The Business Impact of e-Learning
Nick van Dam
ISBN: 0-9708423-1-7
Cover design: Dré Kampfraath and Frans Schupp
© 2005 Nick van Dam. All rights reserved. No part of this publication may be
reproduced, stored in a retrieval system, or transmitted, in any form or by any means,
electronic, mechanical, photocopying, recording, or otherwise, without the prior
permission in writing from the proprietor (s).
NYENRODE BUSINESS UNIVERSITEIT
The Business Impact of e-Learning
Proefschrift
ter verkrijging van het doctoraat
aan de Nyenrode Business Universiteit
op gezag van de
Rector, prof. dr. J. Palm
en volgens besluit van het College voor Promoties.
De openbare verdediging zal plaatsvinden op
woensdag, 22 juni 2005
des namiddags om 16.00 uur precies
Nicolaas (Nick) Hendrikus Martinus van Dam
geboren op 21 november 1961
te Amersfoort.
Leescommissie:
Promotor:
prof. dr. M.R. Creemers
Overige leden:
prof. dr. F. van Eenennaam
prof. dr. A.A.I. Holtgrefe
prof. dr. M. K. Najdawi
In memory of my loved father who taught me to be an entrepreneur
Nic J.M. van Dam (1939 – 1991)
Foreword and Acknowledgements
It has been ten years since we moved from the Netherlands to the USA, at the time of the
commercial launch of the Internet. I recall in 1998, when I first looked at an application
of learning delivered over the Internet. Intrigued by this, I believed that learning on the
Internet had the potential to become extremely powerful for people and enterprises
around the globe. As a passionate embracer of Education Permanente, I concluded that
this could be a fascinating field of study and a potential area for writing a dissertation.
Having had the desire to write a dissertation, if time and circumstances would permit, I
shared this idea for a dissertation with Judith, my wife and friend, and her first response
was positive. Although, at that time, she might have thought this was just another Nick
idea.
Soon, I reached out to Pieter Cornelis, a retired Professor from the Vrije Universiteit,
Amsterdam with whom I had worked on a number of exciting business initiatives in the
past. I had always admired Pieter for his enthusiasm in his work with students and he was
very supportive and pointed me to prof. dr. Marcel Creemers, who had succeeded him as
Head of the department Information Systems Management, Marketing and Logistics at
the Vrije Universiteit.. Marcel responded with encouragement and provided guidance for
writing the proposal for my dissertation. This turned out to be the start of a very
interesting, challenging, and fantastic learning experience.
Reflecting on this five year journey, working both a demanding job, as well as devoting
down time to the research, it has been Judith who provided me with on-going and
tremendous support for completion of this significant project. It was not always easy for
her and Yannick (our eight year old son), that I had to study so many vacations,
weekends, and late nights. There is no doubt that I could never have done this without her
full support. I want to thank her for her love and personal dedication to make this happen.
She has supported and encouraged me to pursue my professional aspirations ever since
we met each other in 1980 and has been the driving force behind my professional
accomplishments.
I could not have imagined a better advisor than prof. dr. Marcel Creemers. Marcel’s
thorough academic perspectives combined with his solid business experience helped me
tremendously in developing the skills needed to conduct empirical research. Marcel is
definitely from the Socrates school, as he always asked me great questions and
consistently challenged me to re-think some of my assumptions. Furthermore, I greatly
appreciated his very clear, no-nonsense approach that kept me on a straight path. He
always encouraged me to continue to make progress with my dissertation while also
respecting that there where times that it did not move as quickly because my work
became overwhelming. I also was buoyed up by the humor in some of his emails such as:
“Great seeing that you move so fast – you surely must have missed the outcomes of the
presidential elections last night.” Marcel, thanks for inviting me a several times to your
home to discuss the dissertation. You were always well prepared when we spent time
together and your feedback has always been very constructive.
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Eileen Rogers, one of my best friend in the USA, encouraged me to start with my
dissertation from the first time that I shared this idea with her. Eileen and I had many
conversations about the research questions and different aspects and chapters of the
dissertation. She always pointed to new directions and broadened my interest in related
themes. Additionally, Eileen encouraged me to keep my eye on the ball and to keep
going. Thanks for your emails on many Fridays that asked – “What are your plans for the
‘D’ this upcoming weekend?” Furthermore, I want to thank Eileen for editing my
dissertation. I have learned tremendously from you.
Special thanks to prof. dr. Joseph Kessels for inviting me at your home in June 2003 and
for your encouragement and great feedback.
I want to thank my family and friends for forgiving me that did not reach out to you
frequently enough over the last five years, for not showing up on at parties, or leaving
early in the evening. I promise you to get re-connected!
I am grateful to a number of my friends and (ex) Deloitte colleagues who have been a
source of inspiration and learning to me over the last five years. They have shared
valuable business perspectives on e-learning on day-to-day basis in building and
implementing e-learning, not limited too, but in alphabetical order: Mary Andrade,
Sushant Buttan, Manish Buttan, Richard Cavagnol, Katie Coates, Bronwyn Dredge,
David Dun, Chrissie Gale, Tamara Ganc, Tony Gleeson, Candy Haynes, Steve Hendrick,
Jen Holenstein, Hans Jaap Moes, Ara Ohanian, Michelle Ratcliffe, Brian Petersen, Kathy
Scholz, Jeff Schwartz, and Tammy Sharpless.
Thanks to leadership within Deloitte for provide me with a unique opportunity to develop
a vision for learning and supporting the global implementation of e-learning and
exploring new and innovative ways for providing learning to our people within the Firm.
This dissertation would not exist without support from case organizations/clients. I want
to thank all professionals from the case organizations for taking the time for the
interviews, providing their insights, challenges and lessons learned.
Finally, thanks to the American airline industry – the flight delays provided me over the
years with invaluable time at many Starbucks outlets, where I could read, reflect and
work.
Chadds Ford, March 2005
Nick van Dam
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Table of Contents
1. Introduction
1.0 Introduction
1.1 Summary of the Research Approach
1.2 Overview of the Chapters
15
17
20
23
Part A: Theoretical Framework
2. e-Learning
2.0 Introduction
2.1 Learning Terminology
2.2 Learning Theory
2.3 The Role of Technology in Learning
2.4 Types of e-Learning
2.5 Concluding Remarks
3. e-Learning and Business Drivers
3.0 Introduction
3.1 Enterprise Transformation
3.2 Cost Reduction
3.3 Time-To-Competence
3.4 People Commitment
3.5 Concluding Remarks
4. Organizational Capabilities for e-Learning
4.0 Introduction
4.1 e-Learning Culture
4.2 e-Learning Design
4.3 e-Learning Technology
4.4 Performance Management
4.5 Effective e-Learning Implementation
4.6 Concluding Remarks
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27
28
33
40
52
57
59
61
63
70
79
83
87
91
93
94
99
105
111
115
121
11
5. Measurement of e-Learning
123
125
128
132
137
147
149
5.0 Introduction
5.1 Business Measurement Framework
5.2 Learning Evaluation Frameworks
5.3 Return on Investment
5.4 Creation of Shareholder Value
5.5 Concluding Remarks
Part B: Research
6. Research Methodology
6.0 Introduction
6.1 Overview of the Research Framework
6.2 The Theoretical Framework
6.3 The Empirical Research
6.4 Research Results
151
153
156
157
158
168
Part C: Results
7. Results Empirical Research: Phase I
7.0 Introduction
7.1 Overview of Research Case Studies
7.2 e-Learning Culture
7.3 e-Learning Design
7.4 Performance Management
7.5 e-Learning Technology
7.6 e-Learning and Business Drivers
7.7 Concluding Remarks
8. Results Empirical Research: Phase II
8.0 Introduction
8.1 Overview of Research Case Organizations
8.2 Dimensions of Organizational Capabilities
8.3 Elements of an Effective Business Practice
8.4 Concluding Remarks
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171
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175
178
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193
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201
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203
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9. Conclusions
9.0 Introduction
9.1 How can e-Learning be defined?
9.2 How do enterprises justify their investments in e-Learning?
9.3 What appear to be critical success factors
for the implementation of e-Learning?
9.4 Which elements can make e-Learning an effective business practice?
9.5 The Business Impact of e-Learning
9.6 Recommendations for Future Research
215
217
218
223
228
233
237
240
i. Summary in Dutch
243
ii.. Epilogue: The Future of e-Learning within Enterprises
251
iii. References
257
iv. Appendices
Appendix A: Phase I, Case Interview Questionnaire
Appendix B: Phase II, Case Interview Questionnaire
Appendix C: Phase I, Summary Case Results Comparison
Appendix D: Phase II, Summary Case Results
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275
284
285
287
Biography
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Chapter One
Introduction
1.0 Introduction
1.1 Summary of the Research Approach
1.2 Overview of the Chapters
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1.0 Introduction
Economic, social and technological forces continue to change the global economy and
organizations around the world. The adoption of new technologies, the rapid
obsolescence of knowledge, the need for just-in-time training, and the search for costeffective ways to meet learning needs of a globally dispersed workforce have redefined
the processes that underlie design, development and delivery of training and education in
the workforce (Urdan & Weggen, 2000). The Hudson Institute (2004) suggests that only
20% of today’s workforce has the skills for 60% of the jobs in the year 2020.
Additionally, demographic changes will have an impact on training needs. By 2008, a
wealth of skills and experience will begin to disappear from the market as the first
members of the Baby Boom generation turn 62. For example, it is expected that in
automotive manufacturing, up to 40% of managers will be eligible to retire within the
next five years. The US public sector could loose more than a third of their government
employees by 2010 (Athey, 2004). Another study predicts a “radical decline in the
numbers of people available for leadership roles over the coming decade”. (Kaye and
Jordan-Evans, 2004) Therefore, it is suggested that, given skill gaps in organizations and
demographic changes, new learning models are needed.
The arrival of the Internet has led to a related innovation in the approach to training and
learning, and a new term has been coined to characterize this new phenomenon:
e-Learning. It was not until 1996 that a number of companies became aware of, and
interested in, the application of e-Learning. In fact, the first article on e-Learning
appeared in American Training Magazine in 1997. The market for e-Learning then grew
very quickly from a few million dollars in 1995 to about $1.7 billion dollars worldwide in
1999 (IDC, 2003).
In his November 1999 keynote speech to the 1999 Comdex Trade Show, in Las Vegas,
John Chambers, CEO of Cisco Systems, described e-Learning as the next killer
application:
“The biggest growth in the Internet, and the area that will prove to be one of the biggest
agents of change, will be in online training, or e-Learning...Through e-Learning
employees will be able to take more control of their jobs, while the dispossessed of the
world will be able to make strides to improve their economic position. The primary load
on the Internet is email, but email is a rounding error compared with e-Learning.”
Given the exponential growth and popularity of e-Learning, one would expect that there
would be a common understanding of what e-Learning encompasses. Yet, the existence
of a broad range of definitions and applications of e-Learning suggest just the opposite.
According to Broadbent (2002), “It seems that everyone from e-Learning theorists and
practitioners, to vendors and learners, are applying the term e-Learning to very different
methods and products.”
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Therefore, I have defined the first research question for this dissertation as:
•
How can e-Learning be defined?
Since the introduction of e-Learning, companies have made significant investments to
support e-Learning initiatives. This is reinforced by research data that shows that the
market for e-Learning has grown between 1999 and 2003, from $1.7 billion to $6.5
billion worldwide, with a forecast to become a $21+ billion market by 2008 (IDC, 2004).
This leads to my second research question:
•
How do enterprises justify their investments in e-Learning?
Many authors suggest that e-Learning growth is fueled by a number of factors, for
example: rapid technological change; shortening product development cycles; lack of
skilled personnel; the shift from the industrial to the knowledge era; enterprise resource
planning; migration towards value chain integration; e-business; increasingly global
business environment; cost reduction; shortening time-to-competence; and people
commitment, among others (e.g., Arevola & Luny, 2003; Cheese & Thomas, 2003;
Horton, 2001; Mcrea, Gay & Bacon, 2000; Ticoll, Lowy & Kalatowa, 1998; and, Yip,
2003).
It appears that business drivers may generate investments in various activities including
e-Learning. Therefore, I will try to identify and assess the most important business
drivers which may generate investments in e-Learning.
Furthermore, literature offers evidence that investments alone in technologies do not
necessarily provide the anticipated business results. Several organizational capabilities
seem to be required to make e-Learning successful. Those organizational capabilities may
include: the existence of an e-Learning culture; implemented e-Learning technologies;
quality of instructional design of e-Learning programs; alignment with performance
management methods, processes, and systems; and change and risk management (e.g.,
Clark, 2003; Cross & Dublin, 2002; Masie , 2001; Rosenberg, 2001; Russell, 2001; and
Spenser and Spenser 1996)
Therefore, is it one of the objectives of this dissertation to identify and assess different
dimensions of organizational capabilities, and to determine which dimensions are critical
success factors for e-Learning.
The third research question for this dissertation is:
•
What appear to be critical success factors for the implementation of e-Learning?
Specific business drivers might generate the need for investments in e-Learning and/or
the development of required organizational capabilities to support e-Learning. However,
it is suggested that those investments are not necessarily valuable for the business.
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In May 2004, almost five years after his first speech on e-Learning, John Champers made
the following comments on the business impact of e-Learning at the Networld+Interop
tradeshow in Las Vegas:
“Even though Cisco had spent millions of dollars to upgrade and improve its network to
provide e-Learning to its employees, it initially showed very little productivity gains. But
as sales people learned that they could break the lessons down into smaller increments
instead of spending three to four hours at a time in front of the computer, and they
learned to filter out material they didn't need right away, productivity improved. If all
you're doing is automating a function, you won't improve productivity. You really need to
improve the underlying fundamental business processes.”
Research data and literature published between 1999 and 2002, indicates that e-Learning
has not always lived up to its promises in a number of organizations (e.g., Foreman,
2001; Masie/ASTD, 2001). Foreman says (2001, p.399): “Most people would agree that
80% or more of e-Learning Programs are rudimentary and ineffective.” .
Therefore, the fourth research question for this dissertation is:
•
Which elements can make e-Learning an effective business practice?
I order to answer this question I will explore the business goals targeted for achievement
through an e-Learning initiative and how the effectiveness of the initiative can be
measured.
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1.1 Summary Research Approach
In this section, I will provide a brief summary of the Research Methodology for this
dissertation. A more in-depth explanation will be provided in Chapter 6: Research
Methodology.
The main goal of this study is: To assess the critical success factors that make e-Learning
an effective business practice.
As mentioned in the introduction section, the main research questions for the dissertation
are:
•
•
•
•
How can e-Learning be defined?
How do enterprises justify their investments in e-Learning?
What appear to be critical success factors for the implementation of e-Learning?
Which elements can make e-Learning an effective business practice?
This dissertation is comprised of three stages which have been defined in the Research
Framework (see Figure 1.1: The Research Framework).
The first stage of this study includes an in-depth literature study, review of existing
research data, and in-depth interviews conducted with organizations which are
implementing e-Learning. This analysis resulted in the development of a Theoretical
Framework for the research, which is discussed in the following chapters:
Chapter 2: e-Learning
Chapter 3: e-Learning and Business Drivers
Chapter 4: Organizational Capabilities for e-Learning
Chapter 5: Measurement of e-Learning
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Figure 1.1: The Research Framework
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The second stage of the study includes the empirical research.
In this stage, I developed questionnaires for the case studies. I selected the case study
method as this is a research method which does not imply any specific form of data
collection and can be either qualitative or quantitative (Yip, 1984 and 1985).
The case study research has been conducted in two phases:
Phase I
The first phase consisted of an in-depth case research study among five
organizations which took place from January 2001 - December 2001 (see
Appendix A for the research questions). The research results from this phase will
be discussed in Chapter 7: Results Empirical Research - Phase I.
Phase II
The second research phase was focused on follow up research, which took place
from July 2002 - November 2002. The main objective in this phase was to collect
more specific data in selected areas from 24 companies. The additional research
questions in Phase II were based on the outcomes of the empirical research of
Phase I (see Appendix B for the research questions). The research results from
Phase II will be discussed in Chapter 8: Results Empirical Research - Phase II.
The data analysis of the case studies was conducted from September 2001 - December
2003.
The third stage of the study consists of a discussion of the empirical results of the study
based on a combination of theory, which was presented in the Theoretical Framework, as
well as the results from the case studies. Furthermore, in this final stage I also answer the
main research questions of the study:
•
•
•
•
How can e-Learning be defined?
How do enterprises justify their investments in e-Learning?
What appear to be critical success factors for the implementation of e-Learning?
Which elements can make e-Learning an effective business practice?
Finally, I will discuss the overall results of the study.
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1.2 Overview of the Chapters
As discussed before, there are three stages of the study which are discussed in the
following chapters:
Stage A: The Theoretical Framework
Chapter 2: e-Learning
Chapter 3: e-Learning and Business Drivers
Chapter 4: Organizational Capabilities of e-Learning
Chapter 5: Measurement of e-Learning
Stage B: Empirical Research
Chapter 6: Research Methodology
Stage C: Results
Chapter 7: Results Empirical Research: Phase I
Chapter 8: Results Empirical Research: Phase II
Chapter 9: Conclusions
Overview of the Chapters
Chapter 1 is the overall introduction to the dissertation. Chapter 2: e-Learning¸ offers a
context for the learning targeted by e-Learning offered within the context of an overview
of the various definitions of education, training and learning. This is followed by a
discussion of the progressive adoption of new technologies in learning initiatives, and
concludes with an examination of the various types of e-Learning offerings and a review
of adult learning theories and their influence on the design of e-Learning.
In Chapter 3: e-Learning and Business Drivers, the financial and business economic
aspects of e-Learning are explored. One of the questions addressed in this chapter is:
How do enterprises justify their investments in e-Learning? Therefore, a number of
business drivers which focus primarily on knowledge and people will be discussed,
including: enterprise transformation; cost reduction; time-to-competence and people
commitment.
Chapter 4: Organizational Capabilities for e-Learning presents an overview of
organizational capabilities for e-Learning and reviews those aspects which support an
effective e-Learning implementation. This includes: e-Learning culture;
e-Learning design; e-Learning technology; the role of performance management; and
management of the impact of risk and change in e-Learning implementations.
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Chapter 5: Measurement of e-Learning discusses the impact of e-Learning on the
business and the measurement of this impact. The questions explored include:
•
•
Do e-Learning investments make business sense?
What instruments can enterprises use to measure the business impact of
e-Learning?
Chapter 6: Research Methodology presents an overview of the research framework of the
dissertation. This includes: the theoretical framework; empirical research phase; and the
results.
In Chapter 7: Results Empirical Research Phase I presents the empirical results which
have been derived from the in-depth case studies among 5 organizations. This research
was conducted between January 2001 and December 2001.
Chapter 8: Results Empirical Research Phase II provides the empirical results which
include the follow-up case studies among 24 organizations. This research was conducted
in 2002.
The last chapter, Chapter 9, provides answers to the main research questions of this
dissertation, overall conclusions, and offers recommendations for future research.
This thesis ends with summary in Dutch, and includes references and appendices.
Finally, an Epilogue provides my personal vision regarding The Future of e-Learning
within Enterprises.
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Chapter Two
e-Learning
2.0 Introduction
2.1 Learning Terminology
2.2 Learning Theory
2.3 The Role of Technology in Learning
2.4 Types of e-Learning
2.5 Concluding Remarks
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2.0 Introduction
e-Learning has become the focus of growing interest and has generated significant
investments in recent years. Although the estimates of projected future growth vary, all
agree that the market for e-Learning solutions is dynamic. International Data Corporation
(IDC, 2004) has estimated that world revenues in the corporate
e-Learning market will surpass $21.1 billion by 2008, compared with a $7.9 billion
market in 2004. In addition, Forrester (2004) states that the growth and interest is not just
limited to corporations. The market for online courses offered at universities will
continue to grow about 25% to 30% a year.
Given this exponential growth and popularity, one would expect that there would be a
common understanding of e-Learning. Yet, the existence of a broad range of definitions
and applications of e-Learning might suggest just the opposite. According to Broadbent
(2002), “It seems that everyone, from e-Learning theorists and practitioners, to vendors
and learners, are applying the term e-Learning to very different methods and products.”
In this dissertation, I limit the scope of e-Learning to a Business Environment. This
means that e-Learning in schools/universities, although of interest, is not included my
study and research.
In discussions about e-Learning, I have found that many questions arise, such as:
•
•
•
What does e-Learning encompass?
Does all e-Learning look the same?
What is the impact of learning theories on the design of e-Learning?
In my own journey answering these questions, I realized that there are three main
components that currently shape and influence e-Learning: definitions of learning;
emerging technologies and the application to learning; and, learning theories.
First in this chapter, I will provide a context for the type of learning targeted by
e-Learning within an overview of the various definitions of education, training and
learning. This will be followed by a discussion of the progressive adaptation of new
technologies in learning initiatives, and finally I will examine the various types of eLearning offerings and review adult learning theories and their influence on the design of
e-Learning. I will finalize this chapter with some concluding remarks.
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2.1. Learning Terminology
Prior to an exploration of the definitions and characteristics of e-Learning, I feel it
important to explore the meanings of the terms: education; training; and learning. Much
has been published on these topics but for a better view of the position of e-Learning
within this context, it is important to put some parameters around the terms that define
the field.
Elkington (2002, p.1) defines training as a change in skills and education as a change in
knowledge. He argues that “education is our attempt to give our learners broad
information on a subject, no attempt is made to develop skills.” Additionally, Kurtus
(1999, p.1) draws a distinction between formal and informal education. Formal education
usually consists of studies in schools, and informal education refers to self-study where
people read books, listen to tapes and learn through other media. He essentially agrees
with Elkington, when he refers to training, as “a deliberate attempt to build a set of
skills.”
If education is a change in knowledge, how is knowledge defined? In the various
definitions of knowledge there seems to be general agreement that knowledge involves
use and application of information. In addition, there is a general recognition that training
ultimately results in the utilization of knowledge in a specific way. Rosenberg (2001)
refers to knowledge as well-structured information. Lee & Owens (2000) define
knowledge as the intellectual information a job performer must have. Newman (1999,
p.1) looks at knowledge as information that is put into productive use and is actionable.
Tobin (2000, p.11) refers to knowledge as information that one has used, tested, seen how
it works and how it is applied to work.
Tobin (2000, p.9-11) views knowledge as one of the four stages of learning which leads
to wisdom. The stages are:
Stage 1
Stage 2
Stage 3
Stage 4
Data: everything that one observes.
Information: filtered data which is relevant to us and has a purpose.
Knowledge: information that one has used, tested, seen how it works and
applied to work.
Wisdom: the process whereby employees continually apply knowledge to
their work, gaining experience and insight as to what works, what does
not, how modifications to methods effect results, how different situations
require slightly different solutions, and so forth.
Zack (1999, p. 224-226) concurs with Tobin and says that knowledge is commonly
distinguished from data and information. According to Zack, data represents observations
or facts out of context that are, therefore, not directly meaningful. Information results
from placing data within some meaningful context.
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According to Harvey (2001, Website), “The primary difference between information and
knowledge is: relevance, a personal applicability.” That is why Lee and Owens (2000)
use the word ‘intellectual’ before the term information, in their definition of knowledge.
Zack (1999) says that “knowledge is considered the most important strategic resource,
and the ability to create and apply it, the most important capability for building and
sustaining competitive advantage.” According to Sanchez (1996), there are at least three
categories of knowledge: know-how (practical knowledge); know-why (theoretical
knowledge); and know-what (strategic knowledge). Furthermore, many writers suggest
that important knowledge within individuals and organizations can be tacit, meaning that
it is incapable of articulation according to Cross (2000), as opposed to explicit
knowledge. Carliner (2002, p.7) refers to tacit knowledge as “content that exists within
an individual or organization but has not been recorded or exchanged.” This implies that
he expects that employees can ultimately exchange tacit knowledge.
One initiative used frequently in the context of e-Learning is an effort to capture, record
and exchange this tacit knowledge in knowledge management. Newman (1999, p.1)
defines knowledge management as “finding ways to create, identify, capture and
distribute organizational knowledge to people who need it.” Another definition of
knowledge management is from Corall (2000, Website). She refers to knowledge
management as “a management philosophy which combines good practice in purposeful
information management with a culture of organization learning, in order to improve
business performance.” According to Bielawski e.a. (2003, p.45), important features and
business objectives for knowledge management include:
•
•
•
•
•
Knowledge transfer from accomplished performers to others
Sharing of the best practices and lessons learned with a broad work force
Easy connectivity to experts who hold high-value knowledge
Promoting of lifelong continuous learning environment
Enabling knowledge workers who can affect the bottom line
In discussing knowledge management, Kessels (2000) argues that ‘knowledge can’t be
managed’ in a traditional sense. “In a traditional economy a manager could say: work
harder or run faster. In a knowledge economy it is useless when a manager says: be
smarter or show more creativity.” Therefore, Kessels believes that it is very important to
understand what emotional and affective drivers employees have, and how they can
regulate these, because this could be an important aspect of human resource development
in the knowledge economy. Furthermore, the emphasis of knowledge management should
be more on initiation and stimulation of a continuing knowledge flow within an
organization.
Rosenberg recognizes that the challenge is building organizational knowledge
management capability that is “so flexible and dynamic that it is easy to be understood
managed, valued by people and supportive of a broad-based learning culture”
(Rosenberg, 2000, p. 66).
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To this end, knowledge management uses databases, the web and organizational intranet
sites but can also include online chats, discussions, and symposia and while promoting
just-in-time learning (Carliner, 2002).
Cross (2000, p. 69) believes that “a lot of early knowledge management initiatives have
focused almost exclusively on information technology and missed the myriad ways in
which knowledge can become embedded in the organization.” As a result of this,
organizations have generally collected far more information and knowledge than they
ever can put to use (Cross, 2000). It is argued that a true improvement of efficiency and
effectiveness in knowledge-intensive works comes from attending to the ways that people
seek answers to ambiguous problems and use knowledge in organizational settings.
However, Bielowski e.a. (2002, p.51) states, “Yet few companies really know where or
how to start implementing an effective knowledge management system and how to extend
learning beyond the walls of training organizations,” and he suggest that, “In order to
create a learning organization that can capture, manage and disseminate knowledge, it is
necessary to consider technologies that can make this process easier, more cost-effective,
and widely distributed.”
In the first part of this section, I have defined education and knowledge and the
applications of knowledge in organizations through knowledge management. I will
continue this discussion by providing some definitions regarding skill and its role in
training.
Rosenberg (2001) defines training as, “the way the instruction is conveyed.”
According to Rosenberg, there are four main elements of training (2001, p.5):
1. Intent to enhance performance in a specific way, typically derived via needs
assessments and reflected in learning goals and instructional objectives.
2. A design reflecting the instructional strategy that is best suited to the learning
requirements and the learner’s attributes, as well as the measurement strategy that
gauges the effectiveness of training.
3. The means and media by which the instruction is conveyed, which may include
the classroom, a variety of technologies, independent study, or a combination of
approaches.
4. In high accountability situations, a more formalized assessment or certification
capability.
Rosenberg states additionally that training must support learners in acquiring skills or in
utilizing knowledge in a specific way. Therefore, his perspective on training is a little bit
broader than that of Elkington and Kurtus, because it is more inclusive with regard to
knowledge application.
All definitions of skill include observable and measurable behavior. Skills are defined by
Lee & Owens (2000) as required behavior.
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Capelli (1999, p.4) argues that the definition of a skill should include:
•
•
•
A named task that is observable and measurable
A description of the conditions under which the task is to be performed
Associated criteria for successfully performing the task. The resulting skill
definition referred to as a ‘performance objective’
This leads to the conclusion that the intent of training is to enhance performance.
After reviewing the differences between education and training, I want to continue with a
discussion of learning.
According to Huysman (1996, p.1), there are many perspectives on learning, but it is
difficult to get consensus on what learning is and how it occurs. One of the reasons is the
apparent confusion in the literature between an outcome perspective and process
perspective in learning (Dodgson, 1993). An example of a definition of learning with a
process perspective is offered by Cross (2000, p.24). He defines learning as, “a process
which changes the state of knowledge of an individual or organization.”
He does not include skills in his definition as do Kruse and Keil. Kruse and Keil (2000,
p.9) define learning as: “the acquisition of desired traits, knowledge and skills, and the
ability to utilize them.” This definition includes both the process component of learning
and its application. However, Kruse and Keil describe the outcome of learning as the
“utilization of traits, knowledge and skill” without referring to performance.
A more extended definition and description of learning, which has elements of both
process and outcome, comes from Gagné and Medsker (1996, p.6). “Learning is a
relatively permanent change in human disposition or capability that is not ascribable
simply to process of growth.” For example, such learning is evident in the human being’s
progression from beginning to walk at one year, to becoming rebellious in the teenage
years, and finally gaining perspective in the later years of life.
According to Gagné and Medsker (1996, p.6) “Learning exhibits itself as a change in
behavior, and the inference of learning is made by comparing what behavior was
possible before the individual was placed in a learning situation and what behavior can
be exhibited after participation in the learning process. The change is often an increased
capability for some type of performance. It also may be an altered disposition of attitude,
interest, or value. The change must be more than momentary; it must be retained over
some period of time.”
Another definition which combines both process and outcome of learning is offered by
Rosenberg (2001, p.4). He defines learning as a process by which people acquire new
skills and/or knowledge for the purpose of enhancing their performance.
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In summary, Figure 2.1 illustrates the relationship and differences between education,
training and learning as discussed in this paragraph, and which I propose as the definition
framework for the rest of this dissertation.
Figure 2.1: The Relationship and Differences Among Education, Training and
Learning
To conclude, I propose a definition of learning as the term for the process of acquiring
new skills and knowledge with the goal of improving performance. The formal learning
in organizations occurs to a large extent through education and training. However, much
of what one learns happens in a more informal way, as one does the actual work related
to the job. I will discuss this in greater depth the next section.
Although both formal and informal processes support learning, it is important to have a
good understanding of the significant differences between education and training. This is
highly important in that the learning goals for each are unique and very different.
Furthermore, a required change in skills versus a transfer of knowledge lead to a very
different design in the learning program, which becomes even more significant when the
use of technology is added as a capability in the design mix.
In the next section of this chapter, I will discuss various learning theories and their
implication for the design of learning programs.
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2.2 Learning Theory
Literature on different learning theories is extensive. Medsker and Holdsworth (2001)
categorize these learning theories as: behavioral; cognitive; and humanistic, social and
affective learning theories. These various theories advocate different instructional models
for learning design.
Gagné defines instruction as “the set of events that initiate learning in an individual.”
(Kruse & Keil, 2000) Thus, we can see that understanding the goals of the learning and
selecting the appropriate instructional design is critical. Instructional design can be
narrowly defined as “a set of models and practices that are systems oriented, consistent
with Instructional Systems Design (ISD1), and based on behavioral or cognitive
approaches to learning” (Medsker and Holdsworth, 2001, p. viii). A broader definition
includes “some models and strategies which are not systems oriented, are inconsistent
with ISD, or are based on humanistic and social approaches to learning.” (Medsker and
Holdsworth, 2001, p. viii)
In this section, I will review several learning theories and their implications for
instructional design for e-Learning. Figure 2.2 shows a framework of number of learning
theories and different models and strategies for the design of instruction.
Figure 2.2 Learning Theories
1
Instructional System Design (ISD) is a systems approach to training development which consists of five
phases: analyses, design, development, implementation and evaluation. According to Gagné and Medsker
(1996), this has become a new standard for training development for large organizations. Although, this
approach has come under attack for being rigid, clumsy, slow, unscientific and costly, leading to the
production of training products that are boring, static and don’t meet business needs (Gordon and Zwemk,
2000).
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Behavioral Theories
Behaviorism has served as the prominent psychological approach to research in learning
and performance (Medsker and Holdsworth, 2001). According to Merriam and
Cunningham (1989), the assumption behind the behaviorist’s paradigm is to ensure that
learners attain previously defined learning objectives, many of which are specified in
terms of clearly observable, behavioral outcomes. “Therefore, learning activities are
sequenced so that learners move through a series of carefully designed, progressively
complex operations. The educational activity is evaluated as successful to the extent that
the previously defined learning objectives are demonstrably achieved.” (Merriam and
Cunningham, 1989. p.7)
Ideas and practices that behaviorists have contributed to the theory and practice of
instructional design include (Medsker and Holdsworth, 2001, Part I, p.1):
•
•
•
•
•
•
A focus on observable behavior as the outcome of learning
Specific behavioral objectives to guide the focus of instructional design
Analysis of desired behavior into small units, to be learned individually
Increase in the likelihood and frequency of desired behavior through positive
reinforcement or less punishment
Provision of opportunities for frequent response (practice) by the learner
Insurance that all learners achieve the objectives by providing enough time and
support
Examples of behavioral theories and models are: Behavior Modification (MacMillan,
1973); Behavioral Approach (Gropper, 1983); Mastery Learning (Caroll, 1971; Bloom,
1971); Behavior Modeling (Bandura, 1977, Robinson 1982).
Robert M. Gagné is a behaviorist who is considered to be the foremost researcher and
contributor to the systematic behavioral approach to instructional design (Kruse & Keil,
2000). He identified mental conditions for learning which were based on the information
processing model of the mental events that occur when adults are presented with various
stimuli. He created nine events of instruction, which correlate and address the conditions
of learning (Gagné and Mesker, 1996). The events are: gain attention; inform learners of
objectives; stimulate recall of prior learning; present the content; provide learning guide;
elicit performance (practice); provide feedback; assess performance; and enhance
retention and transfer to the job. Kruse and Keil (2000) strongly believe that applying
Gagné’s model is the single best way to ensure an effective learning program.
Another prominent behaviorist is Robert Mager. He argued for the use of specific
measurable objectives that both guide designers during courseware development and aid
students in the learning process. These objectives are known as behavioral and
performance objectives (Kruse and Keil, 2000).
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Behaviorists have looked at motivation as another very important aspect of learning.
Gagné and Mesker (1996, p.168) define motivation as “cognitive persistence: the drive,
tendency, or desire to undertake or complete a task, expend effort, and do a quality job.”
They state “Motivation to learn, is expressed as attention and effort directed persistently
toward learning task.” Their belief is that it cannot be assumed that the adult learner is
already motivated to learn. Schank (1997) argues that everyone needs to be motivated to
start learning.
Deci (1975) explains two types of motivation: intrinsic and extrinsic. Intrinsic motivation
derives from factors inherent in the learner (e.g. the need to be competent) and in the
learning task itself (e.g. the challenge). Intrinsic motivation is often referred to as selfmotivation. (Medsker and Holdsworth, 2001) Extrinsic motivation consists of externally
applied rewards (e.g. pay increases, praise, recognition) for demonstrating the desired
behaviors. (Gagné and Mesker, 1996) They suggest that intrinsic motivation is always
more effective and motivational.
Behaviorists John Keller and T.W. Kopp (1983) developed an instructional design model
based on psychological motivation called the ARCS model. Their motivational strategies
fall into four major categories: attention; relevance; confidence; and satisfaction (ARCS).
Each category consists of subcategories of motivational strategies. Gagné and Mesker
(1996, p.179) feel strongly that well-designed training programs include planned
motivational strategies. They recommend doing thorough needs assessment before
beginning to design, to acquire knowledge of the learners and their work environment as
completely as possible. They propose also the identification of the trainee’s motivational
needs and biases. The next step in the design process is to select motivational strategies
that can be tailored to fit those needs.
According to Medsker and Holdsworth (2001), many models of instructional design
focused on instruction would be effective if the students wanted to learn. However, little
had been written to prescribe methods to make the instruction more appealing. Medsker
and Holdsworth (2001, p. 359 -361) also believe that behavioral models and strategies
may be best applied to e-Learning design when specific and concrete actions are to be
learned. They believe it would work particularly well if program control is desirable and
prerequisite sequences are well defined. Furthermore, they propose that the learners
should be actively responding to the program content, not passively viewing it --as in the
so called e-Learning page-turners.
Prensky (2000) believes that digital-based learning can play an important role in
presenting learning material that is not intrinsically motivational to anyone but which
must be learned. Malone (1981) also presents a framework for intrinsic motivation in the
context of designing computer games for instruction. He argues that intrinsic motivation
is created by three qualities: challenge; fantasy; and, curiosity. Curiosity is defined by
Gagné and Mesker (1996, p.169) as “interest or arousal that results in behavior such as
moving toward or manipulating the objects of curiosity.” Senge (1990) believes that
people are inherently curious, creative and seek challenges that relate to what they value.
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Cognitive Theories
The cognitive school of instructional design deals with events and processes that occur
within the learner’s mind. Two different camps can be distinguished: expository and
inquiry or discovery (Medsker and Holdsworth, 2001). “Expository models generally
approach teaching and learning as a problem of how to store skills in the learners head
in efficient ways, making use of what is known about human information processing.”
(Medsker and Holdsworth, 2001, p. 67) Examples of expository theories and models
include: Advanced Organizer (David Ausubel, 1968); Structural Learning Theory
(Scandura, 1983; and Landa, 1983); Mnemonics (Joyce and Weil, 1996); Conditions of
Learning (Gagné, e.a.1992); Component Display (Merill, 1983); and, Learning
Taxonomy (Bloom, 1952).
Bloom’s (1952) learning taxonomy distinguishes between six types of learning:
knowledge; comprehension; application; analyses; syntheses; and evaluation. Bloom
finds that people first need to acquire lower level skills (knowledge, comprehension and
application), before they can learn the higher level skills (analysis, synthesis and
evaluation). Gagné’s (1965) taxonomy includes five types of major differences in
learning outcomes (intellectual skills, cognitive strategies, verbal information, attitudes
and motor skills) and describes conditions under which each is acquired.
Gagné, is probably one of the first who attempted to describe how instruction should be
designed to provide the conditions required by different types of learning outcomes
(Clark 1989, p.29).
Merill (1983) builds on the work of Gagné and provides technical experts with a very
effective and succinct basis for designing effective instructional materials (Clark, 1989).
He classifies learning into two dimensions. The first dimension is type of content: facts;
concepts; processes; procedures; and principles. The second dimension is level of people
performance for the types of content: remember; use (or apply); and generalize.
It is argued that learning programs need to be designed differently for Bloom’s different
types of learning and for Merill’s types of content and level of performance,
Clark (1989) says that a useful taxonomy will group learning goals to suggest different
approaches for each.
Inquiry or discovery models are derived from philosophical ideas how people learn and
from observation of the practices of master teachers and their students (Medsker and
Holdsworth, 2001). Examples of those theories and models are: Synectics, originated by
Gordon (1961); Cognitive Inquiry Theory (Collins & Stevens, 1983); and,
Constructivism, as described by Duffy & Jonaassen (1998).
The cognitive inquiry theory is learner-centered and problem-based, as opposed to
instructor-centered and solution-based (Medsker and Holdsworth, 2001).
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The cognitive inquiry theory is based on teaching practices that trace their beginnings to
Socrates, 469-399 B.C. “Using dialogue or dialectic, Socrates drew forth existing
knowledge from within his learners by pursuing a series of questions and examining the
implications of their answers. In this way, he effectively guided his listeners to discover
various philosophical insights on human condition” (Medsker and Holdsworth, 2001,
p.194).
Prensky and Schank are advocates of learner-centered and problem-based learning.
Prensky (2001) says that learning needs to be engaging but stresses that most learning is
boring compared with alternatives such as computers, television and work. The reason for
this is that learning is many times too focused on the teacher and/or content. He believes
that the learner has changed and therefore that there is a need to focus on the learner.
Schank (1997) concurs with him and criticizes people who assume that if something is
taught and people are tested that they remember it. He refers to John Dewey, who already
in 1916 noted that “schools insist on telling students what they need to learn, despite
research demonstrated, that learning-by-telling does not work and learning-by-doing2
does” (Schank 1997, p.15).
This conclusion is emphasized by Edgar Dale (1969) who claims that we remember
mostly what ‘we are doing’ versus what ‘we are reading or hearing’.
Schank (1997) advocates that there is no substitute for learning by doing. Although, I
tend to agree that a lot of the learning by telling lacks inspiration, it really depends on the
teacher in this type of learning to what extent he is able to engage and motivate the
learners.
Constructivism is based on the premise that all knowledge is constructed subjectively in
the mind of the individual learner (Medsker and Holdsworth, 2001). According to
Medsker and Holdsworth (2001, p. 71) “radical constructivists believe that all learning
should happen in a rich but unrestricted learning environment that simulates or actuates
real-world problems and tasks.” The roots of constructivism are in discovery learning
(Bruner, 1961).
According to Medsker and Holdsworth (2001, p.362-364), cognitive theories have
influenced e-Learning design in the development of intelligent tutoring programs and
expert systems, in the area of knowledge representation, and in the development of
simpler interfaces, and the development of case studies and simulations.
2
The term and concept of Learning-by-doing came into use after publication of an article from K. Arrow in Review of Economics
(1962), titled The Economic Implications of Learning-by-Doing. Arrow pointed to what he called the Horndahl effect, a reference to a
steel plant in Sweden which showed a steady 2% per annum increase in productivity over a 15 year period without any capital
investments whatsoever (Zack 1999, p.126).
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Humanistic, Social and Affective Theories
Humanistic models emphasize respect for the learner’s existing knowledge, their
judgment about what they need to learn, and their ability to engage in self-directed
learning activities and evaluation of their own learning. Social models emphasize the
advantages of groups or teams in which learners facilitate each others learning.
Emotional models advocate that activities need to be developed that engage people on an
emotional level, and then observe which learning objectives emerge from those activities.
(Medsker and Holdsworth, 2001, p.235-238) Examples of Humanistic, Social and
Affective theories and models include: Adult Learning (Knowles, 1978); Popular
Education (Vella, 1994); Cooperative Learning (Dewey, 1916); Lancaster:
A Meta-Model (Stuart and Binstead, 1978).
The theory of adult learning which has drawn extensively on the humanistic philosophy
was introduced by Malcolm Knowles (Medsker and Holdsworth, 2001). He coined the
term andragogy to describe the study of how adults learn. Andragogy is the opposite of
pedagogy which describes the way children learn. There are four basic assumptions that
distinguish adult learners from children: self-concept; experience; readiness to learn; and
orientation to learning (Medsker and Holdsworth, 2001).
Key principles of the Knowles theory of adult learning include:
•
•
•
put a great importance on a welcoming and non-threatening climate in the
classroom
create a climate in which learners feel respected, comfortable and welcomed and
reinforce that the learners occupy center stage
use the term facilitator instead of instructor
Central to the practice of andragogy is fostering adult capacity for self-direction
(Knowles, 1975; and, Brookfield, 1985).
Kruse and Keil (1999) strongly emphasize that training for adults must be based on
proven principles of instructional design. “Although training should look appealing and
engaging, above all it must be designed to teach.” Instruction and not technology should
always be the most important design consideration for any technology-based training
program, according to Kruse and Keil (1999). David Merill (1998) emphasized that
‘information is not instruction.” He has also stated that “it has always been too easy to
become enamored with the technology portion of technology-based training, at the
expense of proper design and learning outcomes” (Kruse and Keil, 1999, p. 88).
People have different preferences in the way they learn. This is often referred to as
Learning Styles. According to Broadbent, “There are many schools of thought about
learning styles but there is no universally accepted approach to defining them or
adjusting instructional design and methods to account for them. Nor does everyone agree
on their significance” (Broadbent, 2002, p.113).
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Kolb does use two learning activities (perception and processing) to define four learning
dimensions: concrete experience; reflective observation; abstract conceptualization; and
active experimentation. Those dimensions are separated into four different learning styles
known as convergers, divergers, assimilators and accommodators. Silverman (1998)
concludes that learning programs need to support a variety of learning styles and it is
important that instructors provide a blend of visual, auditory and kinesthetic activities.
According to Medsker and Holdsworth (2001, p 365-366), humanistic, social and
effective theories have all had a great influence on e-Learning design. For example this
includes: avoiding stereotypes; usage of motivation strategies in programs; and usage of
e-Learning programs for groups.
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2.3 The Role of Technology in Learning
In order to get a good understanding of emerging role of technologies in learning, it is
important to take a brief look at the history of teaching and learning and also at the rapid
historical adoption of technological innovations to enhance learning opportunities and
acquisition. In this section, I will first provide a brief overview of the adoption of the
most important technologies in learning, and I will conclude this section with a
perspective of the definitions of e-Learning.
The first phase of education and training was a process of imitation and coaching. A
technical addition to this learning process was the adoption of pictures and symbols. The
development of spoken language was the next technological innovation in learning. This
made is possible to explain people how to do something, without the need of doing it.
Then came literacy, which made is possible for learners to read the thoughts of others on
their own. The invention of printing press made it possible to distribute educational
material to everyone who was interested. Printing led to writing of speeches, assays and
books. This promoted an increase in the need to teach people how to read and write.
According to Postman in Negroponte’s book, Being Digital (1996, p.196) “Our modern
mass education system began essentially as a product of the printing press, and was
designed to bring everyone to a basic level of literacy.”
Many authors suggest that education and training has primarily been delivered at specific
locations such as Education/Training Centers, Schools, and Colleges or Universities.
The key characteristic has been that the person who is delivering the lesson is in the same
classroom/location and at the same time as the participant(s) or student(s) (Hall, 1997;
Horton, 2000). This is consistent with the approach at the University of Bologna. The
University of Bologna is probably one of the first Universities of Europe (Website,
University Bologna, 2002).
A University is here defined as a place where a scholar:
•
•
traces the outlines of a discipline and within this framework carries out precise
research for the sake of knowledge, and/or
carries out his research and transmits his knowledge to a group of pupils who
follow him freely, this being done outside any other official institution whether of
the church or the state
Theoretical findings suggest that the year 1088 may be accepted as the date to indicate
when teaching became free and independent of ecclesiastical schools in Bologna. Yet,
contemporary chronicles suggest that the University of Bologna was without permanent
buildings of its own until the middle of the 16th century. Until then, professors offered
lessons in their own houses or in halls rented from the city authorities (Website,
University of Bologna, 2002).
This traditional approach to learning dominated throughout the centuries and has been
replicated in primary education and business training.
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However, there has always been a need to make training available for people who lived
and worked in remote areas, or who worked on jobs during normal school hours.
Furthermore, there was a need to educate special groups of students, such as women who
could not enroll in male-only education institutions, or physically challenged people who
where prevented from attending conventional schools.
This need gave the birth to distance learning. Distance learning has its roots in the so
called correspondence education. Pioneers in correspondence education where the
Scottish educator J. Stewart of Cambridge University who started offering off-campus
lectures around 1840. Illinois-based Wesleyan University began a home study program in
1870s and a Correspondence University was founded in Ithaca, New York in 1883
(Horton, 2000).
Over the years, distance learning has quickly adopted available technologies to reach
wider audiences and to disseminate knowledge and train skills more effectively.
One of the first technologies used in the learning process was the radio. The first radio
courses were offered by the State University of Iowa in 1925. Film came next in
technological advances embraced by education. One of the challenges during the World
War II was to reach the millions in military service and teach them. This led to the
introduction of the Army Training film. Later in the 1940s, live television broadcast
capabilities were introduced.
The first use of mainframe computers in teaching was at Stanford University, where
educators worked together with IBM to offer computer-aided instruction in elementary
schools in the late 1950s. The focus of this was mostly ‘drill-and-practice’ sessions using
mainframe computers. A real breakthrough was the development of the PLATO system
by the University of Illinois and the Control Data Corporation. PLATO is the acronym
for Programmed Logic for Automatic Teaching Operations. This system was used to
deliver over 40 million hours of instruction on a variety of sophisticated subjects from the
mid-1960s through the mid 1980s (Horton, 2001). Video recorders and audiocassette
recorders for the consumer market were introduced in the early 1970s and have been
adopted for learning since.
An enormous breakthrough was the introduction of the personal computer at the end of
the 1970s and later the additional possibility of adding multimedia capabilities in the late
1990s. This lead to the development of a significant boom in technology-based learning
programs, interestingly first recognized and leveraged by Apple Computer in the
elementary school systems (Hall, 1977; Rosenberg, 2001; Horton, 2001).
Teleconferencing was introduced in the 80s and provided learners and teachers with
opportunities to talk to each other over long distance. Satellite television networks were
also introduced in the 80s which made is possible for learners and teachers to interact
with each other over distance. The Internet, wireless technologies and new devices such
as DVD players, Personal Digital Assistants (PDAs) and mobile phones became available
in the 1990s and keep emerging.
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All introduced technologies added new features for learning, and therefore did not
necessarily replace an ‘older’ technology (see Figure 2.3). However, the intensity of the
usage of the different technologies has changed. For example, radio is still used for
learning, although less than in the period from 1920 to 1950.
Figure 2.3: Adaptation of Technology in Education
Kurse and Keil (1999) acknowledge in their book Technology-Based Training, that there
is much overlap and convergence in the definitions with regard to technology and
learning/training. They refer to technology-based training as “using technology to deliver
training and educational materials.” They use technology-based training instead of
technology-based learning as a matter of personal preference and because they believe
that most companies have training departments rather than learning departments.
Consistent with the explanation of the differences in education, training and learning as
described earlier, I propose to use technology-based learning as an overall inclusive term
to describe the use of technology for all training and education with the goal to enhance
people’s performance, and therefore ultimately learning.
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Over the years we have seen a number of terms, acronyms and created words offered
with regard to technology-based learning as shown in Figure 2.4.
Figure 2.4: Technology Based Learning Terminologies
Computer-based training (CBT) is term with which many people are quite familiar,
having become popularized with the arrival of the first personal computers at the end of
1970s to early 1980s. It is a general term used to describe any learning event that uses
computers as the primary distribution method; typically used to refer to text-based,
computer delivered training (Sanders, 1998). Zalm (2000) describes computer based
training as usually delivered via CD-ROM or as a web download and that it is usually
multimedia-based training. Hall (1997) refers to CBT as an all-encompassing term used
to describe any computer-delivered training including CD-ROM and the worldwide web.
This definition is broader than Sanders. However, Hall acknowledges that people who
use the term CBT are generally referring to the more narrow definition of text-based
computer training.
Multimedia-based training includes computer applications which use any combination of
text, graphics, audio, animation and/or full-motion video (Sanders, 1998). With the
performance improvement made available through personal computers, when combined
with the launch of CD-ROM (Computer Disk-Read Only Memory) for storage and as
carriers of information, and multi-media capabilities, a new medium was born.
Rosenberg (2001) defines CD-ROM-based training as technology-based learning systems
for instruction and information delivery. These methods lack the networkability that
enables information and instruction to be distributed and updated instantly, as once a CDROM is created the information on it is fairly static.
Hall (1997) defines Internet-based training as any training that can be accessed over the
Internet. Usually this is done on the worldwide web, but e-mail correspondence courses
and file transfers also fall in this category.
Online Training is an all-encompassing term that refers to any training done with a
computer over a network, including a company’s intranet, the company’s local area
network and the Internet (Hall, 1997). Net-based training according to Hall is the same as
online training.
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The difference between online training and online learning goes back to the difference in
definitions of training and learning as discussed before. However, many people use
training and learning as synonyms.
Web-based training (WBT) is instruction delivered over the Internet or intranet (Hall,
1997). Horton (2000) refers to web-based training as “any purposeful, considered
application of Web technologies to the task of educating a fellow human being.” The
adjectives purposeful and considered emphasize that WBT is more than just sharing of
text-based websites, but that the WBT is designed with specific learning goals in mind.
Interestingly, he uses education in his definition of WBT because he states that “There is
no longer any clear difference between training and education.” According to Horton,
WBT is the term used most frequently to describe the use of Web technologies for
learning within the industry. Rosenberg’s (2001) view is that Web-based training and
Internet-based training are both more up-to-date descriptions of computer-based training.
However, I find that the general understanding of CBT as described earlier would not be
included in the more dynamic and multi-media concept implied by Web- and Internetbased training.
Based on the definitions, I have developed a terminology framework (Figure 2.5) which
shows the relationship between the training technology terminologies.
Figure 2.5: Training Technology Terminology Framework
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The main conclusions that can be drawn from this Training Technology Terminology
Framework are:
•
•
•
•
Online Training is training delivered over the Internet, intranet, and/or local area
networks (LAN)
Web-based training is training delivered over the Internet and/or intranet.
Computer-based training includes Web-based Training and CD-ROM-based
training
Web-based training does not include CD-ROM-based training.
The application of technology and in particular the Web and Internet in learning has
resulted in the creation of the new term e-Learning, where the e stands for electronic, and
where the learning is digitized, so it can be stored and distributed in electronic form. One
could say that the e stands for the How.
Yet, many different definitions of e-Learning exist, and therefore I will discuss and
compare some perspectives and conclude this section with my own definition.
Sanders (2001) refers to e-Learning as electronic technologies that deliver information
and facilitate the development of skills and knowledge. Clark (2003) adds to this that eLearning should use instructional methods, and that skills and knowledge development
should be linked to individual learning goals or to improved organizational performance.
Another definition of e-Learning comes from Broadbent (2002). He refers to e-Learning
as training, education, coaching and information that are delivered digitally. He includes
delivery media such as CD-ROM, satellite, and even telephones.
Masie (2001) defines e-Learning as: the use of technology to manage, design, deliver,
select, transact, coach, support and extend learning of all kinds. Although, he does not
refer to the Internet in his definition, it is apparent that this is what his referring too.
Cisco Systems has been one of the early adopters and champions of e-Learning, and
defines e-Learning as: Internet-enabled learning. Hall and Schnider (2000) include in
their definition of e-Learning both the Internet and intranet. Urban & Weggen (2000)
extend this definition with extranets.
Rosenberg (2001) broadens the scope of electronic learning when he refers to e-Learning
as the use of Internet technologies, which include Internet, intranet and extranets, to
deliver a broad array of solutions that enhance knowledge and performance.
Rosenberg’s definition of e-Learning is based on three criteria:
1. e-Learning is networked, which makes it capable of instant updating,
storage/retrieval, distribution and sharing of instruction or information.
(This is the reason that he excludes CD-ROM-based learning from e-Learning.)
2. It is delivered to the end-user via a computer using standard Internet technology.
3. It focuses on the broadest view of learning – learning solutions that go beyond the
traditional paradigms of training.
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Furthermore, he distinguishes three solutions of e-Learning, including: training;
knowledge management; and, performance support. (Figure 2.6)
Source: Rosenberg, 2001
Figure 2.6: Solutions or Forms of e-Learning
The first two solutions offered by e-Learning which Rosenberg identifies are Training
and Knowledge Management. These have been defined and discussed in section 2.1 of
this chapter. It is important to mention here that Rosenberg does not differentiate between
training and education but includes education within training.
The third component of e-Learning according to Rosenberg is Performance Support.
He states that performance support can help a person to do a better job or task better,
faster and at less cost, without having to learn it directly. Performance support can be
provided, for example, through checklists, forms, books, mentors, systems and tools.
Rosenberg (2001) makes a distinction between electronic performance support tools
(EPST) and electronic performance support systems (EPSS). Electronic Performance
Support Tools are usually delivered as stand-alone software or independent tools on the
web (Rosenberg, 2001). Electronic Performance Support Systems can be defined as an
integrated computer application that uses any combination of expert systems, hypertext,
embedded animation of expert systems, and/or hypermedia to help a user quickly perform
a task in real time and with minimal support by other people (Sanders, 2001). However,
most authors do not make the distinction between EPST and EPSS but focus primarily on
EPPSs.
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According to Bielawski (2003, p.31), the methods of EPSS vary widely, but fall into the
following categories:
•
•
•
•
•
•
•
•
Mentoring
On-the-Job Training
Job-Aids
Online help
EPSS Databases
Embedded Systems
Threaded Discussion Groups
Live Online Help
Consistent with Rosenberg’s perspective on e-Learning, Carliner (2002, p.2)
distinguishes five forms of e-Learning: online education; online training; knowledge
management; and electronic performance support. However, he qualifies knowledge
management and electronic performance support as informal learning, because it does not
identify outcomes that learners should achieve. He argues that only online education and
online training recreate the formal classroom learning experience online.
According to Rosenberg, it is very powerful to integrate training, knowledge
management and performance support online thereby leveraging multiple Internet
technologies to enhance performance.
Bielawski concurs with Rosenberg (2003, xix) and uses the term blended e-Learning to
describe the integration of media in learning design and delivery. He refers to blended
learning “as a powerful and cost effective continuous learning solution that combines the
elements: learning, performance support and knowledge management.” He believes that
the blend itself will focus on optimizing the mix of the different elements. An important
goal of blended learning is to maximize the total impact on human performance.
The last definition of e-Learning, from Allison Rossett offers a slight variation on the
definitions described above. Rossett (2002, p.6) has a broad perspective on e-Learning
which includes:
•
•
•
•
•
Learning
Information support and coaching
Knowledge management
Interaction and collaboration
Guidance and tracking
Rossett does not differentiate between training and education but says that learning
relates to “what we can remember and use, when needed, and that there is in investment
involved in learning.” Her second point, information support and coaching, is analogous
to Rosenberg’s definition of performance support, and we have followed an in depth
exploration of knowledge management above.
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The final two aspects of Rossett’s perspective offer additional views of e-Learning that
are especially valuable to our understanding. Online interaction and collaboration can
take place between two or more people. Voosen (2002, p.1) introduces the term learning
community for “a network of constituent groups or sub communities who represent
multiple functions, levels and geographies.”
According to Voosen (2002, p.1) learning communities “provide an environment in
which members obtain useful information, exchange and create ideas, share and develop
tools, generate knowledge, and interact in a meaningful, productive manner.”
Furthermore, she argues that learning communities are self-directed, flexible, dynamic,
and inclusive. Online collaboration and interaction uses a number of different tools such
as: e-mail; threaded discussions; chat; electronic whiteboards; application and document
sharing; web-meeting; file transfer; and instant messenger (Bielawski, 2003; Voosen,
2002; Hall, 2002).
Rossett’s final point, guidance and tracking, relates to the ability of new technology to
provide more and better guidance, assessments, tracking and information with regard to
the entire learning process (Rossett, 2002). As an example, learning systems can guide
individuals towards developing critical skills.
I propose to use the term learning management for the e-Learning solution which Allison
Rossett has named guidance and tracking. Online learning management refers to the
online guiding and managing of the net-enabled learning experiences of learners
including: learning pathways; registration; tracking; and, reporting the learning activities
of learners.
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In Table 2.1 are e-Learning definitions mapped by a number of key elements.
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Net-Enabled Learning
For purpose of this dissertation, I have defined e-Learning in a Business Environment as:
net-enabled learning targeted to achieve business goals
In this definition, the net includes the Internet and intranet, but does not include CDROM-based learning. One of the key characteristics of the Internet is the instant
dissemination of learning content, as well as 24/7 access to the most up-to-date learning
content for users. I view CD-ROM-based learning, although also electronic in nature, as
more of a precursor to net-enabled learning. There are a number of inefficiencies with
CD-ROM-based learning which have been eliminated by net-enabled learning such as:
•
•
•
•
•
•
•
•
The costs of production, distribution and version control of CD-ROM-based
learning:
o The development and production of CD-ROM-based learning is very time
consuming
The limits to tracking and learning management:
o CD-ROM-based learning has very limited possibilities for supporting
enterprise-wide tracking of registration and attendance at programs, and
following progress and completion of learning programs
The limits to storage capacity:
o It is impossible to put an entire (or significant) course library on a CDROM because of a limit to maximum storage
The inability to pursue integration with other e-Learning solutions such as:
knowledge management and performance support.
The lack of interaction and collaboration (live) with other learners.
A number of different learning delivery media can not be leveraged while using
CD-ROM
It is hard to manage and support individual learning experiences of learners who
participate in CD-ROM-based learning
CD-ROM-based learning provides learning content on static medium that is place
dependent. Though, the learning is more dynamic than learning content in a book
In my definition for e-Learning in business, I include the different forms or solutions of
e-Learning such as: online training and online education; online collaboration; electronic
performance; knowledge management; and online learning management. All of these
forms or solutions leverage the net for learning purposes.
The overall goal of learning should be an enhancement of human performance, and each
of these net-enabled learning solutions should have an ultimate impact on business
performance. Donald Kirkpatrick developed a framework for evaluation of learning about
forty years ago (Philips 2000).
His Level 4 evaluation is called the business impact of learning. This refers to the actual
results of a learning program. I will discuss evaluation of learning in Chapter 5.
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I want to conclude this section with a Learning Terminology Framework which captures
my definition of e-Learning. Figure 2.7 is visual representation of relationship between
several key terms which have been discussed in this section and in section 2.1.
Figure 2.7: Learning Terminology Framework
In the coming section, I will take a look at different types of e-Learning. This will
provide a more in-depth perspective on e-Learning and how it can be used.
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2.4 Types of e-Learning
As there are many names utilized to describe technology-based learning, there are also
many classifications for the various methods and types of e-Learning. With multiple
enhancements of learning technologies and e-Learning media, there is a proliferation of
potential e-Learning experiences, methodologies and terminologies. I will review a
number of e-Learning type classifications which together provide a broad perspective on
e-Learning at the beginning of the 21st century. I have grouped the e-Learning
classifications by scope, content area, instructional design and deployment.
Scope
In the previous sections, I also discussed several e-Learning solutions such as: online
training; online education; electronic performance support; knowledge management;
online collaboration; and online learning management. I consider all these solutions as
discrete aspects of e-Learning. However, there are authors who have defined e-Learning
more narrowly, as previously discussed.
Content Area
e-Learning can also be classified by different subject and/or content areas. The first eLearning courses were developed to support people in developing information technology
(IT) skills such as programming, data base, application software, and desktop software,
among others. IT professionals have adopted e-Learning very successfully because:
1) there is a continuing and significant need to develop new skills in this area; 2) IT
professionals are savvy technology users; and, 3) IT classroom training is relatively
expensive (Masie, 2000/2001).
New e-Learning content areas which have emerged include:
• Business, e.g. marketing, finance, management, sales, customer service
• Industry, e.g. financial services industry, consulting, healthcare
• Languages, e.g. English, French, Mandarin, Japanese
• Professional skills, e.g. communication skills, teambuilding
• Leadership, e.g. strategy, change management, leadership skills
• Organizational proprietary content, e.g. orientation program, policies and
procedures, safety, products/services
Instructional Design
A number of e-Learning classifications are driven by e-Learning instructional design.
A first example is from Clark and Richard Mayer (2003). They classify e-Learning into
inform programs and perform programs. Inform programs are primary designed to build
awareness or provide information and knowledge, such as many new hire orientation
programs. Perform programs are designed to build specific skills, for example lessons on
evaluating a mortgage, or usage of software.
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The Mayers differentiate three types of e-Learning based on three different views of
learning. The first type of e-Learning is called Information Acquisition, which according
to this view, involves adding information to one’s memory.
The instructional design for this learning approach is ‘receptive,’ or show-and-tell. eLearning courses of this type are inform programs. The second type of e-Learning is
called Response Strengthening. Here, learning involves the strengthening or weakening
of associations between the stimuli. The instructional design approach for this is
directive, or drill and practice. The last type of e-Learning is classified as Knowledge
Construction. Learning occurs when a learner builds a coherent mental representation.
The instructional design approach is guided discovery. Both Response Strengthening and
Knowledge Construction fit in the e-Learning perform program category.
Kruse & Keil (1999) classify e-Learning based on different instructional methods.
e-Learning types include: tutorials; simulations; instructional games; test; and record
keeping. Horton (2000/2001) adds to this list web-based training, facilitated web-based
training, web-conducted classroom course, e-mail correspondence course, discussion
group seminars, guided tours, onscreen workbooks, tele-mentoring, e-coaching, job aids,
libraries, museums, glossaries, and field trips.3
Early e-Learning programs were primarily programs which were text-heavy, containing
static, rapidly dated content, with little interactivity (Forrester, 2000). However, based on
the media and communication technologies available today and the varied modes of
training and instruction possible, e-Learning programs can be very engaging and
effective, especially those that combine capabilities in simulations and games.
Games can be defined as a structured activity in which two or more participants compete
within constraints of rules to achieve an objective. One of these participants can be a
computer (ASTD, 1987). Prensky (2001) refers to games as organized play. According to
him games are a subset of play and fun.
He lists six key structural elements of games:
1. Rules
2. Goals and Objectives
3. Outcome and Feedback
4. Conflict/Competition/Challenge/Opposition
5. Interaction
6. Representation or Story
Prensky (2001) also has defined eight genres of games: action; adventure; fighting;
puzzle; role-playing; simulation games; sports; and strategy.
3
Appendix D offers definitions of the different types of e-Learning by mode of training or instruction.
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Sham Bhangal and others, list in their book Flash Games Studio (2001) the following
categories of e-Learning games, including: puzzle games; board games/card games;
casino games; platform games; role playing games; first person shooters; adventure
games; sports games; fighting games; simulators; and strategy games.
ASTD (1987) refers to a simulation as an operational model, using selected components,
of a real hypothetical process, mechanism or system. Prensky (2001) describes
simulations as a synthetic creation of an artificial world that approximates the real one,
something that creates the reality of the workplace or a mathematical model with a set of
initial conditions that allow prediction and visualization as time unfolds. Schank (1997,
p.22) describes a good simulation: “Like a good novel, a good simulation asks your
learners to suspend their disbelief. Whether you’re creating a simulation on a computer
or through role-playing, you want participants to experience the event as if it were really
happening. Perhaps more to the point, you want to avoid evoking an unnatural response
– a response someone wouldn’t give in real life.” According to Prensky (2001, p.128),
“Simulations can be a story, it can be a game, it can be a toy. If it’s a role-playing
simulation, ultimately it’s a story. If it’s a simulation of trading, it’s a game. If it’s a
simulation of an airplane, it’s a toy.” A simulation-game combines the characteristics of
both games and simulations (ASTD 1987).
A third classification of e-Learning based on instructional design is to focus on who is
controlling the learning process during the course. Learner-controlled e-Learning courses,
“allow learners to select the topics they want, control the pace at which they progress,
and decide whether to bypass some lesson elements such as examples or practice
exercises” (Clark 2003, p.227). An e-Learning course is program-controlled when there
are limited choices for the learner for navigation through the course.
Finally, Hall (1997) uses level of interactivity and the amount of multimedia to create a
classification of three different types of e-Learning. Type 1 e-Learning programs are text
and graphic programs which are sometimes simply paper-based course materials placed
on the web so that students can access them in electronic format. The interactivity is very
limited or non existing. Type 2 e-Learning programs are programs with interactivity and
instructional design. At a minimum, these can include application exercises, drag-anddrop, column matching, testing, text entry and even programming code entry. Type 3 eLearning programs allow the user to manipulate graphic objects in real-time, sometimes
taking on the quality of a game playing exercise. Simulations and games are part of this
category, and audio and video sounds are both used.
Deployment
A number of e-Learning classifications are structured according to the method by which
e-Learning is deployed. I will discuss a number of examples such as: synchronous and
asynchronous e-Learning; e-Learning targeted to individuals or groups; the storage of
learning content; and hardware devices used to deploy e-Learning.
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The first classification which I will discuss makes a distinction between synchronous and
asynchronous e-Learning. Chen (2001) defines synchronous or live e-Learning as “a
learning experience delivered at a regular time over the Internet that features an
instructor interacting in real-time with students4 by means of two-way audio, text and
graphics oriented communication.” Examples of synchronous e-Learning include online
seminars, real-time chat, and video and/or audio conferencing (Brandon-Hall, 2002).
Chen mentions a number of benefits derived from synchronous e-Learning including:
•
•
•
•
•
•
•
•
Engaging learning experience: Synchronous e-Learning can be very interactive,
easy to customize and exciting learning experience.
Convenient for learners: Learners can access the course from any internet
connection.
Convenient for instructors: Teaching a course can done from any location.
Cost-effective for training providers: Tangible benefits include reduction of
facility costs and training logistical planning.
Allowing trainers to aggregate demand: Synchronous learning provides the
opportunity to take the class with a limited number of participants in any location
desired.
Leveraging instructors: Particularly for areas with limited availability of
instructors.
Respectful of instructor contribution: Proven instructors remain very important in
the classroom.
Easy course development and update: The update of courses is much faster than
with other types of learning.
Asynchronous learning is the more common type of e-Learning, according to Kruse and
Keil (1999). They refer to asynchronous learning as learning experiences where students
complete e-Learning courses on their own time and schedule, without live interaction
with the instructor.
They distinguish two forms of asynchronous Learning: facilitated and self-paced. The
facilitated asynchronous learning involves an instructor and a group of participants
(students) but the interaction is not in real time (Kruse and Keil, 1999).
Examples of facilitated asynchronous e-Learning include: instructor posts assignments
on a webpage; communication through online bulletin boards; and/or homework
submission using Website. Self-paced asynchronous is the most common form of eLearning according to Kruse and Keil (2000). This form of delivery consists of standalone instructional material that can be accessed and completed via the web without
additional interaction among students.
4
I refer to students as participants in e-Learning courses. Participants can be people in
Universities/Colleges but also employees of organizations who take e-Learning courses. In America both
audiences are usually referred to as students and/or participants.
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The second e-Learning deployment classification deals with the number of people who
participate in the e-Learning experience. e-Learning can taken by an individual, solo eLearning, or by a group, collaborative e-Learning. Collaborative e-Learning can be
defined as a structural exchange between two or more participants designed to enhance
achievement of the learning objectives (Clark 2003, p.199). Collaborative e-Learning
takes advantages of internet technologies. Examples of channels for collaborative eLearning include: chats; message boards; online conferences; and e-mail.
Another classification of e-Learning types is by storage technologies, defined as “things
that hold programs and data” by Kruse and Keil (2000). Examples of storage
technologies are: floppy disk; CD-I; CD-ROM; DVD, and Internet/Intranet. Adding the
extension learning to the storage medium defines the different learning types based on
the capabilities of the storage technologies, such as DVD-based learning. Kruse and Keil
suggest that there are organizations which always embrace new technologies, and
organizations which will take more time to adopt new technologies. As a result, there will
always be new, recent, and old technologies simultaneously in use as we can see with the
storage capabilities mentioned above.
The final e-Learning deployment classification which I will discuss classifies e-Learning
types by hardware device. Most studies suggest that e-Learning has been primarily
delivered via computer. This can be a desk-top or laptop computer. According to Quinn
(2000), more and more e-Learning will be delivered in the future through computational
devices, such as personal digital assistant (PDAs) or digital cell phones. He calls this mLearning or mobile Learning.
It is argued that e-Learning programs differ significantly in their appearance, depending
on use, application of learning technologies, and instructional design. Based on the
decisions made on these factors, very different learning experiences are created, and must
ultimately support the learning goals and objectives of the initiative.
For the instructional design of e-Leaning it is important not just to understand the
technology, but to have an understanding of a number of adult learning theories which
provide instructional design models and strategies (Broadbent, 2002).
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2.5 Concluding Remarks
In this chapter, I have provided an overview of the evolution of technology-based
learning, and I have framed e-Learning within the broader theoretical context of learning.
My first conclusion is that well established learning terminologies, such as training,
education and learning, are differently defined and interpreted by many authors.
Therefore, it is unlikely that people share a common baseline of terminologies when
discussing e-Learning. This is why I have provided specific language and definitions on
key terminologies. I will use these definitions when I am discussing e-Learning design in
Chapter 4.
Secondly, many theories exist on how people learn and the related implications for
designing e-Learning programs and content. However, it is not evident that most of the
currently existing e-Learning programs are designed based on these theories and on
scientific valid research studies.
Third, over the years new technologies, ranging from radio to the Internet, have been
rapidly adopted to support learning and have provided new ways to shape the design and
delivery of education and learning programs. I argue that the Internet will have a similar
impact in creating a new way for people to learn and collaborate in the future.
However, I strongly believe that all e-Learning programs need to be based on wise
selections and combinations of learning theories and principles of instructional design.
This is the only way to take advantage of the e-Learning technologies and to provide the
learner with a meaningful learning experience. This moves e-Learning well beyond
“access and reading of data or information.” Or, in other words, the focus needs to be on
the learning (what) first and secondly on the e- (how). Obviously, a good learning design
and right usage of e-Learning technologies has a high impact on e-Learning acceptance
and satisfaction. Therefore, in Chapter 4, I will discuss organizational capabilities for the
implementation of e-Learning, and in Chapter 3, e-Learning and Business Drivers.
Fourth, it has been argued that the proliferation of technologies and application of these
technologies to learning, have created a multiplicity of definitions in the field of eLearning and, as a result, e-Learning means different things to different people.
Based on my literature study on e-Learning, it appears that e-Learning can be defined
based on the:
•
•
•
•
Inclusion of different deployment classifications
Inclusion of different learning solutions
Level of instructional design used
Scope of content included
Depending on how people define e-Learning, it can be viewed as:
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•
•
•
•
•
Very narrow or broad in scope
The content can be limited or very extended
The instructional design can support a poor or a very rich learning experience
The deployment can leverage a range from low-end to high-end in the application
of e-Learning delivery technologies
Furthermore, e-Learning can be targeted to individuals or groups.
Depending on the scope of e-Learning, the organizational capabilities for
implementation, the business drivers, and the business impact, the approach to e-Learning
may be different. As an example: if e-Learning is defined by the organization as simply a
few online education courses, this will have a very different impact on individual learning
and organizational performance than when it is defined in a broader and more inclusive
way to embrace all the capabilities of the net, human curiosity and intelligence.
My final conclusion and my own perspective is that e-Learning includes solutions such
as: online education; online training; performance support; knowledge management;
online collaboration; and online learning management. My assumption is that many of
the e-Learning solutions are less integrated than desired in most companies due in part to
the fact that they are owned and managed by different organizational department, such as:
Education and Training; e-Learning; Knowledge Management; IT; and, Human
Resources. Also, this lack of integration is due to inexperience with the application and
integration of the various e-Learning solutions.
In conclusion, the theory in this chapter provides evidence that many e-Learning
solutions exist which organizations may find of interest to initiate. Therefore in the
following chapter, I will explore the impetus for organizations to invest in e-Learning
solutions.
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Chapter Three
e-Learning and Business Drivers
3.0 Introduction
3.1 Enterprise Transformation
3.2 Cost Reduction
3.3 Time-To-Competence
3.4 People Commitment
3.5 Concluding Remarks
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3.0 Introduction
The literature discussed in Chapter 2 provides some evidence that research and
publications on e-Learning focus primarily on two aspects: technology and learning. I
suggest that this perspective is not broad enough to identify the business impact of
e-Learning. Therefore in this Chapter, I will explore the financial and business economic
aspects of e-Learning. My key question is:

