What is a Learning Management System (LMS)?

A Learning Management System (LMS) is a system that serves to manage learning activities. LMS are usually offered in the form of software. Such a software is sometimes also called Learning Content Management System (LCMS). The learning activities can be the activities of a person learning in the state education system (e.g. at a school or university). But also of a person in the quaternary sector of the education system. That means for example at an adult education center, in a company or any other further education and training activity. In the following we answer from our perspective: “What is a Learning Management System (LMS)?”. We focus on the topic of “corporate learning” – i.e. “learning in the business environment” – less in the environment of the state education system.

In detail: A Learning Management System

The exact scope of an LMS software’s features depends on the vendor. But the purpose of an LMS is always to map learning processes. The processes that an LMS supports:

  • Provision of training content
  • Selection and ordering of training courses and materials
  • Participation in trainings and use of materials
  • Transfer of results and, if necessary, learning transfer assurance.

From the perspective of an IT system, this sequence of processes represents the complete end-to-end process of a learning process.

An IT system supports this learning process with digital content. Also, it makes the process transparent with functions and data views. However, instructor-led training are documented here, too. Both in presence and via communication software such as Zoom, Microsoft Teams or similar. These are relevant for an LMS, if:

  • access management is done thorugh the LMS
  • if there is feedback in the system necessary on the execution of the event
  • or if the participation needs to be tracked
  • and, if applicable, a result needs to be documented.

However, an LMS primarily supports people who learn with the system. Possible tasks are – as explained before – partly to be done digitally in the system or also the digital representation of activities in the “real world”.

Digital processes with a Learning Management System

A digital process is, for example, reading a PDF or watching a video. That is also reflected in the extension of the title to “Learning Content Management System”. The function of managing learning content sometimes creates confusion. Because in the IT world there are also so-called content management systems (CMS) that also manage content. Most CMS are specialized in providing media content. For example images and videos specifically for web publishing. This media content can also be used for learning. But most of the time, it needs much more information to manage the information for learning or learning progress than a CMS provides.

LMSs are very good at storing and delivering digital learning materials. They are also especially supportive in interfacing with communication software.

Digitally document non-digital processes with a Learning Management System

A process that takes place in reality but is digitally documented in an LMS is, for example, the physical taking of an exam. The result on a test must be evaluated. If necessary, it must be given a grade or score. This result must then be input to the system so that the result besomes accessible.

Another example is preparing a meeting room with the right physical resources. This means setting up rows or circles of chairs. Or providing metaplan boards, flip charts, bulletin boards or other equipment. Someone executes this task in the physical world, but the task is documented in the LMS.

Appearance and usability

The topics a company focuses on, when choosing an LMS, depend on the type of learning they offer. But it also depends on the learning processes it follows. And also on the extent to which these are already digitized or can be digitized.

When researching for the selection of an LMS, it quickly becomes apparent how large the market is. All the more important it is for a company to understand what functions a software of this type should have. This is based on what tasks in the company should be handled by this system. For example, whether there is more content to manage or the focus is on the administrative management of training content. The latter one is the actual task of a Training Management System (TMS).

Besides functionality: also usability!

There is an old german adage “the eye eats with you”. True to this quote, customers rank design and usability as important – even the most important – requirement when selecting an LMS. After all, such a system is procured for the learners. No matter if the learners are internal or even external – and therefore: paying – customers.

This means that the acceptance of the system is business-critical. Acceptance therefore depend on the users’ interaction with the system being positive. It is precisely in this area that UX (= user experience) is relevant. There could be other providers in the markte for the same learning content. In that case, there is a risk that a learning person will turn to the other provider with a more advantageous UX. However, it should not be overlooked that an LMS should map learning processes. So testing specific functions according to the requirements should be prioritized just as high. Especially, when selecting and ordering learning content becomes part of the scope of services.

Related terms to Learning Management System

Other terms used in this context are learning platform, learning environment, or learning world. In our consideration, these are synonymous with an LMS, even if they partly place the emphasis on certain aspects.

For example, the term platform emphasizes the integration of the LMS into other environments. Or even the integration of other systems into the LMS. These could be a linked streaming server for learning media that is so well integrated that users of the system do not notice it.

Learning environment and learning world tend to emphasize a focus on learner use for learning. Less, for example, on administrative elements. This is usually linked to the fact that learning is offered here in a global and all-encompassing way. A large company might use a centralized approach with one system providing training on a global level with local additions. In addition, “soft” criteria and functions linked to design, should promote learning beyond the mere provision of content. Some exaples are: color schemes, design, usability. The basis for this is, among other things, knowledge from psychology, marketing and also didactics. These expectations were also integrated into the ide of a LXP, a Learning Experience platfom.

We consider all of these synonyms to be included when answering the question of what a Learning Management System (LMS) is.

What do companies use a Learning Management System for?

The first facet of the answer to the question of what a Learning Management System (LMS) is: the question of what it is used for. What a company uses an LMS for depends to a large extent on the significance and scope of the learning activities in a company. Basically, a distinction can be made between two forms of use by companies.
Firstly, companies in which the learning processes are to be mapped internally, such as in personnel development for employees.
And secondly, learning processes that affect external learners, such as product training.

The purpose of use in case of training for internal customers is strongly influenced by a company’s learning strategy. For this reason, we subdivide the topic for internal customers according to the major currents in learning strategies.

Learning Management System as support for internal learning processes

An LMS that supports internal learning processes is either purchased to replace an outdated existing system. Or it is purchased because the – usually central – delivery of learning content can no longer be accomplished without software in terms of effort. However, this is a consideration that, from our perspective, relates more to the choice of a training management system (TMS) as it relates to management efficiency.

However, as part of this change, there are often plans to simplify communication with learners and improve the transparency of the training offered. At the same time, discussions usually begin about the increased use of digital learning media, which should both increase efficiency and make it easier for learners to access.

There are two perspectives on the learning processes: that of the company and that of the learners.

The perspective of the company

When procuring an LMS, it is important to have a discussion of the different philosophies of how the company plans to deliver learning to employees. This is not always – but often – also justified by the way learning is financed in the company.

