Ken WoodCourse-Source

The Hidden Costs of Sourcing e-Learning for your LMS

Alternative Title

Are you getting value for money from off-the-shelf e-learning?

Why buy off-the-shelf?

• Low (or no) resource to create own courses• Better quality – more interactivity• Instant delivery• Wide range of subjects in library

Why create your own?

• When off-the-shelf not available• No “hard” cost (if developed in house) • No annual fee• Need to “own” the course for commercial

reasons• Getting easier to build own interactive

courses with modern tools

Predictions

• The biggest competitor to most publishers will be companies creating their own courses

• Publishers will need to adapt and embrace customers doing their own editing and customising, especially for “generic” courses.

• More specialist (niche) publishers

What are the costs of off-the-shelf?

• Finding• Evaluating• Uploading• Licenses

“Soft” Costs

• Time spent searching for courses• Contacting publishers to get pricing and full

evaluations• Being chased by publishers after contact• Working out different pricing models • Whole process can take weeks• Time to upload and test large course files

Rise of the Marketplace• Amazon• Learndirect, e-Learning Marketplace, Training

Post and many more• Often have limited “try before buy” but not full

evaluations.• Mainly B2C using e-commerce• Can compare pricing but mostly on single courses• Volume pricing hidden and varies greatly

License Costs

• Most OTS courses sold on a per-user basis.• Calculated from total number of users and

number of courses being licensed, i.e. a traditional site license.

• Until recently, only way if customer has own LMS• Good deal if every user actually takes several

courses.

What is the true cost?

Case Study• Company X has 350 staff• Pays approx £7,000 (per year) for a library of 80

courses.• At end of year out only 56 people have accessed

any course with 78 “enrolments” in total.• Cost per user per course (enrolment) was £89!

Sound familiar?

Cloud Technology

• With SCORM, courses used to have to reside on same server as LMS.

• New technology means courses stay on central (cloud) servers using a small “connector” that is uploaded to LMS as if it was local.

• Course is tracked centrally and by LMS enabling remote control of licenses.

• If a course is updated centrally, all users accessing it instantly get new version.

Ski Pass• Old system was printed “pass”• Now electronic card that gets read at lift with all data stored

centrally• Can buy passes online and assign to card• But business/pricing model hasn’t changed!• What alternatives to the traditional model can you come up with?

Alternative pricing models for OTS

Cloud based delivery (and tracking) is a gamechanger that makes possible:

– Charging for time actually spent in courses– A “behind the bar” model that buys a discount and whenever an enrolment is made it draws down from the deposit– Enrolment based pricing

Enrolment Based Pricing

• Pre-pay for X “enrolments”, discounted for volume

• Each enrolment lasts 3 months from first access.

• Only counts down when user first accesses the course.

• Could be adapted to only count down on course completion.

Enrolments (for illustrative purposes only)

20-49 £17 ea

50-99 £14 ea

100-249 £12 ea

250-499 £10 ea

500-999 £8 ea

1000-2499 £6 ea

2500+ £5 ea

Questions and Discussion

kwood@course-source.net

http://www.course-source.net

Stand 32