What causes organizations to invest in e-Learning?
According to Strassman and Pisello (2003): ‘The IT arms race is over and economic
criteria are now the benchmark for IT investment decisions’.
Literature specific to the topic of investments in e-Learning appears to be in an early
stage of evolution. Therefore, I have identified and explored additional sources in which
authors conclude that business drivers generate investments in various activities,
including investments in learning.
Business Drivers
Business drivers can be described as those goals, events, or issues that urge or compel the
enterprise or business to move onward (Webster's Dictionary, 2004). Business drivers are
instrumental in business growth, improved competitiveness and profitability, and
increased value of the business (Barksdale, 2002).
Barksdale (2002) differentiates between external and internal business drivers. External
business drivers are generally outside the organization's control and include: economic
drivers; human resources drivers; government drivers; public perception drivers; and,
market or customer drivers. Internal drivers are generated by factors and events within
the organization's control and include: technology drivers; changes in systems; processes
and key policies; shareholder or financial drivers; and, leadership and organizational
drivers.
I find it outside the scope of this dissertation to discuss all possible business drivers and
will limit the exploration to those business drivers which focus primarily on knowledge
and people. A number of authors suggest that the most important business drivers in this
area include: enterprise transformation; cost reduction; time-to-competence and people
commitment (e.g., Arevola & Lundy, 2003; Barksdale, 2002; Capelli, 2002; Cheese and
Thomas, 2003; Moore, 2003; Porter, 1985; and, Yip, 2003). These drivers are most
likely to relate to investments in learning and specifically in e-Learning.
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The first driver I will discuss in Section 3.1 is Enterprise Transformation. Enterprises are
experiencing increasing pressure to create shareholder value and therefore need to
transform themselves to achieve extraordinary goals (Moore, 2003; Cheese & Thomas,
2003; Yip 2003). In this section, I will explore several forces which cause enterprises to
transform, as well as how this might impact the needs for skill development and learning.
According to the IBM Global CEO Study 2004, among 450 CEOs, there is now “the
ability to recognize, analyze and respond more effectively to continuously changing
market conditions and risks,” a new key competence for enterprises (IBM, 2004).
Grantham (2000) argues that enterprise transformation presents a new set of challenges
for organizations and workers.
According to a number of writers (Driscoll, 2002; Horton, 2001; and, Porter, 1985)
Cost Reduction is a business driver which leads to competitive advantage for enterprises.
In Section 3.2, I will discuss the importance of cost reduction within enterprises and will
explore the potential role e-Learning can play in reducing the costs for enterprise-wide
learning.
The speed at which enterprises can transfer knowledge and build new capabilities is an
important business performance indicator, according to Arevola & Lundy (2003). In
Section 3.3, I will explore whether Time-to-Competence can be increased by using eLearning to support achievement of specific business goals.
Retaining knowledge workers is an important competitive advantage for enterprises and
People Commitment plays an important role in this area (e.g., Capelli 2002). In Section
3.4, I will discuss the role that e-Learning might play in maximizing people commitment
through the enhancement of learning opportunities.
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3.1 Enterprise Transformation
Today’s business environment for enterprises is characterized by a fluid exchange of
money, technology, people, ideas, information, and knowledge. (Athey, 2001)
Many authors suggest that forces which may transform businesses include: changes in
types of competition; industry consolidation; regulatory issues; changing technology and
the impact of the Internet; access to capital; shortage of skills; and, lack of pricing power
(Prahalad & Hamel, 1994; Athey, 2001; Hortob, 2001; Yip, 2003; Elwood, 2003; Berner,
2001).
In this section, I will briefly discuss the possible impact of the forces mentioned above on
enterprise transformation and learning.
Changes in Types of Competition
Prahalad and Hamel (1994) made changing competition the subject of their book:
Competing for the Future. They stress that competition for the future is profoundly
different from the competition for the present. They find that main differences of future
competition are the need to:
•
•
•
•
Compete for opportunity share
Opportunities are new markets that an organization could enter with new
products/services. In order to capture a share of future opportunities, companies
need to attract and develop new skills that form the competencies which provide
an avenue to future opportunities.
Compete on a company basis versus competition among business units or
products
Future opportunities do not fit neatly into an existing business unit or product
segment because it can require significant investment, a relatively long time span,
access to competencies in different business units, and more risk. Therefore they
argue that competing for the future must be a corporate-wide responsibility.
Compete both intercorporate and intercoalition
Management of innovation, new product development and commercialization
require capabilities, which do not necessarily exist within one company, country
or business unit. Therefore organizations must conclude alliances and collaborate
with potential rivals in order to gain the capabilities needed.
Compete based on speed
Product life cycles are getting shorter, development times are getting tighter, and
customers expect almost instantaneous service. Therefore speed leads to
competitive advantage. One of the key enablers for speed is technology, which
will be discussed in a subsequent section of this chapter.
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•
•
Compete in ‘unstructured’ arenas
New opportunities for companies are found in areas where the rules of
competition are not yet defined. The challenge is to make the right strategic
choices such as: Which core competencies to build? Which products/services to
support and what kind of people to hire? This is a new environment with
unpredictable change and turbulence.
Compete in multi stages
Industry development and transformation can be compared with a triathlon.
Competition will take place in multiple areas and in different time periods.
Prahalad and Hamel (1994) conclude that in order to compete successfully in a rapidly
and radically changing environment, organizations need to learn new ways of doing
things and building new competencies, but equally need to unlearn familiar things and
ways of doing. The relevance of e-Learning to this requirement will be expounded in the
conclusion of this section.
Another aspect of changing competition is globalization. According to Crandall and
Wallace (2000) technology and economic forces have created a new form of competition,
which is global in nature.
The key industry globalization drivers that affect a company’s ability to compete in
different areas of the world include: market; costs; government; and, competition
(Rhinesmith, 1996; Yip, 2003). Examples of market globalization drivers include the
existence, or emergence of: common customer needs and tastes; global customers; global
channels; and transferable marketing. Cost globalization drivers include: global scale
economies; steep experience effects; favorable logistics; differences in country costs;
high product development costs; and, fast changing technology. Examples of government
globalization drivers are: favorable trade policies; compatible technical standards;
common marketing regulations; and, government-owned competitors and customers.
Finally, competitive globalization drivers include: high exports and imports; competitors
from different continents; interdependence of countries; and, globalized competitors
(Yip, 2003).
.
Yip (2003) argues that the benefits of globalization include: cost reductions; improved
quality of products and programs; enhanced customer preference; and increased
competitive leverage. Global companies do not have to be everywhere in order to gain
benefits from globalization. Though, “they should have the capability to go anywhere,
deploy any assets, access any resources, and maximize profits on a global basis”
(Yip, 2003).
According to Conference Board (2003, p. 14), CEO’s expect “the dynamic of emerging
markets around the world, the dazzling speed of their developments, and the proliferating
interfaces of disparate markets everywhere, to play a major part in both the microeconomic and macroeconomic outlooks for 2008.” Specifically, the emergence of India
and China will have a huge impact on how business will be done in the future
(Conference Board, 2003).
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In order to become more global, it is crucial that companies develop a global mindset and
skills that will help to facilitate international dealings and decisions (Rhinesmith, 1996).
In a similar way, the results from the Conference Board Study (2003) indicate that it is
critical for companies to have cross-cultural savvy.
To illustrate, China does not permit majority ownership by any foreign entity. Therefore,
“there will be a high learning curve for many Western companies to scale rapidly in a
country where their own transplanted employees neither read, write, nor speak the local
language, much less have familiarity with local customs, conventions, and traditions”
(Conference Board, 2003, p. 23). The Conference Board study suggests that companies
that do not develop their cross-cultural competence will probably lose ground to
competitors.
Furthermore, global organizations need to develop business processes that maximize
knowledge and learning transfer between subsidiaries and corporate staffs (Moran &
Riesenberger, 1994). Other sources (Athey, 2001; Marquardt & Reynolds, 1994) find that
using technologies to support cross-organizational and global learning and knowledge
transfer are critical to building learning organizations.
Finally, Crandall and Wallace (2000) believe that the new competition has created
opportunities and threats for enterprises. They argue that the implications of the new
competition will cause massive restructuring on a large scale. Furthermore, they suggest
that only companies with the right skills will be successful.
To summarize, it appears that within this shifting competitive arena, e-Learning may
enable enterprises to develop cross-cultural human capabilities and to provide crossborder flows of knowledge, expertise and best business practices. Additionally, eLearning may provide employees with the opportunity to develop new skills on a just-intime basis in all geographies instantly, and at advantageously low costs, becoming a
serious contributor to enterprise transformation. As I will discuss in this dissertation, I
suggest that e-Learning capabilities allow organizations to access a global workforce
immediately, with high quality learning, providing an important lever for gaining a global
competitive edge.
Industry Consolidation
Various authors (Deans, Kroeger and Zeisel, 2003) anticipate that further consolidation
both across industries and throughout the world will be inevitable and widespread in the
future. They suggest in their book, Winning the Merger Endgame, that “the pace of
corporate combinations may ebb (as it did in 2001) or flow (as it did throughout the
1990s), but consolidation is unstoppable. Its progress is continuous and inevitable. And
its impact on individual industries is profound” (Deans, Kroeger and Zeisel, 2003).
Furthermore they suggest that mergers and consolidation have moved from a primarily
local, regional or national focus to the global arena.
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65
Consolidation can also take place through mergers and acquisitions but also through
strategic partnerships and by creating alliances with different parties (Spekman, Isabella,
MacAvoy, Forbes, 2001).
One of the challenges with further industry consolidation through mergers and
acquisitions is that fewer than half of all mergers have created the promised value for
shareholders. This is primarily because they fail to effectively integrate people,
knowledge, culture and competencies across the merged organizations (Athey, 2001).
Similar statements can be made about alliances, with a failure rate as high as 60%
(Spekman, Isabella, MacAvoy, Forbes, 2001). To ensure the success of strategic
partnerships and alliances, there is a need to for knowledge transfer within and across the
organizational boundaries and the people who manage the alliances (Athey, 2001).
Furthermore, people who manage alliances need to have a variety of skills including:
•
•
•
Threshold skills: Skills which center around the ability to convey a sense of selfconfidence and the ability to inspire others and urge them to be open to novel
ideas and new ways of thinking.
Distinguishing Skills: Skills which revolve around the depth and breadth of
informal networks the alliance manager has developed, both internal and external
to the alliance.
High-Performance Skills: Skills which take alliance management and the role of
the alliance manager to the next level of effectiveness.
(Spekman, Isabella, MacAvoy, Forbes, 2001)
During mergers and acquisitions there is tremendous uncertainty, change, and a lack of
clarity for employees in a number of areas such as: strategy; leadership positions;
organizational structure; products and service portfolio; roles; and systems and processes
(Pribilla, 2002). Therefore, it might not be a surprise that personnel problems are one of
the main reasons for the disappointing financial results of more than half of all mergers
and acquisitions (Hubbard, 1999).
Other survey data shows that 85% of all top US executives believe that HR issues have a
greater impact than financial issues on the success of acquisitions (Hubbard, 1999, p.16).
Fritz-enz (2000) has observed that merged organizations take the risk of losing their top
performers if these individuals become dissatisfied with the progress made and the future
perspective and culture of the new company. Picot (2002) has identified four steps
towards a successful cultural integration which include: building trust and mental
networking; developing shared values/joint vision; comparing intended values with
everyday business reality; and creating consistent management models. This requires
significant communication from leadership and collaboration from employees. As an
example, Picot (2002) refers to the need of integration workshops with employees and
managers from both companies who are to work together more closely in the future.
However, I suggest that bringing the workforce together in classroom training sessions
might be very difficult from a logistics, timing, frequency and cost perspective.
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Leveraging e-Learning might be a valuable approach for fast dissemination of consistent
quality information and knowledge throughout an enterprise to support mergers and
acquisitions.
Legal and Regulatory Mandates
Many companies are faced with the challenge to comply within a designated time frame
to various standards, policies, regulations, and laws related to their business (e.g. Horton,
2002). Certification requirements for employees have long been established in industries
such as: finance; chemicals; healthcare; and, energy. However, legal and regulatory
requirements for corporate accountability have increased for other industries as well.
(Athey, 2001) Recent events in the global business world will ensure that legal and
regulatory compliance issues to some degree will drive large-scale enterprise
transformation.
In order to be in compliance with laws or regulations, companies must conduct training to
meet these requirements. In addition to externally driven compliance training,
organizations have internally driven compliance programs, such as ethics, independence
and safety (van Dam, 2003).
Horton (2001) suggests that by providing training to a large number of employees to
ensure compliance, e-Learning is the most effective and efficient way to train and track
completions for the targeted audience.
Changing Technology and the Impact of the Internet
Many writers (Gates, 1999; Yip, 2003; and, Zuckerman, 2001) suggest that the rise of the
Internet is probably the most powerful force effecting the business enterprise
transformation today and for at least the next decade.
Yip (2003) addresses the question: “What is the effect of the Internet on organizations?”
He argues that it will have an impact on: industry globalization drivers; global market
participation; global products and services; global activity location; global competitive
moves; and globalization itself. Yip finds that the Internet will make it easier for
companies to be simultaneously global and local. In his own words, “the Internet
certainly improves global coordination, the running of global teams, and the sharing of
information”. In addition, it makes it much easier for companies to participate in foreign
markets, due to the low costs (Yip, 2003). Furthermore, he believes that the Internet
might also affect global organizational structures.
A study from the Conference Board (2003) provides some evidence that technologies will
continue to drive competition in different ways, such as: speed; efficiencies; enhanced
communication; and enhanced management tools and techniques. These findings are
consistent with other research results among executives (Cheese and Thomas, 2003), who
view technology as both integral to achieving business strategy and as integral to setting
business strategy in the first place.
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However, although many companies have made significant investments in technologies
in the 1990s, questions have been raised by executives about the value of these
investments (Cheese and Thomas, 2003).
Zuckerman (2001) argues that in order to get maximum benefits from technology
investments, companies and institutions must (2001, p.323):
•
•
•
•
Understand the impact that technology makes in their corporate culture and in
workflow
Create an information/workflow system based on human style that acts as a
support or infrastructure to technology
Train employees in the writing-based and analytical skills they need to maximize
technology use
Remember that it is humans, not technology, that drive an organization and that
speedy, accurate information flow is crucial to success in the networked, B2B
world
However, Zuckerman also observes that many organizations lack the human skills
required to make smart technology choices and to apply technology to business and
institutional goals. The relatively low spending on information technology training
among employees might support his observation. According to ASTD Study (2003), just
11% of the 2002 learning expenditures were on information technology training.
Consistent with Zuckerman’s perspective, I argue that the adoption of new technologies
might happen much faster if employees were better educated in Information Technology.
As discussed in Chapter 2, e-Learning was first applied for technology content and has
proven to be very effective and efficient. Because of ongoing investments and changes in
technology (e.g., Zuckerman, 2001), I expect that there will be a significant growth in
e-Learning to support the deployment of information technology skills.
Shortage of Skills
Another business driver for e-Learning is the growing shortage of talent. According to
research data from Aspen Institute’s Domestic Strategy Group (Ellwood, 2003) the baby
boomer generation, the largest generation of workers in the US, will retire within the next
17 years. By 2008, the first members of the baby boom generation will turn 62, the
average retirement age n the large developed economies in North America, Europe and
Asia (Athey, 2004).
Up to this point, each generation to enter the workforce in the US has been larger and
better educated than the previous one. This is not the case anymore for the generation
who will replace the baby-boomers (Aspen Research, 2003). The percentage of primeage labor force members that have been to college will remain flat at about 60%. As a
result of these factors, Ellwood (2003) predicts that the gap in skilled workers in the US
will be 40 million by 2020.
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Therefore, it appears that companies need to provide more education and training to
specific segments of their workforce to fill the skilled worker gap (Conference Board,
2003).
According to a number of authors (e.g., Carliner, 1999; Horton, 2001; Philips, 2002) eLearning provides a cost effective, just-in-time and personalized learning capability, and
thus can be a valuable resource in filling the skills gap.
Lack of Pricing Power
Pricing power can be defined as “the size of the effect on demand for a firm’s product of
a change in prices” (Berner, 2001). Companies lacking pricing power will lose market
share if they raise their price. Without pricing power, there is an ongoing pressure for
organizations to reduce costs (Conference Board, 2003).
Cost reduction has been identified as one of the business drivers of e-Learning which will
be separately discussed in Section 3.2.
In this section, I have identified a number of business issues, which are of major concern
to enterprise leadership. Competition is fierce. A competitor anywhere can be a
competitor everywhere. Knowledge, skills, commitment, know- how and know-what are
critical capabilities that contribute to competitive success. These capabilities need to be
available in the people everywhere the company does business around the globe.
In addition, various industry and market forces are causing enterprises to drastically
reduce their costs. This cost reduction can be achieved in several ways, including: by
implementing new technologies; by using resources in low cost countries; or by
achieving economies of scale through a merger with another enterprise. Additionally,
factors in the organizational environment impact enterprises significantly. Examples of
these include new legal and regulatory mandates and changing demographics which have
an impact on the availability of highly skilled employees.
All of these challenges are driving businesses to require a high quality workforce, welleducated in constantly changing skills, technologies, and knowledge, trained through
learning delivered at a reduced cost, with consistent messages, delivered simultaneously
to a globally dispersed audience, at all times convenient to their lives and work schedules,
while ensuring rapid speed to skill attainment.
I suggest that if knowledge, speed, and costs are important business drivers—and we
have seen here that they are—there is a strong business case for e-Learning capabilities.
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3.2 Cost Reduction
I will start this section with a brief discussion on competitive strategy and the importance
of managing costs in enterprises. Secondly, I will look at different cost categories for
learning and compare the cost for providing classroom learning versus delivering it
through an e-Learning approach. Finally, I will discuss why costs are an important driver
for e-Learning.
Michael Porter is perhaps best known for his work on competitive strategy. Porter (1980)
argues that the state of competition is a composite of five competitive forces:
•
•
•
•
•
The rivalry among competing sellers in the industry
The potential entry of new competitors
The market attempt of companies in other industries to win customers over to
their own substitute products
The competitive pressures stemming from supplier-seller collaboration and
bargaining
The competitive pressures stemming from seller-buyer collaboration and
bargaining
The collective strengths of these competitive forces determine the ability of companies in
an industry to earn, on average, a rate of return-on-investment in excess of the costs of
capital (Porter, 1985). Furthermore, he argues that the five forces determine industry
profitability because they influence the prices, costs, and required investments of
companies in an industry, and form the elements of return on investment.
However, he argues that a company position within the industry determines whether its
profitability is above or below industry average. His findings suggest that in the long run
sustainable competitive advantage is the fundamental basis for above-average
performance within an industry. Porter (1980) distinguishes two types of competitive
advantage: low cost and differentiation. Furthermore, he proposed thee generic strategies
for achieving above average performance in an industry:
•
•
•
Cost Leadership
Differentiation
Focus (cost focus and differentiation focus)
Cost leadership and differentiation look for competitive advantage in a broad range of
industry components, while the focus strategy (both costs and differentiation variant) aim
at narrow industry components.
According to Porter, competitive advantage is at the heart of any strategy and achieving
competitive advantage requires firms to make a choice of type and scope of competitive
advantage.
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Figure 3.1 presents the three generic strategies for obtaining competitive advantage
(Porter, 1980).
Figure 3.1: Strategies for Competitive Advantage
When an organization sets out to be the lowest cost producer in industry, it’s following a
Cost Leadership Strategy. The sources of cost advantage may include: the pursuit of
economies of scale; proprietary technology; preferential access to raw materials; and
others (Porter 1980). Low cost producers sell mostly a more standard product or service.
However, a cost leader must achieve parity5 or proximity in the bases of differentiation
relative to its competitors. Parity in differentiation allows a cost leader to translate its
cost advantage directly into higher profits than its competitors. Porter says that,
“proximity in differentiation means that the price discount necessary to achieve an
acceptable market share does not offset a cost leader’s cost advantage and hence the cost
leader earns above average returns.” Furthermore, Porter argues that there can only be
one cost leader in an industry.
The company that seeks to be unique in its product offering and in its industry in ways
that are widely valued by customers is following a Differentiation Strategy. The Focus
Strategy aims at cost advantage (cost focus) or a differentiation advantage (differentiation
focus) in a narrow segment. This can be a market segment, or a group of segments in an
industry.
5
Parity implies either an identical product offering to competitors, or a different combination of product
attributes that is equally preferred by buyers (Porter p.13).
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71
Porter argues in his book, Competitive Advantage (1985), that competitive advantage
cannot by understood by just looking at a company as a whole, but it comes from many
activities that it performs in designing, producing, marketing, delivering and supporting
its products.
All these activities are part of what Porter calls the company’s value chain contributing to
a relative cost position and creating a basis for differentiation. Value is defined as the
amount that buyers are willing to pay for what a firm provides them and is measured in
revenue (Porter, 1985, p.38). A company is profitable if the value exceeds the costs in
creating the product. This is the goal of any generic strategy.
The value chain provides total value and consists of value activities and margin. Porter
defines value activities as the physically and technologically distinct activities a company
performs. Margin is the difference between the total value and the collective cost of
performing the value activities. Every value activity uses purchased inputs, human
resources and technology to perform the function. Value activities can be divided into
primary activities and support activities. There are five generic categories of primary
activities: inbound logistics; operations; outbound logistics; marketing and sales; and
service. Support activities can be divided in four generic categories: procurement;
technology development; human resource management; and infrastructure (Porter, 1985).
Human resource management consists of activities in recruiting, hiring, training,
development and compensation of personnel. Porter argues that human resource
management affects competitive advantage in any firm, through its role in determining
the skills and motivation of employees and the cost of hiring and training (Porter, 1985,
p.43).
The value chain is not a collection of independent activities but a system of
interdependent activities. Therefore, value activities are related by linkages within the
value chain. Linkages can be defined as the relationships between the ways a value
activity is performed and the cost or performance of another and can lead to competitive
advantage through optimization and coordination, according to Porter.
Cost advantage is one of the two types of competitive advantage a company may pursue.
However, it is also very important to the differentiation strategy type because a
differentiator must maintain cost proximity to competitors otherwise it won’t achieve
superior performance (Porter 1985). Therefore, management recognizes the importance
of costs and organization goals include often plans for cost reduction or cost leadership.
This is consistent with the outcome of a study from Cheese and Thomas (2003) among
executives who listed reducing costs and creating value as one of their top ten issues.
The larger goal of cost reduction is the creation of shareholder value (Cheese and
Thomas, 2003). Shareholders are the investors who hold shares in a company.
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According to Moore (2002), management must serve four constituencies in a capitalist
system: customers; partners; employees; and investors. He asserts that investors’
influence on companies is both deep and pervasive. Furthermore, he agues that investors
are always looking for a company’s future prospects to brighten, because this raises the
value of the stock and creates a positive return on investment. Moore says “the total value
of a company-- its market capitalization-- is equal to the present value of its forecastable
future earnings from current and planned operations, discounted for risk. Market
capitalization is a grade on company’s competitive advantage strategy” (Moore, 2002).
In addition to market capitalization there are number of other industry standard measures
of corporate performance, and there is still much debate on which single standard to use
(Strassman and Pisello, 2003). As an example, Strassman and Pisello (2003, p.5) argue
that: “high market capitalization, such as the Internet boom period can falsely predict a
high contribution from IT, and in poor times, such as 2001, the value of the investment
may be lost in poor market performance.” Strassman and Pisello (2003) propose
Economic Value-Add (EVA) as the best current measure of corporate performance. EVA
measures the difference between the return on a company’s capital and the cost of that
capital. A positive EVA indicates that value has been created for the shareholders,
whereas, a negative EVA signifies value destruction (Strassman and Pisello, 2003, p.31).
Other important instruments mentioned by executives for creation of shareholder value
are (Cheese and Thomas, 2003): improving quality; using information technology to
reduce costs; and, reducing workforce related costs.
Traditionally, there has been a very strong relationship between short term earning and
the stock value. One of the leading writers on this subject Brockbank (2001), finds that
the correlation between short term earning and the stock value, has been the driver of
90% of stock value until the early 1990s. However, he argues that this percentage has
been halved since then. Now, a study from Ernst & Young (1998) finds that additional
important evaluation matrices for analysts include: the quality of management; their
strategy; their logic; how they manage people; if succession planning is in place; and if
they have policies that link compensation to performance management (Brockbank,
2001).
In this section, we have determined that both cost and the management of human capital
play significant roles in creating shareholder value. An examination of costs involved in
providing learning, growth and development for employees will be examined next.
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Enterprise Learning Costs
In the United States, the overall training market was an estimated $66 billion in 2002
(Training Industry Report, 2001). The enterprise learning market in the United States,
which represents enterprise firms with $500 million and more in sales, was
approximately $11.4 billion in 2002 (Fairfield Research, 2002). These organizations
spent on average $3.7 million on learning, which equals almost 0.7% of revenue and is an
average expenditure of $912 US per employee for their training programs (Fairfield,
2002).
According to a report from the American Society for Training & Development (ASTD,
2004), average expenditure for training per employee ranged from $812. - $2,126.,
depending on a combination of industry type and organization size. A category of
companies cited as Training Best 6 spent 4.16% of payroll in 2004 on training, while the
average training spending per employee for this group was $2,126., which has been flat
when compared with 2002 (ASTD, 2004).
Table 3.1: Learning Spending by Training Type 2007 (projected)
Learning Type
2002
2007 (projected)
Instructor Led
63% ($7.2 billion)
45%
($6.3 billon)
Technology Based
Learning
31% ($3.5 billion)
50%
($7 billion)
5%
($0.7 billion)
Individualized Text Based 6%
Total
($0,7 billion)
100% ($11.4 billion)
100% ($14 billion)
Source: Fairfield Research, 2002
By 2007, enterprise companies are projected to spend nearly $14 billion in corporate
learning programs. The types of training programs they will be investing in will be
significantly different compared with 2002, including the projected 50% of learning
investments that be made in technology-learning (Fairfield Research, 2002). ASDT
(2004) research results indicate that 29% of training for the category Training Best
companies was delivered via learning technologies in 2004. This percentage does not
include the portion of blended learning (28%), which was delivered via technology.
When considering opportunities to optimize learning investments, it is important to
understand what is included in overall learning budgets. Jack Philips (1997) suggests that
the true cost of training is often an elusive number even in the best organizations.
6
Training Best, recognizes organizations that demonstrate a clear link between learning and performance.
Twenty-four companies were selected for the category from 83 submissions in 2004, of which five non-US
companies.
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He says that a total human resources budget is in general easy to develop. However, it is
more difficult to determine the specific costs of programs including indirect related costs.
Philips (1997 and 2001) has identified a number of cost categories for learning. The
following table illustrates which cost categories apply primarily to classroom and/or
e-Learning.
Table 3.2: Training Cost Categories
Training Cost Category
Classroom e-Learning
A. Training Needs Analyses
•
•
B. Design and Development
•
•
C. Acquisition
•
D. Delivery
•
E. Travel, Lodging and Meals
•
F. Evaluation
•
•
G. Training Function Overhead
Costs
•
•
H. Participants Salary and
Benefits
•
•
Each of these cost categories has an implication for e-Learning investments.
A. Training Needs Assessment
This includes costs of conducting a training needs assessment, the time for staff members
conducting the assessment, and internal services and supplies needed in the assessment.
The training needs analysis and design and development of courseware need to be
completed for any learning invention.
B. Design and Development
This includes all costs for the design and development of a program including: internal
staff time for design and development; external consultants; administrative costs; and
costs for purchase of supplies.
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75
Company specific e-Learning courseware development costs vary from $10,000 to
$150,000 per learning hour, depending on level of complexity and sophistication (Masie,
2002). This is based on e-Learning development rates of an average of $70/ hour. Using
specialized e-Learning resources in India can reduce the development rates to about $20
dollars an hour7, which reduces the development cost of an hour of e-Learning by about
75%. As a comparison, the average development cost for classroom training is about $50
an hour (Horton, 2001).
The e-Learning cost per person depends on the number of users who take a specific
course. This can be calculated by dividing the total e-Learning development cost by the
number of participants. For example: The per participant cost of an e-Learning program
with an estimated e-Learning development price of $30,000, that engages 5,000 learners
is $6.00.
C. Acquisition costs
Instead of relying solely on internal development, organizations often purchase programs,
which they may modify or use as-is. Acquisition costs include the purchase price of:
training programs; instructor materials; train-the-trainer sessions; licensing agreements;
certification costs; and other costs related to the right to deliver the program.
Purchasing off-the-shelf e-Learning from vendors can vary, but $30. - $40. per course is a
common price (Carliner, 1999). Pricing trends appear to be following predictable models
of lower prices for commodity topics and higher prices for a unique course in high
demand (Whalen & Wright, 2000).
D. Delivery cost
This includes four main categories (Philips, 2002):
•
•
•
•
Salaries of trainers/facilitators and coordinators
Program materials and user fees
Preparation time
Facilities
Philips (2002) argues that (classroom) delivery costs are usually the largest segment of
training costs. The average delivery cost per training classroom day (about six learning
hours) equals between $314 per learner, according to a 2004 study from the American
Society for Training & Development (ASTD, 2004).
The delivery cost of e-Learning equals the development or acquisition costs of the eLearning program. This can range between $5. and $240. per day (Horton, 2002).
The exception is for synchronous e-Learning, whereby a live instructor teaches
participants in a virtual classroom.
7
Based on quoted rates from Indian Firms: NIIT and Maximize Learning.
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However, the delivery costs for synchronous e-Learning are still much lower than the
physical classroom delivery, because virtual classroom sessions do not require an
instructor to be engaged for a whole day. Rather, virtual classroom sessions are typically
1.5 hours in length. In general, most e-Learning requires an electronic and network-based
infrastructure rather than special training facilities.
E. Travel, Lodging and Meals
Most organizations have geographically dispersed workforces which make travel and
hotel costs a significant part of the expense for classroom training. According to CUX
(2000), Chief Learning Officers estimate that the costs of learners traveling to classroom
based-training amounts to approximately 23% of their operating budget. Becker (1999)
suggests that among US employees, up to 40% of the training cost is for travel.
F. Evaluation Costs
The course evaluation costs include: the costs of developing the evaluation strategy;
designing instruments; collecting data; analyzing data; and preparation and distributing
reports. Many authors suggest that the course evaluation costs might be lower for an eLearning course than a classroom program, because it takes place over the Internet as part
of the program without interaction of training coordinators (Hall, 2000; Horton, 2002).
G. Training/Learning Function Overhead Costs
The overhead costs include the additional costs of the training/education function, which
are not directly related to a specific program. This includes: cost of clerical support;
departmental office expenses; salaries of training managers; and other fixed costs such as,
office costs and other learning infrastructure costs.
H. Participant Salaries and Benefits
The last cost category is the salaries and benefits of employees who attend training.
Benefits are usually calculated as a percentage of base salary, and the average benefits
costs for employees in the United States are about 38%8. It is argued that salaries of
knowledge workers consume an increasingly large percentage of corporate budgets
(Athey, 2001). Therefore, is suggested that the calculated salary and benefits for the
attendance of training days are significant.
Adelseberk and Troly (1999) are other writers who make a difference between the visible
costs of training—which include all categories identified by Philips—and the invisible
costs.
8
Annual Employee Benefits Report, Nation’s Business, January 1996, p.28.
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They estimate that the invisible costs are even much larger than the visible cost and
include:
•
•
•
Lost Opportunity Costs, which are defined by as ‘the hidden costs or lost revenue
that occur when critical and profitable work does not get done’: Which could
include lost customers, missed sales due to a lack of the right skills or insights
(Horton 2002, p. 68)
Wasted Training Investments: For example, wrong person, wrong training, or
poor quality of training
Lost Productivity: Such as, time away from the job
One of the additional cost savings provided by an e-Learning solution is the opportunity
to reduce the participant lost productivity costs due to the time requirement.
As discussed in this paragraph, enterprises must create value for their shareholders and
sustain their competitive advantage. An important strategic instrument for sustaining
competitive advantage is the reduction of enterprise-wide costs. One the cost categories
executives frequently target for reduction is workforce related costs, which includes
learning costs. Enterprise-wide education spending can equal as much as 4.16% of
payroll for Training Best companies (ASTD, 2004).
However, it is argued that the true cost of training is often an elusive number, even in the
best organizations, since the training costs are distributed over a number of different
training cost categories. It has been seen though in the discussion above, by comparing
the costs categories for classroom learning versus e-Learning, significant costs savings
can be achieved by using e-Learning (e.g., Chute, Thompson and Hancock, 1999; Hall,
2000; Horton, 2002). Ultimately, this offers solid support to the enterprise goal of
creating shareholder value, by both reducing learning delivery costs while contributing to
the rapid building of knowledge and skills across the enterprise.
In Section 3.3, I will discuss time-to-competence as another business driver.
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3.3 Time-to-Competence
In today’s economy, the fastest growing occupations are those that employ knowledge
workers, where a college education is a minimum requirement (Grantham, 2000).
However, the level of education required in the workforce is changing. Enterprises must
accomplish more in a shorter time, and the speed of knowledge transfer is becoming a
determinant of how fast an enterprise can perform (Arevola & Lundy, 2003). According
to Whalen and Wright (2000), the information age has increased the need for training
because knowledge workers have ongoing needs for new information and updated skills
to respond to challenging and constantly changing jobs. They argue that true competitive
advantage is closely linked to the ability of employees to respond quickly to change.
In order to do so, employees are required to perform new job functions in a timely
manner and in a competent way. An employee is competent to fulfill specific tasks if
specific competences are mastered. Competencies are underlying characteristics of
people and indicate “ways of behaving and thinking, generalizing across situations, and
enduring for a reasonable long period of time” (Spencer & Spencer, 1993, p. 9).
Furthermore, they distinguish five types of competency characteristics including:
motives; traits; self-concept; knowledge; and, skills.
One of the key business questions is: How fast can an employee become competent to
perform the new task or role? In other words, what is the time-to-competence?
Time-to-competence is a very important business performance indicator as it supports a
number of specific business goals, including:
A.
B.
C.
D.
E.
F.
Faster launch of products/services
Speedy deployment of new information systems and business processes
Quicker compliance with legal and regulatory mandates
Building seamless global organization capabilities
Rapid “job-readiness” of new hires
Increased productivity of the sales force
(e.g., Capelli, 1999; Cheese & Thomas, 2003; Deloitte Research, 2001; Driscoll,
2002; Horton, 2001; Moore, 2003; Porter, 1985)
A. Faster Launch of Products/Services
A critical success factor for most organizations today is the successful, speedy launch of
new products and services. When launching new products and services, time-to-market
driven by increasingly compressed product life cycles is critical to profitability. Often,
the information about the new product or service is sought not only by employees, but
also by the extended partners, such as customers, vendors and suppliers.
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As a result, many diverse audiences must be reached and educated to successfully launch
a new product or service. Horton (2001) argues that speed in developing new products is
the most important factor in business today. As an example, companies like Sun and
3Com derive 80% or more of their revenue from products less than a year old (Peters,
2001). Therefore, time-to-market of new products and services is one of the key areas
with which corporate executives constantly concerned (Arevola & Lundy, 2003).
One important task in the business process of a new product/service launch is to provide
specific product training to all people who touch the product, including those who sell,
market, provide product maintenance and product support, in various geographies and
time zones. As discussed in the previous sections, bringing people to training facilities is
costly, time intensive and requires significant logistic and administration work upfront.
E-Learning provides the opportunity to provide just-in-time and relevant training
everywhere, at much lower costs.
B. Speedy Deployment of New Information Systems and Business Processes
According to Hammer (1995) process management is important to the success of any
business and poorly managed processes might have a significant impact on profitability.
Furthermore, improved application of new information systems and related business
processes can produce higher yields, while reducing costs and cycle time (Zuckerman,
2001). Therefore, I argue that a speedy deployment of new information systems and
business processes can have a significant business impact.
One aspect of the implementation of new systems and business processes is the training
of employees who need to work with the new information systems and/or follow new
processes. I suggest that the business benefits for using e-Learning include: fast
deployment of training; instant availability of the training globally; no travel
requirements for training; and related cost savings. Furthermore, information systems eLearning courseware is probably one of the largest content segments in the e-Learning
market (Masie, 2001). This provides enterprises with the opportunity to buy high quality
off-the-shelf e-Learning courseware. Furthermore, e-Learning simulations are very
powerful e-Learning applications and are used for the development of information system
skills and process skills (Prensky, 2001; and, Schank, 2002).
C. Quicker Compliance with Legal and Regulatory Mandates
Many companies are faced with the challenge of complying in a designated time frame
with various standards, policies, regulations, and laws related to their business. Often,
they must demonstrate that their employees have completed training programs on the
standards or regulations as a condition of their compliance. Compliance with standards
can be driven by both external factors (e.g. government or regulatory body) and internal
factors (e.g. the organization’s compliance governance board).
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Not being in compliance can have impact on the types of business an organization can
perform, the segment of customers the organization can serve, and/or the kind of
processes and organization can perform (Athey, 2001).
As mentioned, compliance training often touches a very large number of employees.
Therefore, I propose that e-Learning delivery for compliance training can be a very cost
effective alternative to classroom training. Additionally, it is easy to track completion and
certification rates automatically. E-Learning systems can provide stakeholders with
enterprise-wide management reports on the progress status of the compliance training.
I argue that most compliance training does not provide participants with engaging and
challenging learning content. Typically, there are no learning requirements for interaction
and/or collaboration with others. E-Learning can actually provide more engaging content
interaction than the frequently utilized compliance training approaches. Additionally, I
argue that due to the fact that e-Learning content can be customized to personal needs, it
makes the learning experience for compliance content as efficient as possible.
D. Building Seamless Global Organization Capabilities
According to Yip (2003), global enterprises experience unique challenges and must align
their global workforce to the highest standards of service, knowledge, and capability, as
customers and clients expect a consistent level of value, no matter where they come into
contact with the company’s products and services.
I suggest that e-Learning has been extremely valuable for reaching audiences distant
geographically from corporate training headquarters. It can be argued that before the
existence of the Internet and e-Learning, a limited number of geographies in an
organization could tap in to global training programs. Frequently, these were experienced
through a phased country-by-country rollout of training, taking a while before all were
able to participate.
Alternatives for this would require significant travel of employees from different
geographies to attend a specific training program. Furthermore, it is argued that the
consistency of skill building can be diluted by using local resources who might modify
training material or have different interpretation with regards of the importance of an
subject. Several authors suggest that e-Learning helps organizations to develop seamless
global organizational and people capabilities instantly at low cost compared with the
alternative classroom option.
E. Rapid “Job-Readiness” of New Hire
Increasingly, organizations must quickly bring new employees up to full productivity,
while in some cases they need to meet government regulation requirements. In addition,
organizations want to ensure in the new hire’s mind that they made the right choice in
selecting the employer and that their ability to excel in their new job is assured by the
provided training (Athey, 2001).
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It appears that e-Learning can provide new employees with just-in-time training when
they join a new organization. Additionally, the learning content is consistent even when
delivered across different geographies and organizational units. Due to the fact that there
are no resources needed for course delivery, I suggest that close to 100% of new hires can
attend an e-Learning based new hire orientation program, increasing access and leverage.
F. Increased Productivity of the Sales Force
A sales force is a major investment for most companies, and to grow the business
requires that the sales force focus on market opportunities be knowledgeable about
products, and skilled in selling to customers. Knowing the products and services and
being able to describe the benefits and value to customers is a critical capability for the
sales force (e.g., Athey, 2001; Horton, 2001).
Taking the subject matter experts out of the field and bringing the entire sales force to
facilities for training can pose serious opportunity costs. Therefore, I suggest that an eLearning delivery of training can improve the product/services knowledge of the sales
force because they will have unlimited access to a large number of courses, which they
can take at a time that fits their schedule without the need of travel to a training facility.
In this section, I have looked at a number of specific business goals, which if achieved,
will provide enterprises with a competitive advantage. These business goals share a
common theme - 21st Century enterprises require that human competences be developed
at high speed, on a large scale, and in multiple geographies. I suggest that one of the most
significant value contributions of e-Learning is that it increases time-to-competence.
As discussed, this is feasible as e-Learning can be deployed to an entire organization at
once. Additionally e-Learning eliminates a number of inefficiencies in the learning
business model, which have an impact on time. Examples of inefficiencies in the learning
business model include: travel time of participants; time for scheduling facilities and
training; time for participant registration; course administration; and the time involved in
conducting train-the-trainer programs.
In Section 3.4, I will discuss people commitment as another business driver.
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3.4 People Commitment
According to Capelli (1999) most executives in organizations believe that employee
commitment and loyalty are important factors in determining whether a company
succeeds or fails. He argues that there is “evidence that more committed employees have
higher performance on a range of dimensions. For example they have lower quit rates
and lower rates of absenteeism and tardiness. And they are more likely to act in the
interest of they organization” (Capelli, 1999, p. 46).
A study from ISR (2004), using data from over 360,000 employees from 41 companies in
the world’s largest economies, examined the relationship between different levels of
employee engagement and corporate financial performance, measured by change in
operating margin and profit margin. Over a period of three years, high-employee
engagement companies outperform low – employee engagement companies by 5.75% in
operating margin and 3.44% in net-profit margin. The research indicated that engaged
employees are more loyal, and this will lower the costs of recruiting, hiring, training and
developing and has a positive impact on productivity.
The costs of employee turnover can be very costly for employers. Often, employees who
leave represent the distinctive competency of an organization. Therefore, the cost of
replacement, including sourcing, hiring and training can equal the costs of one year of
salary for managerial jobs (Capelli, 1999).
A number of studies suggest that employee commitment and loyalty to one employer is
changing (Capelli, 1999; Grantham, 2000; Gubman, 1998; Crandall & Wallace, 1998).
Grantham (2000) compares the basic social psychology among workers of two
generations. One group, which he calls emerging employees, entered the workforce in the
late 1980s, and the other group, termed traditional employees, has been in the workplace
a long time. He characterized the attitudes of these groups as shown in the following
table.
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Table 3.3: Attitudes of Traditional versus Emerging Employees
Traditional Employees
Emerging Employees
•
Demand long-term job security
•
Reject job security as a driver for
commitment
Take personal responsibility for their
career
•
Believe employers are responsible for
career growth
•
•
Are less satisfied with their jobs
•
Are more satisfied with their jobs
•
Believe changing jobs often is bad for
career growth
•
Believe frequent job changes are part
of career growth
•
Define loyalty as tenure
•
Define loyalty as accomplishment
•
View work as an opportunity for
income
•
View work as a chance to grow
Source: Grantham 2000, p.6
Crandall & Wallace (1998) have a similar perspective on the changing employee attitudes
and argue that a new social contract has evolved between employees and employers. This
new contract differs from a traditional employment contract with regard to: skills; work
design; and rewards. As an example, successful companies enhance, grow and renew the
skills among their core employees. In addition, work is bundled in fluid teams, which
might include members from different organizations. Finally, new compensation
strategies are driven by the economic impact of employees skills on core business
process.
A number of studies, including Capelli (1999), have indicated that employee commitment
to an employer depends on a number of factors including:
•
•
•
•
The availability of other job options
The costs and effort to change jobs
Level of education (more educated workers are less committed to their
employers)
Type of workers (e.g. professionals are less committed)
The change in relationship between employee and employer and as a result of a decreased
level of commitment may result in a higher employee turnover (Capelli, 1999).
Another factor that will have an impact on employee turnover is changing population
demographics in the United States, whereby the ‘baby boomer’ generation will retire in
the coming years and will be replaced by a generation smaller in real numbers.
A shortage in skilled workers will translate into even more opportunities for skilled
employed people to change jobs, which will have an impact on employee turnover.
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Employee turnover does not have to be necessary a bad thing according to Capelli,
because there are always skill sets which are not needed anymore in organizations.
However, I propose that it is important retain employees with key skills. Thus the
question arises:
•
What can organizations do to retain employees with key skills sets?
The Conference Board (1997) published research data on “What employees expect from
companies?” which provides some insights into what employees value most. This study
found that the top three expectations of employees were:
1. Interesting, challenging work
2. Open, two-way communication
3. Tools, opportunities for growth and development
Another study (Capelli, 1999) suggests that characteristics of internal employee
development make employees more committed to their organization. Furthermore
Crandall and Wallace (2000) indicate that one of the characteristics of successful
companies is that they enhance, grow and renew skills among their core employees.
Other evidence that investment in training pays off comes from a study by the Bureau of
Labor Statistics (1996) which amplifies the relationship between employee turnover and
training. Establishments with the medium level of turnover invested 12.5 hours of training
per employee, while establishments with high turnover invested only 7.2 hours of training
per employee. Study from ISR (2004) has found that the top driver of engagement for
employees is ‘the opportunity for personal development and growth’. Furthermore, a
study from Nolan and McFarlan (2003) shows that companies who have adopted active
learning policies from 1997-2003 have increased productivity by 28%.
However, an interesting question is:
•
To which extent should organizations invest in skill development for their
employees?
According to Becker (1962), employers will weigh the costs of investments made in
employee skills against the benefits that they expect from having better skilled
employees. “Employers earn the return on investment in training because the value of the
employee’s work rises as their skills increase. The greater the difference between the
value of work and the wage, the greater the return, and the more training is funded”
(Capelli 1999, p.46).
Capelli (1999) argues that a complicating factor arises when an employee’s skill rises
compared with other employees, increasing his or her market value, requiring a higher
wage or that they might leave the organization.
A higher wage could potentially diminish the return on investment in the training.
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As mentioned in this chapter, e-Learning courseware requires significantly lower
investment levels than a typical classroom program. This lower investment for building
the same skills will increase the potential return on investment for the employer, and
thereby provide some answers to the questions above.
In addition to this, an e-Learning solution provides employees with a flexible method to
provide the opportunity to engage in learning at a time which better fits work schedules,
or on the employee’s own time. Furthermore, more employees can benefit from access to
e-Learning courseware at no additional cost when it has been made available on the
Internet.
Finally, more learning opportunities can be offered to the workforce at an overall lower
investment level. As discussed before, this might have an impact on employee or people
commitment what might lead to better employee retention rate. Therefore, it appears that
people commitment is an important business driver for e-Learning.
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3.5 Conclusions
In this chapter, I have discussed a number of business drivers that impact both people and
knowledge. They include:
•
•
•
•
Enterprise Transformation
Cost Reduction
Time-to-Competence
People Commitment
My first conclusion is that these business drivers can be relevant to investment decisions
in e-Learning capabilities.
My second conclusion is that there is some evidence that business drivers are relevant for
organizations from different industries, geographies and size. As discussed, competition
for many industries and organizations is global in nature, and therefore, I suggest that eLearning may help enterprises to achieve a greater degree of globalization by developing
similar competencies simultaneously in different geographies with speed and at lower
cost.
My third conclusion is that there is evidence that companies must develop skills to
support critical business goals, while they do not necessarily have the ability to increase
their education and training budgets. I suggest that a competitive advantage might be
achieved by executing e-Learning strategies to build employee competencies faster,
better and cheaper. This is consistent with the results from the ASTD Study (2003/2004)
which shows that expenditure on learning per employee from 1999 - 2004, has been at
best flat for five years, or even down, if corrected for inflation.
Finally, I propose in this dissertation that e-Learning can provide opportunities to reduce
or take away inefficiencies in the learning business processes, thereby supporting
business goals and reducing costs.
The inefficiencies in the learning business process, which I have identified include:
•
Time intensive training needs analysis process. A part of training needs analysis
can take place over the Internet, for example by using automated skill-gap
assessment tools.
•
Limited number of training sessions offered. Classroom training sessions can only
be scheduled at a certain frequency, and it is unlikely that the same training
sessions are offered on a daily basis. Due to limitations of group size for
classroom training, employees cannot always attend the training session which
they desire. As a result, the scheduled training sessions do not necessarily match
the right timing for skill development of employees.
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One can argue that often classroom sessions take place either too early, or too
late. It is too early if the skills can not get practiced and applied immediately after
the training session, and it is too late if the learner has to use skills prior to
attending the training program.
The Research Institute of America found that three weeks after a course is
completed, only 18% of the knowledge is retained (Primelearning.com, 2001).
E-Learning provides learners with the opportunity to develop skills just-in-time
because it is available 24 hours a day, 7 days a week in all time zones.
•
Time away from the job. Each hour that employees are attending training or
traveling to a training facility constitutes an hour away from the job which can
result in lost productivity. According to Driscoll (2002), e-Learning programs
usually take fewer hours than a classroom event. Reasons for this include that the
learners are in charge of the pace and path they use to navigate through the
learning program, and individuals are not held up by pace of the classroom group.
Additionally, e-Learning will eliminate travel time to and from a training facility.
Therefore, the consensus among authors is that e-Learning provides the
opportunity to reduce the time-away from the job.
•
Course is customized to a group versus the individual. E-Learning can provide
training that is customized to the learner’s specific needs. For example, by
conducting an online pre-assessment, learning gaps can be identified and the
participant can be directed to the course content that he/she needs in order to
master a proficiency level in a particular subject area (e.g., Horton, 2001;
Rosenberg, 2001).
•
Geographic barriers for attending training. Most enterprises use a (limited)
number of training facilities or conference centers to conduct training. If
employees are dispersed over a number of different locations across the world,
attending training sessions requires significant travel time and it can be very
expensive. This can be a barrier for employees to get approval for attendance.
E-Learning can be taken at any location providing employees with 24/7 access
to training.
•
Time consuming course content management processes. Training programs need
to be updated on regular basis. According to an ASTD Study (2002), the shelf life
of an average training program is less than 2 years. Yet, many authors (Carliner,
2002; Hall, 2001; Horton, 2001 and 2002) suggest that version control and global
deployment of courseware can be very time consuming. One of the benefits of eLearning courseware is that once a course has been updated, all employees have
instant, global access to the same, most current version of a training program.
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•
Variations in course quality and consistency. Usually classroom training material
can be modified by trainers for deliveries in different geographies. The
implications are that different course versions and qualities will exist globally.
E-Learning courseware can always be deployed in one version with consistent
quality in the different geographies.
•
Expensive, time-consuming distribution of training material. The coordination,
printing and logistics of the distribution of classroom training material can be very
time consuming and expensive. The benefits of e-Learning are that all classroom
material is available online.
•
Time consuming participant training enrollment and administration processes.
Updating employee training records, e-Learning course enrollment and eLearning completion tracking are completely automated process that takes place
without involvement of the training function. Furthermore, there are no resource
needs for classroom scheduling, training material logistics, and trainer scheduling
in an e-Learning environment.
•
Usage of relatively expensive resources for courseware development. Classroom
training development can be expensive because this is done by local learning
professionals or vendors. E-Learning courseware development can to a large
extent be accomplished for a relative low cost in offshore locations, e.g. India.
•
Limited access to training. In most organizations employees are only allowed to
attend a limited number of classroom days annually because of cost. As a
comparison, many organizations provide employees with unlimited access to their
entire e-Learning catalog because there are no incremental costs for attendance in
an e-Learning course.
•
Collaboration opportunities limited to people who can attend training in one
location. The collaboration among participants in a classroom-based training
model is limited to the classroom attendees. E-Learning provides an opportunity
for people from multiple geographies to participate in virtual classroom sessions
and collaborate with each other without the requirement to be in the same
physical location.
•
Limited opportunities to re-take (parts) of a course. Most people can take a
specific classroom course only once. E-Learning courses, or modules of eLearning courses, can be re-taken to refresh memory, at no incremental costs, at
any time needed.
•
Knowledge transfer and collaboration stops at the end of a course. E-Learning
provides the opportunity to build communities of practice where participants can
come together after the training and share knowledge and experience long after
the end of a training program (Rosenberg, 2001).
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•
Limited integration with knowledge management. Compared with classroom
training, the Internet facilitates knowledge management by providing the means
to collect and re-deploy knowledge more efficiently throughout the organization
(Geolearning, 2003).
•
Limited engagement of senior leadership in training. Due to time constraints, it
can be a challenge for leadership to allocate time to attend classroom programs.
E-Learning programs require less course time, and no travel time as discussed,
making their attendance in virtual classrooms, or in e-Learning self-study a good
alternative.
•
Variation in quality in similar subject areas. If courses are developed on a
company or geographic basis, there might be a larger variance in quality because
of investment limitations in course development, or due to limited access to
experts. E-Learning offers potential global access to best-in-class learning content
which can be accessed globally.
In summary, as enterprises decide to invest in e-Learning, they must understand the
organizational capabilities necessary for e-Learning success and the factors which
support an effective e-Learning implementation. This is covered in Chapter 4:
Organizational Capabilities for e-Learning.
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Chapter Four
Organizational Capabilities for
e-Learning
4.0 Introduction
4.1 e-Learning Culture
4.2 e-Learning Design
4.3 e-Learning Technology
4.4 Performance Management
4.5 Effective e-Learning Implementation
4.6 Concluding Remarks
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4.0 Introduction
In Chapter 3, I explored the reasons organizations invest in e-Learning. A significant
body of literature suggests that investment alone in technologies or capabilities does not
necessarily provide the anticipated business results. For example, Strassman and Pisello
(2003, p.1) state about IT investment: “It is not just how much you spend, but what you
invest in and how well it is managed that counts.”
A number of authors have suggested that successful implementation of e-Learning
requires investments in, and management of, a number of organizational capabilities
(e.g., Horton, 2001; Masie, 2001; Rosenberg, 2001). The most significant organizational
capabilities for e-Learning identified by a number of authors include:
e-Learning culture; e-Learning design; e-Learning technology; and, performance
management (e.g., Bielasweski and Evens, 2002; Metcalf, 2003; Rosenberg, 2001;
Russell, 2001; and, Spencer and Spencer, 2003).
In this chapter, I will discuss how the organizational capabilities, mentioned before, can
contribute to an effective e-Learning implementation. Additionally, I will identify a
number of dimensions within organizational capabilities which appear to be critical
success factors for e-Learning.
In Section 4.1: e-Learning Culture, I will explore the existence of an organizational
culture which encourages and provides incentives for the adoption and usage of eLearning by employees. In addition, a number of studies (Russell, 2001) have
underscored that the quality of instructional design is the most important factor in the
retention of knowledge, rather than the medium (classroom or technology) in which
knowledge is delivered. I will discuss the requirements of e-Learning Design in Section
4.2.
e-Learning technologies are the core capabilities needed to implement and sustain
effective e-Learning in enterprises. I will explore these capabilities in Section 4.3. In
Section 4.4, the role of performance management and performance management systems
as organizational capabilities will be examined. Finally, in this chapter, I will discuss the
challenges posed as e-Learning organizational capabilities are put into place, requiring
significant efforts in change and risk management. This will be explored in Section 4.6:
Effectiveness of e-Learning Implementations.
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4.1 e-Learning Organizational Culture
A very important enabler of e-Learning is the existence of an organizational culture
which encourages and provides incentives for the adoption and usage of e-Learning by its
employees. According to Hofstede (1991), “a culture is a shared set of learned
assumptions, values and behaviors developed over time, which influence thoughts,
feelings and day-to-day actions.” Thus, an e-Learning culture in an organization would
support a shared positive perspective on the value of e-Learning and the active adoption
of the behaviors associated with engaging frequently and productively in e-Learning to
enhance skills and job performance. Rosenberg (2001) argues that a strong learning
culture is required for e-Learning to prosper and be sustained over time.
Unfortunately, the assumptions and beliefs about e-Learning have not always been
positive among various learners in many organizations. The resistance expressed to
learning on a computer is not difficult to understand when we consider that the education
experience from kindergarten through college until now has always involved a teacher
and a physical classroom. Sullivan (2002, p.2) explains that classroom training is deeply
embedded in the corporate educational culture in most organizations “…even if we hate
being in a classroom, it’s familiar and not intimidating.” Sullivan states further that:
“They (employees) feel reassured in the standard classroom environment and even enjoy
going off-site for a day to take a course. Off-site training represents a welcome departure
from the daily routine, especially if the training requires travel to a different location.”
This is one of the reasons why a change from the familiar physical classroom training to
the new e-Learning environment could constitute a major cultural shift (Cross, 2002).
Therefore, gaining positive support for e-Learning from a number of organizational
groups is a critical key to success, including the support of the:
•
•
•
•
Business Leaders
Training Staff
Information Technology (IT) Function
Learners
In addition, others identify the following organizational supports as critical to the
successful implementation of an e-Learning strategy.
•
•
•
Internal Champion and Support from Supervisor/Manager
Time and Location for Learning
Marketing and Promotion
Business Leaders
According to Kotter (1996), “Leadership defines what the future should look like, aligns
people with that vision, and inspires them to make it happen despite the obstacles.”
Several authors suggest that the support of leadership is critical for building a learning
culture which embraces e-Learning (Cross and Dublin, 2002).
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Leadership support should include a focus on communication and motivation, and last
but not least, on participation in e-Learning (Cross and Dublin, 2000). According to
Lederer and Sethi (1988) gaining and securing top-management commitment is one of
challenges in implementing a strategic information plan which can include an e-Learning
architecture system plan.
Many authors (e.g., Cross and Dublin, 2002; Horton, 2001; Masie, 2001; Rosenberg,
2001) suggest that those in leadership roles who need to be involved in e-Learning
include senior management in the business (Business Units, Department Management),
and relevant staff functions (Human Resources, Learning and Development, Internal
Marketing Communications, and Information Technology).
Business leaders can play a strong role in convincing others that e-Learning is critical to
the achievement of strategic business goals. Human Resources must champion eLearning in management team meetings. Internal Marketing Communication can help to
support the development of an e-Learning culture through marketing and communication
messages. The Information Technology function is needed to support the assessment and
integration of new learning management applications and e-Learning content.
Cross and Dublin (2002) suggest that e-Learning requires dedicated sponsors who can
champion the business case for change, explaining the change and reassuring the learners.
They have identified characteristics of effective champions which include:
•
•
•
•
•
Commitment to the implementation
Great communication skills
Understanding of the change process
High integrity and honesty
Sensitivity to both politics and people
Training Staff
When organizations try to move aspects of their education programs from the classroom
to the Internet, they may experience resistance from those employees who are involved in
physical classroom delivery, administration, and logistics. Yet, many studies (Masie,
Mantyla, 2001) suggest that a blended approach, where the classroom learning is blended
with e-Learning, is the most powerful learning solution.
However, Mantyla (2001) also proposes that it is critical for the learner’s success that the
learning be facilitated by a trainer before, during and after the learning experience. She
expects that trainers will continue to act as facilitator, coach and guide for the learners,
even within the e-Learning arena. Therefore, important new skills for trainers include
learning how to use various technologies, how to apply software applications, and how to
create well-designed blended learning courses.
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Information Technology Function
Since e-Learning requires investments in applications and systems, it appears that the
Information Technology function in many organizations is also involved in the eLearning planning and decision making process as well. The process of deciding on the
objectives for organizational computing and identifying the potential computer
applications an organization should implement is termed strategic information system
planning (Lederer and Sethi, 1988).
An organization may have the most progressive e-Learning strategy, the highest quality
e-Learning courseware, but without an effective information system planning and
support, employees may never experience the benefits of the full e-Learning solution.
Because of the complexity and the integration needs of e-Learning technologies, it is very
important to have full support and cooperation from the Information Technology
function. Horton (2000) recommends that training department should work with the IT
function before they develop training, because it is important to understand the
limitations of computer and network resources and how to avoid vulnerability. Horton
(2000) continues that it is important to recognize that the goals of the IT function and the
Training function might be conflicting, e.g. the objective of IT department might be to
keep computers and servers working efficiently but the Training department goals are
only to get people trained with high quality e-Learning programs.
I will discuss e-Learning Technology in depth in Section 4.3.
Learners
The acceptance of new learning technologies by learners seems to be an important critical
success factor for the adoption of e-Learning. Fred Davis and Richard Bagozzi (Bagozzi
et al.; 1992 Davis et al., 1989) developed an information systems theory called the
Technology Acceptance Model, which demonstrates how users come to accept and use a
technology. The Technology Acceptance Model suggests that the most important factors
which influence a potential user’s decision about when and how they will use new
technologies are:
•
Perceived usefulness – Defined as the degree to which a person believes that
using a particular system would enhance his or her job performance (Davis,
1989).
•
Perceived ease-of-use – Defined as the degree to which a person believes that
using a particular system would be free from effort (Davis, 1989).