Fundamentally, learning is always a cost-benefit calculation for the employer:

Costs arise from:
  • Organization, administration and creation of learning materials
    • It doesn’t matter whether it’s face-to-face training or digital learning materials: Both have to be created and maintained to be up to date.
  • Implementation costs of the learning unit
    • in face-to-face training possible in the form of training rooms, trainer costs, catering, travel costs, catering etc.
    • for digital learning media possible in the form of required technical systems such as streaming servers, communication tools, licenses for software or purchased content
  • Cost of absence
    • Employees in trainings are not available for the immediate value creation planned for them
This is offset by various components of expected benefits:
  • General employability of employees through basic information
  • Increased efficiency through newly learned methods or newly acquired knowledge in the use of e.g. software
  • Quality improvement through avoidance of “typical errors” or the “correct” use of methods or software
  • Fulfillment of legal conditions through trainings such as data protection or compliance trainings
  • Further:
    • Satisfaction and/or motivation of employees due to the character of a reward of a training (absence from the job, variety, etc.)
    • Team-building due to the social nature of a training course
The result of this analysis

To put the results of this analysis exaggeratedly, there is a basic classification of trainings according to the following evaluation grid: “Trainings …
1… have little significance. Usually, this means: the training portfolio is maintained with minimal effort and also only the most necessary contents
2… are necessary. This usually means, that the size of the training portfolio is between the absolutely necessary and an arbitrarily generous breadth and depth.
3… are something great and important. Meaning: the training portfolio is usually not limited to internal offerings. Under certain circumstances, the internal offering is also supplemented by content created by the employees themselves

These three exaggerated classes often result in the following three – equally exaggerated – concepts for the processes that the LMS must then implement:

Concept 1: Training has little significance

Only training required by law is funded centrally. All others are financed according to the “causing person pays principle”:

Trainings e.g. for a new software have to be paid by the budget of the implementation project (whether planned or not!) or even the cost centers of the learners.
Team building measures, learning periods, further education and training of any kind have to be paid by the cost center of the employees. Automatically tensions are created in the distribution of the usually scarce resources. This prohibits transparent learning opportunities: Anyone who wants to learn something must demand and enforce it through the hierarchies.

In turn, this leads to a general requirement to review, in one form or another, every step in the process of learning. Requests for training must be approved by cost center managers in terms of cost and content by HR development. Learning progress is reported back and reviewed. Costs must then be allocated.

Often, within a learning landscape according to this concept, it is easier to do learning-by-doing or learning-on-the-job. In other words, being guided and receiving explanations from an experienced person while on the job, rather than following formal training activities.

Opportunities and risks?

In this concept, the opportunity arises that the control over the training is completely in the hands of the HR department, as a single point of contact. That means, here one gets any information about the offer. This also offers the chance that the budget for training remains measurable and thus very controllable.

On the other hand, it carries the risk that the general change in society and learning topics moves faster than the portfolio can be adapted by the HR department. In addition, there is a lack of impetus from outside the company. In addition, the employees – the “people affected”, so to speak – are not involved.

Concept 2: Training is necessary

Through requirements gathering, feedback from conversations with employees, and other sources, a company gathers what training is needed. There is a central budget for the resulting portfolio. This is used to create an offer for employees from which they can choose. There can be a gradation between “free” training and, for example, training for target groups such as managers, which is only visible and bookable for them. The individual or their cost center does not have to pay anything for these trainings, nor does the cost center manager have to agree to them.

The portfolio can be viewed by all employees in the form of a structured online catalog. Nevertheless, there are special trainings for which the budget has to be delivered by the “originating” cost center. However, the training is then also procured individually tailored to their needs.

Opportunities and risks?

As a result, there is an opportunity for regular cycles of coordination of catalog requirements within departments and with learners. These cycles can vary in length. To bridge the gap, there is the offer of individual ordering. This reduces the risk that one central office alone will have to bear the responsibility for the further development of the portfolio. Trainings are always an indicator that knowledge of existing methods and techniques is lacking or that new methods and techniques have emerged. This also makes them an indicator of how strongly a company is aligning itself with new trends. These innovations might potentially not even be visible to personnel development since they may stem from specialist topics. They do become visible when employees request trainings or during the needs assessment. In spite of everything, however, it will be a cost-benefit consideration whether these ultimately make it into the training portfolio.

The risk is that the use of an open catalog depends very much on what the workload of employees looks like. If the workload is high, there is a risk that a rich training offering will have the impression of a metaphorical “unreachable carrot” – i.e. it cannot be used at all. This is diametrically opposed to the fact that when training is freely available, teams with low workloads and little direction from team leadership benefit greatly. In the worst case, this can lead to overqualification of employees in relation to their competence or position.

Concept 3: Training is something great and important

The (self-)understanding that training is something great and important leads to not even trying to create a “closed” catalog as a default. A personal training credit or budget allows each individual to organize for themselves what is necessary. This can come from the company’s internal catalog or from outside. The responsibility is completely transferred to the employee. Therefore, hardly any approvals or major checks are necessary – except, if necessary, for absences. In this case, the working time model and learning strategy are mutually dependent.

In this case, employee training is usually also supported by employees. User-generated content (UGC) in the form of learning videos, PDFs, etc. is created by employees and consumed by other employees. It is important to consider whether to quality assure UGC or not. If one chooses to do so, an appropriate editorial process is needed. Not doing so runs the risk of quality differences between the artifacts that are created in the process.

Opportunities and risks?

In this concept, the opportunities are clear: the trainings have their finger on the pulse of demand. Knowledge can be actively shared. Personal competence is valued beyond its usefulness for one’s own work. For employees, this is an immense gain in freedom and self-responsibility.

However, this also poses a risk. Both the production and consumption of learning units offered by employees automatically lowers productivity. This is because employees can only perform one task at a time. Without an editorial concept to ensure quality, it is not even guaranteed that something valuable for the company or the learners will come out of it.

Especially in companies that take this perspective, the topics Learning Experience Platform (LXP) and Learning Record Store (LRS) are of particular importance.

Overview of the three concepts:

The following is a summary table of the three – exaggerated – concepts of how companies view training in their organization. Each of the concepts has opportunities and risks for both the company and the learners. In addition, each concept has a very specific impact on what purpose the LMS should serve for a company that follows that concept.

