS
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Helpful learning statistics as you’re building an LMS business case
24%
increase
65%
decrease
6%
mastery
35%
usage
34%
prepared
10%
use
nearly
1/3identified
3.47devices
An investment as low as $1500
per employee in training increases
profit margins by 24%, on average.
Source: Federal Reserve Bank/Georgetown
Companies that invest highly in their
employees—including training and de-
velopment—decrease turnover by 65%.
Source: GPTW
More than 2/3’s of companies see the
trend to next-gen learning as urgent or
important. Only 6% have mastered the
tech and content aspects of learning.
Source: Deloitte
35% of employees turn to their
smartphone first to solve issues.
Source: Pew Research Center
Only 34% of executives agree that
their leaders are prepared to lead a
diverse workforce
Source: Workforce 2020
Only 10% of organizations have use
of mobile learning.
Source: Brandon Hall Group
Nearly a third of organizations
identified a lack of qualified
workers as a barrier to growth.
Source: PwC
The average worker carries 3.47
mobile devices for work.
Source: appsFreedom
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9. Building the Learning Business Case: The ROI of a Next-Generation LMS
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Depending on your organization, you’ll need to
build a business case for a new technology
purchase.
In our experience, this generally involves
communicating four key points. We’ll highlight
each one below and give tips on which areas to
focus on for the greatest business impact.
1. WHAT’S THE BUSINESS PROBLEM?
The organization is facing one or more of the
following issues:
•• Increased compliance pressure
•• Looming skills gaps
•• Lack of engagement and productivity
•• Ineffective learning resources
2. WHAT’S THE CURRENT STATE?
The organization has outdated learning systems:
•• They’re disparate and expensive to maintain
•• Learning is inaccessible outside of the organiza-
tion or on mobile devices
•• The old system is hurting user adoption
•• The provider is discontinuing support for the-
current solution
•• There is a lack of analytics and reporting that
internal stakeholders need in order to make
decisions
3. WHY DO WE NEED A DIFFERENT SOLUTION?
The organization needs a better-performing
learning solution that:
•• Reduces costs or increases efficiency
•• Reduces dependence and cost of in-person,
instructor-led training
•• Increases availability with a cloud-based
solution
•• Ensures 100 percent certainty on compliance
•• Increases skills and delivers better outcomes
•• cross the workforce
•• Creates a secure learning infrastructure
4. THE PROPOSED SOLUTION
The organization can solve problems and fix the
status quo if you find a solution that meets all
of these broad needs as well as some of the
discrete challenges you face. Specifically, sup-
port infrastructure and implementation are two
areas to be certain of before finalizing the busi-
ness case.
Not every single bullet and statistic we provide is
going to be helpful to your specific situation, and
there may be additional reasons why your
organization needs to make a swift change to a
new LMS. Feel free to use this as a guide to build
a compelling case that will help you accomplish
what you need.
Building Your Business Case
No two business cases are alike. Use the
information from this paper and other sources
to make your case customized for your
organization.
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10. Building the Learning Business Case: The ROI of a Next-Generation LMS
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Once a decision is made, the hard part is over,
right?
Unfortunately, that’s not the case. As part of the
purchase process, you’ll want to understand how
you can partner with the provider and third-party
consultants and firms to come up with an action
plan that’s appealing to internal learning
stakeholders.
Though it can be a long, arduous process for
some organizations, SAP SuccessFactors has
deployed learning in a short time frame to large
global enterprises.
As you plan your transition and implementation,
there are three critical factors to keep in mind:
First, don’t replicate bad processes just
because they exist in your old system.
Use the transition as a fresh start to take a
critical look at your processes and make sure
they’re aligned with how you should be working,
not just how you have been working.
Second, think about how you can make an
implementation and transition easier on
yourself and ensure success.
You’ll want to look to the provider to better
understand the ecosystem tie-ins that can solve
discrete issues, integration with other talent
management software, or enhancements that
aren’t baked into the product.
And finally, involve the business owners in
order to get their opinions and buy-in during
the process.
Ensuring that you have executive sponsorship
will lead to success.
With these three considerations in place, you’ll be
on the right path to transitioning and
implementing your new LMS.
Transitioning to Your New LMS
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11. Building the Learning Business Case: The ROI of a Next-Generation LMS
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Learning technology probably isn’t the first thing
organizations think of when they prioritize
technology purchases. There’s a good chance
your learning system doesn’t have the latest
features and benefits you can get from a next-
generation solution.
The need is there, though. Learning is a critical
component that drives performance, success,
and engagement across the workforce. In
addition to providing a positive ROI, the right
change can help you reduce costs and increase
efficiencies.
SAP SuccessFactors offers a way to move to a
next-generation LMS that takes into account
many of your organization’s concerns. Our learning
solution is a single, simple learning platform that
improves engagement and reduces complexity
and cost. It’s secure and compliant, and will en-
able you to develop your employees, close skills
gaps, and deliver better learning outcomes more
effectively and efficiently. Furthermore, it’s only
one part of a comprehensive talent management
suite. SAP SuccessFactors simplifies talent man-
agement so you can proactively act, easily mea-
sure, and clearly communicate talent results and
business impact.
Want to learn more about a next-generation
learning system and get more resources to
help build your business case? SAP SuccessFac-
torshasthepeople,tools,and—mostimportant—
the experience to help you transform your
learning business. To get started, contact us at
successfactorslearning@sap.com for more
information.
Conclusion
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