The Technology Acceptance Model assumes that a high degree of both perceived
usefulness, as well as perceived easy-of-use, can lead to a positive intention to use new
technology.
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e-Learning usage can be measured by looking at e-Learning participation rate and eLearning completions. Study results (e.g., Masie/ASTD, 2001) have shown that eLearning participation and completion rates have differed greatly from classroom
training, which typically show a 100% participation/attendance rate and do not
experience participant fall-out during a program. As a comparison, a Masie/ASTD
(2001) study shows an average participation and completion rate of 58% for mandated
e-Learning courses. For voluntary courses the participation rate did not exceed the 32%.
Full course participation tended to occur when courses:
•
•
•
•
Were tied to performance reviews
Had an internal champion and support
Were mostly taken over working hours and at a learner-preferred location
Had intense marketing and promotion
The linkage between e-Learning success and performance reviews will be explained in
Section 4.4: Performance Management.
Internal Champion and Support from Supervisor/Manager
Management support for classroom training has been shown in the past to be important
for building a learning environment. Research (Masie 2001) has shown that the manager
or supervisor can also play an influential role in e-Learning by:
•
•
•
•
Explaining why the learner should take the course
Motivating the learner by linking the course content to the workplace and
business objectives, as well as to future career opportunities
Displaying an interest in the upcoming course and giving as much status and
importance to it as attendance at a physical class
Providing time or coverage to enable employees to engage in e-Learning courses
during or at work
Time and Location for Learning
When and where people take e-Learning has a significant impact on course start rates
(Masie, 2001). This study shows that when the majority of learners took e-Learning at
their desk during working hours there was a significantly lower start rate. The reason for
this is that learners are too much distracted while working at their desk to start or to
complete e-Learning courses. This was true though most learners (68%) stated they want
to take a course in their work environment, such as in their office, a shared workspace, or
an onsite learning center.
This apparent contradiction may be shown in an additional finding that learners (87%)
prefer taking e-Learning courses during work hours within time that their employer
provides. This was particularly important for courses which have been mandated. About
39% of voluntary learners took their courses on their own time.
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One of the assumptions in the study mentioned as a reason for this activity on the part of
voluntary learners is that employees engage in e-Learning in their own time to try to
increase their skills for other jobs within or outside the organization.
Marketing and Promotion
The Masie/ASTD (2001) study suggests that marketing and promotional efforts
associated with e-Learning courses are very influential in attracting the learners to the
courses. According to the study, marketing and promotion activities which have an
impact on e-Learning uptake include:
•
•
•
•
•
Use of formal means of communication
Use of testimonials
Visibility of an internal champion
Use managers/supervisors to promote the courses
Communication more than once about training
Furthermore, ongoing support from the learners for e-Learning depends on the learner’s
satisfaction with e-Learning. This will also have an impact on the organization’s ability to
build a sustainable e-Learning culture. The Masie/ASTD study (2001) defined a number
of factors that ensure the e-Learner’s satisfaction, including:
•
•
•
•
•
•
•
•
•
•
Positive previous e-Learning experience
Extensive technology support
A general preference for e-Learning over classroom training
Extensive marketing and promotion of e-Learning
e-Learning conducted away from home or office
Relative advantages of e-Learning
Appropriate use of technology
Technology easy to learn
Technology quick and responsive
Value of skills taught
It is found that the most important predictor of the learner’s judgment of the quality of eLearning is their first e-Learning experience and their general preference for e-Learning.
The preferences for e-Learning differ by audience and organization. The Masie study
shows that 31% of the learners favored classroom training over e-Learning. Just 38% of
learners said that they prefer e-Learning over classroom training, and 31% do not have a
preference. Preference for e-Learning was stronger for learners who are on-the-road, in
professional and administrative roles, and for learners with a graduate degree.
Other potential barriers and enablers to e-Learning will be reviewed in the coming
sections.
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4.2 e-Learning Design
Another organizational capability is e-Learning program design. In the world of eLearning, content is king. Therefore, e-Learning content design is central to the success
of an e-Learning implementation.
This is underscored by results of a meta-analyses conducted by Thomas Russell (2001) of
over 355 studies since 1928. Russell concluded that the quality of instructional design is
the most important factor in the retention of knowledge, rather than the medium
(technology or classroom) in which the knowledge is delivered. Schank (2005, p.49)
agrees with this and suggest that “ e-Learning software programs always seem to contain
major design flaws’.
In this section, the methods employed by enterprises to design high quality e-Learning
programs will be explored. Enterprises must make many sourcing decisions in the
development of e-Learning programs, including whether to: build the courseware inhouse; purchase off-the-shelf courseware; use an external vendor to custom-build
courseware; or to leverage a mix of internal and external capabilities. Independent of all
of these decisions, the quality of the e-Learning program design retains importance in and
of itself. In fact, many authors suggest that e-Learning design plays a very important role
in the overall effectiveness of e-Learning (Masie, 2002; Moshinskie, 2002; Clark, 2003;
Mantyla, 2001; Mayer, 2001).
The design has a direct influence on the motivation of the learners to engage in and
complete e-Learning courses. According to a joint study from Masie/ASTD (2001),
course start rates for e-Learning courses differ by nature of course. Courses which were
mandatory had a 69% start rate. However, only 32% of people started voluntary classes.
Enterprises that have implemented e-Learning programs have also experienced high eLearner drop-out rates. The drop-out rate is defined as the difference between the
numbers of employees who have signed up for a course as compared to the number of
employees who have completed the course (Moshinskie, 2002, p.218). These findings
lead to a number of questions.
How can we motivate e-Learners to:
•
•
•
•
Take a course?
Learn the content and develop skills?
Complete the course?
Apply knowledge and skills in the work environment?
The answers to these questions are found primarily in the design of the e-Learning
course. According to eLITE9 (2002), e-Learning instructional designers must focus on
enhancing the extrinsic motivation of the learner.
9
eLITE (e-Learning Inside Training Excellence) is a member based think tank that includes performance
improvement technologists from two educational organizations and eight corporations.
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This can take place before the learning (by understanding the learner and environmental
needs), during the learning (by providing learning opportunities to match specific learner
needs), and after learning (by evaluating the degree of success and encouraging learner
reflection on what and how learning addresses needs) (Moshinskie, 2002). Examples of
strategies which create and maintain motivation during an online course are: maintain a
conductive environment; chunk the information; build on the familiar; very the stimulus;
give legitimate feedback; provide the human touch; provide a social context; build
opportunities for fun; make it timely; and, stimulate curiosity (Moshinskie, 2002).
However, designing e-Learning programs is a relatively new skill for organizations and
there are differing views on the best approach. According to Lundy and others (2002),
there is more to designing e-Learning than just building textual (instruction) in a
sequential flow (Lundy, 2002). Clark (2003) concurs and states that: “Web delivered
training is revolutionary in its universal access across networks and platforms, but the
quality of the training seems like a giant step backward, compared, with a CD-ROM
learning environment.” She believes that many design issues are parallel to those raised
during the computer-based training (CBT) days of the late 1970s and early 1980s.
Unfortunately, the new generation of e-Learning designers does not always have the
advantage of the lessons learned from CBT design experiences.
However, a new benefit to guide the work of e-Learning designers, and which ultimately
improves the experience of the e-Learners, is the research on cognitive learning methods
that has taken place over the past 15 years, increasing the knowledge in this field (Clark,
2003). This research and its application to e-Learning design is one reason why Gartner
(2002) suggests that e-Learning courseware can provide new opportunities for highly
creative instructional design, a more robust level of interactivity, and an increase of
experiential learning over what has been possible in a physical classroom with an
instructor.
What Constitutes High Quality e-Learning Design?
This is one of central questions of this section. Clark (2003, p.26-27) argues that effective
courseware:
•
•
•
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Includes instructional methods which address specific training goals, e.g. a
distinction can be made between training which is designed to inform a learner
on a subject, versus training which requires the learner to perform a procedure or
principle task.
Applies instructional methods appropriate to the learner’s characteristics, e.g.
the knowledge level of the learner determines the course design.
Is designed in alignment with the unique organizational environment,
e.g. some environmental factors which have an impact on e-Learning design
include: potential technical constraints of the delivery platform or network;
cultural factors; existing budgets; available time; and, management expectations.
The environmental factors will be discussed in the other sections of this chapter.
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Furthermore, Clark (2003) finds that the instructional design of e-Learning must support
the way people learn. She refers to cognitive learning theories which explain “how
mental processes transform information received by the eyes and ears into knowledge
and skills in human memory” (Clark 2003, p.35). A brief review of the key ideas from
the cognitive schools and their implications for e-Learning design is relevant here. First,
it is explained that human memory has two channels for processing information: visual
and auditory. Therefore, e-Learning designers might consider the use of techniques to
draw the learner’s attention to important text or visual information. Second, the human
memory has a limited capacity for processing information. Therefore, it is important that
an e-Learning course does not overload the working memory, because this would make
the learning difficult. One of the ways ensure that this overload does not take place is by
minimizing irrelevant visuals, background music and environmental sounds. Third,
learning occurs by actively processing the information in the memory system, for
example – e-Learning which includes practice exercises and working examples stimulates
the integration of new knowledge into prior knowledge. Lastly, it is found that new
knowledge and skills must be retrieved from long-term memory for transfer to the job.
Therefore, it is important that e-Learning design includes job context during the learning
process, because this will provide the ‘hooks’ in memory which are necessary for
retrieval of knowledge (Clark 2003).
Schank (2005) suggest that all learning should be engaging. Therefore, basic learning
engagement elements which should be included in design of e-learning include:
fascination, exhilaration, confusion, anticipation, curiosity, determination, emotional
identification, excitement and arousal. Examples of design elements that make e-learning
engaging are: use of visually based situations, just-in-time stories from experts, use
realistic job-like scenarios that an employee would recognize as something that would or
could happen to him or her, give people a choice of action, among others.
One of the common themes in the literature on e-Learning design proposes that high
quality e-Learning program design should be based on a process of sound instructional
design (Harris, 2002; Carliner, 2002; Mayer, 2001; Brandon Hall, 1997; Conrad, 2000).
I mentioned in Chapter 2 that different learning theories, such as behavioral, cognitive
and humanistic, and social and affective learning theories, advocate for different
instructional models for learning design.
Harris (2002) proposes that one can use the instructional design model called ADDIE
(Analysis, Design, Development, Implementation and Evaluation), for designing eLearning. But he also acknowledges that there are a number of unique aspects to consider
when designing e-Learning, such as: authoring systems; content management systems;
delivery systems; learner analysis; media analysis; web-based project team analysis; task
analysis; web usability; and graphic design (Harris, 2002, p.1).
Carliner (2002, p.17) has developed an Instructional System Design (ISD) model for
e-Learning. This model looks similar to the ADDIE model and is divided into four
categories:
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1.
2.
3.
4.
Define phase
Design phase
Development phase
Implementation and maintenance phase
According to Rowland (Carliner, 2002, p.15) “If in theory, design is part science and part
art, and if it is guided by beliefs about how to best present content to learners, in
practice, Instructional System Design is actually just problem-solving.”
I propose Figure 4.1 below as a framework for the design of e-Learning. The first three
phases depicted are crucial to any high quality learning program design and consist of
content, instructional methods, and media.
The content taxonomy was developed by David Merrill and built upon work of Gagne
and others (Clark, 1994). An instructional method is the technique that supports the
learning of the content (Clark, 2002). Media elements are the audio and visual techniques
used to present words and illustrations in learning (Clark, 2003). Communication
technologies are a combination of platforms and applications which can be used in the
development of e-Learning (Horton, 2001). By combining the communication
technologies in learning programs, one can create different delivery methods for eLearning. Examples of delivery methods are shown in Figure 4.1.
Figure 4.1: e-Learning Design Framework
As illustrated in the above Figure, the e-Learning instructional designer has a number of
instructional methods, media, and communication technologies available to create varied
delivery methods to support an engaging learning experience for e-Learners. The learning
experience is especially powerful if the designers ‘blend’ different learning methods into
one program.
The literature provides different definitions for ‘blended learning’. Yet, many studies
refer to blended learning as a blend of instructor-led classroom training with online
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learning (Horton, 2002; Mantyla, 2001; Masie, 2002). However, according to Bielawksi
(2003), blended learning can refer to the blend between various online learning delivery
methods, e.g. an e-Learning program that blends simulation, online testing, a live eLearning course, and online coaching.
Furthermore, Bielawski (2003, p Xvii) argues that: “What complicates the matter even
further is the introduction of other learning-oriented systems and their accompanying
technologies, such as electronic performance support systems and tools, and knowledge
management systems and portals. Yet these complementary technology based approaches
are very much part of the e-Learning mix today.”
In this dissertation I propose to define blended learning as: “Learning solutions which
combine the best features of all online education and training delivery methods,
including: online performance support; online information and knowledge; online
collaboration; online learning management; and physical classroom learning.”
Figure 4.2: Blended Learning
In Chapter 2, I mentioned the research results from Edgar Dale (1969) who finds that
people remember more what they do, versus just what they read.
His learning model was called The Cone of Dale. I have mapped a broad variety of eLearning delivery methods to this learning model and termed this The Online Learning
Continuum. The level of desired learning drives many of the design decisions.
The Online Learning Continuum (Figure 4.3) indicates some possible delivery methods
of e-Learning that best support achieving different types and levels of learning.
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Figure 4.3: The Online Learning Continuum
As you move along the continuum from e-Reading to e-Learning, it is important to note
that the degree of investment in instructional design may increase as you move further up
the retention pyramid. An online business simulation is a powerful learning tool.
However, it is one of the most expensive to develop in terms of design capability, time,
and resources.
e-Learning program design can be accomplished by employees within the organization,
by vendors, or through collaboration between the two. Enterprises which are purchasing
off-the-shelf e-Learning courseware from vendors must have the requisite expertise to
evaluate e-Learning courseware. To support standards of excellence in e-Learning, the
American Society for Training and Development (ASTD) has launched the ASTD
Certification Institute, a certification program for e-Learning courseware. Vendor courses
are submitted and are evaluated against the quality standards developed by the ASTD
Certification Commission.
As discussed in this section, e-Learning design is a very important capability to support
the adoption of e-Learning in enterprises.
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4.3 e-Learning Technology
The objective of e-Learning is to improve performance through learning, but the ‘e’ or
the technology is the enabler of the learning. Sanders (1997) refers to learning
technologies as electronic technologies that deliver information and facilitate the
development of skills. e-Learning technologies are a critical organizational capability for
e-Learning, because learner’s satisfaction is impacted significantly by the type of eLearning technologies selected, integrated and supported.
According to Masie (2001), technology factors which drive satisfaction with e-Learning
include:
•
•
•
•
Appropriate (use of) technology
Extent of technology support
Ease of mastery of the technology
Speed and responsiveness of the technology
Masie (2001, p. 26) concluded that “the lack of familiarity or experience with a
particular learning technology is a key obstacle preventing learners from engaging in eLearning.” Furthermore, he recommends that organizations deploy best-of-breed
technology and back it up with internal support.
In this section, I will provide a brief overview of e-Learning technology architecture and
the integration of technologies. Furthermore, I will discuss how to select and support eLearning technologies.
e-Learning Technology Architecture
Whether an organization chooses to build the technology backbone required for its eLearning strategy, or to outsource the required capabilities to an outside vendor, it is
critical to understand the requirements of the enterprise and to equally understand the
capabilities that exist in the marketplace. To build an integrated technology architecture
that will optimally support an organization’s e-Learning strategy, the technical
functionality requirements associated with the process and content included in the eLearning strategy must be evaluated and mapped to current offerings in the marketplace
(Bielawaski and Metcalf, 2003).
It is generally accepted that most progressive e-Learning strategies require an open, or
non-proprietary architecture, which allows additional process, content, and technology
components to be easily added from multiple vendors with overall ease of integration. As
mentioned in Chapter 2, there is a wide range of technology-based products and contentbased solutions available in the e-Learning marketplace.
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Many authors include the following components as part of overall e-Learning
architecture:
•
•
•
•
•
•
•
Learning portals
Learning management systems
Learning content management systems
Content development or authoring tools
Collaboration tools
Assessment tools
Human resource information systems
(Bielasweski and Metcalf, 2003; Horton, 2001; Masie, 2002; Rosenberg, 2001)
Web-based portals have greatly proliferated since the mid 1990s. In order to reduce the
costs related to maintenance of a number of departmental or country/geography specific
portals to serve various audiences and to streamline the flow of information and services,
organizations have been consolidating these multiple Web sites into a single entity – an
enterprise-wide portal. Once employees have access to the enterprise portal they should
be able to easily find learning solutions through the enterprise learning portal. A learning
portal is a Web-based, single point of access that serves as a gateway to a variety of eLearning resources on the web (Rosenberg, 2001).
As learning portals provide the gateway to learning resources, a learning management
system provides the functionality. A Learning Management System (LMS) manages the
interaction between users and learning resources (Rosenberg, 2001). Learning
management system capabilities and functionality include: online course catalog; online
registration for classroom and e-Learning; competency management; skill management
and career planning; publication of e-Learning courseware; e-Learning tracking; learning
assessments; management of learning materials; facility and resource management;
integration with knowledge management; online learning performance support;
organizational readiness information; reporting; course pre-testing; financial
management; online collaboration; online learning communities; and system and
application integration (Brandon Hall, 2001; Bielawski and Metcalf, 2003; Rosenberg,
2001; Saba, 2001).
Bielawski and Metcalf (2003) introduced the term Integrated Learning Management
Systems (ILMS) to describe an LMS that links to a variety of outside systems and
capabilities. Furthermore, they refer to Human Capital Development and Management
(HCDM) as “an emerging discipline that is about maximizing the value that is embodied,
or created, through people’s capacity to contribute.” They describe four major
components for HCDM solutions, including: learning management; performance
management; content management; and, resource management.
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Content management can be defined as “the process of creating, developing, capturing,
assembling, publishing and delivering knowledge content that empowers productivity
within an extended enterprise, and reporting on content utilization and effectiveness”
(Bielawski and Metcalf, 2003, p.174). The e-Learning technology which supports this is
termed Learning Content Management Systems (LCMS).
According to (Downs, 2001) an LMCS typically contains four essential features,
including: an authoring application; a collection of learning objects (repository); a means
of sending the completed course to a delivery system (delivery interface); and content
administration tools.
Authoring systems or tools include the software required to put together Internet-based
learning programs (Brandon Hall, 1997). Authoring tools can be part of a LCMS but also
can include separate systems and tools which integrate content within an LCMS.
Another group of e-Learning technologies which plays a significant role in the expansion
of e-Learning are collaborative learning tools. Collaborative learning tools are Internet
technologies which support learning through the exchange and sharing of information
and knowledge among learners (Horton, 2000, 2001). Many authors suggest that the most
common examples of collaborative e-Learning includes: email; instant messenger;
whiteboards; bulletin boards; virtual breakout rooms; virtual classrooms (live eLearning); web seminars; web meetings; online mentoring/coaching; application and
document sharing; and file transfer.
Learning assessment tools help to analyze learner capabilities, progress and knowledge,
and can ensure a uniform learning standard across an organization. Assessment tools can
support both pre-course assessment and post course assessment (Horton, 2001).
Human Resource Information Systems (HRIS) have a very robust functionality and
support a wide range of related information/knowledge requirements including storage of
personnel information, benefits and payroll, competency management and performance
profile information (Deloitte Research, 2001).
An emerging trend in the industry is that LMS providers are delivering a complete
learning technology solution as part of one integrated platform including: learning
management; learning content management; authoring tools; collaboration tools;
competency and performance management; and assessment and evaluation tools (IDC,
2002).
Selecting Learning Technologies
The plethora of emerging e-Learning technologies is overwhelming and therefore an
important issue is to determine the best method for selecting e-Learning technologies for
an organization.
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Some considerations include:
•
•
•
•
•
•
•
•
•
•
•
•
Needs of the learner
Needs of the organization
Existing technology infrastructure
Constrains imposed by the tool or technology
Types of content
Costs
Types of skills to be learned
Learner characteristics
Evidence of learning technology effectiveness
Return-on-investment
Financial condition and longevity of the supplier
Availability of independent support services
(Sanders, 1998; ASTD, 2001; Horton, 2001)
Another aspect to consider in the selection of the best e-Learning technology for an
organization is how the e-Learning technology supports the learner’s needs. These
considerations can increase the likelihood of acceptance of e-Learning technologies by
the learner.
Sanders (1998) distinguishes technology which is targeted for groups of learners versus
individuals (e.g., synchronous versus asynchronous technologies), and simple
technologies (e.g., printed courseware) versus complex technologies (e.g., interactive
multimedia based courseware). He argues that there are advantages and disadvantages to
each of these formats, but that it is important to look at the fit of each format with the
needs of the learner, e.g. synchronous technology supports the needs of learners who are
dispersed and have a desire to collaborate in a live session without having to leave their
office or home.
Rosenberg (2001, p.164 -167) has developed a number of questions to assess an LMS
technology solution and evaluate its user friendliness. Examples of these questions are:
•
•
•
•
Does the system use industry standard plug-ins?
Can the system easily scale in size to meet the growing demand of users and
increased number of users?
Does the system respond adequately when used in a dial-up mode?
Does the system have appropriate security protocols to protect users?
Many studies suggest that the lack operability of e-Learning systems is one of the barriers
for the implementation and usage of different e-Learning technologies. Interoperability
describes the capability of e-Learning systems and products to work seamlessly with each
other (Rosenberg, 2001). This requires a standardized definition of the components of the
learning systems, as well as standardized interfaces.
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The e-Learning industry has been motivated by these issues to accept a number of
standards. Some of the best known and most widely accepted e-Learning standards are
AICC (Airline Industry CBT Committee), IMS (Instructional Management Systems), and
SCORM (Sharable Content Object Reference Model). It is outside the focus of this
dissertation to engage in an in-depth technical discussion of these e-Learning standards,
but I argue that it is critical to explore whether learning technologies are compliant with
these standards before an organization selects, implements and integrates technology
systems to support e-Learning.
e-Learning Technology Maintenance and Support
Once e-Learning technology systems have been purchased and implemented, the user
must receive support, and system and courseware maintenance must be conducted.
According to Carliner (2002, p.172) support and maintenance of e-Learning courseware
should include: scheduling technical fixes; providing ongoing tutoring services;
scheduling maintenance of the technical content of the learning program; and managing
the evaluation of the learning program.
Horton (2001) says that technical complexity “frustrates, distracts, and discourages
learners, who either waste their time in the course or else give it up outright.”
He continues that instructors also can lose enthusiasm for their jobs when faced with
technical problems, which may ultimately have impact on the learners. Therefore he
proposes organizations plan for technical support. Secondly, he suggest taking action on
number of other things including: identify technical barriers; reduce technical
requirements; limit the number of technologies; simplify and integrate technology; obtain
safe conduct through firewalls; require some computer skills.
Vendors
Most training organizations do not have the capacity, capabilities or enough time to
implement e-Learning. In addition to this, they rely on the marketplace for learning
platforms, tools and courseware. This is because the development of their own
technology solutions might be very expensive and is not part of core expertise of the
organization. Therefore, organizations interested in establishing e-Learning initiatives
have recognized the importance of engaging vendors and consultants whose core
competence is e-Learning.
Vendor offerings fall into three elemental areas of an e-Learning solution (IDC, 2002):
Content; Technology; and, Services. The number of vendors in each of these areas have
grown and changed significantly. The selection of the right e-Learning vendors has
become a very important organizational capability for the successful implementation of
e-Learning.
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Rosenberg (2001, p.273- 278) has established nine approaches to finding the right vendor
including:
1.
2.
3.
4.
5.
6.
7.
8.
9.
Know what you are looking for
Know how you want to deal with the vendor
Research the company
Understand the industry as a whole
See the vendor for yourself
Road test
Develop a qualifying checklist
If the vendors are new, invite them in for a face-to-face meeting
Limit the numbers and lengthen the bond
Rosenberg (2001) argues that once organizations have selected vendors, it is important to
maintain a good ongoing relationship. He says that one of the implementation goals is to
learn from the experience and this is why organizations should build a consultative and
collaborative relationship with vendors.
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4.4 Performance Management
Performance Management is an important organizational capability for the
implementation of e-Learning. Although performance management is a very extensive
subject area, here I will discuss its importance related solely to e-Learning.
Much has been published about performance management and there are different uses
of the term performance management, but the main characteristics of Performance
Management include (Slottje 2003):
•
•
•
•
Appraisal system (including goal setting)
Reward system (including compensation)
Assessment and feedback (e.g. 360° degree programs)
Communication process between employee and employer
Thus, the working definition of Performance Management employed here is: “The
systematic, data-oriented approach to managing people at work that relies on positive
reinforcement as the major way to maximize performance” (Bailey, 2002).
The success of an organization depends on the ability of each of its employees to
effectively perform and meet the identified goals. Therefore, organizations are currently
engaging learners in e-Learning to support the achievement of individual performance
goals, contributing ultimately to organizational performance and helping the organization
to achieve its business goals. Evens (2002, p.71 - 80) says that there are seven factors that
must be considered in Performance Management Systems, such as: link to business
strategy; measurement; involvement; development; reinforcement; process and link to
other systems, e.g. reward programs; managing ‘out’ systems; leadership development
and succession planning; annual operating cycles; and retention systems. Spencer and
Spencer (1993, p.266) differentiate Performance Management Systems which focus on:
•
•
The performance: the what of behavior
The competence: the how of performance
A competency-based performance management system is more oriented to the future and
focused on development. Mixed performance management systems combine planning,
management and appraisal of both performance results and competency behaviors.
Many studies suggest that high performers are able to produce high value
accomplishments, because they have the required competencies and they know how to do
things more productively than others. For e-Learning to contribute significantly to
performance improvement, it must develop these requisite competencies.
Many definitions of competencies exist including: “skills, knowledge and attitudes”
(McGraw, 2001). Also, Masie defines this as, “Personal characteristics that result in
superior performance” (Masie, 2002).
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Leading authors on this subject also include Spencer and Spencer. They define a
competency as “an underlying characteristic of an individual that is causally related to
criterion referenced as effective and/or superior performance in a job or situation”
(1993, p.9 -11).
They make a distinction between five types of competency characteristics:
1. Motives: things a person consistently knows about or wants that cause action
2. Traits: physical characteristics and consistent responses to situations or
information
3. Self Concept: a person’s attitudes, values, or self-image
4. Knowledge: information a person has in specific content areas
5. Skills: the ability to perform a certain physical or mental task
It is important to realize that the type of competency required has implications for people
development. Knowledge and skills are relatively easy to develop with education and
training programs. Self concept, traits, and motives are central to people’s personalities
and harder to develop or change (Spencer and Spencer, 1996).
Evans (2002), concurs with Spencer and Spencer, and states that a very important aspect
of performance management is to measure not only what is done (results), but also how
things are done (competencies). This has led to a slightly different category called
competency management in organizations. Competency management can be defined as:
“A process used by organizations to identify desired competencies and competency gaps
and to manage how and when those competencies will be developed” (Masie, 2002).
One part of competency management is to organize competencies in a framework, known
as a competency model. There are two primary, opposing approaches to competency
modeling (Boulter, Dalziel, Hill, 1998). Highly-generic competency models have been
developed and validated across a number of organizations and can be purchased as
databases of competencies. Highly-customized competency models require full
competency assessment and analysis to be conducted for each position and are
organization specific. A comprise between the two extremes is an approach whereby
organizations purchase existing competency models and refine them, so they better
represent their desired outcomes and competencies.
McGraw (2001) finds that organizations often encounter problems with competency
assessment and modeling because they underestimate the efforts to do this well. Another
problem is that it can be viewed by management as too academic or impractical because
the list of competencies for a job is too long, or the methodology is too arduous, takes too
long, or is too costly. Nevertheless, competency modeling has proven that it can
successful, according to McGraw (2001). One study suggest that nearly 100% of high
performing companies either are measuring competencies or plan to introduce such a
change (Evans, 2002).
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Once a competency model has been developed and validated, it can be used in a number
of ways, such as:
•
•
•
•
•
•
Selection
Assessments Centers
Career Planning
Compensation
Succession Planning
Training and Development.
Training and development by itself is not the end objective, but it can improve
performance when it is directly linked to a relevant competency and addresses a
competency gap (Spencer and Spencer, 1993). Many studies suggest that all
competencies, even competency types such as self concept, traits, and motives, can be
taught.
Spencer and Spencer (1993, p.294 – 298), distinguish seven steps for the development of
competency based Training and Development Programs:
1. Development of a competency model
2. Identification of competencies which are cost-effective to train for versus to select
for
3. Selection of the most cost-effective development options
4. Develop assessment methods and training curricula
5. Train the trainers (if applicable)
6. Train learners
7. Evaluate the training results
In Step 3 of this model, organizations need to select the most cost-effective development
options for their learners and their organization. As I will discuss in Chapter 5, eLearning solutions can be a very cost effective development option for most
organizations. The wide variety of e-Learning methodologies can be selected for the
developing competencies, including: self-paced e-Learning; live e-Learning; simulations
and gaming; mentoring and coaching; and assessments.
Step 4 requires organizations to select assessment instruments and develop training
curricula. Taba (1962) has described a curriculum as essentially a plan for learning.
Kessels (1993, p. 14) defines a curriculum in the context of corporate education as:
“The course of action open to an organization, for influencing the necessary skills of
employees, that contribute to goal-oriented changes in their performance and in their
work environment, thus striving for a desired impact on the organization, by applying
planned learning activities and the resulting learning processes.” Curricula may require
people to take specific courses or complete entire certification programs. A certification
program (McGraw, 2001) can be defined as “a group of learning offerings that a learner
must complete in order to gain a certification or be qualified in a particular technology,
educational area or field.”
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Kessels (1993, p.13) uses the adjective corporate to “distinguish between the educational
provisions in labor organizations and those in public and vocational education.” He uses
education to “indicate the variety of planned learning provisions for immediate and
future competencies in an organization.”
Consistent with what has been said before, I propose that e-Learning solutions become
part of a curriculum – a plan for learning – and be mapped to competencies.
Results from Masie Study (2001) present evidence that the acceptance of e-Learning is
mostly influenced if ‘the skills taught in an e-Learning course were valuable to the
learner.” Therefore, I argue that if organizations use competency-based performance
management systems, and if e-Learning solutions are mapped to competencies, that the eLearning program start and completion rates will increase, because I anticipate that eLearning courses will be more valuable for the learner.
Finally, one of the goals of performance management is: “to reinforce and reward
effective behavior and progress towards goals” (Spencer and Spencer, 1993, p.265).
Rewards for performance improvement and acquisition of the desired competencies are
another organizational capability critical to the success of an e-Learning implementation.
Masie (2001, p. 29) proposes that organizations can improve performance by rewarding
employees’ e-Learning efforts, and also finds that acquisition of new skills and
knowledge can lead to more exciting and rewarding careers. He states that personal
development plans are important instruments to support this. Many studies suggest that
effective performance management also links rewards to performance.
Therefore, I propose that the completion of a number of required e-Learning programs
should be considered in the performance appraisal when a manager has to determine an
overall performance rating for an employee. This would enhance the extrinsic motivation
to engage in e-Learning programs.
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4.5. Effectiveness of e-Learning Implementations
Effective e-Learning implementations should ensure that people are able and motivated
to participate in e-Learning programs, changing personal behavior and having an impact
on job performance. If this does not happen, the organization will not benefit from eLearning solutions, and the investments might not provide an adequate return-oninvestment (Cross & Dublin, 2002).
In the previous sections, I have discussed the organizational capabilities required for
making e-Learning a success, including an e-Learning Culture, e-Learning Program
Design, e-Learning Technology, and Performance Management.
Figure 4.4: Organizational Capabilities for Implementation of e-Learning
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Rosenberg (2001) proposed that organizations which want to implement e-Learning
successfully, must pay attention to the four C’s:
•
•
•
•
Build a learning Culture
Help senior managers become true Champions of e-Learning
Communicate the value of e-Learning
Establish an integrated Change strategy for bringing all the pieces together
According to Cross and Dublin (2002) successful implementation strategies for eLearning need to address: processes that have worked in other settings; the business goals
of the organization; barriers to change; the individual learner; and change management.
Many authors suggest (Cross and Dublin, 2002; Horton, 2000; Rosenberg 2001;
Rossett, 2002) that an e-Learning transformation should start with the development of
a vision for learning and a number of strategic goals, which are aligned with business
goals (see Chapter 4: Business Drivers). The second stage is the development of a
business case. The business case should justify the investments in e-Learning in three
ways:
•
•
•
e-Learning meets specific business needs
e-Learning is more economical than other forms of delivery
The company recognizes the need to manage knowledge as an asset, not just a
cost (Rosenberg 2001, p.193).
After approval of the business case, e-Learning initiatives need to be prioritized and an
implementation plan must be developed.
Schackelford (2002, p.14) makes a distinction between e-Learning processes, e-Learning
products and e-Learning projects. He defines the e-Learning process as: “an overall
strategy for providing knowledge to the organization’s audiences (internal and external)
using technology and connectivity.” An e-Learning product is: “a discrete package
obtained at the end of one specific e-Learning project.” This is a deliverable and
examples include: a new e-Learning course; a software upgrade; and a learning
management system implementation, among others. e-Learning projects are defined as:
“initiatives to deliver or enhance a discrete package of e-Learning content or to create,
install, or maintain software or infrastructure to support the e-Learning process.”
According to Schackelford (2002) it is important to understand the differences because:
“an e-Learning process never ends, but e-Learning projects have a clearly defined
beginning and end. e-Learning products evolve through a series of discrete construction
and enhancement projects.” Furthermore, he (2002) argues that if an organization does
not acknowledges this distinction, the e-Learning process might “become mired in
perpetually unfinished projects and shoddy, poorly executed e-Learning products.”
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A solid e-Learning project management approach is critical for successful e-Learning
implementations. e-Learning projects cover a number different areas, for example:
technology selection; integration and implementation; extensive marketing and
communication; potential organization restructuring; process reengineering; internal
development of e-Learning solutions and capabilities; and significant change
management (Deloitte Research, 2001). In addition to this, most e-Learning projects are
complex in nature, have an impact on many people (in multiple geographies), and
generally demand rapid deployment and a high quality (Deloitte Research, 2001;
Shackelford, 2002).
I find it outside the scope of this dissertation to discuss principles of project management,
such as: methods; tools; and techniques. However, I want to discuss briefly the role of
risk and change management in e-Learning implementations because this can have huge
implications for successful e-Learning implementations. First, I will start with Risk
Management.
Risk Management
Shackelford (2002, p.25 – p.27) has identified risk and change management as the two
primary tools for anticipating and responding to threats to an organization’s e-Learning
projects. He has identified five steps for building a risk management strategy into an eLearning project plan:
1. Anticipate Hazards: Identify what might possibly go wrong
2. Assess the Risk to Your Project: Take list of risks and score and calculate the
risks and compare them
3. Assign Priorities to the Risks: List the risks in descending order of risk
4. Manage Risks: Determine what actions might be taken to prevent the highestscoring risks from occurring and identify contingencies to put in place for dealing
with them in case they occur
5. Estimate Costs: Estimate the time and costs required for implementing preventive
measures and contingency plans, decide which one to implement, and build them
into the final project plan
e-Learning project constraints always include: cost; time; quality; and, scope. In an ideal
e-Learning project, one would deliver on time, within scope and budget, and at agreed to
quality standards. In daily reality, it is important to prioritize those constraints, mitigate
risks associated with achieving goals, and manage the expectations from stakeholders
(Shackelford, 2002).
One of risks related to the implementation of e-Learning is that it takes a very long time
before achievements are realized with the result that leadership support can deteriorate,
having a negative impact on future initiatives.
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Therefore, in selecting e-Learning products, research has shown (Deloitte Research,
2001) that it is important to select a number of limited e-Learning products and try to
make progress and achieve quick, tangible successes (quick hits). In addition, there must
be ongoing feedback to the business leaders - evaluating the project and deliverables,
validating priorities in respect to ongoing business initiatives and decisions, and retaining
funding.
Figure 4.5: e-Learning Implementation
Change Management
As mentioned in previous sections, preparing an organization for a shift to e-Learning
requires: a new learning culture; support and championship from leadership and the
training staff and IT department; motivated learners; various incentive and reward
systems for learning; and frequent and value-based communications. The shift to an eLearning initiative may cause resistance among different constituencies and could cause
e-Learning implementations to fail (Cross and Dublin, 2003; Kruse and Keil, 2000;
Rosenberg 2001). Therefore, it is critical to address this through the development of a
change strategy as an integral part of the e-Learning implementation. In the literature a
change strategy is often referred to as change management (Rosenberg, 2001).
Change management is the process of:
•
•
•
Facilitating acceptance and implementation of intended changes
Responding to unexpected changes in project requirements
Averting undesirable changes
(Shackelford 2002, p.28)
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Much has been published about change management, and many theories and examples
exist. In this section, I will briefly explore some change management models that can be
applied to e-Learning implementations.
Bridges (1991, p.3) differentiates between change and what he calls transition and says
that: “It isn’t the changes that people are in, it is the transitions.” According to Bridges
(1991), change itself is situational e.g. a new team or a new policy, whereas transition is
the psychological process people go through to come to terms with the new situation. He
says that change is external, and transition is internal, and “unless transition occurs,
change will not work.” Bridges identifies three stages in the transition process: endings,
or letting go, the neutral zone, and consolidation or beginning. People engaging in eLearning implementations will go through each of these three stages. People may resist
the ending and have difficulties to letting go of the old way of doing things. In the neutral
zone, people will explore the opportunities e-Learning may offer, and in the consolidation
phase, e-Learning will be accepted and people will support the path forward.
A similar change model is proposed by Jaffe and Scott (1995), who have identified four
stages of change that people go through: denial; resistance; exploration; and commitment.
People react in each of the stages differently and change efforts must target the different
stages.
Mauer (2002) suggests that most changes, new initiatives or projects demand that others
not only like the idea, but get behind it. Obviously, e-Learning initiatives require more
than full support in the organization, and without help and support can become a costly
failures. He has developed six principles that are helpful in developing understanding,
favorable reactions and building trust. The principles are: know your intention; consider
the context (time, place and relationship are important as well); avoid knee-jerk reactions
(do not respond instantly and instinctively when people show resistance); pay attention
how others respond; and explore deeply when people oppose the new ideas.
Rosenberg is perhaps one of the few e-Learning experts who have included change
management at the top of the agenda for e-Learning implementations. He has introduced
four rules of change which apply to e-Learning implementations:
1. Do not put change management off until e-Learning deployment.
2. Do not assume that everybody needs the same approach to help them accept the
changes related to e-Learning.
3. Focus on the change from the start of the e-Learning implementation to finish,
and beyond.
4. Be open and do not oversell e-Learning.
(Rosenberg 2001, p.201-204)
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John B. Kotter is a well known writer on the subject of change management. He says in
his book Leading Change: “that people do not handle large change well, that they make
predictable mistakes, and that they made these mistakes mostly because they had little
exposure to highly successful transformations” (Kotter, 1996). Kotter and Cohen
conducted follow-up research to this publication, and created eight steps for successful
large-scale change in their publication The Heart of Change. The eight steps include:
1.
2.
3.
4.
5.
6.
7.
8.
Increase urgency
Build the guiding team
Get the vision right
Communicate for buy-in
Empower action
Create short-term wins
Don’t let up
Make change stick
(Kotter and Cohen 2002)
I propose that these steps should be applied to large-scale e-Learning implementations
because they are very well aligned with the change challenges which characterize eLearning implementations.
Finally, is it crucial to manage the expectations of the stakeholders during the
implementation cycle of an e-Learning implementation. Therefore, it is suggested that
stakeholder management is one of the cornerstones of good change management
(Shackelford, 2002).
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4.6. Concluding Remarks
In this chapter, I have provided an overview of organizational capabilities for e-Learning.
Based on the discussed literature, a number of dimensions within organizational
capabilities have been described which appear to be critical success factors for the
implementation of e-Learning. The dimensions are categorized by organizational
capability. The company case study research will be assessing those dimensions.
Table 4.1: Dimensions of Organizational Capabilities
Organizational Capability
Dimensions
e-Learning Culture
•
•
•
•
•
Technology Orientation
Use of Technology in learning
Leadership Sponsorship
Incentives for Participation
Change Management
e-Learning Design
•
•
•
•
Personalized Content
Collaboration and Feedback
Quality Content
Support and Enhancements
e-Learning Technology
•
•
•
Learning Management System
User Friendliness
Technology Support
Performance Management
•
•
•
Competency Management
Assessments and Testing
Link to Performance Management
My first conclusion is that, e-Learning implementations are very complex and pose risks,
resulting in the fact that many things need to be done well in order to be successful.
My second conclusion is that, culture always wins. Therefore, it is imperative that
significant consideration should be given to the existing learning culture, the vision for a
new learning culture, and the actions that need to be taken to transform the culture. As
discussed, gaining support, from leadership, training staff, the IT Function, and last but
not least - the learner, is an important aspect in creating an e-Learning culture.
My third conclusion has to do with the quality and quantity of time allocated for eLearning. In the traditional model of learning, the distinction between the time dedicated
to learning and to work was clearly delineated. The challenge with e-Learning is that
most employees need to find time for e-Learning during working hours, which turns out
to be difficult, and therefore finally must engage in e-Learning on their own time. The
consequence is that it might be more difficult for learners to start and complete
e-Learning programs.
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My fourth conclusion is that the required capabilities within internal training functions
have to shift significantly, because of the required new organizational capabilities. Some
examples of new capabilities for Training Functions may include:
•
•
•
•
•
•
•
•
•
Understanding of multiple technologies
Proficiency in instructional design skills for development of blended learning
programs
Marketing and communication capabilities
Skills to facilitate live e-Learning sessions
Ability to develop new vision and solid business case
Skills, and experience to run or monitor large e-Learning implementation projects
Change management skills
Skills to select and manage vendor relationships
Skills to re-engineer, define and/or validate new learning processes
My final conclusion is that e-Learning designers must acquire the skills and experience to
design e-Learning solutions which are engaging and which blend a variety of e-Learning
solutions and classroom programs. However, today there are only limited theories and
best practices for designing Internet-enabled learning which include e-Learning solutions
as a part of an integrated design.
Even if organizational capabilities for e-Learning are solidly in place in organizations and
e-Learning has been implemented effectively, it is still is not certain that e-Learning will
have an impact on the business and whether this impact is actually measured in a way
that demonstrates the value to the business. This theme will be explored in Chapter 5:
Measurement of e-Learning.
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Chapter Five
Measurement of e-Learning
5.0 Introduction
5.1 Business Measurement Framework
5.2 Learning Evaluation Frameworks
5.3 Return on Investment
5.4 Creation of Shareholder Value
5.5 Concluding Remarks
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5.0 Introduction
In Chapter 3, I explored the reasons organizations invest in e-Learning. Chapter 4
described the organizational capabilities necessary for e-Learning and the factors which
support an effective e-Learning implementation. In this chapter, I will explore the impact
e-Learning can have on the business and how this can be measured.
Research data from a number of organizations (Forrester, 2004; IDC, 2003/2004; ASTD,
2002) indicate that the investments in e-Learning have increased significantly since the
late 1990s. For example, IDC (2004) suggests that the worldwide corporate market for eLearning has grown from $1.7 billion in 1999 to an estimated of $7.9 billion in 2004.
Questions which arise include:
•
•
Do these investments make business sense?
What instruments can enterprises use to measure the business impact of
investments in e-Learning?
Based on the Accenture High Performance Workforce Study 2002/2003, it appears that
many training functions are underperforming. Some study results, conducted by
interviewing some 200 senior executives in six countries across multiple industries,
support this conclusion.
These results include the following:
•
•
•
•
•
Only 27% of executives believe that a considerable majority of their employees have
the skills necessarily to execute their jobs at an industry level.
Only 17% of executives are very satisfied with the progress they have made on their
training programs.
Only 17% of executives believe a considerable majority of their employees
understand the connection between their jobs and the execution of corporate strategy.
Only 13% of executives are satisfied that the training function is providing timely,
relevant and cost-effective services for employees.
Only 12% of executives said that they believe that a considerable majority of their
employees understand their company’s business strategy.
One of the criteria identified for evaluating the impact of learning is to look at the
efficiency and effectiveness of learning initiatives and the learning function.
According to Keuning (2003, p.27), “a good organization is one in which people work
purposefully and are goal oriented and try to make use of available resources.”
Additional definitions are helpful to this discussion. Organizational effectiveness refers to
the achievement of multiple goals, and organizational efficiency refers to the economical
use of skills and resources (Keuning, 2003).
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Consistent with these definitions, one can say that learning initiatives are effective if they
achieve specific goals, and as discussed in Chapter 3, some important business goals may
include:
•
•
•
•
•
•
•
•
•
•
•
•
Faster launch of new products/services
Speedy development of new information systems and business processes
Building seamless global organization capabilities
Fast ‘job-readiness’ of new hires
Increasing the productivity of the sales force
Gaining a competitive edge by reduction costs
Increasing shareholder value
Supporting successful mergers and acquisitions
Compliance with legal, regulatory and/or internal mandates
Attracting, developing and retaining the talent
Developing the next generation of leaders
Building human capital capabilities
(e.g., Capelli, 1999; Cheese & Thomas, 2003; Athey, 2001; Driscoll, 2002; Horton,
2001; Moore, 2003; Porter, 1985)
Learning to achieve these goals can be accomplished frequently via e-Learning, ensuring
that the desired organizational effectiveness is realized. Research conducted in mid-1994
on computer based training draws conclusions that offer important insights on the
effectiveness of e-Learning (Brandon Hall, 1995, p.37):
•
•
•
There is a strong evidence that computer based training reduces the total costs of
training compared to instructor-led training using a physical classroom.
There is a strong evidence that computer based training requires less time for
training compared to instructor-led training using a physical classroom.
There is very strong evidence that computer based training results in an equal or
higher quality of learning over traditional instruction.
Foreman (2001) is another writer who states that e-Learning successfully applied can
impact the external perception of what companies do and the subsequent valuation of the
company and their internal process and methods. However, he also argued in 2001 that
“most people would agree that 80% or more of e-Learning programs are rudimentary
and ineffective” (Foreman, 2001, p.399).
A number of authors suggest (Brock, 1996; Cheese and Thomas, 2003; Fitz-enz, 2002)
that executives are only moderately satisfied with results of training programs and
functions. For example, Tobin (2000) argues that that many company training programs
fail because the information in a training program is never applied to the work of
individual workers.
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Gartner (2001) suggests that the main reason for dissatisfaction with learning is the lack
of measurement of the business impact of training and development initiatives. Research
results from ASTD point in the same direction. They mention that: “One of the top issues
affecting the learning industry is the need for employees to produce demonstrable,
strategic business results and show a return on investment” (ASTD, 2002).
In this chapter, I will explore different learning measurement frameworks and learning
metrics which can be used by enterprises to measure the business impact of their
e-Learning programs.
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5.1 Business Measurement Framework
In this Section, I will explore a business measurement framework known as the Balanced
Scorecard, which has been introduced by the authors Kaplan and Norton (1992). These
authors propose that innovations and improvement of products, services, and processes
can only be achieved by re-skilling employees, acquisition of superior information
technology, and alignment of organizational procedures. According to Kaplan and Norton
in their book The Balanced Scorecard (1996), only those companies which invest in their
intellectual assets will succeed.
Furthermore, they suggest that instrumentation concerning many aspects of the business
environment and performance are needed by managers to monitor the journey toward
excellent future outcomes (1999, p. 2). However, they also argue that the success of this
can not be measured by simply employing the traditional accounting model.
Therefore, they have developed a framework called the Balanced Scorecard, which
translates an organization’s mission and strategy into a comprehensive set of performance
measures, providing the framework for a strategic measurement and management system
(Kaplan & Norton, 1996). They propose that the main focus of a Balanced Scorecard is
on financial objectives, and it measures organizational performance across four balanced
perspectives:
•
•
•
•
Financial
Customers
Internal Business Processes
Learning and Growth
I find it outside the scope of this dissertation to have an in depth discussion of all areas
of the balanced scorecard and will limit the exploration to the Learning and Growth
dimension, focusing primarily on the measurement element.
Kaplan and Norton argue that the ability to meet ambitious long term targets for
financial, customer and internal business processes depends on the organizational
capabilities for learning and growth.
Learning and growth identifies the infrastructure that the organization must build to
create long term growth and improvement. The main sources for this derive from people,
systems, and organizational procedures. Kaplan and Norton emphasize that learning is
more than training. Learning also includes things such as mentors and tutors within the
organization, as well as the ease of communication among workers that allows them to
readily get help on a problem when it is needed.
They suggest that significant investments are needed in these resources, in order to build
the required organizational capabilities.
The investment outcomes can be measured in employee satisfaction, productivity, and
retention (motivation, empowerment, and alignment).
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They consider employee satisfaction as the driver for productivity and retention.
Employee productivity is an outcome measure of the aggregate impact from enhancing
employee skills and morale, innovation, and improving internal processes, and satisfying
customers (p. 131). An important productivity measure is revenue, but this is limited if
costs associated with the revenue are not included.
The key enablers for productivity include:
• Staff Competencies
• Technology Infrastructure
• Climate for Action
Staff competencies relate to the current skill level of employees. Kaplan and Norton
argue that organizations are going through radical changes and that their employees need
to take on new responsibilities to support business objectives. In order to take on new
responsibilities they have to acquire new skills (Kaplan & Norton, 1996). Furthermore,
they suggest that the demand for re-skilling employees can be viewed along two
dimensions.
•
•
The level of re-skilling or the skill-gap
The percentage of the work force that requires re-skilling
Figure 5.1: Re-Skilling Model
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Based on the two dimensions they distinguish three re-skilling scenarios:
•
•
•
Competency upgrade: Some portion of the work force, small or large, requires an
upgrade of core skills
Massive re-skilling: A large proportion of the work force requires massive skill
renovation
Strategic re-skilling: A focused portion of the work force requires a high level of
new, strategic skills
Kaplan and Norton conclude that companies that determine their skill gap positions them
in the upper half Figure 4.1 have a significant need to re-skill. They also believe that reskilling will have a measurable impact on their company’s long term financial objectives.
Therefore, they propose that employee re-skilling should be part of these companies
Balanced Scorecard.
Furthermore, they propose two different re-skilling measures. The first one is the
strategic job coverage ratio which tracks the number of employees qualified for specific
jobs relative to anticipated organizational needs. The second proposed measure is “the
length of time required to take existing employees to a new, required level of
competency.”
I suggest that those two measurement metrics are important ones to consider in the
development of measurement frameworks for e-Learning initiatives.
People development and learning is a capability managed in most organizations under the
Human Resources (HR) responsibility area. A number of writers, (Becker, Huselid and
Ulrich, 2001)), argue that although many executives want to believe that people are our
most important asset, they have difficulty ensuring that the HR function makes that
vision a reality (p.1).
Becker, Huselid and Ulrich (2001) believe that this problem is rooted in the fact that
HR’s influence is difficult to measure. However, they suggest that good measurement
systems for the HR function can definitely create value when they are carefully matched
with an organization’s competitive strategy and operational goals. Therefore they have
have taken the Kaplan and Norton’s Balanced Scorecard concept and have developed a
Human Resources Scorecard. They argue that the Human Resources Scorecard will
manage Human Resources as a strategic asset and demonstrate the human resources, or
people contribution, to an organization’s financial success. They suggest that each
organization or organizational unit must develop its own version of an HR Scorecard
which addresses unique business needs.
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The HR Scorecard can be developed by walking through five specific steps:
•
•
•
•
•
Identify the overall business goals and performance drivers – for example, the
overall business goal is profitability growth, and the performance drivers are
revenue growth and productivity improvement
Identify Human Resources deliverables – such as, stable high talent staffing in the
R&D function, or optimal staffing levels in manufacturing
Identify and measure the foundational High-Performance Work System elements
that help to generate the HR deliverables – one example is to provide regular
performance appraisals and design and implement a competency model.
Identify HR System Alignment – an application might include using the
competency model in hiring process
Identifying HR Efficiency Measures – for example, cost per hire as a strategic
efficiency measure
(Becker, Huselid and Ulrich , 2001)
Figure 5.2: Human Resources Scorecard
Becker, Huselid and Ulrich acknowledge that every Human Resources Scorecard should
capture the efficiency of the HR function, but just driving out cost in the HR function will
not have a strategic significance for the organization. However, the potential impact of
HR on efficiency of the line business is important as it can reduce costs significantly and
therefore contribute to creation of shareholder value. Becker, Huselid and Ulrich (2001)
conclude that value creation can provide the ultimate measurement of the contribution of
the HR Function.
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5.2 Learning Evaluation Frameworks
In this Section, I will discuss a number of learning evaluation frameworks which have
emerged over time, as well as their usability for evaluation of e-Learning.
Donald Kirkpatrick is one of the first authors who developed an evaluation framework
for the training industry in 1959. According to a 2003 interview with Kirkpatrick, he says
that “his main contribution has been to break down the subject of evaluation in
meaningful terms. When anybody talks about evaluation they talk about the same things.”
Another author who developed an evaluation framework based on the original framework
from Kirkpatrick was Jack Philips. He extended the Kirkpatrick evaluation model with
another evaluation level for measuring return on investment. Daniel Kirkpatrick’s 4 Level
Model (Kirkpatrick, 1959) of training evaluation, supplemented with Jack Philip’s Level
5 (Philips, 1997), has dominated the training industry when assessing training’s value
(Active Education, 2000).
Table 5.1: Comparison of the Evaluation Frameworks of Kirkpatrick and Philips
Evaluation
Level
Kirkpatrick
Philips
Evaluation Targets
(percentage of
courses)
100
Level 1
Reaction and
Planning
Reaction, Satisfaction,
Planned action
Level 2
Learning
Learning
50
Level 3
Behavior
Application
30
Level 4
Results
Business Impact
20
Return on Investment
10
Level 5
The last column is a recommendation of evaluation targets for a program (Philips and
Pulliam, 2000). In this section, I will introduce Level 1 to 5, but will provide additional
content for Level 4 and 5 in section 5.3 (Philips 1999, 2002).
Level 1
Level One measures the response - the reaction by learners to training program. It
measures whether people liked the training along with a list of how they plan to apply
what they have learned (Philips and Pulliam, 2000).
Level 2
This Level measures if people have learned something from the training. Basically, what
kind of skills, knowledge, attitudes, beliefs or understandings did they acquire as a result
of training. Measurement for Level Two can include: tests; skill practice; role play;
simulation; group evaluations; and, other assessment tools (Philips, 1999).
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Level 3
This Level measures the change in behavior or performance on the job. It evaluates to
what degree people apply learning in their jobs. Philips used the term application instead
of behavior for Level Three because he believes that people better relate to this term (TD
Magazine, 2004). Several studies have provided evidence that learning transfer to the job
has failed (Broad and Newstrom, 1992).
Level 4
Kirkpatrick’s Level Four measures the actual results achieved by the program
participants as they successfully apply the program material. It evaluates the business
results of the training and if the training was worth the investment. Philips has split the
results in Levels Four and Five. His Level Four evaluates the impact on the business. He
argues that the words Business Impact fits business issues such as: quality; technology;
Six Sigma; marketing; and policy changes (TD Magazine, 2004). According to Philips
and Pulliam, typical Level Four measures include: output; quality; costs; time; and,
consumer satisfaction.
Level 5
Philips measures Level Five as the return on investment. Kirkpatrick has included return
on investment as part of results, Level Four evaluations. Level Five measurement
compares the monetary benefits of the program with the program costs (Philips and
Pulliam, 2000).
It is easier to generate data for lower levels of the framework and progressively harder to
collect and to interpret for the higher levels (Parry, 1997). This might be one of the
reasons why there is a big variance in evolution among the different levels. According to
Whalen and Wright (2000), more than 80% of the US organizations still evaluate training
only at Level 1, and fewer than 50% evaluate training in terms of business results, which
are represented at the higher levels of Kirkpatrick system.
A recent study from the American Society for Training and Development (ASTD, 2004)
shows that in 2004 evaluation usage levels included:
•
•
•
•
•
Level 1: 74%
Level 2: 31%
Level 3: 14%
Level 4: 8%
Level 5: No data available for Return on Investment.
Although the percentages have gone up for all the evaluation categories compared with
2001, the results show low percentages of measurement of business impact and return on
investment for learning.
Based on study from Ernst & Young (2002) among IT executives, a low level of this type
of measurement is not necessarily unique to investments in learning. 79% of respondents
believe that financial justifications of IT investments are important, but only 40% of the
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respondents perform a financial business case on a regular basis to justify IT investments
(Ernst & Young, 2002).
The evaluation frameworks from Kirkpatrick and Philips have been developed several
years before e-Learning was introduced. Forman (2002) has argued that the Kirkpatrick/
Philips evaluation frameworks should be modified and extended to support measurement
needs in e-Learning. Therefore, he has developed a nine level evaluation model for eLearning based on his experience and specific characteristics of e-Learning.
Table 5.2: Evaluation Model for e-Learning
Level
Criterion
Measure
Comments
1
Use
Process
2
Course reactions
Process
3
Relevance/Attitudes
Outcome
4
Knowledge: Facts
Outcome
5
Outcome
6
Knowledge:
Intellectual Skills
Performance
7
Transfer to Job
Impact
8
Business Results
Impact, Money
And Quantity
9
Value Creation
Business Growth
Measurement focus is on usage. This is
important for e-Learning because
completion rates can differ significantly.
Measurement focus is on reactions.
Course reactions provide insights into the
effectiveness of the structure and content
of a course.
Measurement focus is on course relevance
to learner’s day-to-day job. Additionally,
knowledge transfer and the applicability of
skills are highly impact if the learners are
highly motivated.
Measurement focuses is on facts but might
also include more behavioral outcomes.
Measurement focus is on ‘higher level’
problem solving skills.
Measurement focus is on change in
performance.
Measurement focus is on change in
behavior on the job that leads to business
results and value creation.
Measurement focus is on business impact
by:
• Cost reduction
• Productivity increase
• Revenue gain
Measurement focus is on creation of
shareholder value.
Outcome
Source: Forman 2002
I suggest that Forman’s Level 1 and 9 are especially important additions. Although
Forman has split some of the evaluation levels and used his own definitions or
descriptions, one can argue that levels 3 through 7 are similar to the Kirkpatrick/Philips
framework.
On the other hand, Level 1 is an important measurement level for e-leaning because there
was never a need for the measurement of usage in face-to-face classroom events. If a
classroom program was developed, it was just a matter of scheduling the course and
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enrolling the attendees. Making an e-Learning program available is not a guarantee that
people will take it, or that they will complete a course.
Forman’s Level 9 evaluation goes beyond the Philip’s Level 5 which focuses on return on
investment. Creating value for shareholders has been mentioned as one of the business
drivers for e-Learning in Chapter 3. Foreman (2002) says that improving the bottom line
and having the capacity to innovate and respond quickly, are the seeds of growth and
improved shareholder value. Thus, these need to be included in the business case for eLearning and therefore need to be measured. I will discuss the metric creation of
shareholder value in section 5.4.
SkillSoft, one of the largest global e-Learning companies in revenues in 2003, has
developed specific e-Learning performance criteria which focus on an e-Learning
program measurement and the learner (2003).
Program focused e-Learning measurement includes:
•
•
•
•
•
Percentage of employees who take e-Learning
Percentage of instructor led training that is replaced with e-Learning
Average percentage of annual required training that is delivered through eLearning
Employees’ demonstration of a percentage mastery score after completion of a
program
Percentage of technical problems reported by employees who have taken a
program
Learner focused e-Learning measurement includes:
•
•
•
•
•
Percentage of approval rate on e-Learning content
Percentage of approval rate on e-Learning usability
Percentage of approval rate on e-Learning as a learning modality
Feedback on how learners apply what they have learned to their job
Feedback on effectiveness of instruction by comparing pre-and post assessment
scores
It appears that a number of the SkillSoft measurement indicators can be mapped to the
measurement frameworks of Kirkpatrick, Philips and Forman. However, some of the
indicators provide a deeper measurement in some of the defined categories, such as the
employee approval rates.
Another e-Learning measurement framework has been proposed by the learning research
firm Eduventures (2001). They have established a system to evaluate and rate
e-Learning initiatives. A higher rating indicates a greater tangible business impact.
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Table 5.3: Eduventures e-Learning Rating Scale
Nature of Demonstrable Success
Rating in stars
A. User adoption of e-Learning
*
B. User learning or satisfaction
**
C. Gross savings in cost or time
***
D. Return on Investment (ROI)
****
E. Gross increase in revenues
*****
User adoption of e-Learning (one star indicates the lowest tangible business impact) is
measured in terms of deployment, registrations, or some usage metric. This level is
similar to Forman’s Level One measurement. Typically, the two star rated initiatives
employ assessments of employee knowledge before and after e-Learning, and often use
surveys of e-Learning satisfaction. Three star rated e-Learning initiatives focus on
benefits in terms of gross savings in cost or time. Cases meriting four stars allow an
estimation of ROI by quantifying the benefits as well as the costs of the e-Learning
solution. Last, five star rated initiatives generate revenues for the organization.
Furthermore, the star rating approach implies that it should be the objective of
organizations to gain Five Stars for their e-Learning initiatives. Though, it seems to me
that not all e-Learning initiatives will have impact on revenue, and that the cost of
measurement for a specific level should be considered upfront, and then compared with
benefits of obtaining the results, in order to determine its value.
Finally, other specific e-Learning metrics have emerged over the past few years, which
are unique to e-Learning for example:





e-Learning catalogue utilization
e-Learning vendor analyses
Costs of e-Learning program per employee
Unique percentage of e-Learning users
e-Learning usage in different categories
(ASTD, 2001)
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5.3 Return on Investment
As discussed in the previous sections, return on investment and the creation of
shareholder value appear to be metrics which have gained interest among executives and
learning professionals. In the coming two sections, I will conduct a more in-depth
discussion of these two aspects.
Return on Investment (ROI) has become one of the most challenging and intriguing
issues facing the human resources development and performance improvement field, and
the interest in ROI has been phenomenal, according to Philips (1997).
Philips (1997) believes that there are several reasons for this. First, and most important, is
the pressure from clients and senior management to show the return on investment for
training. Secondly, the pressure on cost management has an impact on training. Third, a
renewed interest in measurement and evaluation has been created by increased attention
on quality management, re-engineering and continuous process improvement, seen in
initiatives such as ISO and Six Sigma. Finally, the general trend toward accountability of
staff support functions including Training and Development, or the Learning Department.
Philips finds that audiences who must be supportive of the ROI process include: Human
Resources Development Practitioners; Senior Management; Sponsors; Clients; and,
Researchers.
Philips and Pulliam (2000) provide a number of benefits that can be derived from the
implementation of ROI measurements for learning in organizations, including:
•
•
•
•
•
•
Setting priorities for programs
Allowing for a complete analysis of problems
Opportunities which lead to redesign of, targeting, or elimination of programs
Focus on program results
Convincing management that training is an investment and not an expense
Alteration of the perception of training
The ROI concept overall has been used by companies for centuries, according to Sibbett
(1997), and is therefore very familiar to executives. ROI is usually calculated as earnings
divided by investments, and Philips suggests that therefore it allows learning investments
to be compared to other opportunities inside or outside the company. Additionally, using
the same measurement method makes it easier to compare training investments with other
investments (Philips, 2001).
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In order to satisfy a variety of stakeholders, Philips (1997) has developed a number of
criteria for an effective ROI process including:
1. The ROI process must be simple, void of complex formulas, lengthy equations,
and complicated technologies.
2. The ROI process must be economical with the ability to be implemented easily.
3. The assumptions, methodology, and techniques must be credible.
4. The ROI process must be theoretically sound and based on generally accepted
practices.
5. The ROI process must account for other factors which have influenced output
variables.
6. The ROI process must be appropriate with a variety of HRD programs.
7. The ROI process must have the flexibility to be applied on a pre-program basis.
8. The ROI process must have the flexibility to be applied on a pre-program basis as
well as a post-program basis.
9. The ROI process must include the costs of the program.
10. The ROI process must have a successful track record.
As mentioned in the previous section, Philips has added the ROI process to the four
levels of evaluation introduced by Kirkpatrick. Kirkpatrick’s Level 4 measures the
business impact, but it is argued that a program may produce a measurable business
impact and may still have cost too much.
In contrast, the Return on Investment Model, conceived in the late 1970s, has been
developed, changed and refined in the past 20 years, and can reveal the value of the
investment in the training (Philips, 1997). The model used by Philips for the
calculation of ROI for training is shown in Figure 5.3.
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Figure 5.3: Return on Investment Model for Training
This ROI Process Model provides a systematic approach to ROI calculations.
I will briefly describe the different steps of the ROI Model in this section.
Training Objectives
The first step provides an understanding of the scope of the program and the business
measures that it influences. Philips argues that developing objectives at each of the five
measurement levels defined by Kirkpatrick/Philips provides direction for design of the
program, as well as the outcomes expected from the program. It can also serve as a
suitable communication tool with the stakeholders regarding the impact of the training.
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Evaluations Plans and Baseline Data
Evaluation plans specify and document how success will be measured. The most
important purposes for evaluation include:
•
•
•
•
•
•
Determine if the program is accomplishing its objectives
Identify the strengths and weaknesses in the training process
Determine the cost/benefit analysis of a program
Assist in marketing the program in the future
Determine if the program was appropriate for the target audience
Establish a database, which can assist in making decisions about the programs
(Philips 1997, 2001)
Therefore, baseline data must be collected and evaluation plans developed early in the
ROI Model. Philips suggests that this should happen in the training needs assessment and
program design phase.
Collection of Data During and After Training
Evaluation and ROI measurement of training programs requires collecting data. Most
data will be collected during and after the training. However, for some training initiatives
pre-program measures are taken to compare with post-program measures. Philips
distinguishes between hard data and soft data. He proposes that hard data are measures of
improvement, presented as rational, undisputed facts that are easily accumulated.
Examples of hard data include: productivity; profitability; costs savings; and, quality
improvements. Philips categorizes soft data into six areas: work habits; work climate;
attitudes; new skills; development/advancement; and, initiative.
Philips argues that both hard data and soft data are important in an evaluation process, but
hard data are preferred to show results because of their distinct advantages and level of
credibility.
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Isolate the Effects of Training
Philips argues that it is very important to determine the amount of output performance
that is directly related to the success of a program. By eliminating non-training factors
which have an impact on the training program, you increase the accuracy and credibility
of an ROI calculation. The first step of the isolation process is to identify all factors
which contribute to a total improvement after training program. Examples include:
training program; system and procedures changes; incentives; management attention; and
external factors. The second step is to identify a number of strategies which are used to
isolate the effects of training and may include: control groups; trend line analysis;
forecasting; participant estimate; supervisor estimate; management estimate; customer
input; expert estimate; subordinate input; and, other factors input. The last step is to
decide which strategies to use.
Philips concurs that isolating the effects of the program is one of the most important and
challenging parts of the ROI process.
Convert Data to Monetary Values
In order to calculate the ROI, all business results of a training program need to be
converted in monetary values and compared with the program costs (Philips, 2001). This
will put training investments on the same level as investments in other areas. The first
step in this process is to sort out hard data and soft data. Philips argues that training
initiatives are also designed to have an impact of soft variables. Furthermore, he
considers measures like employee turnover and absenteeism as soft data because it is
more difficult to convert these into monetary values. Other intangible benefits include:
increased job satisfaction; increased organizational commitment; improved teamwork;
improved customer service; reduce complaints; and reduced conflicts.
He has identified a number of strategies for converting data to monetary values including:
•
•
•
•
•
•
•
•
•
•
Converting output to contribution
Converting the costs of quality
Converting employee time
Using historical costs
Using internal and external experts
Using data from external databases
Using participants estimates
Aligning with other measures
Using supervisors and managers estimates
Using training staff estimates.
Furthermore, Philips believes that a major challenge is to select the strategy that best
matches a certain type of data and the situation.
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Identify the Costs of Training
An important aspect of ROI calculation is identifying the appropriate program costs.
Table 4 provides recommended cost categories. Philips proposes that most costs should
be directly expensed to one course delivery, but some cost items need to be prorated over
several sessions of the same program.
Table 5.4: Training Cost Categories
Cost Item
Pro-Rated
Needs assessment