Concepts Opportunities of the concept Risks of the concept Purpose of the LMS in the concept
Concept 1 Focus on operational business and learning-by-doing concept Change (whether social or technical) is not necessarily integrated in a structured and timely manner

– Management of training courses for documentation

– Allocation to cost centers
Concept 2 Company’s need for innovation and adaptation through training is transparently presented Pre-prepared catalog is not actively adapted to current needs and thus obsolete needs are met. Distribution of budget may seem unfair depending on individual’s freedom to opt out of work.

– Catalog and booking functions

– Separate target groups

– Documentation and accounting
Concept 3 Freedom and personal responsibility for employees

Use of budget for other than business objectives if

Creating content for others takes more time than operational activities

– Catalog with possibility for all to add content

– Good search functions

– Documentation and charging to individual budgets

– Editorial process for UGC

Learners’ perspectives on “why learn?”

The learner’s perspective usually revolves around the other side of the coin: what the person gets out of learning. From our experience, learners learn for one of the following four reasons:

Mandatory trainings:
  • The word “compulsory” gives the term a subtext, which means that participants rarely expect an interesting training experience.
  • Learners are usually primarily aware of the mandatory character and less of the benefits.

From this, the need that learners have for system support in the form of an LMS can be derived. Learners want to find the mandatory content easily. This requires that the LMS can assess which mandatory training the person needs to learn. For that reason, the LMS needs information about the person (e. g., department, job, etc.). Learners want to be able to work through this learning content efficiently. They want to be able to quickly find learning materials for the content they have learned and use them again to recall what they have learned.

Career Opportunities as driver for learning
  • These are trainings that cover topics that are within the learner’s current job or directly adjacent (vertical in the sense of being complementary or horizontal in the sense of being expected in the future).
  • Learners do it for career: whether working through a learning plan or further training to become (or even: as) a manager. Learners take part in these trainings because they offer contents that are relevant for their job and especially for their career.
  • A distinction can be made between two types of training:
    • Trainings that are only helpful within the company (e.g. product trainings or trainings focusing on methods of the company).
    • Trainings that are also helpful in case of a professional change (e.g. generic methods like SCRUM).

In this case, the purpose of an LMS as a support for learners is to quickly find suitable trainings. This requires that the LMS is able to find out what a suitable further training is.Therefore it uses information about the person (e.g. department, job, length of service, level of education, etc.). Again, subsequent access to learning materials is beneficial to learners. Especially forms of proof such as certificate or badges are welcome artifacts here.

Career and personal goals as drivers for learning
  • These are training courses that have private benefits beyond professional needs, such as language training.

In this case, the purpose of an LMS as a support for learners is to quickly find suitable training. This requires that the LMS is able to find out what are suitable trainings. The selection can be based on information about the person like department, job, seniority, educational background. Or also information like  personal preferences, hobbies, etc, if the are available. Due to the benefits for the participant, the willingness to look for trainings like this is greater than, for example, in the case of compulsory training.

Private purposes as driver for learning
  • These are trainings that meet a person’s personal needs, but usually *not* the company’s – e. g.:
    • Trainings of a private nature, such as sports activities or hobbies. Companies that put a lot of emphasis on their employer branding offer these kinds of training. They are also often publicized with a desire for external exposure as part of the compensation package for employees.
  • Training courses of a retraining nature, i.e. not directly related to employees’ current job. For example, to prepare for another line of work, such as employees in an accounting department learning programming in order to move from accounting to IT. This form of training is usually not promoted or offered due to aspects of human resource planning. Such training is more likely to be offered by the employment agency.

In this context, the trainings are not offered internally through an LMS. It is more likely to be offered through an LMS of the employment agency or companies such as adult education centers. Therefore, this is more represented in the use case for companies offering trainings on the public market. Due to that nature, it is usually not possible to use existing data to optimize the search. That means learners expect a clear and structured presentation of the offer. The presentation of the benefit for the learner should be in the foreground.

We have summarized these perspectives in the following table:

 

Aim of the learner Purpose of the LMS for the goal Necessary functions of the LMS
Mandatory trainings Easy to find, reminder, “efficient” to work through.

– Search function

– Reminder function

– Database with learning materials
Learning for career opportunities Find suitable or necessary training

– Search function

– Contextualization (which training for which purpose?)

– Database with learning materials
Learning for career and private Be able to use personal preferences linked to career topics as a search criterion

– Search function

– Search criteria beyond professional character

– Database with learning materials
Learning for private purposes Savor reward element

– Search function

– Well structured catalog

– If applicable, separate catalog or catalog branch for “private” offers

The learner’s perspective on “how to learn?”

What does “learning” mean for learners? “Learning” is a very complex concept and the subject of research in a wide variety of scientific disciplines.

Starting with the distinction between intentional and “inadvertent” or unintentional learning, to the question with which formats, what is the right “portion size” of learning units, there are vast amounts of scientific material.

The German entry on “learning” in Wikipedia is more than 4,500 words long and has per section of about 200 words between at least one and up to 40 cross-links to context articles leading to a more in-depth topic.

Thematically reduced down to the question of: In the work context, what does “learning” mean for the job or in the job that is not “on the job” – and how can that be supported with an LMS?

And why do we ask this question under the point “perspective of the learner”?

The “how” is a question that every company that works with cimoio and us, STL GmbH, asks – and probably all others that have an HR department or even a personnel development department.

The methodology is a decision criterion for the learners

We have already introduced the companies and their goals before. To put it more pointedly, one can say: to achieve maximum success with the trained person for little input (in the form of working time and training costs). In addition to the discussion on “cost reduction”, this inevitably leads to the question of how maximum success can be achieved. And the answer lies in the person learning.

The toolbox of methods – partly due to technological progress – is larger today than ever before. After the COVID pandemic, knowledge transfer is more diversely positioned and also more mobile than ever before. Questions about face-to-face knowledge transfer range from one-on-one coaching in person to group training in a training room to hybrid sessions with on-site participants and online participants.

With this in mind, science tries to prove, what is the “best” method (about which expert opinion has certainly changed historically). Regardless, it is important to many training companies to choose methods that are cost-saving, in tune with the spirit of the times. They are also happy to accommodate the wants and needs of learners to create another layer of incentive.

And from this, in our opinion, comes the need to ask the “how?” question in the section on “learner perspective.”

