InformationWeek
Defining The Business Value Of Technology
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February 26, 2001 |
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E-Learning Branches Out
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By Sandra Swanson (sswanson@cmp.com)
Since mid-1997, Air Canada has invested about $1.5 million in its E-learning effort, yet it doesn't expect to save money anytime soon. Focusing on training costs for E-learning ROI is "ancient history," says Corbett. "If organizations are trying to measure value on that basis, they're not going to get anywhere. You have to impact what's important to the business."
The most important goal of Air Canada's E-learning program is to reduce personal injuries and damage to aircraft, equipment, and facilities attributed to ramp operations. Those areas represent upward of 5% of the total cost of running the business, but it will probably take three to five years to see tangible payback from the program, Corbett says. Air Canada executives understand that such changes won't occur overnight. They're focused on a compelling near-term reason for supporting E-learning: safety. Other companies take a similar approach to measuring E-learning's benefits; nearly 80% of survey respondents said soft-dollar payback was sufficient ROI to satisfy their management.
That's the case with the business measurables that Corbett laid out for Air Canada's E-learning program. Typically, new projects must meet certain financial benchmarks to receive funding, such as payback to cover the initial investment within six months. The learning program flunked the financial benchmarks but scored big on strategic value. Air Canada, like other companies, is prepared to make a significant E-learning investment today and wait for the meaningful ROI a year down the road, maybe two years, maybe never. "Innovation is all about risk taking," says Corbett. "We're prepared to take risks."
Still, E-learning is most effective when combined with classroom training, and widespread acceptance will come slowly. For all Air Canada's enthusiasm, E-learning only comprises about 5% of its corporate instruction. That figure will probably increase to half of all training during the next three to five years, Corbett says.
A hybrid approach to learning is the method of choice for Ford's global core engineering organization. In early 1997, Ford set a four-year goal to give 160 hours of instruction to 20,000 employees in nine core engineering programs, including problem solving and process-control methods. But the company soon realized that it wouldn't meet its goal by using only instructor-led training. It now offers seven of the courses on the Web, seven on CD-ROM, and five in the classroom. It's definitely a time-saver for Ford, which finds that Web-based and CD-ROM instruction cuts course time by 30%. But after each Web or CD course is completed, students must attend a two-to four-hour "face-to-face" session to discuss case studies with an instructor.
Ford began offering online engineering instruction to its 3,000 suppliers in late January. So far, about 100 suppliers have accessed information about the online training via the Web, though very few have actually signed on to participate. While Ford charges for the courses, they're not designed to generate revenue, says Bob Kiger, manager of Ford's technical education strategy. "Our suppliers are our partners. We all have to be at the same skill level."
As companies develop more-ambitious E-learning projects, product choices become more complex. The number of learning-management systems has grown in the past two years from 67 to about 113. And that's just the beginning. Once you've selected a learning-management system, will you host it yourself, or have an application service provider host it on its server? What's more, standards don't exist yet to guarantee interoperability among E-learning products. For all these reasons, it's easy to overlook technology due diligence, but there's a price to pay for haste.
That's another lesson John Deere's Loyd discovered last year. After purchasing a library of courses for $70,000, he got an E-learning education during integration time. The vendor, which he declines to name, neglected to disclose critical information up front: Users needed to run off a Windows NT server, and the content depended heavily on Java applets, neither of which John Deere uses. Loyd ultimately received a refund from the company, but he's not taking any chances now. Before he'll even look at new content, he has Logic Bay Corp., John Deere's E-learning ASP, verify that it's technically compatible with the company's system.
Famous Footwear also had an unpleasant surprise when it launched its E-learning initiative for salespeople in July 1999. The Madison, Wis., shoe retailer was using LearningSpace 2.5, a learning-management system from IBM Mindspan Solutions. While LearningSpace 2.5's delivery framework functioned properly, its tracking component--the part that documents course-completion records--didn't work with Famous Footwear's Lotus Notes address book. The result: The IS department had to save the day and build an agent to collect course completion records.
Illustration by Lorraine Tuson
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