Design and development

Acquisition

Delivery Costs:
• Salaries/benefits Instructors
• Salaries/benefits Coordinators
• Program materials and fees
• Travel/Lodging/Meals
• Facilities
• Participants’ salaries/benefits
• Contact Time
• Travel Time
• Preparation Time
Evaluation

Overhead/training and development

Expensed










Source: Philips, 2001
Calculate the Return on Investment
One of the earliest methods for evaluating training improving investments was the
benefit-cost analysis (Thompson, 1980; Kearsley, 1982). In the benefit-cost analysis, the
benefits of a program are compared to its costs through the benefit-cost ratio (BCR).
The BCR can be calculated by dividing the program benefits by the program costs, or in
formula:
Program Benefits
BCR = ----------------------Program Costs
A benefit-cost ratio of one means that the benefits of a program are equal to the costs of
the program. A benefit-cost ratio of three (written also as 3:1) means that for each dollar
spent on a program, three dollars were returned as program benefits.
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The return on investment (ROI) on the other hand, can be calculated using the net
program benefits and the program costs. The ROI is often expressed as a percentage, and
therefore the outcome of initial ROI calculation needs to be multiplied by 100 (Philips,
2001). The ROI can be calculated by dividing the net program benefits by the program
costs and multiply the answer by 100. The net benefits are the program benefits minus the
program costs.
The return on investment formula is:
Net Program Benefits
ROI % = -------------------------- x 100
Program Costs
The ROI value is related to the benefit-cost ratio by a factor one, e.g. a BCR of 3.20:1 is
the same as an ROI value of 220%.
The ROI formula is same formula which is used in evaluating other business investments
and therefore can be easily understood by executives, according to Philips (2001).
Identify Intangible Benefits
The calculation of the ROI is conducted based on hard data and converted into monetary
values as described above. Additionally, Philips emphasized that a number of training
programs result in some level of intangible benefits. He adds that intangible benefits are
hard to convert into monetary values, or it is too expensive or very time consuming and
therefore not worth the effort. Philips distinguishes two types of intangibles: behavioral
application and implementation (e.g. improved teamwork, increased organization
commitment and increased cooperation), and business impact (e.g. customer satisfaction,
employee satisfaction and reduced employee turnover).
However, Philips argues that if we can put a value on the intangibles with a high level of
credibility, intangibles become tangibles. Additionally, he says that stakeholders may be
interested solely in the intangible results and are satisfied with the expenditure level
related to the achieved benefits.
Generate an Impact Study
The last step of the ROI model is to monitor the overall progress made and communicate
the results. The audience for the communication message, according to Philips, includes:
senior management; supervisors/management of program participants; the participants;
and the training staff. He recommends the creation of tailored reports for different
stakeholders, in order to address their specific and unique needs.
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An impact study may contain the following areas: management/executive summary;
background information; objectives of the study; evaluation methodology and strategy;
data collection and analyses; program costs; reaction and satisfaction; learning;
application and implementation; business impact; return on investment; intangible
results; barriers and enablers; and conclusions and recommendations (Philips, 2001).
Finally, he suggests keeping the impact study to minimum amount of information that
will satisfy the audience.
ROI Calculation Based on Total Economic Impact
Schooley (2004) has developed a model that determines ROI for e-Learning based on
Total Economic Impact (TEI). TEI proposes that organizations should evaluate the
different elements of costs, benefits, flexibility, and risk of the e-Learning
implementation, by estimating and attaching a value to each element to justify the
investment and measure success after deployment.
The description of the elements of Total Economic Impact that determines ROI includes
(Forrester, 2004, p.5):
•
•
•
•
Costs: Tangible Expenses
o These include infrastructure preparation, end user equipment and learning
application purchases, selection of off-the-shelf or development of custom
content, the costs of integration and customization, the yearly maintenance
fees, and labor costs for IT and other staff.
Benefits: The Business Value
o These include savings on travel and instructors, consistency and efficiency
of learning, productivity gains and savings from consolidation of learning
activities.
Flexibility: Future Options
o This means the option to invest in additional infrastructure above today’s
needs to enable the deployment of future e-Learning applications.
Risk: Assumptions Attached to e-Learning Success
o If assumptions such as vendor viability, culture, project size, technology
execution, and integration activities prove false then the costs required to
mitigate these risks must be factored into assessments.
Implementation Issues – Criticism
Philips (1997) acknowledges that executives may not be accustomed to seeing training
results expressed as a return on investment. Furthermore, they might question the
credibility of the study. Therefore, he argues that it is important to provide stakeholders
with a brief explanation of the methodology used to collect and analyze the data, and
describe how the return on investment has been calculated.
Additionally, he argues that it is very important to provide stakeholders with both
financial data and with data that is not converted to monetary value. He gives examples
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of programs which have a low ROI, but intangible data demonstrate that the program has
made a significant contribution.
Other barriers for ROI calculation include:
•
•
•
•
•
•
•
•
Costs and time
Lack of ROI standards or methodology
Lack of skills or sufficient staff
Faulty or inadequate initial analyses
Fear of failure or unknown
Need for discipline
Planning
False assumptions
(Benedet, 2001)
A study on ROI calculations for IT investments conducted by ComputerWorld of their
Premier 100 (2002) indicated that:
•
•
•
65% of companies do not have the knowledge or tools needed to do ROI
calculations
75% have no formal processes or budgets in place for measuring the ROI of IT
projects
68% do not measure ROI on IT projects 6 months after the work is completed
According to Brennen (2003, p 2), “putting together ROI figures is difficult for most
training organizations, especially for those that are not tied in well with organizational
goals.” Futhermore, he says that: “Some e-Learning adopters have been pleasantly
surprised by the payback on their investments, while others have been bitterly
disappointed by a number of issues, including the lack of use of their investments and
poor service performance on the part of e-Learning vendors.” Strassman and Pisello
(2003, p.20) argue that: “Although investments success clearly relies on better
management, the current stakeholders seem ill-equipped and supported to meet these new
accountability challenges.”
Benedet (2001) finds that measurement of the effectiveness of training has always been
time-consuming, expensive, and something that trainers have not consistently done. She
argues that one of the benefits of e-Learning is that it automates much of the process and
cuts the costs of managing measurement by up to 90%. Therefore, she concludes that is
has become easier and more effective to make ROI calculations and prove the value of
training. Hudy (2001) concurs with this and states that learning management systems
have enabled and automated online training program delivery, skills assessment, and
feedback, and learning measurement.
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West (2004) critics the ROI for e-Learning calculations that are defined in terms of saved
expenses by simply eliminating classroom training. He argues that this does not take into
consideration the value that is created by assessing acquired knowledge or a measurable
impact on the business.
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5.4 Creation of Shareholder Value
As discussed in Chapter 3, a number of authors indicate that an important goal of
enterprises and executives is to create shareholder value. Shareholder value can be
defined as: return on investment or total shareholder results, made up as dividends plus
share price appreciation (Donavan, Tully and Wortman, 1998). The authors suggest that
surplus cash flow or economic profit drives dividends and share price appreciation.
Value drivers include: increasing revenue; enhancing operating margin; assets efficiency;
and, overall business expectations. (Deloitte 2003) According to Donovan, Tully and
Wortman (1998), shareholder value is heavily driven by investor expectations of future
performance.
An important question is: Can e-Learning create shareholder value? In previous
chapters, I have provided a number of benefits of e-Learning including: faster time-tomarket of training courses; improved quality of training; and, training at reduced costs.
My assumption is that that these could translate into overall lower costs, which would
have a positive impact on company earnings and therefore could create shareholder
value. However, I have not been able to identify specific publications and/or research
data which explicitly link e-Learning to the creation of shareholder value.
Measuring and linking the impact of human capital to shareholder value is a relatively
young field of study (Jac Fitz-enz, 2000). Some research in this field has been done by
Watson Wyatt, a company that publishes a Human Capital Index. This index quantifies
the HR practices and policies which have the greatest correlation to shareholder value. As
an example, the results of a 2002 study indicate that companies with superior HR
practices have a higher shareholder value (Watson Wyatt, 2002).
Contrary to what one might expect, training has a negative impact on the market value of
a company, according to the study from Watson Wyatt (Pfau and Kay, 2002). Their
explanation is that many organizations may implement training in a wrong manner. As an
example, when a company emphasizes developmental training for the next job more than
training on how to succeed in the current job, it may be making investments that actually
could benefit competitors (Watson Wyatt, 2002).
Table 5.5: Impact on Market Value of Training Practices
Practice
Impact on Market Value
Employees have access to training
-5,6%
Training programs are maintained even during less than
favorable economic circumstances
-3,4%
Source: Watson Wyatt’s Human Capital Index (Pfau and Kay, 2002)
One of questions might arise if there has been a proven correlation between the variables
such as access to training and impact on market value, which have been used in the study
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from Watson Wyatt. Additionally, I suggest that there are a number of variables which
have an impact on market value and it is hard to isolate the impact of just one variable.
Other research (Lynch and Fletcher, 1995) also could not detect a positive link between
training and better financial performance. The only impact found was that “the impact of
employer-provided training differs according to the nature, timing and location of the
employer investments.” However, results from another study indicate that the opportunity
to develop new skills seems to be a very important factor for top performers in attracting
them to a particular company, resulting in a positive financial impact (Strategic Rewards,
2001).
Fritz-enz (2002) argues that the key to sustaining profitability is the productivity of
human capital, and that the driving force for this are knowledgeable people. Furthermore,
he mentioned that the stock market has awarded market value for service and technology
companies that leverage knowledge exceed their book value many times over.
Additionally, it appears that the evaluation of companies is not just based on pure
financial assets. As an example, one research report says that institutional investors, who
manage large stock portfolios, base their portfolio decisions for 35 to 40% on nonfinancial information (Zimmerman, 2001).
West (2004) says that modern business is all about creating value and he argues that if eLearning as an industry can not create value, it may never rise above a quick fix to reduce
basic training costs. He suggests that enterprises should use the metric Value-OnInvestments (VOI). The VOI is categorized by courses that solve problems that impacting
the core of the business and that the return on investment can be measured in any of the
following items:
•
•
•
Significant dollars saved by the organization
Significant increases in revenue earned
Substantial improvement in the company’s market position
In conclusion, there are a number of benefits of e-Learning which appear to have a
positive impact on the business; an example is expenditures in learning, such as time-tomarket of new skills. However, there are a number of variables which appear to influence
whether e-Learning can create shareholder value. Some of these variables are: relevance
for the training for the current job; applicability of the training for other roles/jobs;
reduction of costs for learning; ability to have a better trained sales force which could
generate more revenue, among others.
Therefore, it appears to me that the ability to create shareholder value through e-Learning
might depend on the implementation practices of e-Learning.
The literature and research focusing on this topic seem to be limited. As this has been
outside of scope of my dissertation, I recommend that future research in this area be
pursued.
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5.5 Concluding Remarks
As mentioned in the introduction of this chapter, the investments in e-Learning have
increased significantly over the last years. Business drivers might have led to positive
movement towards investments in e-Learning, as explained in Chapter 3.
The question which I have explored in this chapter is:


Do these investments make business sense?
What instruments can enterprises use to measure the business impact of
investments in e-Learning?
It was shown that it might be important to look at the initial business goals for e-Learning
and assess whether the goals have been achieved (= effectiveness of e-Learning).
Additionally, one can assess whether the goals have been achieved by the economical use
of skills and resources (= efficiency).
In order to answer these questions, it appears that one needs to measure the impact of eLearning. Many researchers and writers believe that measurement of the impact of
learning and human resources practices is essential.
However, my first conclusion is that there seems to be very different perspectives among
executives, learning practitioners and writers, in view of questions such as:
•
•
•
Can the impact of learning be measured?
What should be measured?
How should the impact of learning be measured?
(e.g., Kaplan & Norton, 1996; Ulrich et. al, 2001.)
Training measurement and evaluation frameworks have existed since the late 1950s, and
recent frameworks include metrics such as business impact and return on investment
(Philips, 2000). As discussed, return on investment is a business economic metric that has
been used by companies for centuries and which provides companies with a method to
compare different investment options (Sibbett, 1997; Philips, 2001). Philip’s return on
investment model for learning provides a prescriptive method for conducting return on
investment for learning programs.
My second conclusion is that although there appears to be a strong interest from business
leaders in measuring the impact of learning, there seems to be only a small percentage of
enterprises which measure business impact and/or return on investment of their learning
initiatives (e.g., ASTD, 2003/2004; Philips, 2001).
I have explored a number of potential reasons why enterprises do not use return on
investment as a metric to measure the impact of learning. Some of the barriers include:
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cost and time; lack of return on investment standards and methodology; and lack of skills
or sufficient staff, among others.
My third conclusion is that it appears that e-Learning technologies can help to automate a
portion of the return on investment processes and reduce overall costs of return on
investment calculations. This might help to increase the percentage of
programs/initiatives for which return on investment calculations will be completed in the
future.
Several writers have adjusted the learning evaluation frameworks to support the
evaluation needs of e-Learning. My final conclusion is that those frameworks may
provide enterprises with specific information which might help them to determine the
business impact of e-Learning initiatives. Some of the specific e-Learning metrics
mentioned include: e-Learning usage; learning catalog and vendor utilization; cost per eLearning course, among others.
One of the measurement metrics identified by a number of authors is the contribution of
e-Learning to shareholder value. As I have discussed in the previous section, it appears
that e-Learning might create shareholder value through reduced costs, enhanced revenue,
and so forth. According to Strassman and Pisello (2003, p13), “Competitive advantage
has progressed from those who know how to implement technology, to those who know
how to apply technology to improve business processes, to those who know how to use it
to share, manage and grow knowledge.”
Therefore, I suggest that creation of shareholder value through learning initiatives may
depend upon the implementation practices.
In Part A of my dissertation, The Theoretical Framework, I conducted an extensive
literature search and attempted to find answers to the following research questions:
•
•
•
•
What is e-Learning? (Chapter 2)
What causes organizations to invest in e-Learning? (Chapter 3)
What are the organizational capabilities for e-Learning, and which factors support
an effective e-Learning implementation? (Chapter 4)
Do e-Learning investments make business sense, and what instruments can
enterprises use to measure the business impact of investments in e-Learning?
(Chapter 5)
In Part B, The Research, I will describe my research methodology. (Chapter 6)
In Part C of this dissertation, The Conclusions, I will and share the results of my research
among different companies (Chapter 7 and 8), and summarize the findings of my overall
study (Chapter 9).
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Chapter Six
Research Methodology
6.0 Introduction
6.1 Overview of the Research Framework
6.2 The Theoretical Framework
6.3 The Empirical Research
6.4 Research Results
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6.0 Introduction
In Chapter 3, various authors indicated that business drivers appear to generate
investments in key targeted activities. Furthermore, business drivers are instrumental in
business growth, improved competitiveness and profitability, and increased value of the
business (Barksdale, 2002).
I have discussed the business drivers which focus primarily on knowledge and people,
and which have been identified by a number of authors as the most important business
drivers including: enterprise transformation; cost reduction, and time-to-competence
(e.g., Arevola & Lundy, 2003; Barksdale, 2002; Capelli, 2002; Cheese and Thomas,
2003; Moore, 2003; Porter, 1985; and, Yip, 2003). These drivers are most likely to relate
to investments in learning and specifically in e-Learning.
A significant body of literature suggests that investments alone in technologies or
capabilities do not provide the anticipated business results. As stated in Chapter 4: “It is
not just how much you spend, but what you invest in and how well it is managed that
counts” (Strassman and Pisello, 2003). A number of authors have suggested that
successful implementation of e-Learning requires investments in, and management of, a
number of organizational capabilities (e.g., Horton, 2001; Masie, 2001, Rosenberg,
2001). The most significant organizational capabilities for e-Learning identified and
discussed by a number of authors include: e-Learning culture; e-Learning design; eLearning technology; and performance management (e.g., Bielasweski and Evens, 2002;
Metcalf, 2003; Rosenberg, 2001; Russell, 2001; and, Spencer and Spencer, 2003).
Based on the business drivers and organizational capabilities identified by most of these
authors as discussed in Chapters 3 and 4, an e-Learning Business Framework can be
developed.
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Figure 6.1: e-Learning Business Framework
The design of the e-Learning Business Framework has two components: organization
capabilities and business drivers.
As shown in Figure 1, four categories of organizational capabilities can be identified
which are organized along 15 dimensions. The dimensions are derived from the theory
which has been discussed in Chapter 4 and are identified as critical success factors for eLearning implementations. Similarly, I have organized the identified business drivers into
four categories, but there is no further decomposition into dimensions.
In Chapter 1 of this dissertation, I proposed that the main goal of this study is to assess
the critical success factors that make e-Learning an effective business practice. The main
research questions which I have posted in this chapter were:
•
•
•
•
154
How can e-Learning be defined?
How do enterprises justify their investments in e-Learning?
What appear to be critical success factors for the implementation of e-Learning?
Which elements can make e-Learning an effective business practice?
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Based on the theory reviewed in the theoretical framework and the creation of the
e-Learning Business Framework, I formulated additional research questions which can
help to answer the main research questions of this dissertation.
The additional research questions are:
•
•
•
Which learning design components are used by companies in their e-Learning
programs?
Which of the 15 dimensions of organizational capabilities appear to be critical
success factors for e-Learning?
Which elements appear to play a role in making e-Learning an effective business
practice?
In order to formulate answers to these questions, I organized my empirical research in
two phases. The first phase consisted of an in-depth case research study among five
organizations which took place between January 2001 - December 2001. This phase
encompassed both interview questionnaires, with questions grouped into the eight
categories and fifteen dimensions of the e-Learning Business Framework (see Appendix
A). The research results from this phase will be discussed in Chapter 7: Results
Empirical Research - Phase I.
The second research phase comprised follow up research, which took place from July
2002 - November 2002. The main objective is this phase was to collect more specific data
in selected areas for 24 companies. The additional research questions in Phase II were
based on the outcomes of research Phase I (see Appendix B for research questions). The
research results from Phase II will be discussed in Chapter 8: Results Empirical Research
– Phase II.
In Section 6.1 of this chapter, I will provide an Overview of the Research Framework.
This will be followed by a brief overview of the different stages of the Research
Framework including: The Theoretical Framework (6.2), The Empirical Research (6.3)
and Research Results (6.4).
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6.1 Overview of the Research Framework
One of the first tasks of this study was to define a Research Framework. Figure 6.2 shows
the different stages of the research project:
1. Theoretical Framework: Section 6.2
2. The Empirical Research: Section 6.3
3. The Research Results: Section 6.4
Figure 6.2: The Research Framework
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6.2 The Theoretical Framework
During this phase of the study, I developed an e-Learning Business Framework (see 6.0
Introduction, Figure 6.1) based on a review of the literature and research data. This eLearning Business Framework was also informed by input gained from unstructured
interviews conducted with management and employees of diverse organizations who
have implemented e-Learning, or who are vendors of e-Learning solutions. Furthermore,
I spoke with a number of consultants who have been involved in e-Learning
implementation engagements and with clients in different stages of the e-Learning
implementation life-cycle. All these discussions took place as part of my day-to-day work
in my learning role.
Literature
Study
Research
Data
•
•
•
Interviews
Literature Chapters
e-Learning Business Framework
Questionnaires
Figure 6.3: Elements of Theoretical Framework
My personal experience in the transformation of my Firm’s classroom-based education
model to an e-Learning model, as well as my interaction with our clients and e-Learning
vendors has been very valuable during my entire study.
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6.3 The Empirical Research
As discussed in the introduction section, the empirical research has taken place in two
phases:
•
•
Phase I: In-depth Case Study Research among 5 Organizations, conducted
between January 2001 and December 2001
Phase II: Case Study Research among 24 Organizations, conducted between July
2002 and November 2002
I chose a process of case study for my research. According to Yin (1993), “case study (is)
the method of choice when the phenomenon under study is not readily distinguishable
from its context.” The phenomenon in my study is: the implementation of e-Learning.
The context is: e-Learning as an Effective Business Practice. Yin (1984/1985) argues that
case study as a research method does not imply any specific form of data collection and
can be either qualitative or quantitative.
In this section, I will describe the empirical research approach for both Phase I and II.
Research Phase I: Case Study Among 5 Organizations
In the first research phase, I completed assessments of organizational capabilities and
business drivers of the different categories and dimensions in the e-Learning framework.
Both the categories and the dimensions have been used for the development of the
interview questionnaires. The first questionnaire consists of a total of 109 open-ended
questions grouped into the eight categories and fifteen dimensions of the e-Learning
framework (see Appendix A: Phase I, Case Interview Questionnaire).
The main case research for my dissertation is in-depth research at a limited number of
five case companies and this occurred between January 2001 - December 2001.
The number of cases was constrained by my desire to collect intensive data from each
organizational unit. At the time of research, it appeared that only large enterprises had
begun to implement major e-Learning initiatives.
My requirements for case selection were:
•
158
Enterprises representing different industries
The literature provides some evidence that technology companies and/or
companies which have a relatively high human capital intensive business model,
might be early adaptors of e-Learning solutions. Therefore, I was interested in
exploring any differences of e-Learning adoption within enterprises representing
various industries.
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•
For-profit organizations
This thesis will focus on the business impact of e-Learning and a number of
business drivers will be assessed. Therefore, the selected cases were necessarily
for-profit organizations.
•
Minimum of 1,000 employees
In order to draw conclusions based on the defined research questions, I
determined to limit the research to larger organizations. The business drivers
required significant organizational capabilities and the business results might be
very different for small companies and therefore out of the scope of this
dissertation.
•
Minimum of two e-Learning courses implemented
In order to collect meaningful information, I wanted to be sure that the cases had a
minimum level of experience with e-Learning.
•
Senior-level Human Resources/Learning Leaders as interviewees
It was the objective to conduct the research among senior level of people who
could provide a broad business perspective regarding e-Learning initiatives.
In 2001, there were only a limited number of companies who met the case selection
requirements as early stage adopters of e-Learning solutions.
Table 6.1 provides an overview of the case company demographics.
Table 6.1: Case Company Demographics
Metric
Firm A
Firm B
Firm C
Firm D
Firm E
Name of
Company
Confidential
Confidential
Confidential
Confidential
Confidential
Confidential
Primary
Industry
Description
Professional
Services
Computer
Networks
Aerospace
Financial
Services
Pharmaceuticals
Number of
Employees
in 2000
#
10k–50k
10k–50k
>100k
10k-50k
>100k
Revenue in
2000
$
2B-15B
2B-15B
>20B
2B-15B
>20B
Profit in
2000
$
<1B
<1B
>1B
<1B
>1B
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Data Collection and Processing
I collected data during on-site personal interviews using the research questionnaire. Onsite visits were chosen because of the time commitment required from the interviewees,
the need to develop relationships for frank exchange of information, and to personally
review a number of e-Learning courses and learning technologies. All interviews were
recorded on tape for accuracy and interview effectiveness.
The interviews were conducted with one to two key leaders in the different organizations.
A requirement of the research methodology was that the selected interviewees were all in
charge of the e-Learning implementation in their organization and had a good
understanding of e-Learning strategies, experiences and the business implications.
I conducted all the interviews personally because of my knowledge and experience with
e-Learning. The next step was to review the recorded interviews and document the
answers from the questionnaire. Accordingly, I followed up with the interviewees to
validate their answers and to fill in gaps where necessary.
The next step was the development of a matrix entitled: Case Results Comparison (see
Appendix C). This matrix tabulates and compares the answers from the individual case
study organizations by category and, if applicable, a dimension, on each question.
Several of the questions captured information which is specific to the organization, such
as: Name of the Organization, Name of Person in HR/Learning, and so on. These
responses are not included in the Matrix Case Results Comparison for privacy reasons.
Table 2 shows the design outline for the Case Results Comparison Matrix.
Table 6.2: Design of Matrix Case Results Comparison (Appendix C)
Question
code
e.g. A.
Questions
by area
Overall
assessment
for category
Company
A
Range:
High –
Medium –
Low
Company
B
Range:
High –
Medium –
Low
Company
C
Range:
High –
Medium –
Low
Company
D
Range:
High –
Medium –
Low
Company
E
Range:
High –
Medium –
Low
e.g. A.a
(applies only
to
organizational
capabilities)
Overall
assessment
for
dimension
Range:
++ to --
Range:
++ to --
Range:
++ to --
Range:
++ to --
Range:
++ to --
e.g. A.a.1.
Question 1
Answer
Answer
Answer
Answer
Answer
e.g. A.a.2
Question 2
Answer
Answer
Answer
Answer
Answer
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Explanation of the Scoring
Question codes
The question identification codes used in this matrix are the same as those used in the
actual questionnaire.
Answers to questions
During the interviews, the first step was to write down the answers to the questions in the
matrix.
The answers fell into a number of categories:
Closed questions:
•
•
•
Yes or No (e.g., Are there plans to reinvent the training organization?)
Number (e.g., Number of employees to be trained?)
Choose from number of pre-coded answers. (e.g., Are the e-Learning programs
enhanced by {choose one}): a, b, c, d, e?)
Open questions:
•
Open answer (e.g., Description of e-Learning initiative?)
When responding to all questions, the interviewees provided additional explanations in
most of their answers, which were captured on the tape recording and reviewed with the
actual responses to refine the analysis.
The questions for the organizational capabilities were grouped into the 15 dimensions, as
shown in the e-Learning Framework.
Scoring the Responses
In order to provide a scoring value for each individual dimension, all the answers to the
questions included in one dimension were reviewed and compared across case study
organizations.
An overall scoring strategy for the dimensions was developed which uses the following
symbols and range:
++
+
0
--
: double plus (highest score)
: plus
: neutral
: negative
: double negative (lowest score)
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161
The next step was to determine the score for the 8 categories in the e-Learning
Framework.
The overall scoring of the categories uses the following symbols and range:
H
M
L
: High
: Medium
: Low
The method for scoring the organizational capabilities categories differed from the
scoring for the business drivers categories. In the organizational categories, it was
possible to determine the range for the overall score as a sum of the results on the
dimensions. There are no sub-dimensions included in the business driver categories. The
summary responses for the business drivers could be grouped without the support of
defining sub-dimensions.
Organizational Capabilities
The scoring of the organizational capabilities categories was determined by an overall
assessment of the score for all the dimensions within an individual category of the eLearning Framework.
A category is scored as:
High
Medium
Low
: if all total scores of dimensions for each category are:
++ with a maximum of 2 exceptions, which can be both +,
or one + and one 0.
: if all total scores of the dimensions for each category are: + with a
maximum of 2 exceptions, which can be either ++ or 0.
: if the overall scoring of all dimensions is neither
High nor Medium
The overall scoring of organizational capabilities for the implementation of e-Learning is
based on overall scoring of the categories as explained above. Points are assigned for the
overall scoring by scoring category, as following:
High
Medium
Low
= 4 points
= 2 points
= 0 points
There are 4 organizational capability categories:
•
•
•
•
162
e-Learning Culture
e-Learning Program Design
Performance Management
e-Learning Technology
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Therefore, the maximum number of points a case company can get is: 16 (4 times High
score multiplied by 4 points).
The overall scores for organization capabilities are determined by the number of points
and point ranges:
12 - 16 points = HIGH
6 - 11 points = MEDIUM
0 - 5 points = LOW
Business Drivers
The scoring of the individual business driver categories was determined by an overall
assessment of responses and the assigned values for the questions posed.
In order to determine the score value for a single category, all the answers to the
questions for each category were reviewed and compared.
Each category was scored as: High, Medium or Low. This is based on the summary
assessment of the answers to the individual questions in the category.
The overall summary score of the business drivers for the implementation of e-Learning
was based on the aggregated overall score of the 4 business driver categories. Points were
assigned for the overall scoring by scoring category:
High
Medium
Low
= 4 points
= 2 points
= 0 points
There are 4 business driver categories:
•
•
•
•
Cost Reduction
Time-to-Competency
People Commitment
Enterprise Transformation
Therefore, the maximum number of points a case company can get is: 16 (4 categories
multiplied by a High score 4 points)
The overall scores for business drivers are determined by the number of points and point
ranges:
12 - 16 points = HIGH
6 - 11 points = MEDIUM
0 - 5 points = LOW
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For a comprehensive comparison of the cases a Summary Case Results Comparison
Matrix has been developed (see Appendix D). A design format for this matrix is shown in
Table 6.3.
Table 6.3: Design Format of Summary Case Results Comparison (See Appendix D)
Question
Area
Category A
Company
A
Overall
Assessment
Range: HighMedium – Low
Company
B
Overall
Assessment
Range: HighMedium –
Low
Company
C
Overall
Assessment
Range:
HighMedium –
Low
Company
D
Overall
Assessment
Range:
HighMedium –
Low
Company
E
Overall
Assessment
Range:
HighMedium –
Low
Dimension A.a.1
Overall
Assessment
Range: ++/--
Overall
Assessment
Range: ++/--
Overall
Assessment
Range:
++/--
Overall
Assessment
Range:
++/--
Overall
Assessment
Range:
++/--
Dimension A.a.2
Overall
Assessment
Range: ++/--
Overall
Assessment
Range: ++/--
Overall
Assessment
Range:
++/--
Overall
Assessment
Range:
++/--
Overall
Assessment
Range:
++/--
Category B
Overall
Assessment
Range: HighMedium – Low
Overall
Assessment
Range: HighMedium –
Low
Overall
Assessment
Range:
HighMedium –
Low
Overall
Assessment
Range:
HighMedium –
Low
Overall
Assessment
Range:
HighMedium –
Low
Dimension B.a.1
Overall
Assessment
Range: ++/--
Overall
Assessment
Range: ++/--
Overall
Assessment
Range:
++/--
Overall
Assessment
Range:
++/--
Overall
Assessment
Range::
++/--
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Research Phase II: Case Study 24 Organizations
Phase II included follow-on research at 24 case organizations which took place from July
2002 - November 2002.
This research was limited to one specific e-Learning course or program. The second
questionnaire consists of 6 groups of questions which were linked to different categories
of the e-Learning Framework (see Appendix B: Phase II, Case Interview Questionnaire).
Table 64: Linkage of Questions to e-Learning Framework
Question Group
Category in e-Learning Framework
1. Introduction of e-Learning
e-Learning Design
2. Alignment of the program with
business strategies
Business Drivers
3. Design of the program
e-Learning Design
4. Deployment of the program
Organizational Capabilities:
• e-Learning culture
• e-Learning program design
• e-Learning technology
• performance management
5. The business impact of the program
Business Drivers
6. Implementation lessons learned
Organizational Capabilities:
• e-Learning culture
• e-Learning program design
• e-Learning technology
• performance management
The selection criteria for the 24 cases were the same as for the 5 case studies in Phase I
and included:
• Enterprises Representing Different Industries
• For Profit Organizations
• Minimum of 1,000 Employees
• Senior Level of Human Resources/Learning Leaders as Interviewees
A slightly different case selection criterion for Phase II included the requirement to have
implemented at least one e-Learning Program versus the minimum requirement for the
implementation of two programs in Phase I. The main reason was that the research of
Phase II focused on the implementation of this specific e-Learning program and therefore
there was no need to have a minimum of two programs.
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Data Collection and Processing
The first step was the identification and selection of case organizations. After agreement
to participate in the research, I provided the case organizations with the questionnaire,
and requested that they mail/email specific usable information regarding their approach
towards e-Learning and/or their specific e-Learning initiative.
Furthermore, I requested that they identify the right people to be involved in an interview.
The interview was set up as a conference call among several people from the case
company, myself and one or two additional people who supported the data collection.
The next step was to write down the answers. Accordingly, I followed up with all the
interviewees to validate their answers and to fill gaps where necessary.
Furthermore, I completed the case descriptions and consolidation of answers for all the
cases in a number of categories. The categories where driven from the questionnaire and
include:
•
•
•
•
•
•
•
Why e-Learning?
Business Drivers
e-Learning Culture
o Leadership Support
o Training Staff Support
o Learner Support
o Time for Learning
o Marketing & Promotion
Program Design
E-Learning Technology
o Technology Architecture
o Technology Maintenance and Support
o Technology Vendors
Performance Management
Effective Implementations:
o Project Management
o Phased Implementation
o E-Learning Intelligence
The next step was to develop a number of matrices and tabulate and match answers from
the individual case organizations to a number of answers.
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Table 6.5 shows the design for the Marketing Methods Matrix.
Table 6.5: Design Matrix Marketing Methods
Case\Marketing Method
Case 1
Marketing
Method
A