Different learning styles

As mentioned earlier, this list is quite long and virtually every item on the list is a dimension of “how”, providing a scale at the end of which there are “extreme variants”, but between which there are also transitions. In addition, these dimensions can be combined in a training, which further increases the complexity. This multidimensionality in turn is also a challenge in technical management, i.e. for a TMS. At this point, a small excerpt from the list of dimensions “how” to learn:

  • With a trainer or without
  • With digital content (e.g., videos, e-learning, etc.), without (e.g., classroom training), or mixed (e.g., a video shown on-site in a classroom training)
  • If possible, all information in one block (e.g., vocational school instruction or theory phase in dual studies, but also a “complete” training on a complex of topics over the entire day or even several days) or “micro-learnings” or “learning nuggets,” i.e., very small learning units that can be used frequently (e.g., daily) or only accessed situationally as needed.
  • Channel over which the training runs (e.g. online training via communication software) vs. face-to-face training
  • Spontaneous as needed, scheduled or even mandatory with appointment due to regulation.
  • Consequently: without any test, with self-test for personal confirmation or with final test as formal confirmation of successful understanding
  • and much more…
What does this mean for an Learning Management System?

With regard to the question of how the “how” can be supported by an LMS, the generic answer is: Preferably, the LMS leaves the methodological and didactic solution to those responsible for the training. But at the same time, it offers the broadest possible toolbox of methods that those responsible can use. However, as the terms already show, this is mostly about administratively supporting the creation and management of training, which brings us back to the domain of the training management system (TMS).

For example, important in delivery are:

  • Possibilities to support face-to-face trainings (for example, by providing location and room information), to connect online trainings in a user-friendly way by short click paths to the communication software and, in the case of hybrid trainings, to clearly present the alternatives.
  • Deliver digital media – preferably clearly arranged and with good search functions
  • Mobility of knowledge – access at any time from any place, whether via apps, the web or other means – so that (if desired) any learning person can learn where and when they want to

Once these possibilities are in place, all avenues are methodologically open for a company offering training to implement its learning philosophy.

Interaction between the perspectives of the company and the learners

Learner demands have implications for the LMS in the context of the previously presented – exaggerated – enterprise perspectives. These are shown in the following table.

 

Strategy Concept 1 Concept 2 Concept 3
Mandatory trainings Unavoidable, easy access, good documentation. Unavoidable, easy access, good documentation. Unavoidable, easy access, good documentation.
Learning for career opportunities Only the most necessary. Mostly not easily accessible, not always transparent. The largest part of the training portfolio offered, structured and transparent to book yourself. Part of the training portfolio, which is offered for self-booking.
Learning for career and private Normally not offered. A portion of the training portfolio offered, possibly with quantity limits or application or approval processes. Part of the training portfolio, which is offered for self-booking.
Learning for private purposes Normally not offered. May be present. Part of the training portfolio, which is offered for self-booking.

 

Annotation:

It is important to understand here that – if we move away from the exaggerated representation and take a look at reality – there is a hybrid of both learner requirements and corporate goals. Both are rarely permanently stable.

Learner requirements change over time, due to external life circumstances and changes in the world of work. Likewise, the business goals and thus the requirements for learning are constantly adapting according to the business environment.

It follows that an LMS should not only meet the “extreme requirements”, but should also allow rapid adaptation to the fluid changes in everyday business via settings. This is the only way to ensure that the investment in an LMS also establishes a lasting partnership between the company and the provider.

Learning Management System as support for external learning processes

An LMS that supports external learning processes, i.e. training courses that are sold or offered to external people, is procured in order to:

  • either to purchase an initial sales solution for training or
  • replace a system that has previously taken on this task, but is usually not an LMS, and solve this focus task with a specialized tool or
  • to integrate existing systems (e.g. CRM and web shop) with a solution specialized in the management of training courses

In principle, when considering an LMS that is intended to support external learning processes, it is irrelevant what type of external training is involved. For the LMS, the product training of an industrial company for its customers is comparable to training at an academy, which, for example, imparts methodological knowledge.

In both cases, knowledge should be imparted to a person – which in turn works just as well for external people as for internal people. However, there is also the level of commercial processes.

Three possible sales constellations:

In commercial processes, it can be a relationship with two or three partners. This is because there are three possible constellations:

  • B2C (business-to-consumer; business relationship between companies and private individuals): A private individual buys a training for himself.
    B2B (business-to-business; business relationship between two companies): A company (or more correctly: a person in a company) buys for itself or for another person in the company.
    B2A means: business-to-administration; business relationship between companies and authorities): The buying company can be a private company, but in special cases also one of the public sector, such as the employment office, which pays for further and further training or retraining for a private individual.

In the case of B2B and B2A, one entity (private/government company) usually buys a service for a person who represents it. In this case, all parties involved have specific expectations of a training session.

There are therefore three perspectives for the learning processes for external parties: that of the training company, that of the learner and, in B2B and B2A cases, that of the “buying” company.

The perspective of the training company

The learning measures to be sold are subject to a cost-income calculation for the training company.

Costs arise from:
  • Organization, administration and creation of learning materials
    • It doesn’t matter whether it’s classroom training or digital learning materials. Both have to be created and maintained in order to be up-to-date.
  • Implementation costs of the learning unit
    • In case of face-to-face training possible in form of training rooms, trainer salaries, catering. In case of training at a customers site there are travel expenses and meals catering, etc.
    • In the case of digital learning media, possible in the form of required technical systems. For example such as streaming servers, communication tools, licenses for software
  • Organization, administration and handling of the commercial process
Revenues are generated by:
  • Selling the training, for this the following factors should be considered:
    • Price – must appear reasonable for customers to the performance/value of the training.
    • findability – which in the online context means: optimal conditions for SEO (Search Engine Optimization)
    • “simple” ordering. However, this wish is contrasted by legal framework conditions and commercial necessities. These have to be taken into account when registering as a new customer. Also for processes like logging in as an existing customer and the ordering process for training courses.
There are also framework parameters that affect both the cost and the revenue side:
  • Quality: signaled for example by respected certificates (such as ISTQB for testers, IREB for requirements management, IPMA and PRINCE2 in project management, etc.).
    • Cost: On the cost side, quality is affected by, for example, expenses for documentation for participants, or the type and scope of testing to confirm success.
    • Yield: On the yield side, it again has an impact because a quality promise gives buyers security in procurement and thus potentially increases the number of training courses sold.
  • Topicality: It’s a fine line that separates a buzzword from a tangible trend. But current topics in particular, such as the topic of artificial intelligence in 2023, creates immense demand. This demand for information comes from people who really want to understand the topic. And that means you need trainers who can communicate it.
    • Cost: On the cost side, topicality is affected, for example, by the fact that trainers for trend topics are usually difficult to obtain at the beginning. Since  there are still few of them at the start of a trend. But also to identify trends early on, you have to invest in market research to distinguish between a buzzword or a real trend.
    • Yield: On the yield side – similar to quality – it has an effect that customers usually want to find out about a trend quickly as soon as it becomes recognizably established.
The goals formulated for the introduction of an LMS are usually geared toward optimizing the cost/income ratio:
  • On the one hand, costs should be reduced as much as possible. Especially in the area of organization, administration, and creation of learning materials.  Markedly, these positions fall within the scope of a TMS (training management system). But also in the digitization of commercial processes, an LMS is expected to contribute to increased efficiency.
  • On the other hand, a good LMS should support on the revenue side. Undeniably, it can do so through optimal advertising and sales functions of the catalog. But also through user-friendly processes taking into account legal framework conditions. These touch on registration, log-in, and ordering processes as well as order processing from a commercial perspective. Although order processing as a classic administrative topic again falls within the area of responsibility of a TMS (training management system)).

