By Arlo Team
Arlo is a Sponsor of the eLearning Success Summit
There is no one-size fits all approach when it comes to software for managing training businesses. For small, internal team training, a simple scheduling and logistics tool would suffice, without the need for e-commerce or finance and accounting. For medium to large commercial businesses offering a complex range of courses from face-to-face to live online and blended learning, a highly-automated solution is a must to drive efficiencies and scalability. For enterprise level training providers, such as universities, requirements can be so diverse that robust integrations or custom development may be necessary.
With so many variables, and a global market that is saturated with off-the-shelf software options, where do you start in terms of choosing the right solution for your unique training business?
First off, let’s look at the difference between custom-built software and off-the-shelf software, and the high-level pros and cons.
Custom-built software is commissioned by an individual business to be developed to meet their specific requirements.
Pros of a custom-built TMS:
- Tailored to your needs
- Built to integrate with legacy systems
- Only pay for what you need
Cons of a custom-built TMS:
- Big up-front cost
- Waiting time
- Maintenance and tech-debt
- Stuck with it
- Big internal processes/sign-off
- No trial product
- No training available
- Your requirements have to be spot-on to avoid expensive mistakes
- Budget could get blown, deadlines missed
Off-the-shelf software is pre-designed, ready to use, software that is purchased on a subscription model by a wide range of customers. It’s often called software as a service (SaaS).
Pros of an off-the-shelf TMS:
- Ready to go
- Lower cost
- Accessible support
- Existing help guides and resources
- Quick implementation
- Training available
- Regular updates
- Additional features
- No internal hosting or costs
- Meets data protection standards
Cons of an off-the-shelf TMS:
- You may need multiple systems to service your needs
- No control over new product features
- No control over subscription price (may go up over time)
- You may need to alter the way you work or the systems you use
- May take a long time to learn
- Paying for features you don’t use
The cost of new software
Aside from finding the best fit, one of the most important factors in choosing new software is the cost. Off-the-shelf software is usually the most cost-effective option. Because it’s scalable, the cost of the build is spread across multiple training businesses and therefore not absorbed entirely by your business, as with a custom-build. They’re usually subscription-model based with monthly or yearly payment options – some with discounts for annual contracts.
There is no upfront development cost, and you can reap the benefits of using the software right away. With a custom-build there is a time delay between first payment and return on investment.
And while new software is a significant investment for your training business, purchasing the wrong software is the single most costly mistake that a business can make. From financial costs, to time investment, to employee impact, business reputation and stability – the repercussions are vast and mostly immeasurable, but the impact is huge. Because of the risk involved, some companies choose to enlist outside help to ensure they get it right. Engaging a consulting firm to help define business requirements and compare and evaluate software options is a viable option, particularly for large organizations with diverse needs.
But while there is certainly added value from an expertise and process perspective, engaging an external consultant can be a drawn-out exercise, and is often too expensive for small to medium-sized training businesses.
Doing it in-house can be just as effective, so long as you follow a robust process. Some businesses choose to ring-fence a team of internal employees to dedicate time to the project, with representatives from all areas of the business, and dedicated project manager at the helm. Some may hire contractors to see the project through from end-to-end, or to back-fill existing employees who are working on the project. Either way, if you’re going with the in-house, DIY-method, here’s a proven methodology to ensure a smooth and thorough process…
Define your business requirements
When it comes to defining your functional requirements, a good template to use is user stories. A user story looks like this: As a <user>, I want <goal> so that <reason>.
When determining your requirements for a training management system, you should consult with people in all areas of the business to see what functionality they require in order to do their job. A finance manager will have very different requirements to a training administrator – here are two examples of user stories from their perspectives:
As a finance manager, I want a credit card payment option when registering for a course online so that there is no manual invoicing process.
As a training administrator, I want to automatically send confirmation emails to course participants upon registration so that they are provided with up-to-date information.
Once you’ve created an exhaustive list of functional requirements that are unique to your training organization, you’ll need to go through the process of prioritizing them. Use your priority system to determine what is a must-have, and what can be sacrificed – not all software will meet all of your functional requirements. From there, you need to consider what existing piece of software or process you have in your training organization that may be able to fulfil one of those requirements, and/or whether or not you may need your new training management software to integrate with a legacy system. Here’s another user story as an example:
As a finance manager, I want to automatically match credit card payments received to outstanding invoices in the training management system so that daily reconciliation of payments is accurate and easy.
In order to fulfill the above requirement, the training management system would need to integrate with the company’s accounting system – ie. Quickbooks, Xero or MYOB. A manual process could do the same job, but the key word here is “automatically”. Because who wants to spend hours every day manual reconciling invoices?! That’s neither cost effective, nor scalable. All things considered, this requirement would become a high priority.
Comparing and evaluating software solutions
Once you’ve recorded all of your functional requirements and determined the order of priority, it’s time to begin the process of comparing and evaluating software.
Software review sites such as Capterra and G2 offer a comprehensive list of software solutions based on category, unbiased user reviews and head-to-head comparison. This is helpful to get a high-level understanding of what software solutions are available and how they are rated by other genuine users. What these comparison sites won’t do is give you a weighted rating of the best software for you, based on your own unique business requirements.
The TMS Evaluation Worksheet
To help you out here, Arlo training management software has created a downloadable evaluation worksheet. This is a template that is designed to be used in your own training business. The worksheet includes pre-filled assessment criteria that you can customize to your own needs. As well as in-built formulas to weight your priorities and score each system.
How to use the worksheet:
1. Review the requirements in column A of the Scoring worksheet. Add, delete and rename the requirements to suit your team.
2. In column B, give each requirement an importance weighting from ‘1-Nice to have’ to ‘3-Must have’. These are used in scoring calculations.
3. For each vendor, assess their ability to meet each requirement. Give each a rating between ‘1-Very Poor’ and ‘5-Excellent’
4. At the bottom of the Scoring worksheet you’ll find a summary table – and hopefully a clear winner!
Tip: In the ‘Settings’ worksheet you can adjust the impact of your high to low rating in calculations. For example, changing ‘must haves’ from 3 to 5 points will make these requirements dominate the final scorecard – as you’re increasing their importance weighting.
Once you’ve compared and evaluated software solutions against your unique requirements you should have a clear indication of the options that are most suitable for your training business. If the off-the-shelf software options fail to meet your highest priority requirements you may need to consider a custom-build.
If you’re satisfied with available off-the-shelf software options, the next step is to take the top three from your evaluation worksheet and explore them further by starting a free trial or booking a demo with a salesperson. Before you go into the sales call, note down any unanswered questions you have. Be upfront about any concerns you may have, your specific business requirements, and any other software you’re exploring. Leave no stone unturned, but do put a timeframe on your final decision for efficiency and accountability.
At the end of this process you should be at a point where you can confidently choose the right software solution for training business!
Arlo is a Sponsor of the eLearning Success Summit.