Marketing
Method
B
Case 2
Case 3
Marketing
Method
Z

Total Number of
Marketing
Methods Used
2


2



3
2
2
3
Case 24
Total number of answers by Case
Organizations
Explanation of the Marketing Methods Matrix
The checkmark sign is used to indicate that an answer has been given in one of the
answer categories. The total number of answers is the summary of the number of
checkmark signs in the columns and the rows.
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6.4 The Research Results
The results of the empirical research will be discussed in Chapters 7 (Phase I) and 8
(Phase II).
In Chapter 9, I will answer the main research questions of the dissertation:
•
•
•
•
How can e-Learning be defined?
How do enterprises justify their investments in e-Learning?
What appear to be critical success factors for the implementation of e-Learning?
Which elements can make e-Learning an effective business practice?
In order to answer and discuss the questions above, I will review all the information that
has been gathered and learned from the empirical research and the development of the
theory in the theoretical framework. I will draw conclusions about the individual
organizations and provide recommendations based on my research.
The world of e-Learning is still very new and the object of study has been limited. As in
every study, more questions are raised than answered. Therefore, I have made
recommendations for future research.
Timeframe
The dissertation was conducted between January 2000 and January 2005.
The timeline by activities:
•
•
•
•
•
168
Literature Study: January 2000 – October 2004
Research Phase I: January 2001 – August 2001
Research Phase II: July 2002 – November 2002
Data Analysis: September 2001 – December 2003
Writing Dissertation: August 2001 – December 2004
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Chapter Seven
Results Empirical Research:
Phase I
7.0 Introduction
7.1 Overview of Research Case Studies
7.2 e-Learning Culture
7.3 e-Learning Design
7.4 Performance Management
7.5 e-Learning Technology
7.6 e-Learning and Business Drivers
7.7 Concluding Remarks
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7.0 Introduction
In this chapter, I will discuss the empirical research results derived from the case studies I
conducted. This will include, as mentioned in the previous chapter:
•
Phase I: In-depth Case Study Research among 5 Organizations conducted
between January 2001 and December 2001
In Section 1, I will provide an overview of the demographics of the case studies,
information about the learning function (including learning financials), as well as
information about the e-Learning initiatives.
In the following sections of this chapter, I will discuss the empirical research results,
which are organized by organizational capabilities and business drivers and which were
derived from the e-Learning Business Framework. The e-Learning Framework was used
as a foundation for the development of the questionnaires.
A summary of the results regarding organizational capabilities for e-Learning will be
reviewed in the following sections:
7.2 e-Learning Culture
7.3 e-Learning Design
7.4 Performance Management
7.5 e-Learning Technology
e-Learning and Business Drivers will be covered in Section 7.6. I will complete this
chapter with Concluding Remarks, Section 7.7.
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7.1 Overview of Research Case Studies
In the first research phase, I completed assessments of the organizational capabilities and
business drivers of 5 case companies.
Table 7.1 indicates that the case companies, labeled from A-E, represent different
industries, and that the number of employees in these companies ranges from 10,000 to
more than 100,000. Three out of the five companies could not provide the average
number of training hours per year that each employee is involved in formal learning. The
main reason this information could not be accessed is the absence of information systems
and processes in the specific companies to track and report this data.
However, four companies were able to provide the average learning costs per employee,
ranging from $566. to $5,447. Also, four of the case companies expect that their future
learning budget will decrease, while only one company expects that this will remain the
same. One company does not have data on learning investments, and therefore was not
able to provide a breakdown of the learning budget. Looking at the distribution of the
learning budgets of the other four companies, it appears that there are significant
differences in spending in the following categories:
•
•
•
172
e-Learning: Ranges from 10% - 58%
Classroom training (including travel): Ranges from 30% - 84%
Education function: Ranges from 8% - 41%
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Table 1: Company and Learning Function Profile
Company Data
Metric
Firm A
Firm B
Firm C
Firm D
Firm E
Primary Industry
Description
Professional
Services
Computer
Networks
Aerospace
Financial
Services
Pharmaceuticals
Number of
Employees in 2000
#
10k–50k
10k–50k
>100k
10k-50k
>100k
Revenue in 2000
$
2B-15B
2B-15B
>20B
2B-15B
>20B
Profit in 2000
$
<1B
<1B
>1B
<1B
>1B
Firm A
Firm B
Firm C
Firm D
Firm E
NA
40
NA
NA
Learning Function
Average number of
learning hours per
employee (2000)
#
100
Average learning
costs per employee
$
5,447
566
3,857
NA
1,375
Percentage of payroll
spent on learning
(2000)
%
5.5%
NA
NA
NA
NA
Increase/decrease of
future learning
budget
Budget
Direction
Decrease
Decrease
Decrease
Decrease
Same
Budget distribution:
a. e-Learning
b. Classroom
Learning
c. Travel &
expenses for
classroom
learning
d. Education
function total
Total %
%
11
51
30
58
30
Included
in b.
12
10
75
5
NA
NA
NA
23
36
Included in
b.
10
NA
8
41
100%
100%
100%
NA
100%
e-Learning was launched in all of the 5 case companies between 1998 and 2000. The eLearning function in all of these companies is centralized by geography, business unit or
on a global level. The total number of courses offered to the workforce in 2000 varied
from 6 to 2,000. This indicates that the adoption of e-Learning in the organizations varied
widely over this period of time.
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In addition to overall information on organizational capabilities and business drivers, I
gathered information on one e-Learning initiative in each company. The focus of the
different e-Learning initiatives includes: e-Business Certification Program; Brand Launch
Program; Learning Portal; Courses to support New Product Launches; and a program
called Managing the P&L.
The overall learning investment levels differ for these initiatives from $17,000 to $2
million, because the targeted audience size and the scope of the initiatives as shown in
Table 7.2 differed. The success of the e-Learning initiatives was measured in four of the
companies by looking at the number of employees who completed a test. One company
looked simply at the number of courses that were downloaded and the number of portal
hits, as an indication of e-Learning interest and usage.
Table 7.2: e-Learning Initiative in the 5 Case Organizations
Company
Metric
e-Learning
Initiative
Firm A
Firm B
Firm C
Firm D
Firm E
Course:
e-Business
Certification
Program
Course:
Launch of
Brand
Launch of
Learning
Portal
Course:
Launch of
New
Products
Course:
Managing the
P&L
Employees to be
trained
#
12,000
1,000
70,000
800
300
Countries
#
34
60
2
2
2
$
$
2M
166
50,000
50
2M
29
160,000
200
17,000
56
# of
hours
32
1
Different
per course
12
2
Pass test
Pass test
Downloads
& portal
hits
Pass tests,
portal hits
and
interaction
Pass tests
College and
50%
advanced
degree
College
College
degree
90%
College or
advanced
degree
90% College
and 10%
advanced
degree
Investment in
initiative:
• overall
• per
person
Average course
duration
Methods of
measurement
Level of
education in
target audience
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7.2 e-Learning Culture
In this section, I will discuss the research results on a number of dimensions of eLearning culture for the 5 Case Companies including: technology orientation; usage of
technology in learning; leadership support; incentives for participation; and change
management. In addition to this, I will provide the results of the different marketing and
promotion methods used by the 24 Case Organizations.
As discussed in Chapter 4, one of the assumptions for establishing an e-Learning culture
is that a necessary technology infrastructure is in place, that people have sufficient access
to this infrastructure and that people know how to use the technology. Additionally, the
penetration of e-Learning applications within and outside the classroom also impact the
e-Learning culture.
Technology Orientation and usage of Technology in Learning
The results from the 5 company case studies indicate that between 95% and 100% of
employees have their own computers at work, and have access to the Internet/intranet.
Accessories for computers at work, (including CD-ROM drives, modems, soundcards,
speakers and headsets), are available for most employees in three of the five companies.
Major software applications are used by the majority of senior management, although one
company says that computer literacy of their senior management varies.
Technology is used by all organizations outside of the classroom. The adoption and
integration of technology within the classroom was established in only two of the five
organizations. The other three organizations have just started with this.
The research in this section provides some evidence that an existing technology
infrastructure and wide-spread computer literacy and access, along with current usage of
technologies in learning, support an e-Learning culture in four of the five case
companies, and to a lesser extent in one company.
Leadership Support
The theory discussed in Chapter 4 suggests that it is critical to gain positive support from
leadership for e-Learning initiatives.
The evidence of interest in learning from leadership might be visible in several different
ways. Three companies established a Learning Council/Governance Board in which
business leaders participate and provide direction for the overall learning function. In all
five of the companies, senior management provides a coach function to support learning
and development of leadership. Championship and support of e-Learning appears to be
influenced by the experience that leadership has with e-Learning. In all but one company,
leadership participated in e-Learning programs.
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175
Another interesting aspect is whether leadership provides people with time during
business hours to engage in e-Learning programs. Only two companies provide
employees with some time. The three other companies expect people to take e-Learning
on their own time.
Incentives for Participation
Literature discussed in Chapter 4 suggests that it is important that people are rewarded for
acquisition of desired competencies. However, research results indicate that there are
none, or very limited incentives, for employees to start or complete courseware. As an
example, just one company recognizes employees who have completed an e-Learning
course with a small gift. None of the companies provide their people with direct financial
rewards, e.g., bonuses. Although, from a number of employees it is expected that they
complete e-Learning course(s) outside of business hours, enterprises do not recognize
employees for participation in courses taken after work. Finally, employees do not
receive credits for taking e-Learning courses.
Change Management
Literature reviewed in Chapter 4 suggests that the shift toward an e-Learning approach
may cause resistance among different constituencies and could therefore cause eLearning implementations to fail. Therefore, it is argued that a change management
strategy should be an integral part of an e-Learning implementation (Rosenberg, 2001).
Four of the case companies have a plan in place to reinvent the education function and
transform this to a function which can support e-Learning initiatives. All companies are
optimistic about the motivation of their employees to participate in e-Learning. However,
only two organizations believe that there is an organizational climate which supports
learning in the workplace. This implies that e-Learning would not be an approved activity
during work hours. Furthermore, only two companies have developed a change
management plan to support the introduction of new e-Learning initiatives.
Conclusions on e-Learning Culture
The overall results for the different dimensions of an e-Learning culture have been scored
for the five companies in Table 7.3. The method for scoring was explained in Chapter 6:
Research Methodology.
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Table 7.3: Overall Assessment of e-Learning Culture
COMPANY
Firm A
Firm B
Firm C
Firm D
Firm E
Technology orientation
++
++
+
+
+
Use of Technology in
Learning
++
+
+
+
0
Leadership Sponsorship
++
+
+
++
+
Incentives for participation
0
0
-
-
-
Change Management
+
+
+
+
+
Overall Assessment:
e-Learning Culture
High
High
Medium
Medium
Medium
First, based on the results in this matrix, one might conclude that two of the companies
have a high score on e-Learning culture and three companies have a medium score.
Summarized, detailed results for all questions for the 5 companies can be reviewed in
Appendix C: Phase 1, Case Results Comparison.
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177
7.3 e-Learning Design
In this section, I will discuss the results on several dimensions of e-Learning design for
the 5 case companies including: personalized content; collaboration and feedback;
quality; and support and enhancements. In addition to this, I will provide the results on
the usage of different learning solutions for the 24 case organizations.
Personalized Content
In several sections concerning the Theoretical Framework it is argued that one of the
benefits of e-Learning is that e-Learning programs can be customized to support the
individual and unique needs of the learners. The research results indicate that none of the
e-Learning programs included in this research could be customized based on personal
needs or after a pre-assessment test. I suggest that e-Learning program design knowledge
was probably at an early stage of development at that time. However, all except one
company, allowed people to access program learning modules or chunks of information
on an as-needed basis. Additionally, employees of four companies could test-out learning
content before taking the entire program. This speaks to a certain level of personalization
of the learning experience.
Collaboration and Feedback
In Chapter 2, I proposed that the e-Learning solutions, online collaboration and feedback,
be included in my definition of e-Learning. These solutions use the Internet for learning
purposes and can be very effective if included in the overall design of e-Learning
programs. Table 7.4 shows the results from the case companies on questions regarding
the usage of collaboration and feedback features in their e-Learning program.
The results indicate that only one company provide synchronous (= live) e-Learning for
their employees. Coaching and feedback features are included in the program in a limited
way for two companies, and are unavailable for the other companies. The option to
interact with classmates or trainers/lecturers is not available for 3 companies and is only
available in a very limited way for the other two (See Table 7.4). Only one company says
that participants are encouraged to create and share knowledge online as part of an eLearning program while another company indicates that this depends on the type of eLearning program. Finally, all companies use online evaluations to determine the quality
of the e-Learning program.
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Table 7.4: Collaboration and Feedback
COMPANY
Firm A
Firm B
Firm C
Firm D
Firm E
Limited
No
Limited
Limited
No
Interaction with
classmates
No
No
Very
limited
No
No
Interaction with
trainers/lecturers
No
No
Very
Limited
Limited
No
Synchronous eLearning available
No
No
No
Yes
No
Participants
encouraged to create
and share knowledge
Not in online
sessions
No
Depends
on
programs
No
Yes
Kind of evaluation for
e-Learning
Online
evaluations
Online
evaluations
Online
evaluations
Online
evaluations
Online
evaluations
Including coaching
and feedback
features
Quality of e-Learning
Different authors suggest that high quality e-Learning should include instructional design
methods that address specific training goals and are appropriate to the learner’s
characteristics. Additionally, the courseware should be aligned with the unique
organizational environment (e.g., Clark, 2003). The relevancy of the course content
appears to be highly important for the learner. To that extent, the research results show
that all the e-Learning programs include credible and up-to-date experiences and stories
for the learners. Furthermore, the results provide evidence that the content of e-Learning
programs have been presented at an appropriate level of detail and all of the programs are
perceived as real by the learner. There is only one company which does not engage
internal subject matter experts in the content creation and approval process. Depending
on availability of other resources, this might have an impact on the overall design quality
and value of e-Learning for this company.
Support and Enhancements
E-Learning program designers can chose to provide their learners with additional eLearning program support by giving them access to online resources such as, mentors,
help-desks, and on-line instructors. Other enhancements of e-Learning programs might
include integration of learning content from different vendors. Additionally, e-Learning
programs can be enhanced by using design features which are enabled by technology
such as, instant messenger, and streaming video among others.
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179
All of the 5 case companies indicate that their e-Learning program design has taken
advantage of design features enabled by technology. Though, I believe that the level of
leverage on these features differs. Three companies include courseware from other
vendors in their learning program. Just two companies say that they have included online
resources and help desk support in the learning experience.
Conclusions on e-Learning Design
The overall results for the different dimension of e-Learning Design have been scored for
the 5 case companies in Table 7.5. The method for scoring has been explained in Chapter
6: Research Methodology.
Table 7.5: Overall Assessment e-Learning Design
COMPANY
Firm A
Firm B
Firm C
Firm D
Firm E
Personalized
Content
+
+
+
+
0
Collaboration and
Feedback
-
-
-
-
-
Quality
++
++
+
++
++
Support and
Enhancement
+
0
+
0
0
High
Medium
Medium
Medium
Low
Overall
Assessment:
e-Learning
Program Design
First, based on the results in this matrix, I have concluded that one company scores high
on e-Learning Design while three other companies have a medium score. Just one
company has a low score. Summarized detailed results for all questions for the 5
companies can be reviewed in Appendix C: Phase 1, Case Results Comparison.
180
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7.4 Performance Management
In this Section, I will discuss the results on a number of dimensions of performance
management for the 5 Companies including: competency management; assessment and
testing; and links to performance management.
Competency Management
Many studies suggest that high performers have the required competencies and therefore
know how to do things more productively than others. According to the theory discussed
in Chapter 4, competency based performance management systems support the
development of people. One critical component of competency management is to embed
the desired competencies in a framework, known as a competency model.
The research results on the 5 case companies show that only one company has a
competency model in place which specifies competencies by job level and role (see Table
7.6). None of the companies have set competency goals for the entire enterprise, business
unit and/or individual level. According to Spencer and Spencer (1993) one of the steps
for the development of a competency based training and development program is the
development of a training curriculum.
The research results indicate that just one company has developed an e-Learning
curriculum based on a competency model or framework. Performance on competency
goals has not been measured in any of the companies. The only aspect being measured by
the case companies is job performance. Therefore it appears to me that the majority of the
companies are in the very early stages of adopting competency management and aligning
this with learning.
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181
Table 7.6: Competency Management
COMPANY
Firm A
Firm B
Firm C
Firm D
Firm E
Existence of competency
model in place, which
specifies competencies by
job level and role
Yes
Limited
Limited
No
Limited
Competency goals set for
the entire enterprise,
business units and or
individual levels
No
No
No
No
No
e-Learning curriculum
determined by the
competency model
Yes
Limited
No
No
No
Requirement for a minimum
number of e-Learning hours
Yes
No
No
No
No
Competency goals
measured
No
No
No
No
No
Job performance measured
Yes
Yes
Yes
Yes
Yes
Assessment and Testing
According to Slotje (2003) different forms of assessments and feedback can play a role in
performance management. The company research results provide some evidence that
there is very limited usage of pre- and post-assessment of e-Learning linked to a course.
However, all companies use 360°/upward feedback initiatives as well as certification
tests. For the evaluation of an e-Learning course experience, only two organizations use
Level 3 - transfer of skills and knowledge. Two other companies only look at Level 1 and
2 evaluations - reactions and learning improvement, while one company only evaluates
reactions - Level 1.
Links to Performance Management
One of the goals of performance management is to reinforce and reward effective
behavior and progress towards goals (Spencer and Spencer, 1993). The research results
indicate that there is only one company where test results or completion of tests have an
impact on performance ratings, and this is the only implication for employees from this
company who do not comply with e-Learning requirements.
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Conclusions on Performance Management
The overall results for the different dimensions of performance management have been
scored for the 5 case companies in Table 7.7. The method for scoring has been explained
in Chapter 6: Research Methodology.
Table 7.7: Overall Assessment Performance Management
COMPANY
Firm A
Firm B
Firm C
Firm D
Firm E
Competency
Management
+
0
-
-
-
Assessment
and Testing
+
0
+
++
+
Link to
Performance
Management
++
-
-
-
-
Overall
Assessment:
Performance
Management
High
Medium
Low
Low
Low
First, based on the results in this matrix, I have concluded that only one company scores
high on performance management, while the three other companies have a low score.
One company has a medium score (See Table 7.7). Therefore, it appears that performance
management is an organizational capability that is still in an early stage of adoption
within companies.
Summarized detailed results for all questions for the 5 case companies can be reviewed in
Appendix C: Phase 1, Case Results Comparison.
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183
7.5 e-Learning Technology
Many authors (e.g., Masie, 2001; and, Sanders, 1997) suggest that e-Learning
technologies are a critical organizational capability for e-Learning, because learner
satisfaction is impacted significantly by the type of e-Learning technologies selected,
integrated and supported. In this Section, I will discuss the results on a number of
dimensions of e-Learning Technologies for the 5 Companies, including: Learning
Management Systems; User Friendliness; and, Technology Support.
Learning Management System
A Learning Management System (LMS) manages the interaction between users and
learning resources and is considered a key capability for companies who want to use and
manage e-Learning (e.g., Rosenberg, 2001). All 5 companies have implemented a
Learning Management System, but one company has indicated that their Learning
Management System has limited functionality and is not scaleable to support potential
future growth of the number of employees.
The functionality of an LMS can differ significantly, which might have an impact on the
overall learning experience for the employees. Table 7.8 summarizes the learning
management system functionality that has been implemented in the 5 companies. Very
basic functionality is in place for all the companies. However, more advanced
functionality like competency assessment and management, skill management, and career
tracking is not used by any of the companies.
The learning management system is integrated with Knowledge Management in only one
company, and only one company uses the LMS for management of learning materials.
One of the companies has an LMS in place which can not manage programs from
different learning vendors or e-Learning that has been developed with different authoring
tools. For three out of the five case companies the LMS does not work seamlessly with
other corporate information systems.
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Table 7.8: Implemented Learning Management System Functionality
COMPANY
Firm A
Firm B
Catalog, course
and class
management;
Course registration
and launching and
tracking of eLearning
Learning
assessments
Yes
Yes
No
Competency
assessments
No
Management of
learning materials
No
Facilities and
resource
management
No
Competency-, skill
management &
career tracking
No
Certification
Tracking
Firm D
Firm E
Yes
Yes
Yes
Yes
Done
manually
Yes
Yes
No
No
No
No
Yes
No
No
No
Yes
No
Yes
No
No
No
No
No
Yes
Yes
No
Yes
Yes
Integrated
Knowledge
Management
No
Yes
No
No
No
Course Evaluation
Yes
No
Done
Manually
Yes
No
Course pre-testing
No
Yes
No
Yes
Yes
Reporting and
Financial
Management
Yes
Yes
Yes
Yes
Yes
Can manage
programs from
multiple vendors
and authoring tools
Yes
Yes
Yes
Yes
No
Limited
Yes
Yes
No
No
LMS works
seamlessly with
other corporate
systems
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Firm C
185
User Friendliness
One of the factors which drives learner satisfaction with e-Learning is ease of mastery of
the technology by the user (Masie, 2001). Table 7.9 shows the results on some
dimensions of user friendliness of the learning systems. Only one company’s e-Learning
system enables users to customize the interface and their learning paths to meet their
unique profile. e-Learning content cannot be adjusted to support different connection
speeds in any of the case companies.
One of the implications of these factors is that people who do not have high speed
connections (e.g. DSL) might have a difficulty accessing some of the e-Learning
programs, and/or the quality of e-Learning design will be limited. The interviewed
Learning Executives scored their system interface on easy and intuitive use for
employees and learning administrators (scale of 1-5, 5 = easiest). Only one company has
a relatively high rating on this dimension. Three companies do not use industry standard
plug-ins for their e-Learning courseware potentially causing technical problems once they
employ different courseware from multiple vendors. However, all learning systems can
serve learning participants outside the firewall.
Table 7.9: User Friendliness
Factor
e-Learning system
interface easy and
intuitive
Firm A
3
Firm B
2.5
Firm C
3.5
Firm D
4
Firm E
4.5
e-Learning system
enables users to
customize
Limited
Yes
No
No
No
e-Learning content can
be adjusted to
connection speed
No
No,
Course
developed
for 28.8K
No
No,
Course
Developed
for
28.8K
No
System responds in dial
up mode
3
5
5
4
5
System serves
participants outside the
firewall
Yes
Yes
Yes
Yes
Yes
Learning platform uses
industry standard plugins
No
Yes
No
Yes
No
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Technology Support
Horton (2001) says that technical complexity frustrates, distracts and discourages
learners. Therefore he proposes that organizations plan for technical support.
All companies have set up a technical help-desk to support the learners. The kind of
support from the technical help desks differs, e.g. there is one company which has a help
desk in three different time zones and provides support for about 16 hours a day. Another
company only allows their e-learners to send an email to a mailbox. Four companies
make use of online support that has been provided by the e-Learning vendors.
Conclusions on e-Learning Technology
The overall results for the different dimensions of e-Learning Technology have been
scored for the 5 case companies in Table 7.10. The method for scoring has been
explained in Chapter 6: Research Methodology.
Table 7.10: Overall Assessment e-Learning Technologies
Factor
Learning
Management
System
Firm A
+
Firm B
++
Firm C
+
Firm D
+
Firm E
0
User Friendly
0
+
+
+
+
Technology
Support
+
+
+
+
+
Overall
assessment:
e-Learning
Technology
Medium
High
Medium
Medium
Medium
Based on the results in this matrix, one might conclude that only one company has
relatively high end e-Learning technologies and support in place. It seems like there are
opportunities to improve the user friendliness and the technology support for the eLearning systems. Additionally, is seems that none of the companies have activated all
functionally that is available within their Learning Management System.
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7.6 e-Learning and Business Drivers
In Chapter 3, business drivers instrumental in business growth, improved competitiveness
and profitability and in increased value of the business were described (e.g., Barksdale,
2002). Furthermore, it has been suggested that e-Learning initiatives can support business
drivers, and that business drivers have an impact on decisions to invest in e-Learning.
In this Section, I will discuss the results for a number of business drivers for the 5
companies including: cost reduction; time-to-competence; people commitment; and
enterprise transformation.
Cost Reduction
Cost reduction is a business driver which leads to competitive advantage for enterprises
(e.g., Driscoll, 2002; Horton, 2001; and, Porter, 1985). It has been proposed in Chapter 3
that e-Learning can play a role in reducing costs for enterprise-wide learning.
In order to determine the potential cost reduction, which can be achieved by
implementing e-Learning, one must compare the costs of delivering a program in eLearning format, with the costs for delivering the same program in a classroom format. A
number of different cost categories are included in a classroom learning event, including:
travel; hotel and expenses; course organization; course registration; course evaluation;
facility costs; instructors; time-off-job; and, course material and production. Three
companies were not able to provide classroom costs broken down into the cost categories
mentioned, because these costs were not captured in information systems and/or were
difficult to consolidate from different sources. Only two companies were not able to
provide a total cost estimate if the learning program had been delivered in a classroom
format.
However, they expect that the costs for the delivery of their e-Learning program in a
classroom format would have been much more expensive compared with the e-Learning
delivery. All companies were able to provide the costs per employee for the e-Learning
program, which ranged from $29 to $216. These figures suggest that there is evidence
that delivery of the program in e-Learning format led to cost reduction or cost avoidance.
Time-to-Competence
Arevola & Lundy (2003) among others, suggest that the speed at which enterprises can
transfer knowledge and build new capabilities is an important business indicator. I
suggested in Chapter 3 that time-to-competence can be increased by using e-Learning to
support the achievement of specific business goals.
The research results for one of the companies’ show that only 30% of the targeted
employees enrolled for the e-Learning program (see Table 7.11). However, the
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enrollment percentage for the other companies varied from 80% to 100%. Once enrolled,
it is important to know the percentage of employees who have completed the program.
This varied from 75 to 100% for the companies with relatively high enrollment
percentage, but only 30% for the company with relatively low e-Learning enrollment.
One metric for measuring time-to-competence is the time period for completion of the eLearning program. This ranged from one to nine months. One company indicated that
they had no information regarding time for completion of the e-Learning program.
Employees of the company who launched the more extended, 32 hour, e-Learning
program had 9 months for completion.
Table 7.11: Time-to-Competence
Factor
Metric
Firm A
Firm B
Firm C
Firm D
Firm E
Enrollment
Percentage
%
100
30
80
100
100
Completion
Percentage
%
95
30
75
100
100
Time period
for
completion
of the
program
Months
9
1
Not
applicable
3
2
People Commitment
Capelli (2002) suggests that retaining knowledge workers is an important competitive
advantage for enterprises, and people commitment plays an important role in this area. It
appears from the theory in Chapter 3, that e-Learning can play a role in maximizing
people’s commitment through the enhancement of learning capabilities.
Some indicators of people commitment include: a low percentage of voluntary turnover;
ease in attracting employees; and relatively high scores on employee satisfaction surveys.
Table 7.12 shows that most of this information is not available for the case companies.
The companies indicated that they have not implemented HR processes and/or
management information systems which would support the collection and analysis of this
type of data.
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Table 7.12: People Commitment
Factor
Metric
Voluntary
employee
turnover in:
• 199
8
• 199
9
• 200
0
%
Average
hiring time
for nonadministrati
ve
resources
Months
Firm A
Firm B
Firm C
Firm D
Not
available
Not
Available
Not
Available
2
Not
Available
Not
Available
Not
Available
Not
Available
Not
available
Not
Available
Not
Available
Lack of
Professional
Development
/Learning is
one of top 3
reasons for
leaving the
company
Not
Available
19
20
19
Results of
employee
satisfaction
survey
Firm E
2.2
Enterprise Transformation
Many authors argue that enterprises are experiencing increasing pressure to create
shareholder value, and therefore need to transform themselves to achieve extraordinary
goals (e.g., Moore, 2003; Cheese and Thomas, 2003; Yip, 2003). It is suggested in
Chapter 3, that e-Learning can support strategic business goals, thereby transforming the
enterprise.
Examples of specific business goals include: implementing new business models;
supporting a merger or acquisition; entering new markets; launching new
products/services; implementing new information technology systems; e-enabling the
workforce; globalization; and, implementation of e-commerce.
Table 7.13 shows that all e-Learning initiatives in the case companies supported at least
one specific business goal.
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Table 7.13: Enterprise Transformation
Factor
Firm A
Firm B
Firm C
Firm D
Firm E
Did the e-Learning initiative
support a specific strategic goal/
objective of the company?
a. implementation of new
business models