The perspective of the learning person

Choosing a training is also subject to a cost-benefit analysis for an individual (and possibly also for a company). This may also be coupled with additional elements. Such as a preference for certain providers (or, in the case of B2B: contracts for them) or, for example, spatial restrictions in order to avoid high travel costs.

Depending on the product, there may also be the question of whether substitution training is available. In other words, whether the training is interchangeable. This means whether there are other providers of training courses that are equivalent in terms of quality and content. Then the focus is usually narrowed to the price of the training and all other factors are “only” added as complicating factors.

Costs arise for the learning person due to:
  • Purchase price for training
    • The more interchangeable training and providers are, the more critical this factor becomes.
  • Time value
    • The longer a training course lasts, the higher the base price usually is automatically. However, there are also the values:
      • Absence
        • From work – although this can have both a positive and negative effect, depending on the work ethos.
        • From home – also to be evaluated individually.
      • Travel time
    • Travel costs
      • The further the trip, the higher the travel costs. And the longer the training, the greater the factor for e.g. overnight stays and meals.
    • Transaction costs
      • These are all costs that are not directly related to the training, but e.g. how long a learning person has to search for the appropriate training. Particularly in the case of interchangeable training. There is a risk that a training that does not show up high in searches using traditional search engines will not be considered. However, infrequent training is also at a disadvantage, if it is not found by searcher
Benefits accrue to the learner through:
  • Career opportunities
    • The fact that training gives the learning person an edge in the job market is usually a desired, if not expected, benefit.
    • This also includes announcing what one has learned in professional networks, such as Xing or LinkedIn – in order to draw attention to the new expanded level of knowledge.
  • Knowledge growth
    • This also includes sustainability in the form of physical or digital reference books that can be used to (re-)activate knowledge – even after a training course has ended
  • Time value
    • The longer a training course lasts, the higher the absence:
      • from work – although this can have both a positive and negative effect, depending on the work ethos.
      • from home – also to be evaluated individually
    • Travel bonus
      • Travel to a training location that is not yet known or perceived as pleasant can act as an incentive or, in the case that it is not known (or is perceived as unpleasant), it can act as a demotivator.
    • Expand network
      • Most training takes place in groups, which usually provides the opportunity for networking, which can itself result in an expansion of career opportunities, as well as fulfilling a social need

The long duration of a training course and a trip to the training location are ambivalent criteria that can be interpreted both negatively (cost and effort) and positively (change of scenery). This leaves two criteria that reliably influence as criteria for individuals to weigh. First, they evaluate the cost of the training. And secondly, the resulting opportunities for their career and the expansion of their own social network.

The perspective of the buying company

The perspective of the company procuring training for employees brings us back to the consideration of employee training as described earlier. Again, a brief look at the cost-benefit analysis in abbreviated form:

Costs are incurred by:
  • Transaction costs for procurement.
    • These are the costs to the company of choosing from a selection of training suppliers and possibly even contracting for contingencies.
  • Purchase price for training
    • The more interchangeable the training and vendor, the more critical this factor becomes.
  • Travel costs
    • The farther the trip, the higher the travel costs, and the longer the training, the greater the factor for overnight stays and meals, for example.
  • Absence costs
    • Employees in training courses are not available for the immediate value creation planned for them
This is offset by various components of expected benefit:
  • Increased efficiency through newly learned methods or newly acquired knowledge in the use of e.g. software
  • Quality improvement through avoidance of “typical errors” or the “correct” use of methods or software
  • Fulfillment of legal conditions through trainings such as data protection or compliance trainings
  • Further:
    • Satisfaction and/or motivation of employees due to the incentive character of a training course
    • Team building due to the social character of a training.

Externally procured training courses present companies with a problem. Especially when they involve a relevant monetary investment. This must be taken into account in training, further training and continuing education in general.

The company wants to ensure that the newly gained knowledge does not lead to a departure to a better position in another company. For this reason, these companies face a contradiction. On one hand, for recruitment reasons, they want to ensure that “the world” knows that they are making such investments. On the other hand, the company makes itself vulnerable to  competing companies. These might learn about specific employees and what specific knowledge they have. This allows headhunters, for example, to make a good assessment of potential candidates for poaching.

Summary of the perspectives

When these cost/benefit or revenue lists are contrasted, it becomes clear that virtually every item has a counterpart among each stakeholder group. However, some of the meanings are opposite. The training company’s cost items create value for learners and companies to pay. So these are one of the main reasons to buy the training. In addition, however, there are all the other costs associated with the training.

In the case of benefits, on the other hand, the benefit arguments of a learner are not congruent with the interests of the company in all points. 

 

Training company

 

Learning person

Purchasing company

Costs

 

 

 

 

 

Production learning materials

 correlates with:

Training price

Training price

 

SEO

correlates with:

decreasing transaction costs

decreasing transaction costs

 

 

 

Travel costs

Travel costs

 

 

 

 

Absence costs

 

 

 

 

 

Benefit

 

 

 

 

 

Income from sale

 

 

 

 

 

 

Career opportunities

 

 

 

 

Public prestige

 

 

 

 

Increase in knowledge

Increase in knowledge/ competence

 

 

 

Reward character

Employee satisfaction

 

 

 

Safety/Health

Compliance with legal requirements

 

What does this have to do with a Learning Management System?

The functions of an LMS are designed to satisfy the LMS supplier’s customer. In the long term, however, this also means that the interests of the customers of the customer of an LMS supplier must be taken into account.

Thus, a wisely sourced LMS must consider the interests of all three stakeholders. It is up to the LMS procurer to decide which requirements are the focus of implementation – is the focus in B2B more on the procuring company? Or is the training aimed at private individuals? Or must the balancing act between the interests of private individuals and companies be achieved?

In concrete terms, this question leads to the list of functions that we will present later, which an LMS should be able to map.

Learning Management System as “Webshop for Training Providers”

So, all in all, it’s clear that if you deal in training, marketing and sales are necessary these days. Today, customers expect to be able to buy their goods online, whether digitally or, in the case of training, face-to-face training. It doesn’t matter whether we’re talking about product training as a supplement to physical products or training offered on its own.

Industrial companies usually have a head start here, as they already have an online sales channel for their physical products. Small but growing companies, in particular, are faced with the question of how to offer their training. The choice is between an online sales tool and – in the context of an LMS – an integrated solution.

LMS with web store for training providers

It is important to weigh up the advantages and risks involved in each case. Particularly for a company where training commerce is the key function, an integrated solution with online sales makes sense. After all, if the training process is fully mapped end-to-end in one system, it feels like the most user-friendly solution for customers. If the LMS then also has a meaningful TMS integrated, this solution can fully support a training provider’s business. A transfer is then only necessary to an accounting system, depending on the functionality of the TMS.

LMS with web store for companies whose core products are not training courses

In the other cases, the trade-off is between an integrated solution and any alternative solutions that may already exist. When working with one (or even several) other systems, this always results in so-called “system breaks”. This means that information must be exchanged between systems for further processing. This is done via interfaces. These can be “manual”, which in the worst case means that someone types or copies the data from one system and pastes it into the other. Better are digital interfaces that exchange with little loss of time and high security. However, such fully automated interfaces require development effort in at least one of the systems involved. This costs time and money for coordination, development, testing and introduction.

However, the introduction of an LMS with integrated online sales also involves risks in addition to already existing and established systems. On the one hand, these are to be found in questions of uniformity of appearance vis-à-vis customers, questions of SEO, but also the transfer of commercially relevant information to internal commercial systems, e. g., an ERP system (Enterprise Resource System, in German: Warenwirtschaftssystem), which often contains digital accounting.

Summary of what companies use a Learning Management System for

The basis for the decision to introduce an LMS in most companies is the desire to increase efficiency in employee training and reduce costs. This increase in efficiency is to be achieved on one hand through the digitization of processes and a central point of contact. On the other hand through the fact that a digital learning platform can also provide online content for learners. Online content is also offered in the expectation that it will reduce costs.

There is another aspect that does not apply to all companies that opt for an LMS, however. It is the desire to give employees more autonomy in learning. Thereby trying to achieve that the effort to bring “the right training to the right person at the right time” is redistributed from the administration – e. g., the HR department – to the people concerned. This usually includes a component of increasing employee satisfaction because they can order independently from a portfolio.

For companies that only train externals or even in addition to employees, there is also the question of how the commercial process is integrated. Do you connect the LMS to an existing online channel or do you look for an LMS that offers this channel itself?

Who uses a Learning Management System?

The second facet of the answer to the question of what a Learning Management System (LMS) is: the question of who is using it. Following the question of what perspectives companies and learners take on the what for and the how with an LMS, there is also the question of “Who uses an LMS?”. In a broader sense, what specific tasks do people who need to fulfill specific roles work off of with an LMS? Earlier we discussed that there are different benefits and perspectives depending on the needs of an organization. Classification by audience also has an impact on the question, “Who?” Influence. So let’s look at that context again first before answering the question:

Employee training with a Learning Management System

An LMS for training employees is usually integrated into the company’s intranet. The LMS needs the information as to which person is currently acting specifically. With attention to data protection reasons. But also, if necessary, for the correct processing of bookings to the correct cost center. SSO technologies are often used here to avoid log-ins, since the user is in the context of the intranet anyway.

SSO stands for Single-Sign-On. This is a technical method of making a person’s identity known when using various digital systems. In this case, one logon is used for various systems, thus making further log-ins unnecessary. Once the person has been identified, the various functions of the LMS can be used.

Training customers with a Learning Management System

An LMS for training customers is normally used via the Internet. That makes it necessary to identify the users securely. In the B2C context, there is usually only one user involved.

In the B2B context, however, a company may be dealing with different persons on customer side, who have different roles. The first role is the “booking person” who is commercially procuring. “Learning person” is the second role. The “booking person” has procured a training for this person, because “learning persons” may not have competences to procure themselves. These two roles must be equipped after identification with the appropriate functions and views.

For this, however, it is necessary that the LMS “knows” which person enters the system. Then it may interpret, what the user intentions are and provide the “right” functions and views. This role assignment can be done manually by a person via the system administration or it can be automated.

For both use cases, however, a data record must be in the system. The sources for this can be, for example, CRM systems (CRM = Customer Relationship Management) or self-registration.

Training employees as well as customers with one Learning Management System

In individual constellations, both employees and customers or external employees (e.g., in independent sales) are trained in the same system. For example, in the area of product training, this happens.

In this case, the LMS must be able to distinguish between the external side with registration and ordering and the other with SSO, if applicable. The LMS must also ensure, for example, that internal employees do not register “by mistake” via the external accesses.

After these explanations: roles in a Learning Management System?

Following are the roles and positions in a company that use an LMS – learners are self-evident. The roles of trainer and manager are also classic roles in the system. However, other roles depend on external criteria such as the size of the company and the function of the system in the company. They are therefore only relevant under certain conditions.

Learner

Regardless of whether learners come from within the company or from outside, learners are the main users of a learning management system worthy of the name.

Depending on the strategy pursued and whether learners are expected to be authorized to make bookings themselves, apart from the learning content, a catalog can also be stored or views of additional information.

The access methods are also irrelevant and only a means to an end to let the learners get to “their” information, taking into account data protection and data security. It doesn’t matter whether it’s from the outside or the inside. Drivers here are legal requirements for online commerce and the DSGVO (Basic Data Protection Regulation), whereby there are minimum “standards” that cannot be undercut without the risk of making oneself legally vulnerable.