c. entering new markets


d. launch of new
products/services


b. support merger or acquisition
Developing
Brand


e. implementation of new IT
systems
f. e-enabling the workforce


g. globalization


h. Implementation of ecommerce


Conclusions on e-Learning and Business Drivers
The overall results for e-Learning and Business Drivers have been scored for the 5 case
companies in Table 7.14. The method for scoring has been explained in Chapter 6:
Research Methodology.
Table 7.14: Overall Assessment of e-Learning and Business Drivers
Business Driver
Firm A
Firm B
Firm C
Firm D
Firm E
Cost reduction
++
+
++
+
++
Time-to-competence
++
+
++
+
+
People commitment
0
0
0
0
0
Enterprise Transformation
yes
Yes
yes
yes
yes
Overall Assessment:
Business Drivers
High
High
High
High
High
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The research results summarized in this Section provide evidence that e-Learning
initiatives aid enterprises to reduce costs, decrease the time-to-competence of new skills,
and enterprise transformation. However, most of the companies did not have information
available to the survey questions regarding people commitment. Additional inquiries
indicated that the case companies believe that people commitment is a very important
business driver, but they have not entirely implemented the processes, systems and/or
metrics, which provide quantitative evidence of the impact of e-Learning on people
commitment.
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7.7 Concluding Remarks
In this chapter, I have presented the empirical research results derived from the 5 in-depth
company case studies included in the Phase I Research.
I have organized the results by the 15 dimensions of organization capabilities and for all
five business drivers. All organizational capabilities, including the sub-dimensions and
the business drivers, were included in the e-Learning Business Framework, which was
discussed in Chapter 6.
Table 7.15 shows a summary of the overall results for the different organization
capabilities and business drivers. A more detailed view is provided in Appendix D:
Summary Results, Case Comparison Matrix.
Table 7.15: Summary Case Results by Organization Capability and Business
Drivers
Factor
Organization
Capability:
• e-Learning
culture
• e-Learning
program
design
• Performanc
e
manageme
nt
• e-Learning
technology
Firm A
Firm B
Firm C
Firm D
Firm E
High
Medium
Medium
Medium
Low
Medium
Medium
Medium
Medium
Low
High
Low
Low
Low
Low
Medium
High
Medium
Medium
Medium
High
Medium
Medium
Medium
Low
High
High
Medium
Medium
High
Medium
Medium
High
Medium
High
Medium
Medium
Medium
Medium
Medium
High
High
High
High
High
High
Overall Score
Business Drivers:
• Cost
reduction
• Time-tocompetenc
e
• People
commitmen
t
• Enterprise
transformat
ion
High
High
High
Medium
Overall Score
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Summary Scores of Organizational Capabilities
While reviewing the overall results on organizational capabilities, it is important to keep
in mind that the summary results have been aggregated at a highest level. The scores on
individual dimensions of organizational capabilities differ among the case organizations,
as shown in the various tables in this chapter. The scores on individual organizational
capabilities range among the different cases from Low to High. This might indicate that a
specific organizational capability is less or more utilized within the different case
organizations.
An example of this is the organizational capability e-Learning culture, where the case
organizations scores on the continuum range from low and medium to high.
Alternatively, there are no case companies with a high score for the organizational
capability e-Learning Design. I assume that this might have to do with the early stage of
development of this capability within the case organizations, and the fact that e-Learning
design is relatively a new field of expertise and research, as discussed in Chapter 2 and
Chapter 4.
The organizational capability Performance Management received a low score for all
except one case organization. Therefore, it appears that case organizations are still in an
early stage in developing this capability and one could conclude as well that
organizations can implement e-Learning successfully without having this capability fully
developed. e-Learning Technology did not get a low score among the case organizations.
It appears that all case organizations to a large extent have the necessary e-Learning
technology capabilities in place to support e-Learning.
The overall scores for organizational capabilities for the case organizations show one
company with a low score, one company with a high score, and three case organizations
with a medium score. The case company with the highest overall score on organizational
capabilities is part of an industry which is very human capital intensive and appears to be
knowledge intensive as well. This might explain why more investment has been made in
developing organizational capabilities to support e-Learning.
Summary Scores of Business Drivers
The research results show that there are no low scores for any of the identified business
drivers. All case organizations have shown a high score for the business driver Enterprise
Transformation. Cost Reduction and Time-to-Competence show medium and high scores
among the different case companies. People Commitment received the relatively lowest
score as a business driver for e-Learning. As discussed before, the main reason for the
lack of evidence on the importance of people commitment as a business driver for eLearning is that companies have not implemented the requisite combination of processes,
systems and/or metrics.
Four out of five companies indicate an overall high score for business drivers and only
one company has a medium score. Therefore, I conclude that it is likely that all the
identified business drivers might play a role in investment decisions for enterprises.
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Summary Organizational Capabilities and Business Drivers
There are three companies (Companies C, D and E) with high scores on business drivers,
but medium or low scores on organizational capabilities. This indicates that there are
existing business drivers to support potential investments in e-Learning solutions, but
those organizations have not yet developed the organizational capabilities to provide
maximum support for successful e-Learning implementation. One case company (B) has
a medium score on both business drivers and organizational capabilities which appears to
be in balance. Similarly, one case company (A) shows high scores on both business
drivers and organizational capabilities.
In Chapter 6, I proposed three research questions which define the main questions of this
dissertation.
The first question is:
•
Which learning design components are used by companies in their e-Learning
programs?
The research results from the five companies in this chapter suggest that companies are
using self paced e-Learning (asynchronous learning) as their primary learning solution.
The inclusion of other learning design components such as, online coaching and
feedback, and synchronous e-Learning, are non-existent in four of the case companies. It
is my assumption that the companies are still early in the adoption phase of e-Learning
and therefore did not have a lot of exposure to other design components which could
enhance the quality of the e-Learning program, as discussed in the Chapters 2 and 4.
Therefore, I will explore this research question again in Phase II for the 24 case
organizations.
The second defined research question in Chapter 6 is:
•
Which of the 15 dimension of organizational capabilities appear to be critical
success factors for e-Learning?
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195
Table 7.16 ranks the overall scores for all the companies on the dimensions of
organizational capabilities. The highest possible score is 10 points for one dimension.
Table 7.16: Overall Scores on Dimensions of Organizational Capabilities for All
Companies
Ranked by
highest
score
1
Dimensions
Organization Capability
Total
score
Quality of e-Learning
e-Learning Design
9
2
Leadership Sponsorship
Technology Orientation
e-Learning Culture
e-Learning Culture
7
3
Assessment & Testing
Change Management
Learning Management System
Technology Support
Performance Management
e-Learning Culture
e-Learning Technology
e-Learning Technology
5
4
Personalized Content
User Friendliness
e-Learning Design
e-Learning Technology
4
5
Link to Performance
Management
Performance Management
2
6
Competency Management
Performance Management
1
7
Incentives for participation
Collaboration & Feedback
e-Learning Culture
e-Learning Design
0
The results in this table shows the top 3 (groups of) dimensions have relatively the
highest overall score, and therefore appear to be critical success factors for e-Learning.
The research results of just five companies are not be sufficient to draw valid conclusions
regarding critical success factors. Therefore, I will try to validate the importance of a
number of these dimensions among 24 companies in the research Phase II. The areas that
I will explore more in-depth include:
•
•
•
•
•
•
196
Components of high quality e-Learning programs
Support from leadership (and other stakeholders) for e-Learning
Role of the IT Function in supporting an e-Learning culture
User completion requirements for e-Learning programs
Change management
Existence of other critical success factors
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The third defined research question in Chapter 6 is:
•
Which elements appear to play a role in making e-Learning an effective business
practice?
Research results in this chapter provide evidence that one of the key elements of an
effective business practice is the existence of business drivers, as discussed before.
Another element of an effective business practice that has been assessed is the alignment
of e-Learning initiatives with business goals. The research results indicate that all eLearning initiatives supported one or more specific business goals in the case companies.
The third element that was assessed was measurement of e-Learning. The research results
indicate that companies do not have significant information regarding the business impact
of e-Learning in terms of: cost reduction; reduced time to market of skills; impact of eLearning on people commitment; and the impact on enterprise transformation.
Therefore, I will look more in-depth in Research Phase II at the following:
•
•
•
Business goals supported by e-Learning
Measurement of e-Learning
The business impact of the e-Learning initiatives
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Chapter Eight
Results Empirical Research
Phase II
8.0 Introduction
8.1 Overview of Research Case Organizations
8.2 Dimensions of Organizational Capabilities
8.3 Elements of an Effective Business Practice
8.4 Concluding Remarks
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8.0 Introduction
In Chapter 7, I presented the empirical results derived from research Phase I. This
included an in-depth case research study among 5 organizations. The research focused on
a number of specific organizational capabilities and business drivers, which were
included in the e-Learning Business Framework (See Chapter 6).
Three additional research questions were proposed in Chapter 6, which defined the main
questions of the dissertation.
The additional research questions are:
•
•
•
Which learning design components are used by companies in their learning
programs?
Which of the 15 dimensions of organizational capabilities appear to be critical
success factors for e-Learning?
Which elements appear to play a role in making e-Learning an effective business
practice?
The research results from Phase I, suggested that broader research on additional
organizations could be leveraged to validate some of the results and to provide a range of
answers to the above questions.
In this chapter, I will present the results from Phase II which is the follow-up case study
research among 24 organizations. The research in this phase focused on:
•
•
•
Usage of different e-Learning design components or solutions in e-Learning
Programs
A number of dimensions of organizational capabilities
Elements of an effective business practice including: business drivers; business
goals; measurement; and, business impact
I will discuss the Dimensions of Organizational Capabilities in Section 8.2. This will be
followed with Section 8.3: Elements of an Effective Business Practice. Concluding
Remarks will be discussed in Section 8.4.
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8.1 Overview of Research Case Organizations
In the second research phase, I collected more specific data in selected areas for 24 case
companies. The companies represent different industries and have in common the
implementation of at least one e-Learning initiative within their organization. The
minimum number of employees or learners for the selected companies was 1,000.
Table 8.1 provides a brief profile of the companies included in this research phase.
Table 8.1: Profile of Case Companies in Phase II
Case
#
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
Industry
Professional
Services
High Tech
Manufacturing
Hospitality
Mining
Home Improvement
Retailer
Automotive
Financial Services
Financial Services
Consumer/
Commercial products
Financial Services
Telecom
Insurance and
Financial Services
Professional
Services
Food Service
Services
Packaged Consumer
Goods
Business Education
Business Education
Consumer Products
Financial Services
Financial services
Technology
Manufacturing
Software
Development
Technology
Estimated
number of
employees
Estimated
2002
Revenue
Year eLearning
Launched
119,000
US$12,4B
1996
Number of
e-Learning
Programs in
Curriculum
3,000
43,000
US$6,36B
1999
10
25,000
65,000
290,000
Not available
US$2,3B
US$53,6B
1999
2001
2001
150+
13
14
1,300 (unit)
27,000
84,000
22,700
Not available
US$15,2B
US$19B
US$4,3B
1999
1994
1997
1998
100
200+
600+
100
7,000
34,000
Not available
Not available
US$14,7B
Not available
2000
2000
1999
1,000+
200+
100+
20,000
US$3,5B
1996
3,000+
1,7 million
997
265,000
US$14,8B
AU$213M
E52,2B
2001
2000
1997
29
56
Not available
7,500+
3,000+
2,500
100,000
4,000
76,000
Not available
Not available
US$1,7B
US$3,4B
Not available
Not available
2000
2000
1994
1997
1999
2002
13
Not available
Not available
Not available
25
2,500+
42,000
US$9,4B
1999
100+
4,615
US$1,48B
1997
100
This Table shows that 8 organizations launched their first e-Learning initiative between
1994 and 1998. However, the majority of the organizations (16) first utilized e-Learning
between 1999 and 2002.
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8.2 Dimensions of Organizational Capabilities
In this section, I will discuss the research results for a number organizational capability
dimensions including: e-Learning Design Solutions; Leadership Sponsorship;
Technology Orientation, Infrastructure and Support; Assessment and Testing; and several
other dimensions which have been identified.
e-Learning Design Solutions
The research results in Phase I indicate that organizations are using self-paced learning as
their primary e-Learning solution. Additionally, they do not include a number of other
learning solutions in their e-Learning program. However, the theory profiled in Chapter 2
and Chapter 4 suggests that e-Learning programs using multiple learning solutions (or
components) appear to be more engaging and therefore also more effective for the
learner. Therefore, I have assessed the types of e-Learning solutions which have been
included in e-Learning programs for the 24 case organizations. Table 1 shows the usage
of specific e-Learning solutions in these e-Learning programs.
For example, it appears that self-paced e-Learning has been used in 21 e-Learning
programs. A classroom event has been combined with e-Learning in 14 programs. This
indicates that a large number of e-Learning programs are designed as blended learning
programs. In other words, they might include both classroom and a variety of other online
e-Learning solutions.
Table 8.2: Usage of e-Learning Solutions
e-Learning Solution
Assessments/Tests
Usage of solutions in the
e-Learning Programs
23
Self Paced e-Learning
21
Live (Synchronous) e-Learning
13
Classroom Learning
14
Online Collaboration
4
Online Facilitation/Coaching
4
It appears that self-paced e-Learning and online assessment are the most utilized
e-Learning solutions. Live e-Learning, also known as the virtual classroom, is also used
by more than 50% of the companies. Online collaboration, facilitation and coaching are
e-Learning solutions which were still in an early stage of adoption at the time that I
conducted this research.
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Another quality aspect of e-Learning relates to relevance of the content for the user. The
feedback from the case studies indicates that the courseware was well positioned for the
audience and supported specific business goals.
Finally, I discussed a number of definitions of e-Learning in Chapter 2. Broadbent (2002)
also includes learning events using delivery media such as CD-ROM and satellite in his
definition of e-Learning. In Chapter Two, I outlined my definition of e-Learning as: netenabled learning. This is consistent with the manner in which the 24 case companies
define and use e-Learning.
Leadership Sponsorship
In Chapter 4, I reviewed the suggestion of several different authors ( e.g., Cross and
Dublin, 2000); Horton, 2002); Masie, 2001), and Rosenberg, 2002) that those in
leadership roles who need to be involved in e-Learning include senior management and
relevant staff functions. Kelly and Nanjiani (2004) even suggest that the adoption of eLearning in an organization should be the responsibility of business managers and not
training or IT managers.
The research results from Phase I provide some evidence that leadership supports eLearning, but because leadership sponsorship was identified in the theory as a highly
important success factor, I have investigated the research results among the 24 companies
to confirm this assumption.
The research results show that all companies have indicated that leadership support is
very important for the success of e-Learning, especially at the beginning of an e-Learning
initiative. For example one company articulated: “To deploy an e-Learning infrastructure
and approach enterprise-wide, you must have everyone seated at the same table at the
same time and gain broad acceptance from the beginning” or “Always gain the
commitment of the company senior executive at the beginning of the engagement,
defining clearly the mutual commitments: what the company is prepared to do; what the
institution is prepared to do; roles and responsibilities in marketing; and commitment of
senior executives to sponsor work-related projects.”
However, I found it remarkable that leadership in only 10 out of the 24 companies of the
companies is actively engaged in the promotion of e-Learning programs within their own
company. This can either indicate that learning is not regarded as of critical importance,
or that they are comfortable with the learning/education team being solely responsible for
the promotion of e-Learning initiatives.
Also, people have made comments that it is important to discuss the business value of eLearning with leadership, for example: “Keep your focus on making an impact on
business and on real business issues,” and “Developing a strong business case gains
management support.”
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In addition to support from business leadership, the research results suggest that it is
important to get support from people in the learning function for the adoption of eLearning. As one company said: “Don’t forget about the training team, address their
fears and concerns too.”
Technology Orientation, Infrastructure and Support
The research results from Phase I suggest that an existing technology infrastructure and
wide-spread computer literacy and access, along with usage of technologies in learning
programs, support an e-Learning culture. This is also supported by the research results
from Phase II. The companies indicate that it is important to spend time in the beginning
of an e-learning solution teaching employees how to use technology and how to learn
best from e-Learning. Additionally, it is important not to assume that all employees have
the same level of computer skills.
As I mentioned earlier, the selection, integration and support of e-Learning technologies
can have an impact on learner satisfaction with e-Learning (e.g. Masie, 2001, and,
Sanders 1997). The research results from Phase I show that all organizations use a
Learning Management System but the functionality in use is still limited. This is
consistent with the findings of the research results in Phase II. All companies use a
Learning Management System, which may be an internally or externally hosted solution,
but the functionality is limited to the launch of e-Learning programs and tests, the
tracking of e-Learning usage and completions, and reporting.
Each of the case companies are using some types of authoring and development tools for
their e-Learning courseware. They suggest that the IT function should be included in the
selection of the right media-, and authoring tools. Most companies indicate that it is very
important to build a relationship with the IT function from the beginning of an e-Learning
project. One company said: “Partner with IT from the start to ensure that the technical
infrastructure can support the tools selected and the intended rollout plan.”
Five companies indicated the need for testing of different e-Learning applications before
giving learners access to this. One company recommended: “Test underlying
infrastructure as thoroughly as possible to ensure that all aspects function as intended.”
Another suggestion was that organizations need to set up help-desks to support learners
with technical issues. It has been suggested that: “Help desk support is crucial to success
of any online program rollout.” Other results indicate that providing the learners with
enough support makes them feel at ease.
Assessments and Testing
Online testing can assist in the analysis of learner capabilities, progress and knowledge
and can disseminate uniform learning standards across the organization (Horton, 2001).
The research results from Phase I show that only two organizations have used
completions tests. This is defined in the literature as level 3 evaluation (Philips, e.g.
1997).
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The research results from Phase II show that 23 companies require learners to complete a
test or learning assessment at the end of each e-Learning program. It appears that this is
an important driver for employees to complete e-Learning programs.
Other Dimensions
The research results in Phase I, suggest that it is important to develop a climate which
supports e-Learning. Masie/ASTD 2001, among others, suggest that marketing and
promotional efforts associated with e-Learning are very influential in attracting potential
learners to the courses. Therefore, I have explored the e-Learning marketing and
promotional efforts in the case companies
Research results among the 24 case organizations provide insights on initiatives
undertaken by enterprises to market and promote e-Learning programs. Table 8.3
provides an overview of a number of different marketing methods used by the 24 case
companies.
Table 8.3: Marketing Methods for Promotion of e-Learning
Marketing Method
Companies Using this Approach
Online Marketing and Promotion e.g.:
• eMail
• Portal Announcements
• Targeted Invitations
23
Promotion Material e.g.:
• Newsletters
• Flyers
• Posters
• Promotion Kits
• Presents
12
Incentives/Rewards:
• Certificates
• Training credits
• Prizes
• Presents
11
E-Learning Demonstrations
7
It appears that the majority of the marketing efforts are technology driven. One can say
that this might help to encourage an e-Learning culture. On the other hand, one could
argue that these tactics may make it even harder to reach learners and engage the targeted
audience.
In Chapter 4, I mentioned that one of the risks related to the implementation of eLearning is the length of time that lapses before achievements are realized, with the result
that leadership support can deteriorate having a negative impact on future initiatives.
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Therefore, enough attention should be give to aspects of risk management of e-Learning
implementation projects. Other research data recommend the selection of a limited
number of e-Learning initiatives and demonstration of progress quick, tangible successes
(Deloitte Research, 2001). The research results from Phase II reinforce this perspective.
For example, six companies states explicitly that e-Learning should be implemented in
small steps. Furthermore, it has been recommended that it is important to start with the
bigger picture and narrow it down to several smaller projects.
Additionally, it appears that one should keep the start of a program small but keep the
program consistently growing. To manage quality and risks of e-Learning projects, it is
suggested that organizations require resources with project management capabilities. The
research results indicate that it is important to develop a solid project plan which include
roles and responsibilities, deliverables and timelines.
Finally, a shift to e-Learning may foster resistance among different constituencies and
could cause e-Learning initiatives to fail (e.g., Cross and Dublin, 2003; Kruse and Keil,
2000; Rosenberg, 2001). Therefore, it is suggested that the development of a change
management strategy as an integral part of the e-Learning implementation.
The research results from Phase I show that all organizations acknowledge that moving
towards e-Learning implies significant change in the organization, but only two
organizations have a change management plan in place.
Analogous to Phase I, the comments made by the 24 case organizations seem to
recognize the change management challenge, for example:
•
•
•
•
•
•
•
•
“It is extremely important to identify potential change management issues, and
then address these: before, during and after the learning intervention”
“Recognize that there will be a learning curve with e-Learning”
“You must have everyone seated at the same table and gain broad acceptance for
e-Learning from the beginning”
“Do not forget about the training team – address their fears and concerns too”
“Understanding the culture and identifying what will work best is critical”
“Reach out to local offices for more initial buy-in prior to the launch stage”
“Communicate with all levels in the organization”
“Recognize that roles of different people have shifted and need to include new
skills”
However, none of the 24 case organizations had a change management plan in place to
address the e-Learning implementation challenges.
Dimensions of the e-Learning Framework which received very limited responses in the
Phase II research organizations included: link to performance management; competency
management; and incentives for participation. This was consistent with the outcomes of
research Phase I.
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8.3 Elements of an Effective Business Practice
In this section, I will examine the elements of an effective business practice. This
includes business drivers which can lead to investments in e-Learning; business goals
supported by e-Learning; measurement of e-Learning; and the business impact of eLearning initiatives.
e-Learning and Business Drivers
The research results from Phase I, provide evidence that all business drivers might lead to
investments in e-Learning. The research results from Phase II provide a similar
perspective. Though, the case companies indicated that people commitment might have a
lower impact on e-learning investment than the other business drivers. The Case Study
research method requires that the researcher go back to the research companies, if they
find results which might be different than what one would expect based on literature
study (Yin 1993). Therefore, I reached out to the case companies and asked them to
clarify this point. It appeared that people commitment is often used as an important
business driver for the investment decisions in e-Learning. However, as of the time of
this study, no quantitative data exist that gives solid evidence that investments in eLearning have lead to, for example, a higher level of retention. Similar to the results in
Chapter 6, it appears that companies have not implemented the necessary HR processes,
systems and metrics to prove the impact of investments in e-Learning on people
commitment.
Table 8.4: Business Drivers
Business Drivers
Identified by Number of Cases
Element(s) of Enterprise Transformation
24
Cost Reduction
24
Time-To-Competence
24
People Commitment
2
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Business Goals
As explored in Chapters 4 and 5, business drivers can lead to investments in e-Learning
initiatives which support specific business goals. The business goals which have been
identified by the 24 companies either enhance organizational and/or business capabilities,
and/or support the deployment of an efficient learning model.
Table 8.5 shows a number of examples of business goals for e-Learning initiatives.
Table 8.5: Business Goals for e-Learning
A.
Enhance organizational and/or business capabilities, e.g.:
•
•
•
•
•
•
•
•
•
•
•
•
•
“Providing a higher level of customer service”
“Improve the quality of call handling”
“Provide any time, any place access to the learning content”
“Support the company culture”
“Meet the objectives mandated by a regulator”
“Provide a safe work environment for associates and customers”
“Bring people up to speed consistently and with higher skills than they had in
the past”
“Reduce the time to market of new products and services”
“Boost revenues by easing the sales process for partners”
“Develop management capabilities on new concepts and change issues”
“Standardize training content for 290,000 associates in over 1,500 stores”
“ Faster and better deployment of new information Systems and business
processes”
“ Complying with legal and regulatory mandates
B. Deploy an efficient learning model, e.g.:
•
•
•
•
•
•
•
•
“Deliver training on a core methodology to all people globally at lower costs”
“Minimize time away from customers”
“Reduce time to train and training costs”
“Maximize employees time in the office”
“Efficiently train a distributed audience of learners”
“Enable the sales force to stay in the field”
“Provide a cost effective method of training”
“Reduce or eliminate travel, telecommunications, and facility costs associated
with classroom learning”
The empirical research results show that organizations have identified a number of
distinctive business goals, which are supported by an e-Learning initiative. One might
conclude that business leaders have an interest in the success of e-Learning initiatives
because the e-Learning initiatives seem to be aligned with business goals.
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Measurement of e-Learning
The previous section indicated that all case organizations have defined specific business
goals which are supported by e-Learning. Additionally, it is valuable to look at what has
been measured.
The results from Phase I of the study demonstrate that measurement of the impact of eLearning initiatives was limited. In Chapter 5, I discussed various evaluation and
measurement frameworks. One of those has been developed by Jack Philips (1997), who
proposes five levels of learning evaluation. Table 8.6 shows the different learning
evaluation levels with the research results of the usage of those levels by the 24 different
organizations.
Table 8.6: Usage of Evaluation Levels
Usage of different evaluation levels
Number of cases
1. Reaction
24
2. Learning
23
3. Behavior
4
4. Business Impact
24
5. Return-On-Investment
3
All cases evaluate participant reaction to the course, which measures whether people like
the training (Level 1). Furthermore, 23 organizations said that they measure whether
people have learned something form the training (Level 2). Only four organizations
measure the change in behavior or performance on the job (Level 3). All organizations
indicate that they measure the business impact of the e-Learning initiative (Level 4).
According to Philips and Pulliam (2000), typical Level 4 business impact measurements
include: output; quality; costs; time; and, consumer satisfaction.
The results on measuring the business impact of the initiative seems to be relatively high
compared with other research results data from ASTD (2004), which shows that only 8%
of companies measure the business impact of their learning programs. It appears that the
case organizations only measure business impact on one or two dimensions, namely cost
reduction and reduced time. Finally, just three organizations measure the Return-OnInvestment of the e-Learning initiative (Level 5).
Looking at the metrics used for financial measurement, it shows that all organizations
measure cost reduction or cost avoidance of the deployment of a learning program in eLearning format. Cost reduction relates to actual savings achieved compared with an
existing program, which is delivered in a classroom format and moved to the Internet.
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Cost avoidance shows savings of the deployment of a new e-Learning program compared
with a potential delivery in a classroom format.
In Chapter 5, I discussed the potential impact of e-Learning on the creation of
shareholder value. None of the organizations measure the creation of shareholder value.
Table 8.7 shows the financial measurement metrics used by the case organizations.
Table 8.7: Financial Measurement Metrics
Financial Measurement Metrics
Number of cases
Cost Reduction/Cost Avoidance
24
Return- On-Investment (ROI)
3
Creation of Shareholder Value
0
Business Impact of e-Learning
As discussed in previous chapters, it is suggested that e-Learning initiatives have an
impact on the business. The research results from the Phase II case studies indicate that eLearning might have a business impact in a variety of ways.
First, all organizations say that e-Learning solutions result in reduced overall training
costs, having a direct impact on company earnings. Secondly, e-Learning enhances the
productivity of the workforce. This has been achieved through a reduction of training
time for employees, reduced time-to-competence, and by enhancing the knowledge base
and skill set of employees helping them to be more productive.
Lastly, six organizations mentioned that e-Learning has enhanced their top line by
supporting the generation of more revenue. This can be direct – by selling e-Learning
programs to customers and partners , or indirect – by providing the sales force with more
time as the learning time has been reduced.
Table 8.8: Business Impact of Learning
Business Impact
Improved earnings:
• Reduced Training Delivery Costs
Number of cases
24
Enhanced Workforce Productivity:
• Reduced Training Time
• Reduced Time-To-Competence
• Enhanced Knowledge Base and Skill of
Employees
21
24
24
Enhanced Revenue
6
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8.4 Concluding Remarks
In this chapter, I presented the results from research Phase II, which was the follow-up
case study research among 24 organizations. The research in this phase focused on:
•
•
•
Usage of different e-Learning design components or solutions in e-Learning
programs
Several dimensions of organizational capabilities
Elements of an effective business practice
The questions which I explored in this chapter for the 24 case organizations, and which
defined the main questions of this dissertation include:
•
•
•
Which learning design components are used by companies in their learning
programs?
Which of the 15 dimensions of organizational capabilities appear to be critical
success factors for e-Learning?
What are elements of an effective business practice?
My first conclusion is that e-Learning includes all learning solutions which can be
delivered through the (inter)-net. Companies do not include other delivery mechanisms
such as CD-ROM based learning as a dimension of e-Learning. This is consistent with
the definition of e-Learning in a business environment, which I proposed in Chapter 2:
Net-enabled learning targeted to achieve business goals.
My second conclusion is that effective e-Learning programs are designed using a blend
of learning solutions which enrich the learning experience and may include: self-paced eLearning; live e-Learning; online assessments; classroom events; online collaboration;
online coaching; and online facilitation. However, the last three e-Learning solutions
appear to be at an early stage of adoption for the 24 companies at time of research.
Furthermore, I assessed the importance of the various dimensions of organizational
capabilities for e-Learning and explored whether there are additional dimensions which
appear to be critical success factors for e-Learning.
My third conclusion is that research results indicate that most dimensions of
organizational capabilities play a role in supporting e-Learning success, but that the
dimensions appear to have different weight factors. I have categorized the dimensions in
three different groups: enablers for e-Learning; drivers for the organization; and
motivators for the employees.
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Enablers for e-Learning
Enablers must be in place in order to ensure e-Learning usage. For example, it is
important that employees are comfortable using technologies and Internet. Providing
employees with access to user friendly learning technology applications and with
dedicated help desk support, appear to be primary factors affecting successful
deployment of e-Learning. Additionally, broadband technology enables e-Learning
program designers to design high quality e-Learning by using, for example, a
combination of streaming video, sound, visuals, application sharing functionality, among
other technologies.
Dimensions included: technology orientation; technology support; and learning
management system.
Drivers for the Organization
Companies can drive e-Learning in their organizations by engaging leadership as
sponsors and by increasing awareness through marketing and promotion activities. I
suggest that leadership sponsorship is crucial to gain and/or sustain investment levels in
e-Learning. Additionally, leadership can play an important role in championing eLearning from a business point of view and in gaining attention from employees.
Additionally, the research results indicate that risk and change management seem to be
important dimensions for ensuring e-Learning success.
Dimensions included: leadership sponsorship; change- and risk management, and
marketing and promotion.
Motivators for the Employees
Learners appear to be more motivated to take e-Learning if e-Learning programs include
relevant content which is aligned with their personal and/or business needs. Secondly,
programs need to be well designed using a blend of learning solutions that engage the
learner. It is suggested that completion requirements through assessments and tests
support e-Learning usage as well. Furthermore, all companies provide learners with the
opportunity to evaluate the learning experience which might help to enhance the quality
of future courseware.
Dimensions included: quality of e-Learning; personalized content; assessment and
testing; user friendliness; and collaboration and feedback.
Important dimensions of organizational capabilities which appear to be less important
include: link to performance management; competency management; and (financial)
incentives for participation.
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Finally, based on the research results, I have identified the following top six critical
success factors for e-Learning:
1. Leadership Sponsorship. This is where the business case for e-Learning
and driving e-Learning throughout the organization must begin.
2. Learning Technology Infrastructure and Support. No e-Learning activities
can exist without the required learning technology capabilities.
3. Quality of e-Learning Programs. Sufficient funding and the right
technologies will enable e-Learning designers to develop relevant,
engaging and high quality e-Learning which attract employee usage.
4. Risk and Change Management. Achieving implementation success of eLearning initiatives is critical for sustaining funding and support from
leadership.
5. Assessment and Testing. Completion requirements are shown to be of big
importance for employees to take e-Learning.
6. Marketing and Promotion. It is important to educate different stakeholders
on the available e-Learning capabilities and how they can benefit from
this.
My fourth conclusion is that there is evidence that all identified business drivers may lead
to investments in e-Learning. However, most companies are in an early process of
measuring the importance of people commitment.
My fifth conclusion is that the business impact is mostly evaluated on just one or two
dimensions, namely cost reduction and reduced time.
My final conclusion is that the business impact of e-Learning can translate into:
•
•
•
214
Improved earnings, through reduction of training costs
Enhanced productivity of the workforce, through a combination of: reduced
training time; reduced time-to-competence; and enhanced knowledge base and
skill of employees
Enhanced earnings, through selling e-Learning to customers and partners or
enhancing the productivity of the sales force
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Chapter Nine
Conclusions
9.0 Introduction
9.1 How can e-Learning be defined?
9.2 How do enterprises justify their investments in e-Learning?
9.3 What appear to be critical success factors for the implementation of e-Learning?
9.4 Which elements can make e-Learning an effective business practice?
9.5 The Business Impact of e-Learning
9.6 Recommendations for Future Research
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9.0. Introduction
The main goal of this study is to assess the critical success factors that make e-Learning
an effective business practice. In the first chapter of this dissertation, I defined the main
research questions:
•
•
•
•
How can e-Learning be defined?
How do enterprises justify their investments in e-Learning?
What appear to be critical success factors for the implementation of e-Learning?
Which elements can make e-Learning an effective business practice?
In order to answer those questions, the thesis began with an in-depth study of literature,
review of existing research data, and a series of interviews with companies which were
implementing e-Learning. The study and analysis resulted in the development of a
Theoretical Framework, which was explored in:
•
•
•
•
Chapter 2: e-Learning
Chapter 3: e-Learning and Business Drivers
Chapter 4: Organizational Capabilities for e-Learning
Chapter 5: Measurement of e-Learning
The second stage of the study was the company research phase. The discussion of this
research began with Chapter 6: Research Methodology, in which the research
methodology was explained. Furthermore, two phases of cases studies were conducted.
Phase 1 was an in-depth case study among five organizations, and Phase II comprised
follow up research to collect more specific data in selected areas from twenty-four
companies. The results of the two case studies were discussed in the Chapter 7 and 8.
The title of this dissertation is: The Business Impact of e-Learning. In this final chapter,
the main research questions will be answered based on the insights from literature and the
results from the case studies. Subsequently, overall conclusions of the study will be
discussed. The chapter ends with recommendation for future research.
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9.1 How Can e-Learning Be Defined?
The first research question of this dissertation is:
•
How can e-Learning be defined?
In order to answer this question, various definitions were explored to define
terminologies in the discipline of human resources such as: training; education; and
learning. Literature suggests that these terminologies have been defined and interpreted
differently by many authors (e.g., Gagné and Medsker, 1996; Huysman, 1996; Elkington,
2002; Kurtus, 2001; Rosenberg, 2001) Therefore, it appears that the same variety of
definitions may also be true for the term e-Learning.
E-Learning is a relatively new term (Masie 1997) which combines the existing term
learning with the ‘e’ as the acronym for electronic. In order to define the term eLearning, it is suggested to define the terms of learning and electronic (e.g., Sanders,
2001).
In Chapter 2, I reviewed a number of definitions of learning. Among many authors,
Rosenberg (2001) defines learning as: “a process by which people acquire new skills
and/or knowledge for the purpose of enhancing their performance.” I apply this
definition of learning to the business environment, because this definition includes both a
process perspective and an outcome perspective of learning.
Electronic, refers to digitized learning, and refers to the role of technology in learning
(Sanders 2001). The history of learning has shown that over the years, emerging
technologies such as radio, television, film, computer aided instruction, personal
computing, CD/DVD, intranet, Internet, and so forth, have been adapted to support
learning (e.g., Hall, 1977; Horton, 2000).
It appears that the proliferation of technologies and application of these technologies to
learning have created a multiplicity of definitions in the field of e-Learning (e.g.,
Broadbent, 2002; Clark, 2003; Horton, 2001; and, Sanders, 2001).
Based on my literature study on e-Learning, it appears that e-Learning can be defined
narrowly or broadly based on the:
•
•
•
•
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Inclusion of different deployment classifications
Inclusion of different learning solutions
Level of instructional design used
Scope of content included
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Deployment Classifications
First, a distinction exists between asynchronous (self-paced) and synchronous (live) eLearning. Asynchronous e-Learning appears to be the most common form of e-Learning,
according to Kruse and Keil (1999). Some organizations have only adopted asynchronous
e-Learning, and therefore their definition of e-Learning is more narrow than
organizations who are leveraging synchronous e-Learning as well.
Second, e-Learning can be classified depending on the number of people who participate
in the e-Learning experience. Collaborative e-Learning can be defined as a structural
exchange between two or more participants designed to enhance achievement of the
learning objectives (Clark, 2003). Solo e-Learning is e-Learning taken by an individual.
Another classification of e-Learning is by program and data storage technologies, such
as: floppy disk; CD-I; CD-ROM; DVD; and Internet/intranet. These new storage
technologies have led to new technology-based learning terminology, including:
computer-based training; CD-I based training; CD-ROM/DVD based training;
multimedia based training; web-based training; and, e-Learning.
A number authors (e.g., Hall, 1997; Zalm, 2000) view all learning that is digitized as eLearning, including CD-ROM, and DVD based learning. Others (e.g., Rosenberg, 2001;
Rossett, 2002) view CD-ROM/DVD based learning as a pre-cursor of e-Learning. It is
suggested in Chapter 2, that there are a number of inefficiencies with CD-ROM/DVD
based learning which have been eliminated by e-Learning.
Finally, e-Learning can be defined by how it is deployed through different devices for
example: personal computers (Laptops/Desktops); personal digital assistants (PDA);
mobile phones; and MP3 players.
Learning Solutions
Authors have identified a number of learning solutions which should also be included in
e-Learning, such as: Online Training; Education; Performance Support; Knowledge
Management; Coaching; Collaboration; Testing/Assessments; Communication; and
Learning Management (Hall, 1997; Kelly, 2004; Urdan & Weggen, 2000; and
Rosenberg, 2001). However, there does not seem to be universal acceptance regarding
which individual learning solutions should be included in e-Learning.
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Level of Instructional Design
It has been suggested by a number of authors (e.g., Clark, 2002; Medsker and
Holdsworth, 2001) that e-Learning must be based on proven principles of instructional
design supported by different learning theories. Instruction, and not technology, should
be the most important design consideration for any technology-based training program,
according to Kruse and Keil (1999). Providing information over the Internet for reading
purposes should not be considered e-Learning if instructional design methods have not
been applied (e.g., Merill, 1998).
Content Area
The first generation of e-Learning courses was mainly targeted the development of
information technology skills. This might have supported the perception of e-Learning by
some organizations as simply a learning application for the IT department. However,
currently, e-Learning content includes a vast variety of applications: business; industry;
languages; professional skills; leadership; and organizational proprietary content.
The results from both phases of case study research show that all the companies studied
view e-Learning as learning over the net - Internet/intranet. For example, none of the
case companies included CD-ROM based learning as part of e-Learning. Table 9.1 offers
an overview of all e-Learning solutions which have been identified in the literature as
part of e-Learning, and the adoption of these learning solutions at the time of the
research.
Table 9.1: Case Company e-Learning Solutions
e-Learning Solution
Case Study I
Case Study II
Online Education & Training
All
All
Online Performance Support
None
None
Online Knowledge Management
None
None
Online Communication
None
None
Online Assessments/Testing
5
23
Synchronous e-Learning
5
21
Asynchronous e-Learning
1
13
Online Coaching
2
4
None
4
5
24
Online Collaboration
Online Learning Management
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All companies have included Online Education and Training, Learning Management, and
all except one include Online Assessment/Testing as well. The results from the Phase I
Research indicate that at the time of this research, companies were using asynchronous
(self-paced) e-Learning as their primary learning deployment method.
Phase II Research results show that more than 50% of the case companies had adopted
synchronous e-Learning in addition to asynchronous e-Learning. Online Coaching and
Collaboration appears to be at an early stage of adoption at the time of research.
Furthermore, the research results of Phase II show that the 24 companies have been using
a blend of e-Learning solutions which enrich the learning experience and may include:
self-paced e-Learning; live e-Learning; online assessments; classroom events; online
collaboration; and online coaching.
At the time of research, none of the case companies had included online performance
support and/or knowledge management as part of their e-Learning initiatives.
All companies deploy e-Learning to individual’s laptop/desktops and not yet to any other
(mobile) devices such as: PDAs; mobile phones; or MP3 players.
All case companies in Phase I and II have applied principles of instructional design.
However, the overall quality of e-Learning design differs among the companies.
Additionally, the content areas for which e-Learning has been used within the case
companies is very broad and appears to include all possible content areas.
This leads to an answer to the first research question of this dissertation:
•
How can e-Learning be defined?
As the scope of this research focuses on companies and not on schools/universities,
E-Learning in a business environment has been defined as:
Net-enabled learning targeted to achieve business goals
E-Learning includes:
•
•
•
•
•
•
•
Learning deployment using both intranet and Internet, but excludes CDROM/DVD-based learning.
Various learning solutions such as: online training; education; collaboration;
performance support; knowledge management; online coaching; and online
learning management.
Synchronous and asynchronous e-Learning
Solo e-Learning and collaborative e-Learning
Deployment through all hardware devices such as: laptop/desktop; personal
digital assistants (PDA); mobile phones; and MP3 players.
Application of instructional design principles based on learning theories
All applicable learning content identified by companies
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221
This definition is based on the literature study and results from the company case studies.
However, some elements have been included in the e-Learning definition, which were not
identified as part of the case company results.
First, there are knowledge management and online performance support. I suggest that
the responsibility of these solutions might lay within a different organizational unit, for
example the departments: Knowledge Management; IT; or Human Resources.
Additionally, at the time the research for this dissertation was conducted, these learning
solutions might have been at an early stage of adoption within the case companies.
Secondly, the results from the case companies do not indicate that e-Learning is deployed
through other than through the personal computer. I suggest that the deployment of eLearning through other hardware devices was in an early stage of adoption, but is
definitely part of the scope of e-Learning today.
Conclusions: Defining e-Learning
First, e-Learning is a young field of study and the emergence of new technologies and the
progress in adoption of different learning solutions will further shape the definition of
e-Learning.
Secondly, most e-Learning initiatives leverage a blend of learning solutions which
include a variety of technology-based learning solutions as well as classroom learning.
Third, based on ongoing research regarding e-Learning effectiveness, I anticipate that
advanced e-Learning instructional design approaches might emerge which will support a
richer learning experience for people.
Finally, I suggest that enterprises can only take full advantage of e-Learning if they
leverage a blend of available e-Learning solutions and engage people with a solid
understanding of instructional design.
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9.2 How do enterprises justify their investments in e-Learning?
In this section, I will answer the second research question:
•
How do enterprises justify their investments in e-Learning?
Literature specific to this topic appears to be in an early stage of evolution at the time of
this dissertation. However, literature has suggested that business drivers generate
investments in various activities, and this might include e-Learning as well.
This literature study and research have been conducted with a focus primarily on those
business drivers that impact knowledge and people. A number of authors suggest that the
most important business drivers in this area include: enterprise transformation; cost
reduction; time-to-competence, and people commitment (e.g., Arevola & Lundy, 2003;
Barksdale, 2002; Capelli, 2002; Cheese and Thomas, 2003; Moore, 2003; Porter, 1985;
and, Yip, 2003). These drivers are most likely to relate to investments in learning and
specifically in e-Learning.
Enterprise Transformation
Today’s business environment for enterprises is characterized by a fluid exchange of
money, technology, people, ideas, information, and knowledge (Athey, 2001). Forces
which may transform businesses include: changes in types of competition; industry
consolidation; regulatory issues; changing technology and the impact of the Internet;
access to capital; shortage of skills; and, lack of pricing power (Prahalad & Hamel, 1994;
Athey, 2001; Horton, 2001; Yip, 2003, Elwood 2003, Berner 2001). It has been discussed
in Chapter 3, that all of these forces drive companies to ensure that their globally
dispersed workforce rapidly master (new) competences, thereby supporting the necessary
transformation of their enterprise. It has been suggested that the requirements to develop
those new competences around the world, with speed and at competitive costs, support
the business case for investments in e-Learning capabilities.
Cost Reduction
Porter (1985) and others say that cost management can be a competitive advantage for
companies. Furthermore, Porter argues that human resource management affects the
competitive advantage of any firm, through its role in determining the skills and
motivation of employees, and the costs of hiring and training. It is suggested that
management recognizes the importance and relationship between costs and
organizational goals, and therefore often includes plans for cost reduction or cost
leadership. The investments or costs of education vary among companies and industries,
but spending can equal as much as 4.16% of payroll for companies who have been
recognized as Best Award Winners (ASTD, 2004).
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Philips (1997 and 2001) has identified the cost categories for classroom training and eLearning. An analysis of these cost categories shows that companies can achieve
significant cost savings by using e-Learning compared with classroom training model
(e.g., Chute, Thompson and Hancock 1999; Hall, 2000; Horton, 2002). In addition to the
visible cost of learning, there are invisible costs including: opportunity costs; wasted
training investments; and lost productivity (Adelseberk and Troly, 1999). The potential
cost savings of e-Learning can be even higher if those invisible learning costs are taken in
consideration.
Time-To-Competence
Enterprises must accomplish more in a shorter time, and the speed of knowledge transfer
is becoming a determinant of how fast an enterprise can perform (Arevola & Lundy
2003). According to Whalen and Wright (2000), the information age has increased the
need for training because knowledge workers have ongoing needs for new information
and updated skills to respond to challenging and constantly changing jobs. They argue
that true competitive advantage is closely linked to the ability of employees to respond
quickly to change. In order to do so, employees are required to perform new job functions
in a timely manner and in a competent way.
An employee is competent to fulfill specific tasks if discrete competencies are mastered.
Competencies are underlying characteristics of people and indicate “ways of behaving
and thinking, generalizing across situations, and enduring for a reasonable long period
of time” (Spencer & Spencer, 1993, p. 9). Time-To-Competence is a very important
business performance indicator as it supports a number of business goals, including (e.g.
Athey, 2001; Kelly, 2004): faster launch of products/services; speedy deployment of new
information systems and business processes; quicker compliance with legal and
regulatory mandates; building seamless global organization capabilities; rapid jobreadiness of new hires; and increased productivity of the sales force. These business
goals share a common theme - 21st Century enterprises require that human competences
be developed at high speed, on a large scale, and in multiple geographies.
People Commitment
According to Capelli (1999) most executives in organizations believe that employee
commitment and loyalty are an important factor in determining whether a company
succeeds or fails. He argues that there is “evidence that more committed employees have
higher performance on a range of dimensions. For example they have lower quit rates
and lower rates of absenteeism and tardiness. And they are more likely to act in the
interest of they organization” (Capelli, 1999, p. 46). The costs of employee turnover can
be very costly for employers. Often, employees who leave represent the distinctive
competency of an organization. Therefore, the cost of replacement, including sourcing,
hiring and training can equal the costs of one year of salary for managerial jobs (Capelli,
1999).
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A number of studies suggest that employee commitment and loyalty to one employer is
changing, and has resulted in a decreased commitment and higher level of employee
turnover (Capelli, 1999; Crandall & Wallace, 1998; Grantham, 2000; and, Gubman,
1998). Different research results provide evidence that investments in people
development make employees more committed to their organization (Capelli, 1999;
Bureau of Labor Statistics, 1996). At the same time, it is suggested that better trained
people might require higher wages or could leave the organization. This could diminish
the return on investment in the training (Capelli, 1999).
As mentioned before, there is strong evidence that e-Learning courseware requires
significantly lower investment levels than a typical classroom program. I conclude that a
lower investment for building the same skills will increase the potential return on
investment for companies. Additionally, companies can provide their workforce with
more learning opportunities at lower investment levels than classroom learning. This can
have a positive impact on people commitment which might lead to better employee
retention rates.
Research Results from the Case Studies
The summarized results from the case studies from Phase I and II are shown in Table 9.2.
Table 9.2: e-Learning and Business Drivers
Business Drivers
Case Study I:
Identified by a number of
companies
Case Study II:
Identified by a
number of
companies
Enterprise Transformation
5 (All High Scores)
24
Cost Reduction
5 (2 x High and 3 x Medium
Scores)
24
Time-To-Competence
5 (3 x High and 2 x Medium
Scores)
24
People Commitment
5 (All Medium Scores)
2
The results from the case studies show that enterprise transformation is the business
driver which has the highest scores in Phase I, and has been identified by all case
companies in Phase II. The business drivers cost reduction and time-to-competence have
been identified by all case companies, but have been scored as medium importance for a
some of the case companies in Phase I. People commitment is the business driver to
which all companies gave a medium score of importance in Phase I, and only two case
companies in Phase II identified this as a business driver for e-Learning.
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As discussed before, additional inquiries among case companies has provided evidence
that people commitment is important as a business driver, but most companies have not
implemented processes, systems and/or metrics to measure this.
This leads me to provide an answer to the second research question of this dissertation:
•
How do enterprises justify their investments in e-Learning?
The literature and research results from the company case studies in Phase I and II
provide strong evidence that those business drivers that impact people and knowledge can
be used to justify enterprise investment in e-Learning, including: enterprise
transformation; cost reduction; time-to-competence; and, people commitment.
Conclusions: Business Drivers
First, there is evidence that similar business drivers are relevant for organizations from
different industries, geographies and size. As discussed, competition for many industries
and organizations is global in nature, and therefore, I suggest that e-Learning may help
enterprises to achieve a greater degree of globalization by developing similar
competencies simultaneously in many geographies with speed and at lower cost.
Secondly, people commitment is an important business driver and many companies find
that investment in learning and training is an important part of their employee retention
strategy. However, most companies have not entirely implemented the human resources
processes, systems and/or metrics, which provide quantitative evidence of the impact of
e-Learning on people commitment and retention.
Finally, I have concluded that e-Learning provides the opportunity to reduce
inefficiencies in existing learning business processes including:
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
226
Time intensive training needs analysis process
Limited number of training sessions offered
Time away from the job
Courses designed for a group versus individual needs
Geographic barriers to attending training
Time consuming course content management process
Variations in course quality and consistency
Expensive, time-consuming distribution of training material
Time consuming participant training enrollment and administration process
Usage of relative expensive resources for courseware development
Limited access to training
Collaboration opportunities limited to people who can attend training in one
location
Limited opportunities to re-take (parts) of a course
Knowledge transfer and collaboration stops at the end of a course
Limited integration with knowledge management
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•
•
Limited engagement of senior leadership in training
Variation in quality in similar subject areas
These inefficiencies have been explained in Chapter 3 of this dissertation.
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9.3 What appear to be critical success factors for the implementation of
e-Learning?
A significant body of literature suggests that investment alone in technologies or
capabilities does not necessarily provide the anticipated business results. For example,
Strassman and Pisello (2003, p.1) state about IT investment, “It is not just how much you
spend, but what you invest in and how well it is managed that counts.”
A number of authors have suggested that a successful implementation of e-Learning
requires investments in, and management of a number of organizational capabilities (e.g.,
Horton, 2001; Masie, 2001; Rosenberg, 2001).
In this section I will answer the third research question:
•
What appear to be critical success factors for the implementation of e-Learning?
The most significant organizational capabilities themes for e-Learning identified by a
number of authors, and which have been discussed in Chapter 4, include: e-Learning
culture; e-Learning design; e-Learning technology; and performance management (e.g.,
Bielasweski and Evens, 2002; Metcalf, 2003; Rosenberg, 2001; Russell, 2001; and,
Spencer and Spencer, 2003).
e-Learning Culture
Literature indicates that a very important enabler of e-Learning is the existence of an
organizational culture which encourages and provides incentives for the adoption and
usage of e-Learning by its employees. According to Hofstede (1991), “a culture is a
shared set of learned assumptions, values and behaviors developed over time, which
influence thoughts, feelings and day-to-day actions.” Thus, an e-Learning culture in an
organization would support a shared positive perspective on the value of e-Learning and
the active adoption of the behaviors associated with engaging frequently and productively
in e-Learning to enhance skills and job performance. Rosenberg (2001) argues that a
strong learning culture is required for e-Learning to prosper and be sustained over time.
e-Learning Design
Many authors suggest that e-Learning design plays a very important role in the overall
effectiveness of e-Learning (Masie, 2002; Moshinskie, 2002; Clark, 2003; Mantyla,
2001; Mayer, 2001). Furthermore, Russell (2001) concluded, based on extensive
research, that the quality of instructional design is the most important factor in the
retention of knowledge, rather than the medium (technology or classroom) in which
knowledge is delivered. Additionally, it has been said that the design has a direct
influence on the motivation of the learners to engage in and complete e-Learning courses.
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e-Learning Technology
The objective of e-Learning is to improve performance through learning, but the e or the
technology is the enabler of the learning. Sanders (1997) refers to learning technologies
as electronic technologies that deliver information and facilitate the development of
skills. e-Learning technologies are a critical organizational capability for e-Learning,
because learner satisfaction is impacted significantly by the type of e-Learning
technologies selected, integrated and supported (e.g., Masie, 2001).
Performance Management
The research literature suggests that the success of an organization depends on the ability
of each of its employees to effectively perform and meet the identified goals. Therefore,
organizations are currently engaging learners in e-Learning to support the achievement of
individual performance goals, contributing ultimately to organizational performance and
helping the organization to achieve its business goals. One of the goals of performance
management is: “to reinforce and reward effective behavior and progress towards
goals” (Spencer and Spencer, 1993, p.265). Rewards for performance improvement and
acquisition of the desired competencies are another organizational capability critical to
the success of an e-Learning implementation. Masie (2001, p. 29) proposes that
organizations can improve performance by rewarding employees’ e-Learning efforts, and
also finds that acquisition of new skills and knowledge can lead to more exciting and
rewarding careers.
Based on the research literature which has been discussed in Chapter 4, a number of
dimensions within organizational capabilities have derived which appear to be critical
success factors for e-Learning. The dimensions are categorized by organizational
capability, as shown in Table 9.3.
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Table 9.3: Dimensions of Organizational Capabilities
Organizational Capability
Dimensions
e-Learning Culture
•
•
•
•
•
Technology Orientation
Use of Technology in learning
Leadership Sponsorship
Incentives for Participation
Change Management
e-Learning Design
•
•
•
•
Personalized Content
Collaboration and Feedback
Quality Content
Support and Enhancements
e-Learning Technology
•
•
•
Learning Management System
User Friendliness
Technology Support
Performance Management
•
•
•
Competency Management
Assessments and Testing
Link to Performance Management
Research Results from the Case Studies
The empirical research for the case companies has focused on the assessment of the
fifteen individual dimensions shown above.
The results from company case studies in Phase I and II indicate that all the dimensions
of organizational capabilities play a role in supporting e-Learning success. The
dimensions which appear to be of less importance at the time of research are links to
performance management, competency management, and (financial) incentives for
participation.
I have discussed the theory of marketing and promotion, but I did not identify this as a
dimension for research in Phase I. However, I included this dimension in Phase II
research as its importance became apparent.
This leads me to provide an answer to the third research question of this dissertation:
•
What appear to be critical success factors for the implementation of e-Learning?
Based on the literature and company case research results, the following top six critical
success factors for e-Learning have been chosen:
•
230
Leadership Sponsorship. This is where the business case for e-Learning and
driving e-Learning throughout the organization must begin.
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•
•
•
•
•