Trainer

Trainers can initially be employees themselves and thus also take on the role of a learning person. In this case, it is a matter of efficiency to provide them with the information for their role as trainers in the same system as well.

However, if the trainers are external, it may still make sense to give them access to the system. This helps to avoid having to share, for example, participant lists, feedbacks, etc. by other means (but in compliance with the GDPR). If the insight can be provided within the system, that exchange is not necessar anymore.

Managers

Managers are usually granted the right to book training for their team members in the context of corporate learning. Strong regulations in a business domain can make it necessary, that managers are also responsible for keeping track of the current qualification status of their team.

When using the system internally, managers are also in the role of learners in the system themselves. In this case, it is also simply a question of efficiency to show e.g. team overviews with display of past, current or even planned training measures.

External managers usually do not have an explicit role in an LMS. This role is then replaced by the “booking person” (see next section).

Booking person

In the case an LMS is used for external training and therefore offers a web store, booking persons must register. These should be able to view their commercial data here, such as past orders.

This means that on the one hand they have an importance for the commercial process. But on the other hand they potentially take the role of a manager, who buys trainings for another person.

Administrator:in

The system administrator for the LMS will of course also use the system to make adjustments or check error messages. In the event that the LMS is integrated with a TMS, this role is usually overarching for both system elements.

Who doesn’t use a Learning Management System?

To make the distinction from other systems clearer, here is the list of users who do *not* use the LMS. Depending on the software product and the functions of other systems that it offers, it may be that they work in their software product but do not use functions of the LMS according to the definition.

E-learning authors
An authoring tool is used to create an e-learning. This can be integrated into a TMS or LMS, but does not have to be.

Product owner / organizer
A perhaps confusing piece of information if you haven’t yet read our distinction of TMS vs. LMS. But the management, maintenance and organization of products and events, is part of the Training Management System. Certainly no one will offer an LMS without at least rudimentary TMS functions, and conversely no TMS without at least rudimentary LMS functions. Accordingly, product managers and event organizers therefore use LMS functions and not TMS functions.

Function list of a Learning Management System

The third facet of the answer to the question of what a Learning Management System (LMS) is: the question of what it must be able to do. This follows directly from the previous questions and answers.

Accordingly, there are functions that simply must not be missing, regardless of the context of use.

However, there are also a number of functions that are optional because they depend on a concrete business model or a very specific task to be performed.

The number of bookings of a training provider is a metric for evaluating the success and the scope of a learning activity. During their lifecycle, bookings permanently have a status, so that reports on bookings always allow precise information about activities and results.

The absolute must-haves:

What every software should have:

First, there are must-haves that apply to *any other* software as well. These are:

  • a roles and rights concept, with which you can control functions and data views
  • a data security concept – a part of this should also be a deletion concept, which customers should be able to adapt to their requirements for DSGVO conformity
  • the ability to create/use interfaces to other systems
  • Traceability functions to be able to track what happened before in case of malfunctions and errors.

These things are simply taken for granted by many customers. They are all the more shocked when a supplier has not yet come up with a solution – sometimes not even a concept! -even a concept!

The core functions of an Learning Management System:

  These are the features that make up an LMS and therefore *must* be present in any case:

  • Catalog: Structured presentation of training products or learning content with appropriate SEO-optimized presentation.
  • Products: Easy-to-understand description of the learning content and clear presentation of the implementation alternatives (e. g.: face-to-face event, online, hybrid or as e-learning)
  • Events: Overview of dates with locations (if not digital), travel information, info on trainers and price if necessary. In addition, active information about mandatory trainings with due date
  • Booking option: Efficient and user-friendly processes to register for the desired event(s), role-dependent customizable, e. g. for managers who can book for their team
  • Communication processes: e. g. mailings to remind people before a training is due, updates or even calendar entries for booked trainings.
  • Learning materials: access to digital learning materials such as PDFs, videos, e-learnings, etc. that have been made available (in addition to classroom training, if applicable)
    • More specific: For playing all common media formats. E-learnings, for example, may be available in certain formats (SCORM and AICC), which the LMS should be able to play back.
  • Reporting: e. g. overview of past trainings

The usage-dependent – and thus: optional – functions of a Learning Management System:

Internal training using a Learning Management System:

  • SSO procedure: To avoid an unnecessarily high number of logins, an LMS should be able to authenticate users. It is advantageous if several procedures are mastered.

Regulatory training using a Learning Management System

  • Qualification management: mapping of learners’ current knowledge and skills and planning of knowledge and skills to be achieved.
  • Authorization management: For particularly critical tasks, it may be necessary to check in real time for each assigned task which employees have the necessary qualifications for the task; i. e., who is authorized to perform that task.

External training using a Learning Management System:

Registration process: A registration process that is both user-friendly and compliant with legal requirements and GDPR regulations.

  • It should also ideally be able to prevent internal learners from registering through this channel as if they were customers when used for internal and external training.
  • Ordering process: An ordering process that is both user-friendly and compliant with legal and GDPR requirements. It must also be flexible to meet different expectations for the data required for order processing.
  • Login process: To make it easier for returning customers to work with the LMS, there should be user-friendly login processes. However, these should also take into account privacy and data security aspects. This involves decisions in the area of passwords, for example: password requirements (length and characters), password reset processes, two-factor logins, etc.

Special functions

These are functions that are only needed in very specific constellations. For these, there is sometimes dedicated special software that can be purchased in addition to a TMS and should then be integrated via interfaces.

Multi-client capability:

  • It can make sense for various reasons to divide the system into clients. For example, if a company wants to organize its training offerings by departments. Or if it is a corporate group with possibly international subsidiaries.
    • Each client can then have its own catalog to display under its own domain. Also with each client can have their own registration and ordering processes. It is even possible with, for example, market-specific features, and so on.

Target group capability:

  • Target groups open up the possibility of filtering catalog content for registered users. If a company wants to tailor its training offerings to target groups. Being that executive training for a dedicated group of participants or onboarding for new employees or departments.

Hotel management:

  • This function is necessary, if a company has its own accommodation business or rents room capacity in hotels or other facilities. Hotel management then helps to query participants’ accommodation needs already in the booking or ordering process. Following that there are processesto manage room allotments.