Learning Technology Infrastructure and Support. No e-Learning activities can
exist without the required learning technology capabilities.
Quality of e-Learning Programs. Sufficient funding and the right technologies
will enable e-Learning designers to develop relevant, engaging and high quality eLearning which attract employee usage.
Risk and Change Management. Achieving implementation success of e-Learning
initiatives is critical for sustaining funding and support from leadership.
Assessment and Testing. Completion requirements are shown to be of critical
importance for employees to engage in e-Learning.
Marketing and Promotion. It is important to educate different stakeholders on the
available e-Learning capabilities and how they can benefit from this.
Conclusions: Organization Capabilities
I have categorized the dimensions in three different groups:
•
•
•
Enablers for e-Learning
Drivers for the Organization
Motivators for the Employees
Enablers for e-Learning
Enablers must be in place in order to ensure e-Learning usage. For example, it is
important that employees are comfortable using technologies and Internet. Providing
employees with access to user friendly learning technology applications, with dedicated
help desk support, appear to be primary factors affecting successful deployment of eLearning. Additionally, broadband technology enables e-Learning program designers to
design high quality e-Learning by using for example a combination of streaming video,
sound, visuals, application sharing functionality, among other technologies.
Dimensions included here are technology orientation, technology support, and learning
management system.
Drivers for the Organization
Companies can drive e-Learning in their organizations by engaging leadership as
sponsors and by increasing awareness through marketing and promotion activities. I
suggest that leadership sponsorship is crucial to gain and/or sustain investment levels in
e-Learning. Additionally, leadership can play an important role in championing eLearning from a business point of view and in gaining attention from employees.
Additionally, the research results indicate that risk and change management seem to be
important dimensions for ensuring e-Learning success.
Dimensions included here are leadership sponsorship, change- and risk management, and
marketing and promotion.
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Motivators for the Employees
Learners appear to be more motivated to take e-Learning if e-Learning programs include
relevant content which is aligned with their personal and/or business needs. Secondly,
programs need to be well designed using a blend of learning solutions that engage the
learner. It is suggested that completion requirements through assessments and tests
support e-Learning usage as well. Furthermore, all case study companies provide learners
with the opportunity to evaluate the learning experience, which might help to enhance the
quality of future courseware.
Dimensions included here are quality of e-Learning, personalized content, assessment
and testing, user friendliness, and collaboration and feedback.
Dimensions of organizational capabilities which appear to be less important include: link
to performance management; competency management; and (financial) incentives for
participation.
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9.4 Which elements can make e-Learning an effective business practice?
In this section I will address the fourth research question:
•
Which elements can make e-Learning an effective business practice?
First, launching e-Learning within enterprises requires investments which have to be
justified. It has been discussed that business drivers might generate investments in
various activities, including e-Learning. Business drivers which focus primarily on
knowledge and people and appear to be the most relevant for potential e-Learning
investments include: enterprise transformation; cost reduction; time-to-competence;
people commitment; and workforce performance (e.g., Arevola & Lundy, 2003;
Barksdale, 2002; Capelli, 2002; Cheese and Thomas, 2003; Moore, 2003; Porter, 1985;
and, Yip, 2003).
A significant body of literature suggests that investment alone in technologies or
capabilities does not necessarily provide the anticipated business results. Strassman and
Pisello (2003, p.1) state about IT investment, “It is not just how much you spend, but
what you invest in and how well it is managed that counts.”
A number of authors have suggested that a successful implementation of e-Learning
requires investments in, and management of, a number of organizational capabilities
(e.g., Horton, 2001; Masie, 2001; Rosenberg, 2001). The most significant dimensions of
organizational capabilities for e-Learning which have been identified by a number of
authors included: quality of e-Learning; leadership sponsorship; technology orientation;
assessments and testing; change management; learning management system; technology
support; personalized content; user friendliness; linkage to performance management;
competency management; incentives for participation; collaboration and feedback;
e-Learning culture; e-Learning design; e-Learning technology; and performance
management (e.g., Bielasweski and Evens, 2002; Metcalf, 2003; Rosenberg, 2001;
Russell, 2001; and, Spencer and Spencer, 2003).
Effective e-Learning implementations must ensure that people are able and motivated to
participate in e-Learning programs, changing personal behavior and having an impact on
job performance. If this does not happen, the organization will not benefit from eLearning solutions, and the investments might not provide an adequate return-oninvestment (Cross & Dublin, 2002). However, it has been suggested that even if
organizational capabilities for e-Learning are solidly in place in organizations and eLearning has been implemented effectively, it is still is not certain that e-Learning will
have an impact on the business or whether this impact is actually measured in a way that
demonstrates the value to the business.
One of the criteria identified for evaluating the impact of the learning is to look at
efficiency and effectiveness of learning initiatives and the learning function. Keuning
(2003) suggests that organizations are effective if they achieve multiple goals.
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One can say that learning initiatives are also effective if they support the achievement of
specific business goals (Athey, 2001; Capelli, 1999; Cheese & Thomas, 2003; Driscoll,
2002; Horton, 2001; Moore, 2003; Porter, 1985).
It has been argued that e-Learning needs to be aligned with specific business goals, and
the achievements of those goals needs to be measured. (e.g., Philips, 2000; Kelly and
Nanjini, 2004). Furthermore, learning initiatives are considered efficient if skills and
resources are used economically (Keuning, 2003).
Learning evaluation frameworks have been available for a while. Donald Kirkpatrick is
one of the first authors who developed an evaluation framework for the training industry
in 1959. Philips (1997) extended the Kirkpatrick evaluation model with another
evaluation level for measuring return on investment (ROI). Daniel Kirkpatrick’s 4 Level
Model (Kirkpatrick, 1959) of training evaluation, supplemented with Jack Philip’s Level
5 (Philips, 1997), has dominated the training industry when assessing the value of
training initiatives (Active Education, 2000).
However, various sources indicate a very large percentage of companies have not yet
started to measure the business impact of training and development initiatives (e.g.,
ASTD, 2004; and, Gartner, 2001). Only 24 companies who have been identified by
ASTD as Best conducted Level 4 – Business Impact – evaluations (ASTD, 2004).
In conclusion, based on the literature that has been discussed in Chapters 3, 4 and 5, it is
suggested that elements which can make e-Learning an effective business practice
include:
•
•
•
•
Business Drivers - which can generate investments in e-Learning
Business Goals - which can be supported by e-Learning initiatives
Dimensions of Organizational Capabilities - which can support e-Learning
Measurement Metrics - which can show the business impact of the e-Learning
initiatives
Research Results from the Case Studies
The literature and research results from the company case studies in Phase I and II
provide strong evidence that business drivers can justify enterprise investment in eLearning, and these include: enterprise transformation; cost reduction; time-tocompetence; and, too a lesser extent, people commitment. Furthermore, it appears that all
e-Learning initiatives for all case companies in Phase I and II support the achievement of
one or more specific business goals.
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The results from company cases studies in Phase I and II indicate that the dimensions of
organizational capabilities, which were identified in the literature discussed in Chapter 4,
play a role in supporting e-Learning success. The dimensions which appear to be of less
importance at the time of research are the links to performance management, competency
management, and (financial) incentives for participation.
Research results from Phase II indicate that marketing and promotion is a dimension of
organizational capabilities which is important too.
The measurement of e-Learning has been very limited in Phase I, and focused on Levels
1, 2 and 3 of Kirkpatrick/Philips evaluation framework. The company case results from
Phase II show that almost all companies conduct measurement on Levels 1, 2 and 4. Only
a small number of companies measure Level 3 (Behavior) and 5 (Return-On-Investment).
The Level 4 – Business Impact – measurement focused on
cost reduction/cost avoidance.
Table 9.4: e-Learning Evaluation Usage by Level
Usage of Evaluation Levels
1. Reaction
Phase 1:
Number of cases
(maximum is 5)
2
Phase II:
Number of cases
(maximum is 24)
24
2. Learning
4
23
3. Behavior
2
4
4. Business Impact
0
24
5. Return-On-Investment
0
3
This leads me to provide an answer to the fourth research question of this dissertation:
•
Which elements can make e-Learning an effective business practice?
The research literature and results from the company case studies provide evidence that
business drivers support potential investments in e-Learning. Furthermore, e-Learning
initiatives need to be designed to support the achievement of specific business goals. In
order to have a business impact or return on investment, companies need to have the
organizational capabilities in place, as discussed in Section 9.3. Finally, the contribution
of e-Learning initiatives needs to be measured in order to generate and/or retain ongoing
investments in e-Learning.
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In summary, elements which can make e-Learning an effective business practice include:
business drivers which justify investments in e-Learning; alignment of e-Learning
initiatives to support the achievement of specific business goals; existence of
organizational capabilities to support e-Learning; and measurement of at least the
business impact of e-Learning initiatives.
Conclusions: Elements of an Effective Business Practice
First, there seems to be very different perspectives emerging among business executives,
learning practitioners and academics regarding business measurement of learning (e.g.,
Kaplan & Norton, 1996; Ulrich et. al, 2001). Although there appears to be strong interest
from business leaders in measuring the impact of learning, there seems to be only a small
percentage of enterprises which measure ‘business impact and/or return on investment’ of
their learning initiatives (e.g., ASTD, 2003, Philips, 2001).
I have explored a number of potential reasons why enterprises do not use return on
investment as a metric to measure the impact of learning. Some of the barriers include:
cost and time; lack of return on investment standards and methodology; and lack of skills
or sufficient staff, among others. However, e-Learning technologies can help to automate
a portion of the return on investment processes and reduce overall costs of return on
investment calculations. This might help to increase the percentage of
programs/initiatives for which return on investment calculations will be done in the
future.
Secondly, different writers have adjusted learning evaluation frameworks to support the
measurement needs of e-Learning. I conclude that those frameworks might provide
enterprises with specific information which might in turn help them to determine the
business impact of e-Learning initiatives. Some of the specific e-Learning metrics
mentioned include: e-Learning usage; learning catalog and vendor utilization; and cost
per e-Learning course, among others.
Finally, one of the measurement metrics identified by a number of authors is how eLearning can contribute to shareholder value. I conclude based on the research results
that e-Learning might create shareholder value through, for example, reduced costs,
enhanced revenue, and so forth. However, I suggest that the creation of shareholder value
through e-Learning initiatives depends largely on e-Learning implementation practices.
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9.5 The Business Impact of e-Learning
As mentioned at the beginning of this dissertation, enterprises around the word have
made significant investments in e-Learning over the last five years. Market evaluators
forecast that the e-Learning market will experience significant growth for the coming
years (IDC, 2004; Forrester, 2004; and, Gartner, 2004).
Business drivers seem to justify enterprise-wide investments in e-Learning. In addition,
this dissertation provides evidence that a number of organizational capabilities must be in
place for e-Learning to have an impact on the business.
Literature and research from the company case studies in this dissertation suggest that the
business impact of e-Learning can be comprised of several components: improved
company earnings; enhanced workforce productivity; and, enhanced company revenue.
Table 9.5 indicates the contribution made by e-Learning to business impact.
Table 9.5: The Business Impact of e-Learning
Business Impact
e-Learning Contribution
Improve company earnings
•
Reducing overall learning costs
Enhance workforce productivity
•
•
•
Reducing training time
Reducing time-to-competence
Enhancing knowledge base and skills
of people
Enhance company revenue
•
•
•
Efficient trained sales force
Selling e-Learning courseware to
customers and partners
Company earnings may be increased by reducing the overall learning costs. Potential cost
savings may include the following learning cost categories e.g.: training needs
assessments; design and development; acquisition of training programs; learning delivery
; evaluation; travel; and learning function (e.g., Philips, 2001).
Company revenue can be enhanced by providing the sales force with e-Learning which
apparently is less time consuming, and therefore provides sales personnel with more time
to spend with customers. Additionally, companies can sell e-Learning courseware to
customers, suppliers and partners and turn e-Learning in a direct revenue generator.
Also, the performance of the workforce can be enhanced by providing people around the
world with e-Learning opportunities which are more efficient and effective for the
learner. For example, e-Learning provides people with any-time access to courseware.
Therefore, people can acquire specific knowledge or develop certain skills at the time
they need it.
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237
Additionally, the enhancement of workforce productivity may enhance both company
earnings and revenue as well.
Finally, most of the companies indicate that e-Learning has a business impact because of
a combination of several factors, including: enhanced revenue; enhanced earning; and,
enhanced workforce productivity. However, the hard measurement of the business impact
of e-Learning is largely limited to the reduction of overall learning costs. The financial
metrics used by the case companies include both cost reduction and cost avoidance. As
discussed before, only a few companies measure any form of return-on-investment, and
no single company has measured the impact of e-Learning on shareholder value.
I would like to conclude the dissertation with an overall conclusion:
Since the inception of e-Learning, most discussions have been focused on e-learning
technologies, and how technology could support learning in enterprises. Recently, the
dialogue about e-Learning has matured and shifted to a strategic focus on the impact elearning can have on a enterprise, through support of strategic business goals, such as
enterprise transformation and decreasing time-to-competence, with the overall objective
of creating a competitive advantage.
Discussion of Research Conclusions
In the previous chapters of this dissertation, a number of conclusions have been drawn
based on the literature study and empirical research conducted between 2000 and 2004.
Chapter 6: Research Methodology has provided the research framework for this
dissertation. However, there are a number of limitations on the empirical research
conducted, which might have an impact on the validity of the conclusions for the case
companies, as well as for the interpretation and usage of the conclusions for other
enterprises.
First, the number of case companies included in the research is limited, thereby providing
insights into e-Learning in only a few countries and industries. My research approach
utilized the case study method to investigate the e-Learning practices of 29 companies for
a limited number of industries, within a limited number of countries, and in a specific
time period 2001 – 2003. As discussed in Chapter 6, the case study method has its
limitations as a research method. Furthermore, during this time period of the empirical
research, a significant number of new enterprises launched an implementation of eLearning around the world, and of necessity it was impossible to capture these
experiences in the research results have of this dissertation. Additionally, some new
learning technologies have emerged and been implemented within enterprises during this
time period, which also are so recent that they could not be included in this study.
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Secondly, the questionnaires for the case study research Phases I and II were based on the
literature study conducted and the theoretical framework which I developed in 2001 2002. This was used to identify several dimensions of organizational capabilities
apparently important to the successful implementation of e-Learning. During recent
times, additional research has been conducted. These identified dimensions were the
source for the development of the questionnaires for research Phases I and II. One could
argue that during my empirical research phase, other research was conducted and might
have led to additional organizational dimensions, resulting in other and/or more questions
for research.
Third, the individuals from case organizations who were interviewed during the research
phases were leading the e-Learning initiatives and implementations within their
enterprises. Those people might have had a bias towards certain, most likely positive,
outcomes of research. Another potential research limitation is that a limited number of
people have been interviewed/surveyed for each case company.
Fourth, no financial analysis has been conducted regarding the business performance of
the case companies during the time period of the empirical research. This might have
provided better financial evidence of the business impact of e-Learning. As mentioned
before, many questions have surfaced with regard to the measurement of e-learning and
the business impact of e-learning. However, the responses from the interviewees
regarding financial and business impact have not been audited, and therefore should not
imply an absolute business impact of the e-Learning initiatives in the case companies.
Finally, over the past five years a significant number of articles, research papers, and
books have published on e-Learning in multiple languages and different countries.
Although, extensive literature research and study has been completed over these years, it
is impossible to cover and include all potential perspectives on e-Learning in this
dissertation.
Lastly, looking at the overall research results of this dissertation while taking in mind the
research limitations, one can ask what are the most important conclusions is for
enterprises which consider employing e-Learning capabilities.
I suggest that the research results of this dissertation provide ample evidence that
enterprises can make e-Learning an effective business practice, leading ultimately to a
competitive advantage by:
•
•
•
•
Justifying e-Learning investments upfront
Ensuring that critical organizational capabilities are in place
Aligning e-Learning initiatives with business goals
Using metrics to measure the business impact
.
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9.6 Recommendations for Future Research
E-Learning is a relatively new business application for learning in enterprises. An
ongoing source of new research in this area includes:
•
•
•
•
•
•
•
Inventions in (learning) technologies and standards
The emergence of new practices in e-Learning design
Ongoing experiences in e-Learning implementations
Role of e-Learning in formal and formal learning
Adoption of e-Learning by the Internet Generation
The emergence of Knowledge Management and e-Learning
Measurement and Business Impact of e-Learning
The empirical research in this dissertation has its limitations as discussed in the previous
section. In this last section, I will suggest a few recommendations for future research
based on several conclusions of this dissertation.
First, the research and further inquiries indicate that the absence of processes, systems
and/or metrics in the companies hinders the collection of measurable data to prove that
People Commitment is a very strong business driver for justifying investments in eLearning. Therefore, I suggest that additional research is needed to validate the relative
importance of this business driver for e-Learning.
Secondly, I have concluded that a number of dimensions of organizational capabilities
need to be operational to make e-Learning a success. Future research is recommended in
this area in order to, for example:
•
•
•
Validate the importance of the dimensions of organizational capabilities
Identify additional dimensions of organizational capabilities
Explore the interdependencies between the dimensions of organizational
capabilities
Third, the practice of the measurement of e-Learning appears to be at an early stage of
evolution. This is a very important subject as it can provide business leadership with hard
evidence of the business impact of e-Learning.
Finally, it has been stated that modern business is focused on creating value (West,
2004). A number of variables have been identified which appear to influence whether eLearning can create shareholder value. Although limited literature and research exist on
this topic, I recommend that future research in this area is required as well.
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i. Summary in Dutch
Introductie en onderzoeksvragen
Economische, politieke, sociale en technologische krachten zijn van grote invloed op de
wereldwijde concurrentieverhoudingen tussen ondernemingen. De introductie van nieuwe
technologieën, het verouderen van kennis, de noodzaak voor meer just-in-time learning
en de vraag naar efficiënte wijzen om werknemers op verschillende locaties op te leiden,
vraagt om nieuwe vormen van kennisontwikkeling. (Urdan & Weggen 2000) Volgens
een onderzoek van The Hudson Institute (2004) heeft slechts 20% van de huidige
werknemers de noodzakelijke kennis voor de in 2020 beschikbare banen. Verder hebben
sterke verschuivingen in de leeftijdsopbouw van de beroepsbevolking enorme gevolgen
voor de behoefte aan opleidingen. Naar verwachting zal vanaf 2008 een groot aantal
mensen met specifieke kennis en ervaring het arbeidsproces verlaten zodra deze eerste
lichting van de zogenoemde ‘baby boom’ generatie in grote delen van Noord-Amerika en
West-Europa de pensioengerechtigde leeftijd bereikt (Athey 2004).
De komst van internet heeft geleid tot vele innovaties op het gebied van
kennisontwikkeling. Van het begrip e-learning werd voor het eerst gesproken in 1996.
Een van de eerste artikelen gewijd aan e-learning verscheen in 1997 in het Amerikaanse
blad Training Magazine. De wereldwijde markt voor e-learning ontwikkelde zich tot een
omvang van ongeveer $ 1,7 miljard in 1999 (IDC, 2003).
Gegeven de belangstelling voor e-learning zou men verwachten dat er een algemene
definitie is ontwikkeld voor het begrip e-learning. Echter, het bestaan van een grote
variëteit aan e-learning definities suggereert het tegenovergestelde. Broadbent (2002)
zegt hierover: ‘It seems that everyone from e-Learning theorists and practitioners, to
vendors and learners, are applying the term e-Learning to very different methods and
products’.
De eerste onderzoeksvraag is:
•
Hoe kan e-learning worden gedefinieerd?
Sinds de introductie van e-learning hebben bedrijven enorme investeringen gedaan op het
gebied van e-learning. Onderszoeksresultaten van IDC geven aan dat de wereldwijde
markt voor e-learning zich ontwikkelde van $ 1,7 miljard in 1999 tot ongeveer $ 6.5
miljard in 2003. Het is de verwachting dat de omvang van de wereldwijde e-learning
markt in 2008 ongeveer $ 21 miljard zal zijn (IDC, 2004).
De tweede onderzoeksvraag is:
•
Hoe rechtvaardigen bedrijven hun investeringen in e-learning?
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Uit veel onderzoeken is gebleken dat het alleen investeren in technologieën niet
noodzakelijk leidt tot de verwachte bedrijfsresultaten. Om e-learning daadwerkelijk tot
een succes te kunnen maken, moeter er ook allerlei organisatorisch bekwaamheden
aanwezig zijn.
De derde onderzoeksvraag is:
•
Zijn er kritieke succesfactoren aan te wijzen voor de implementatie van
e-learning?
Uit een aantal onderzoeken is gebleken dat e-learning zeker niet altijd succesvol is in
bedrijven (e.g. Foreman, 2001 en Masie/ASTD, 2001).
De vierde onderzoeksvaag is:
•
Welke elementen kunnen van e-learning een effectieve bedrijfspraktijk maken?
Samenvatting onderzoeksmethode
Het belangrijkste doel van deze studie is: het bepalen van de kritieke succesfactoren die
ervoor zorgen dat e-learning een effectieve bedrijfspraktijk is alsmede het beantwoorden
van de vier belangrijkste onderzoeksvragen.
De eerste fase van deze studie bestond uit een diepgaande literatuurstudie, het bekijken
van bestaande onderzoeksgegevens en het uitvoeren van een aantal diepte-interviews met
mensen binnen organisaties die bezig waren met de implementatie van e-learning.
De analyses hiervan resulteerde in de ontwikkeling van een theoretisch raamwerk voor
het empirisch onderzoek; de resultaten van deze fase zijn beschreven in hoofdstuk 2 tot
en met hoofdstuk 5.
De tweede fase van de studie is het empirisch onderzoek. Ik heb gekozen voor de case
study methodiek. Het case study onderzoek bestond uit 2 delen:
1. Het eerste onderdeel is een diepteonderzoek onder vijf ondernemingen, een case
study die tussen januari 2001 en december 2001 plaatsvond.
2. Het tweede onderdeel was een vervolgonderzoek onder 24 organisaties, een case
study die plaatsvond tussen juli 2002 en november 2002.
De analyse van de case studies vond plaats tussen september 2001 en december 2003.
De derde fase van de studie bestaat uit een discussie over de resultaten van het empirisch
onderzoek. Het gaat hierbij zowel om de theorie die wordt besproken in het theoretische
raamwerk als de resultaten van beide case studies. Tevens wordt in deze laatste fase
antwoord gegeven op de belangrijkste onderzoeksvragen in de case studies.
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Overzicht van de hoofdstukken
Hoofdstuk 1, Introduction is de algemene inleiding op de dissertatie.
In hoofdstuk 2, e-Learning, wordt learning in een context geplaatst en worden
verschillende begrippen besproken waaronder opleiding, training en leren. Ook wordt er
een overzicht gegeven van de verschillende technologieën die zijn toegepast in een
leeromgeving. Vervolgens worden een aantal typen e-learning oplossingen besproken en
wordt een overzicht gegeven van leertheorieën, en van de belangrijkste betekenis voor
het ontwerpen van e-learning.
In hoofdstuk 3, e-Learning and Business Drivers, wordt voornamelijk gekeken naar de
financiële en bedrijfseconomische aspecten van e-learning. Een aantal zogenoemde
business drivers die zich vooral richten op kennis en mensen, passeren in dit hoofdstuk
de revue; inclusief bedrijfstransformatie, kostenreductie, time-to-competence, en de
betrokkenheid van mensen.
Hoofdstuk 4, Organizational Capabilities for e-Learning, geeft een overzicht van de
organisatiebekwaamheden voor e-learning, en wordt er gekeken naar welke aspecten een
bijdrage leveren aan effectieve e-learning implementaties. Het gaat hierbij om aspecten
als organisatiecultuur, leerontwerp, technologie, de rol van performance management, en
risico en veranderingsmanagement bij de invoering van e-learning.
In hoofdstuk 5, Measurement of e-Learning, wordt de impact van e-learning op het
bedrijf besproken en wordt ingegaan op het meten van de leeractiviteiten.
Hoofdstuk 6, Research Methodology beschrijft de methode van onderzoek.
In hoofdstuk 7, Results Empirical Research Phase I, worden de onderzoeksresultaten
weergegeven van de diepteonderzoeken bij 5 ondernemingen.
In hoofdstuk 8, Results Empirical Research Phase II, worden de onderzoeksresultaten
besproken van het vervolgonderzoek dat betrekking had op 24 ondernemingen.
Het laatste hoofdstuk, 9 Conclusions, geeft antwoord op de belangrijkste
onderzoeksvragen van de dissertatie. Dit hoofdstuk wordt afgeloten met conclusies en
bevat aanbevelingen voor vervolgonderzoek.
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Onderzoeksvragen en conclusies
In deze paragraaf worden de belangrijkste antwoorden geformuleerd op de
onderzoeksvragen en worden tevens conclusies getrokken.
De eerste onderzoeksvraag is:
Hoe kan e-learning worden gedefinieerd?
Uit de literatuurstudie en het onderzoek is gebleken dat e-learning zowel heel breed als
beperkt kan worden gedefinieerd, afhankelijk van:
• de wijze waarop e-learning wordt gebruikt;
• de verschillende, daartoe inbegrepen leeroplossingen;
• het niveau en de kwaliteit van het leerontwerp van e-learning;
• de kennisgebieden waarop e-learning betrekking heeft.
In deze dissertatie wordt e-learning gedefinieerd als:
•
Net-enabled learning targeted to achieve business goals
Belangrijkste conclusies:
•
•
•
•
E-learning is een relatief nieuw object van studie. Het ligt dan ook in de
verwachting dat de definitie van e-learning, gelet op de voortgaande
technologische ontwikkelingen en nieuwe toepassingsmogelijkheden, in de
toekomst verder zal worden verfijnd. Tevens zal de adoptie van verschillende
leeroplossingen in bedrijven van invloed zijn op de ontwikkeling van nieuwe,
meer verfijnde definities.
Veel e-learning programma’s worden gecombineerd met klassikale leervormen.
Diepgaand onderzoek zal in de toekomst leiden tot verbeterde inzichten in de
wijze waarop e-learning kan worden ontworpen om een maximaal leerresultaat te
bereiken.
Bedrijven die een maximaal resultaat willen behalen met e-learning zullen ervoor
moeten zorgen dat ze verschillende vormen van e-learning met elkaar kunnen
combineren, en e-learning programma’s laten ontwerpen door mensen met
specifieke kennis en ervaring op dit terrein.
De tweede onderzoeksvraag is:
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Hoe rechtvaardigen bedrijven hun investeringen in e-learning?
Uit literatuurstudie en het onderzoek is gebleken dat voornamelijk de zogenoemde
business drivers die betrekking hebben op mensen en kennis, investeringen in e-learning
kunnen rechtvaardigen. Het gaat hierbij om de volgende business drivers:
bedrijfstransformatie, kostenreductie, time-to-competence, en de betrokkenheid van
mensen bij het bedrijf. Deze business drivers zijn relevant voor bedrijven in
uiteenlopende industrieën en landen van verschillende omvang.
Belangrijkste conclusies
•
•
•
E-learning zal bedrijven ondersteunen bij een voortdurende globalisering. Elearning maakt het namelijk mogelijk om snel nieuwe competenties te
ontwikkelen in verschillende landen tegen relatief lage kosten.
De betrokkenheid van mensen bij het bedrijf is een belangrijke business driver en
veel bedrijven zien investeringen in leren als een belangrijk instrument voor het
behoud van hun mensen. Echter, uit het onderzoek is gebleken dat veel bedrijven
–vaak nog in beperkte mate human resource processen, informatiesystemen en
meetinstrumenten hanteren bij het vaststellen van het verband tussen
investeringen in kennisontwikkeling en het behoud van personeel.
Een belangrijk voordeel van e-learning is de mogelijkheid tot het verminderen
van inefficiënte bedrijfsprocessen. Enkele voorbeelden hiervan zijn onder meer
het tijdsintensieve proces van onderzoek naar opleidingsbehoeften, de
discrepantie tussen het moment waarop een werknemer een opleiding zou moeten
volgen en het tijdstip waarop een cursus daadwerkelijke kan worden gevolgd, en
bijvoorbeeld geografische barrières voor het volgen van opleidingen.
De derde onderzoeksvraag is:
Zijn er kritieke succesfactoren aan te wijzen voor de implementatie van e-learning?
De belangrijkste kritieke succesfactoren die zowel uit de literatuurstudie als het
onderzoek naar voren zijn gekomen, zijn sponsorship van het senior management, de
aanwezigheid van de benodigde technologische infrastructuur en ondersteuning, een
goede kwaliteit van de e-learning programma’s, risico- en verandermanagement, de
mogelijkheden tot het online afnemen van assessments en leertoetsen, en marketing- en
promotieactiviteiten die e-learning ondersteunen.
Belangrijkste conclusies:
Succesvol gebruik van e-learning in bedrijven vereist dat er aandacht wordt besteed aan
een aantal dimensies van de organisatie. Deze dimensies heb ik ingedeeld in drie
verschillende categorieën:
•
Enablers for e-Learning: hierbij gaat het om de dimensies die aanwezig moeten
zijn om e-learning mogelijk te maken.
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•
•
Drivers for the organization: dimensies die ervoor zorgen dat het gebruik van elearning wordt gestimuleerd.
Motivators for employees: dimensies die ervoor zorgen dat werknemers worden
gestimuleerd tot het daadwerkelijke gebruik van e-learning.
De vierde onderzoeksvaag is:
Welke elementen kunnen van e-learning een effectieve bedrijfspraktijk maken?
Uit het onderzoek is gebleken dat de belangrijkste elementen die van e-learning een
effectieve bedrijfspraktijk kunnen maken zijn:
• de aanwezigheid van zogenaamde business drivers,
• het afstemmen van e-learning initiatieven op bepaalde business goals.
• de aanwezigheid van zogenaamde organizational capabilities die e-learning
ondersteunen, en
• het meten van de business impact van e-learning initiatieven.
Belangrijkste conclusies
•
•
•
•
248
Ofschoon het senior management in veel bedrijven grote waarde hecht aan het
meten van de waarde van de investeringen, blijkt slechts een beperkt percentage
bedrijven de opleidingsresultaten te meten en uit te drukken in een business
impact en/of the return of investment (ROI).
Verschillende e-learning applicaties zouden kunnen worden gebruikt voor het (ten
dele) automatiseren van bedrijfsprocessen die het makkelijker maken om ROIcalculaties uit te voeren.
Nieuwe evaluatiemethoden kunnen bedrijven specifieke informatie verschaffen
die kan helpen bij het bepalen van de business impact van e-learning.
De mate waarin e-learning bijdraagt aan het vergroten van shareholder value, is
in belangrijke mate afhankelijk van de wijze waarop e-learning is
geïmplementeerd in bedrijven.
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The Business Impact of e-Learning
De titel van deze dissertatie is: ‘The Business Impact of e-Learning’. Uit het onderzoek is
gebleken dat The business impact of e-learning betrekking kan hebben op het vergroten
van:
• de winst,
• de omzet, en
• de arbeidsproductiviteit.
Bedrijven kunnen hun winst vergroten door hun opleidingskosten te verlagen. Daarnaast
kunnen kostenbesparingen worden gerealiseerd met een adequate analyse van de
opleidingsbehoeften van werknemers, het ontwerpen en ontwikkelen van cursussen, het
bepalen van de inkoopkosten van cursussen, de kosten van het verzorgen van cursussen,
reiskosten, en de kosten voor het evalueren van cursussen en van opleidingsfuncties.
Bedrijven kunnen hun omzet vergroten door hun sales force in minder tijd beter op te
leiden, waardoor deze verkopers meer tijd kunnen besteden aan hun klanten, hetgeen kan
leiden tot meer verkoop. Bovendien kunnen bedrijven omzet genereren door hun
e-learning cursussen aan klanten, leveranciers en partners te verkopen.
De inzet van e-learning leidt tot een hogere arbeidsproductiviteit van werknemers omdat
deze leervorm mensen efficiënter en effectiever opleidt. Werknemers kunnen e-learning
cursussen immers afnemen op het moment dat zij daar behoefte aan hebben en ongeacht
waar zij zich bevinden. Daarnaast bieden veel e-learning cursussen werknemers de
mogelijkheid om alleen dát deel van een cursus te volgen dat noodzakelijk is voor het
ontwikkelen van persoonsspecifieke kennis en vaardigheden. Een hoge
arbeidsproductiviteit heeft een positieve invloed op omzet en winst.
Sinds het ontstaan van e-learning is de discussie met name gericht geweest op de
technologie van e-learning en de wijze waarop deze nieuwe technologie de leerprocessen
in bedrijven kan ondersteunen. Deze discussie heeft zicht gaandeweg verplaatst naar de
impact die e-learning kan hebben op een bedrijf en dan vooral naar de wijze waarop
bepaalde strategische bedrijfsdoelstellingen kunnen worden gerealiseerd. Hierbij kan
worden gedacht aan het ondersteunen van veranderingsprocessen en het verminderen van
de tijd die nodig is voor het ontwikkelen van competenties in de onderneming, met als
uiteindelijk doel het bereiken van een concurrentievoordeel.
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ii. Epilogue: The Future of e-Learning within Enterprises
Since 2000, I have had the opportunity to spend most of my professional time on
e-learning within Deloitte. This includes work within my internal role as Global Chief
Learning Officer, as well as advising a number of clients regarding human capital
management issues as a Firm Director in our Change, Learning and Leadership Practice.
This provided me with a unique opportunity to gain many insights into the dynamic and
fast emerging field of e-learning.
During my research study many new questions emerged but it was not feasible to return
to the enterprises involved in the case study to conduct more research. Obviously,
continuing to investigate new trends and applications in the fast-changing world of
e-learning would have prohibited completion of my dissertation any time in my life.
Although this section is not based on additional empirical research, I would like to look
ahead in this dissertation and provide my vision for the future on e-learning, addressing a
number of questions that I have been asked at different conferences, by clients and within
Deloitte.
Will the e-learning value proposition for enterprises change?
It is evident that economic, social and technological forces continue to create a dynamic
environment for the global economy and enterprises around the world. Therefore,
companies will be forced to build competitive advantage with a focus on operational
excellence, customer intimacy and/or market leadership. As companies become more
knowledge intensive and focus on services, there is an increasing focus on a high
performance workforce and a related belief that access to knowledge and the ability to
develop new skills at business speed for employees around the world will be key to
sustainable success in the market.
Due to the fact that large number of people will retire in the coming decennium and
beyond, it is anticipated that there will shortage of talent, making it very difficult for
organizations to fill open positions with the right caliber of people. Therefore, I expect
that the requirement for efficient and effective people development within our
organizations will increase exponentially. Furthermore, the existence of a rich portfolio
of e-learning capabilities will not be a luxury anymore in the future, but a must to attract
and retain talent.
What role can e-learning play in our self-service economy?
The Internet has transformed the way we buy travel tickets (Expedia), purchase vacations
(TravelZoo), buy books (Amazon) and music (iTunes), explore the lowest price for
electronics (BestBuy) and cars, search for medical advice (webMD), and reserve cinema
tickets, allowing us instant access to what we need, when we need it.
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This self-service economy has expanded rapidly over the past two to three years,
providing consumers and businesses with opportunities to purchase services and
products, or to get advice, with convenience and at a lower cost.
Traditional learning business processes focus on the learning function, not on what the
consumer wants and needs. Similarly to the e-enabled businesses mentioned above, the
traditional learning approach of providing classroom learning in one geographic location,
where the learners must gather to acquire skills, has proven inefficient and very
ineffective in our 21st century economy and I believe will be replaced by Self-Service
Learning.
Traditional learning business processes also are very time intensive for Learning/HR
professionals and employees alike. The total time and effort involved to conduct an
individual training needs analysis, develop an individual learning plan, maintain a course
catalogue, schedule courses, manage course registration and internal approvals, distribute
course material, and consolidate course evaluation forms, among others, drives costs that
impact the bottom line of the business. It is estimated that learning department overhead
costs can easily range between 15%-30% of annual learning budgets, whereas the actual
contribution to business value of these processes is questionable.
In addition, opportunity costs are realized as learning professionals are tasked with
repetitive administrative details, rather than focusing at a strategic level and working with
business leaders and line management in linking learning strategy to business outcomes.
Additional opportunity costs are accrued during the absence of employees from the
business as they travel to and from, and attend the classroom based programs.
The concept of Self Service Leaning provides automated learning business processes and
puts the learner in charge of their individual learning and development.
Self-service learning capabilities include an employee online learning portal MyLearning,
which provides people with Amazon type interface look and feel, offering consumer
information about a rich variety of online learning programs and solutions. In a seamless
process, learners take online assessments which result in a targeted, individual training
needs analysis, automatically identifying a selection of courseware specific to the
requirements of the individual worker. All of the learning programs are organized in easy
accessible online curricula which might be mapped to a competence model.
People develop and maintain their learning plans online, without the need for constant
interaction and support from people in learning function. The entire approval process for
taking courseware is entirely automated, and people can complete online tests at the end
of a course or program to assess their level of mastery in different areas, or to ensure
certification, if this is a requirement for completion.
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This self-service learning business model efficiently and effectively supports several
business objectives of the learning function:
•
•
•
•
Operational Excellence – produced by significant reduction of administrative –
transactional costs – which do not create value for the organization, combined
with efficient and effective technology supported processes
Learning Excellence – realized in a true strategic partnership with the business,
providing learning that is adding value to the business in several ways: improving
bottom line results and contributing to business transformation
Performance Excellence – acquired through self-service learning placed directly
into the hands of the employee with just-in-time access to knowledge and skills to
enhance performance and/or become deployable for future roles
Business Excellence – gained from the enhanced people performance enabling
change and competitive competence in the marketplace and the operational
excellence, thereby creating value for the enterprise and shareholders
A self-service learning capability is implemented by identifying and integrating learning
technology platforms with e-learning courseware, supported by the development of new
technology-based business processes. More importantly, a completely new learning
culture must be established in which the learner owns and is responsible for their career
development. This culture change is the more challenging task and requires significant
change management efforts enabled by communication and learning marketing efforts.
The good news is that the concept of the self-service economy has been adopted widely,
and as people become more and more experienced with this, Self-Service Learning will
be seen as just another powerful application. Much as consumers quickly learned to
balance the availability and usefulness of the local bookstore with online access to books,
purchasing electronic copies, or ordering shipping of hard copies, learners will quickly
demand a related self-service balance between online access to learning and the
traditional classroom.
What do you see as the most significant contribution of e-learning to the field of
human resources development?
I believe that most important contribution of e-learning is the empowerment of people to
take the lead in their own careers and acquire the knowledge or develop skills they find
interesting and useful. In the early 1990s, people at many levels within the organization
were empowered to make decisions in their organizations. However, there were limited
opportunities for individuals to re-tool themselves and develop a whole new skill sets or
even be stay entirely on the top of their profession. The main reason is that all training
had to be delivered face-to-face and the classroom learning budgets were limited in every
enterprise.
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This relatively limited access led to two fairly serious outcomes in our fast-changing
economy:
•
•
People learn skills too far in advance, or too late, to apply it effectively to real
their work
Employees are unable to retool skill sets to accommodate rapid changes in
markets, services and products
Traditional learning business practices also necessarily limit the acquisition of new
knowledge which would prepare people for future assignments, ultimately impacting the
business capacity to compete aggressively in the marketplace. Moreover, today’s
business environment poses significant job security risks for people who do not have
access to learning programs that can provide opportunity to upgrade skills. Additionally,
enterprises may incur significant costs if a large number of people have to be laid-off
because of an existing miss-match of competencies required, versus competencies created
and made available within the enterprise through access to low-cost, high-quality
learning.
What is your expectation about the ongoing adoption of e-Learning in enterprises?
In 2005, we are still in a very early stage of adoption of e-learning in enterprises.
Although some research data shows that the e-learning delivered about 30% of all
learning within enterprises within the US, there are still significant differences in the
adoption by organizations within different industries. Furthermore, the adoption of elearning in countries outside the US has just begun. The market evaluator IDC expects
that the worldwide market for e-learning will grow from about $8 billion to about $21
billion by 2008, with faster growth in EMEA and Asia Pacific. India and China will be
markets with significant growth opportunities for e-learning, with China being the fastest
growing country for e-Learning in the Asia Pacific region, according to IDC (2004).
I estimate that the average adoption of e-Learning within Fortune 1,000 companies in
2004 has not exceeded an average of 10% of all learning – and here lies the opportunity.
Those companies who have made great strides in the adoption of e-learning and have
more than 50% of their learning e-enabled will outperform their competitors.
What will fuel an even faster adoption of e-learning ?
I expect that the adoption of e-learning will be increased as more people who are part of
the so called Internet generation or generation-Y (frequently defined as those who are
born after 1981) join our organizations. Several studies have shown that this generation
will eagerly embrace technology and will integrate technology in the ways they work,
collaborate with people, and learn. e-Learning will not be a new experience for this
generation when they join the workforce, as they are very familiar with this learning
delivery medium through within their world of entertainment and their college/university
experiences. Therefore, the change management imperative will rapidly disappear.
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Furthermore, I anticipate that more Learning Executives will be sourced from this
generation and replace a number of baby boomers who are in these roles today.
What are the main trends in e-learning design and deployment?
From an e-learning design and courseware perspective, there are a number of new trends
developing. First, e-learning will become more and more sophisticated and of higher
quality. Much has been learned about how people best learn in an e-learning environment
and there have been significant improvements in related instructional design. I foresee an
exponential increase in the quality of e-learning courseware. Secondly, e-learning
vendors will expand their off-the-shelf learning portfolios, and there will be a great
variety of learning courses for different industries, competency areas, available in
multiple languages. Third, we are moving toward more stimulation-based learning
because this mirrors the real work environment. Additionally, game-based learning will
emerge as important type of e-learning, as it is very engaging and is familiar to the
Internet generation who will join enterprises in the coming years. Fourth, more e-learning
content will be designed for deployment in smaller learning objects and e-learning
modalities, such as: online books; job-aids; mini-courses; online self-study guides; and,
audiobooks, among others. Finally, moving forward, more e-learning will be deployed on
a wider range of hardware devices including different computers, MP3 players, mobile
phones, and PDAs, providing people with any-time and any-place access to learning.
What will be important learning deployment areas for e-Learning ?
Over recent years, compliance training has emerged as the number one e-learning
program category for many companies. This is driven primarily by legal and regulatory
mandates. Also, I find that the enterprise sales forces can benefit tremendously from justin-time training taken from any location, at any time, supporting the business need to
spend as much as time in the market with customers as possible. Furthermore, e-learning
will play a more powerful role in providing leadership with access to immediate learning.
Finally, e-learning can extend learning to customers, partners and suppliers, building
supporting linkages and commitment in the value chain.
Will the term e-Learning disappear?
Many learning and HR professionals prefer moving away from the term e-learning, as it
is all about learning, whether the delivery mechanism is over the Internet or within a
classroom. Therefore, I believe that more and more people will embrace all types of
delivery mechanisms in discussions about learning, not differentiating between types. At
the same time, the term e-learning will continue to exist, where it is necessary when there
are implications for audience, design, technology, and so forth. I would say it is similar to
the term e-mail. Many say just send me a mail – but mean e-mail. It will depend upon the
context of the dialogue and the issues present whether the e will be added. Analogous to
the fact that mail delivered through post is used as well as e-mail – similarly there
continue to be a need to use the term e-learning along with classroom training.
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Finally, the journey has just started – I look forward to many exciting years to come and
contributions to this exciting field of study and practice. I encourage academics to
conduct more research in this area, and would like to inspire my colleagues in learning
and HR to embrace innovations in their learning approach within their enterprises.
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iv. List of Appendices
Appendix
Appendix
Appendix
Appendix
A
B
C
D
: Phase I, Case Interview Questionnaire
: Phase II, Case Interview Questionnaire
: Phase I, Summery Case Results Comparison
: Phase II, Summery Case Results
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Appendix A: Phase I, Case Interview Questionnaire
I. Organization Background Information
1. Name Corporation and Location Headquarters
2. Primary Industry
3. Number of Employees in 2000
4. Revenue in 2000
5 Profit in 2000
6. Scope of Services/Products
II. Personal Background Information
1. Name
2. Job Title
3. Reports to, and function
4. Number of years in current role
5. Length of time with this organization
6. Phone
7. Email
III. Learning Function
1. Existence of centralized (e-)Learning function, and if so,
since when?
2. Specify for 2000 the percentage of training budget spent
in following categories:
• Classroom-Based Learning (including Training
Facilities)
• e-Learning
• Education Function
• Travel & Expenses
• Training Facilities
3. Percentage of payroll the organization spent on all
training (excluding time away from job) in 2000
4. Will the overall budget for Learning increase/decrease in
the future?
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IV. e-Learning Program Information
1. Description of e-Learning initiative
2. Components of the e-Learning initiative
3. The number of employees to be trained
4. Number of countries
5. e-Learning program offered in different languages
6. Who developed or purchased the e-Learning program?
7. Who has been involved in program content approval?
8. Total investment in e-Learning program
9. Average course duration of the e-Learning Program in
hours
10. What was the measurement for e-Learning Program
effectiveness e.g.:
• # of downloaded courses
• # of students accessing the Learning Management
System
• # of course modules completed
• Length of time spent online at site
• # of students who passed online tests
• # of students interacting in online discussion groups
• Job Performance Assessment
• Other:
11. What level of formal education has the target audience
reached?
A. e-Learning Culture
a. Technology Orientation
1. What is the ratio of computers to number of employees?
2. Do employees have access to internet/intranet? How many
hours do they spend online?
3.What are the accessories on computers at work:
• CD-ROM
• Modem, soundcard, speakers
• Headset and microphone
4. Usage of applications by senior management?
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b. Use of Technology in Learning
1. Does the organization use technology for learning outside of
the classroom. Check the following options:
• Online Web-Based Learning
• Online Synchronous (live) Learning
• CBT
• CD-ROM
• Virtual Campus/Learning Portal
• Video
• Satellite Based Training
2. Does the organization use technology for learning as part of
classroom. Check the following options:
• Pre-classroom: Course read/study
• Pre-classroom: Online synchronous sessions
• Pre-classroom: Online collaboration
• Pre-classroom: Skills assessment
• In-classroom: Tests/courses/tools/collaboration
• Post-classroom: Tests
• Post-classroom: Collaboration
• Post-classroom: Course read/study
3. Number of online courses offered in 2000
4. The average number of learning hours per employee in 2000
5. Year e-Learning was launched
c. Leadership Sponsorship
1. Is the CEO a sponsor for e-Learning?
2. Is there a Governance Board/Council for setting
priorities/direction for e-Learning?
3. Does management provide employees with (scheduled) time
to take e-Learning?
4. Is management accountable to support the learning by the
employee?
5. Does management serve as a coach or mentor?
6. Does management participate in e-Learning programs?
d. Incentives for Participation
1. Does the company publicly recognize employees who have
taken and completed an e-Learning course?
2. Do employees receive bonuses after completion of an eLearning course?
3. Does the company recognize employees that participate in
e-Learning courses after work?
4. Do participants receive credits for taking e-Learning courses?
e. Change Management
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277
1. Is there a change management plan for the introduction of
e-Learning initiatives?
2. Can the organization demonstrate the business benefits of
e-Learning?
3. Are there plans to overcome any bad experiences that people
have had with technology-based training?
4. Is there a plan to reinvent the training organization?
5. Is the organization prepared to invest in e-Learning?
6. Is there an organization climate to support learning at the
workplace?
7. Are employees well motivated to take e-Learning Programs
to enhance their skills or knowledge base?
8. What has been the management support for e-Learning?
B. e-Learning Program Design
a. Personalized Content
1. Can the program be (automatically) customized based on
personal needs or after pre-assessment test?
2. Are learners allowed to access modules or ‘chunks’ of
information on an ‘as needed’ basis?
3. Can the learner ‘test-out’ of learning content areas?
4. Is the learner given enough time for the completion of the
course?
5. Does the learning program have value and usefulness after
completion of the course and is it still accessible to the learner?
b. Collaboration and Feedback
1. Does the program include robust and comprehensive
coaching and feedback features?
2. Do learners interact with other classmates?
3. Do learners interact with trainers/lecturers?
4. Is synchronous e-Learning available?
5. Are participants encouraged to create and share knowledge?
6. What kind of evaluation has been conducted to determine
results and quality of e-Learning program:
• Online evaluations
• Task force/focus group meetings
• Survey
• Other
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c. Quality Content
1. Are experiences and examples that are provided credible and
up-to-date for the learner?
2. Have internal subject matter experts been involved in the
content creation and approval?
3. Is the program ‘real’ in terms of the world the learners
actually live in?
4. Has the content been presented at an appropriate level of
detail?
d. Support and Enhancements
1. Are e-Learning Programs enhanced by:
a. Links to online resources (e.g. textbooks, magazines,
websites)
b. Online library
c. Online help desk
d. Online mentoring
e. Contact among students/instructors by phone/email
2. Has the design of the program taken advantage of design
features enabled by technology?
3. Has e-Learning content from vendors been integrated in eLearning curriculum?
C. Performance Management
a. Competency Management
1. Is there a competency model in place which specifies
competencies by job level and role?
2. Are competency goals set for the entire enterprise business
units and/or individual levels?
3. Is the e-Learning curriculum determined by the competency
model?
4. Is it a requirement for employees to take a minimum number
of e-Learning hours a year?
5. Are competency goals measured?
6. Does the organization track and measure job performance?
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279
b. Skills Assessment and Testing
1. Are pre- and post course assessments linked to course
programs?
2. Are certification tests utilized?
3. Does the organization use 360/upward feedback initiatives?
4. At which level do course evaluations take place:
• Reactions/opinions
• Learning improvement in relation to training objectives
• Transfer of skills and knowledge
• Performance improvement
c. Link to Performance Management
1. Do test results or completion of e-Learning courses have an
impact on performance ratings?
2. Are there any sanctions for employees who do not comply
with e-Learning requirements?
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D. e-Learning Technology
a. Learning Management System
1. Has an LMS been implemented? If so, which one?
2. LMS functionality implemented:
• Catalog, Course and Class Management
• Course Registration
• Launching and Tracking of e-Learning
• Learning Assessments
• Competency Assessment
• Management of Learning Materials
• Facilities and Resource Management
• Competency and Skill Management and Career Planning
• Certification Tracking
• Integrated Knowledge Management
• Course Evaluations
• Course Pre-Testing
• Reporting
• Financial Management
3. Does the LMS work seamlessly with other corporate systems
that the company uses to run the business?
4. Can the LMS manage e-Learning programs from multiple
vendors and multiple authoring tools?
5. Can the LMS easily scale in size to meet the growing supply
of e-Learning programs as well as growing number of eLearning population?
b. User Friendly
1. Is the e-Learning system interface easy and intuitive for both
administrators and end-users?
2. Does the e-Learning system enable users to customize the
interface and their learning paths to meet their unique profile?
3. Can the e-Learning content be adjusted to support different
connection speeds?
4. Does the system respond adequately when used in a dial-up
mode? (on scale 1-5, 5 is very good)
5. Can e-Learning systems serve participants outside the
company’s firewall?
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281
d. Technology Support
1. What level of support is provided by the company, audience
and availability?
2. What level of support is provided by the e-Learning vendors
and for whom?
Business Drivers
E. Cost Reduction
1. Specify the estimated costs of the learning program in a
classroom-based model for the following categories:
a. Travel
b. Hotel and expenses
c. Course organization and registration
d. Facility
e. Instructor
f. Train-The-Trainer
g. Time off job (opportunity costs)
h. Material production and shipping
i. Course evaluation
2. The estimated overall costs per student of the program in a
classroom-based model.
3. Specify the transaction costs of the e-Learning Program for
the following categories:
a. Travel
b. Hotel and expense
c. Course organization and registration
d. Facility
e. Instructor
f. Train-The-Trainer
g. Time off job (opportunity costs)
h. Material production and shipping
i Course evaluation
4. The overall costs per student of the e-Learning program?
F. Time-to-Competency
1. % of employees enrolled in e-Learning programs
2. % of employees completing e-Learning programs
3. What is the time period within which employees had to
complete the e-Learning Program?
4. What has been the feedback on the e-Learning?
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G. People Commitment
1. What has been the voluntary employee turnover in 1998,
1999 and 2000?
2. What is the average hiring time for a non-administrative
resource?
3. Have any performance enhancements been assessed after
skill development?
4. What are results of an “Employee Satisfaction Survey”?
H. Enterprise Transformation
1. Did the e-Learning initiative support a specific strategic
objective of the company? For example:
a. Implementation new business models
b. Support merger or acquisition
c. Entering new markets
d. New product development and/or launch
e. Implementation of new IT systems
f. E-enabling the workforce
g. Globalization
h. Implementation of e-Commerce
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283
Appendix B: Phase II, Case Interview Questionnaire
Industry
Estimated Number of
Employees
Estimated 2002
Revenues
Question
Category
1.
2.
3
4
5
6
284
Scope of Services and
Products
Offices and Locations
Web Site
Questions
Describe the e-Learning Program?
How was the program aligned with the business strategy?
How was the program designed?
How was the program deployed?
What was the business impact of the program?
What were the e-Learning implementation Lessons learned?
THE BUSINESS IMPACT OF E–LEARN ING
Appendix C: Phase I, Summary Results Case Comparison Matrix
Question area
ORGANIZATION
CAPABILITIES:
Summary scores of
all 4 categories
Company Company Company Company Company
A
B
C
D
E
HIGH
MEDIUM MEDIUM MEDIUM
LOW
(12)
(8)
(6)
(6)
(4)
A. LEARNING
CULTURE
a. Technology
orientation
b. Use of technology in
learning
c. Leadership
sponsorship
d. Incentives for
participation
e. Change management
High
Medium
Medium
Medium
Medium
++
++
+
+
+
++
+
+
+
0
++
+
+
++
+
0
0
-
-
-
+
+
+
+
+
B. e-LEARNING
PROGRAM DESIGN
a. Personalized content
b. Collaboration and
feedback
c. Quality
d. Support and
enhancements
Medium
Medium
Medium
Medium
Low
+
0
+
0
+
0
+
0
0
0
++
+
++
0
+
0
++
0
++
0
C. PERFORMANCE
MANAGEMENT
a. Competency
management
b. Assessment and
testing
c. Link to performance
management
High
Low
Low
Low
Low
+
0
-
-
-
+
0
+
++
+
++
-
-
-
-
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285
D. e-LEARNING
TECHNOLOGY
a. Learning
Management System
b. User friendly
c. Technology support
Question area
BUSINESS
DRIVERS:
Summary scores of all
4 categories
Medium
High
Medium
Medium
Medium
+
++
+
+
O
0
+
+
+
Company Company
A
B
HIGH
MEDIUM
(14)
(10)
+
+
Company
C
HIGH
(12)
+
+
+
+
Company Company
D
E
HIGH
HIGH
(12)
(12)
E. Cost Reduction
High
Medium
High
Medium
Medium
F. Time-toCompetency
High
Medium
Medium
High
High
G. People
Commitment
Medium
Medium
Medium
Medium
Medium
High
High
High
High
High
H. Enterprise
Transformation
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Appendix D: Phase II, Summery Case Results
Table 1: Marketing & Promotion Methods
Case
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
Total
A
Online Marketing &
Promotion e.g. :
email, portal,
announcements,
target invitations .
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
23
B
Promotion
Material
e.g.:
Newsletters,
Flyers,
Posters,
Kits,
presents.
C
Leadership
Kick-Off/
Promotion
•
D
Incentives/
Rewards
e.g.:
Certificates,
training
credits,
prizes,
presents
E
e-Learning
Demonstrations
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
12
THE BUSINESS IMPACT OF E–LEARN ING
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
10
11
7
287
Table 2: e-Learning Solutions
Case/
Design
element
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
Total
288
Self Paced
e-Learning
•
•
•
•
Live eLearning
•
•
•
Classroom
Learning
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
21
•
•
•
•
•
•
•
•
•
•
•
•
•
13
•
•
•
•
•
14
Assessments
/Tests
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
23
Online
Collaboration
•
Online
Facilitation/
Coaching
•
•
•
•
•
•
4
4
•
Total # of
solutions
used
4
4
1
4
3
2
3
2
4
3
2
3
3
2
2
6
4
6
4
2
4
3
4
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THE BUSINESS IMPACT OF E–LEARN ING
Table 3: Business Drivers
C
A
S
E
Faster:
Time-ToMarket:
a. products/
services
b. people/
capabilities
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
A
A
Faster:
Compliance with
Mandates:
a. Legal &
Regulatory
b. Company
Faster:
Time for
implementation of:
a. Information
Systems
b. Business
Processes
A
A
B
A
B
B
B
B
B
B
B
B
B
B
B
A
A
A
A
A
A
A
THE BUSINESS IMPACT OF E–LEARN ING
Financial
Lower Costs:
a. Reduced
Training costs
b. Reduced Time
for training
Financial
Measurement:
a. Cost
Reduction
b. ROI
A, B
A, B
A, B
A,B
A,B
A,B
A, B
A,B
A, B
A
A
A,B
A,B
A, B
A, B
A, B
A
A,B
A,B
A, B
A,B
A,B
A,B
A,B
A
A
A
A
A
A
A
A
A
A
A
A
A,B
A
A
A
A
A
A
A
A
A
A, B
A
289
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Biography
Nick van Dam
Born the Netherlands, 1961
Nick van Dam is the Global Chief Learning Officer for Deloitte Touche Tohmatsu, and a Director
in Deloitte’s Change, Learning, and Leadership Practice.
He has held a variety of global Learning and Human Resources Development (HRD) leadership
roles throughout his career in several different countries.
In 2004, he was included as one of the 2004 Global Top 10 List “Top Innovators Changing the
Face of Corporate Learning,” by Capgemini’s Les Fontaines Business Learning Forum.10 He has
received a number of Industry Best Practices Awards from Corporate University
Exchange/Financial Times including: Using Technology to Create a Continuous Learning
Environment, 2001; Innovative and Best Practices in Learning, 2002; Marketing Learning, 2003;
and Establishing Alliances, 2004. CLO Magazine has honored him with the 2004 Chief Learning
Officer of the Year Award in the category Establishing Creative Alliances for establishing
learning offshore capabilities in India.
As an internationally recognized consultant and thought leader in Learning and HRD, Mr. van
Dam has written articles and has been quoted by The Financial Times, Fortune Magazine,
Business Week, Management Consulting, Learning & Training Innovations Magazine, T+D
Magazine, Bizz Magazine, and The India Times, among others. He is columnist for CLO
Magazine (US), Intellectueel Kapitaal Magazine (The Netherlands) and Learning Review
(Argentina). He has authored and co-authored a number of books including: Een praktijkgerichte
benadering van Organisatie en Management, 1991; Change Compass, 2001;
The e-Learning Fieldbook, 2004; and Inside the Minds: Strategic Human Resources, 2005.
He holds several advisory board positions including for: ICEDR, International Consortium for
Executive Development and Research, Lexington, MA/USA, a global learning alliance of some
40 of the world’s leading companies and 25 outstanding business schools; Maximize Learning,
Poona/India; and Villanova University, Center for Responsible Leadership, Villanova, PA/USA.
He is founder and chairman of e-Learning for Kids, which is a global non-profit foundation,
(www.e-learningforkids.org) that provides schools and children around the world with free
Internet-based courseware.
Mr. van Dam is a graduate of Vrije Leergangen - Vrije Universiteit van Amsterdam, Bachelor
Degree in Economics and Education, and Universiteit van Amsterdam, Master of Arts,
Organization and Management.
He lives with his wife Judith and son Yannick in Chadds Ford, Pennsylvania, United States of
America.
10
The list has been compiled based upon a broad range of input, including various corporate university awards (Training Magazine,
Corporate University Xchange, International Quality and Productivity Center’s {IQPC} CUBIC, American Society for Training and
Development’s {ASTD} BEST, and Fortune Magazine’s “Best Companies to Work For”), secondary research, interviews with
corporate university practitioners and pundits, and feedback from industry experts worldwide, including ASTD, Corporate University
Xchange, the European Club of Corporate Universities, and IQPC.
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