Internationalization:

  • To operate an LMS that can be used internationally, the LMS must be able to:
    • on one hand, to process the input of which language a visitor of the LMS would like to have displayed (from the settings of the browser or e.g. profile information).
    • on the other hand, the LMS must also be able to display the other languages and, if necessary, characters. non-european characters pose unique problems, especially in the area of Responsive Design. Responsive Design is a form of design for online pages and media. It ensures that content is displayed correctly, completely, and still usable on mobile devices of different sizes.

Comparison: Learning Management System vs TMS

What is a Learning Management System compared to a Training Management System? If you summarize the direct comparison between a Training Management System and a Learning Management System, the phrase “two sides of the same coin” probably sums it up best.

What you want to present and deliver in the LMS has to be created administratively in a TMS. But a pure tool for presentation and delivery (LMS) makes little sense without the ability to administer it as well. But an administration-focused tool (TMS) would be of little value without a component for delivery. So these two systems are complementary. The focus is opposite in the sense of: administration support (TMS) vs. user support (LMS). All the same, they complement each other perfectly to form a whole.

This picture explains why the term LMS has emerged as the generic term for both systems on the German market. There are markets where the distinction is made between TMS and LMS (e.g., the U.S. market). But even there is practically no software tool that does not have components of both.

What should be the basis for deciding which tool to purchase?

This is highly dependent on the requirements you have for the tool. The strengths of the LMS clearly lie in the presentation and delivery of training. This definitely makes sense for companies that have a lot of a large volume of especially digital content: many PDFs, videos, podcasts, e-learnings. After all, digital access to an LMS or learning platform ensures efficient delivery of digital content in particular. But an LMS is also suitable for “classic” forms of learning in the form of classroom training, because it provides an overview by displaying a catalog with products and dates, and can also provide additional digital content for classroom training. And it is also a very good solution for a blended learning concept (blended learning refers to the idea of mixing different formats, e.g. digital, such as video, PDF, etc., and classroom training to create a multimedia training program).

Comparison: Learning Management System vs LXP

What is a Learning Management System compared to a Learning Experience Platform? A direct comparison between a Learning Management System and a Learning eXperience Platform (LXP) shows that an LXP and the functions of an LMS overlap. Both have the goal of positively shaping the user experience. However, a classic LMS is primarily anchored in the idea of delivering predefined content. Explicitly according to predefined ideas with concrete goals. Even if users can choose for themselves: the catalog is curated. In other words, the content has been selected by HR or personnel development department. They curated the content with a specific strategy and a specific goal.

LXP tries do democratize education

An LXP tries to democratize the educational process. Beyond curated content, the LXP delivers an extended mix. That mix may contain UGC (user-generated content), third-party content such as YouTube, LinkedIn Learning, etc.
In this way, the company can combine a mix of legally required or strategically relevant content. And then join it with content that is acutely necessary for learners.

This idea is supplemented by additional functions. Chiefly a list of suggestions compiled algorithmically or by an AI (artificial intelligence). But also with design alternatives that are oriented toward modern streaming platforms. Comparable with modern streaming services like Netflix, Disney+ and the like. As opposed to classic ideas that are more akin to the paper catalog of the last millennium.

If you have to choose between an LMS *or* an LXP, you need to consider carefully which specific task you are focusing on. And, if necessary, whether it is worthwhile to purchase and use both systems together.

Comparison: Learning Management System vs LRS

What is a Learning Management System compared to a Learning record Store? When comparing a Learning Management System and a Learning Record Store, it turns out that the two complement each other well. The LRS was conceived in the context of an attempt to simplify and standardize the exchange of digital learning media and to update formats such as SCORM and AICC. One result of these activities was a database with the function of receiving and storing the communication or exchange format xAPI (abbreviation for: Experience Application Programming Interface), which was developed in parallel. And this independently of the source.

The LMS, however, manages changes to its data in its own database and communicates with all other surrounding systems via interfaces explicitly created for the use case. So an LRS and LMS interacting could simplify communication, exchange, and storage of learning information via the standardized xAPI format, making the LRS a bridge for the LMS to communicate more easily with other systems.

However, depending on whether a Training Management System (TMS) is available and its feature set, these may compete or functionally overlap.

Thus, an LMS with little TMS functionality can benefit well from an LRS.

Finally: historical development of the Learning Management Systems

Historically, Learning Management Systems (LMS) appeared in the late 90s. At that time as a special variant of Training Management System (TMS). Specifically with a focus on delivery of digital learning content with the advent of the Internet.

As the digitization of learning progressed, LMSs grew in importance. Initially, CBTs (computer-based training) were offered. Subsequently, this was followed by increasingly affordable and mobile access to the Internet. Suddenly, everyone was now able to access content available on the Internet. Likewise, as e-learning grew in importance and number, its importance was significantly advanced.

At the same time, the early 2000s brought further innovations. Platforms publicly available on the Internet, such as MySpace, YouTube, Twitter, and Facebook, etc. These were the first free ways to offer learning content. Whether as text or PDFs, or later audio (podcasts began around the turn of the millennium) and videos, there were many options.

Simultaneously, the meaning of the term LMS became more fuzzy. Due to the rapid advancement of technology and the freely available ways to create learning content. Around the same time, platforms we now call social media emerged . Cell phones were now equipped with cameras and videocameras. So today, anyone with a mobile device, which usually includes a camera, can record learning content. And that without the need for a studio to do it, neither for audio or video format.

Last but not least, the COVID-19 pandemic has given another boost to learning online, further promoting the importance of LMS.

And today…?

Currently (as of 01/2023), the US market research company Gartner lists around 400 LMSs for corporate learning. The comparison platform Capterra, which also belongs to Gartner, lists 1219 LMS products worldwide. For LMSs from providers based in Germany, there are still 50. But on closer inspection, very few are equipped with extensive functions to be considered TMSs as well.

Conversely, however, companies that offer a TMS on the market have often followed the treand of digitization. They have gradually equipped their TMS with functions into mature LMSs. It is reasonable to assume that LXP and LRS functions will also find their way into TMSs (and LMSs) over time.

This makes it all the more important to be clear about your own requirements. About what kind of software or what kind of tool you need to meet these requirements. Also in terms of an interest in long-term collaboration. And only then to make an informed choice.