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Making sense of e-learning 
in a confused market
Jane Knight
e-Learning Centre UK
7 October 2002
Recent articles in the industry press have suggested that current buyers of e-learning are both cautious and confused.
This has come about as a consequence of a series of events in the marketplace: the dot com crash, continuing falling share prices and a stream of vendor mergers and acquisitions in addition to reduced training budgets and stories of unsuccessful LMS implementations and high course drop out rates1. n this article Jane Knight of the e-Learning Centre tries to make sense of the current state of e-learning and offers some advice for buyers of the future.

In the beginning ...

The e-learning industry, like any industry, is developing and maturing.In order to understand the current situation we need to take a look back over the last few years and identify some of the reasons for this confusion and caution.

The advent of e-learning was hailed as a marvellous opportunity for employees to access learning in ways that were previously not possible. However, in many organisations the concept of e-learning was quickly seized upon by management as primarily a cheaper way of training staff. No longer would they need to send them away on expensive courses and have them stay in expensive hotels; it could be done very cheaply and easily with the employees sitting at their desk – and doing their job at the same time! Training managers with grand targets to achieve, of say having 50% of their training online within 3 months, simply bought in large quantities of online courses to replace their classroom-based courses.

The result? Well, at worst, the employees didn’t know the online courses were available, so didn’t access them.At best, where employees did locate them, they found themselves sitting at their desktops for hours on end, clicking the “next” button as they worked through the online courses with no respite - not even the thought of a drink at the hotel bar at the end of the day! They soon got bored and tired of studying in this way and “dropped out”, resulting in poor completion rates. Even attempts to make the courses more compelling through the use of multimedia had little effect on keeping learners glued to their course materials to the bitter end.

The reason for this poor performance was that it was assumed that learners could study in the same way at their computers as they could in the classroom. In other words, that the traditional classroom course could be replicated online by simply converting the content into a web-based format. But what worked in the classroom, doesn’t work on the desktop. What was wrong, was not the materials per se, but the whole course paradigm. In a fast moving world, employees don’t have time to study vast amounts of comprehensive course materials just in case they might need them in the future, they need access to just in time information for them to carry out an activity or task in hand.

Formal and informal learning

Even today, most people equate e-learning with e-training or e-courses, and most training in organisations still takes place on a very formal basis using the traditional training object – the course.However, it is now well recognised that something like 70% of learning takes place informally in organisations2. That is, not in the classroom nor working through an online course, but in everyday working life as employees carry out their jobs, finding out information, reading documents, talking to other colleagues etc.It is these kinds of informal learning activities that need to be supported and encouraged online.

It has taken a long time for the message to get through from inspirational companies like Cisco Systems3who understood very early on that e-learning is more than just e-training, and that it is also about “information, communication, collaboration and knowledge sharing”.

Buying e-learning is more than buying courses

Buying “e-learning” today no longer just means buying courses (whether they be off-the-shelf or custom-built) but buying appropriate learning solutions that match both the learning problem and the learners themselves as well as fit within the corporate culture.

Planners, managers and designers of e-learning initiatives need to be aware of the whole range of e-learning technologies and techniques that might be used to create an appropriate solution.This might well be a formal online course, but could just as easily be an e- presentation, an online demonstration or simulation, a live e-learning event, a collaborative learning experience, a learning game, or simply a job aid or other performance support tool.

e-Learning purchasers of the future will therefore need to understand more about how to build these different types of solutions – either in house using the new tools (or systems) that are becoming available, or in partnership with external vendors who provide e-learning services.

e-learning is firmly linked with business

It will no longer be a matter of purchasing solutions and systems for a series of ad hoc training purposes. e-Learning needs to be firmly linked with business so that it becomes a process of continuous updating and development of the employee. e-Learning is not just another delivery mechanism, as Marc Rosenberg points out4; it requires a fundamental shift in the mindset of the traditional purchasers of learning content and systems.

It also has to be said that many training departments are still overly concerned with the numbers of people being trained, and whether they’ve completed the courses or passed the tests.(Hence the frenzy of purchasing learning management systems only a year ago.)But at the end of the day it’s not about how much employees have learnt, it’s about how they’ve applied their learning, and how their performance has improved. e-Learning, just like learning itself, is a means to an end, not the end itself. Or, as Jay Cross, from the Internet Time Group puts it:

"All of my fellow eLearning gurus will tell you that learning is the important part of eLearning, not the "e".  I say, "Balderdash!" (not an exact quote.) What's really important is doing. If an organisation's people perform proficiently, it matters not whether they learned how in a course, on a prior job, or by meditating in a cave."5

It is because of this that e-learning is probably working most effectively in business units.Business unit managers have recognised that it is not about waiting months for the training department to create a perfectly crafted, instructionally designed, multimedia course on some topic of relevance, but about communicating new information quickly to their staff, their customers and suppliers for them to use immediately.

Unfortunately for a number of larger organisations, there has been a downside to this enthusiasm in the business units for e-learning.Vendors have recognised this thirst for solutions or tools to create just-in-time content, and have gone straight to them to sell their wares, bypassing the traditional purchasers - the training department.The consequence has been that the organisation has either been sold the same product many times over or else, has ended up with a number of competing solutions, e.g. four different types of virtual classroom tools or five different learning management systems.

Coordination and control

What is needed in such organisations is central control over the selection and implementation of vendors. The issue then becomes: which is the best virtual classroom tool or learning management system for the whole of the organisation?Since most e-learning purchases need to be justified as they can be very large and budgets are currently much lower than a few years ago, there has got to be much more due diligence in selecting a vendor.Particularly as the question on the lips of every purchaser, is whether the vendor of choice will still be in business tomorrow.

Every week there is a story of a merger or acquisition of an e-learning company in the news.Only recently Peoplesoft acquired Teamscape6and the two big content giants, Skillsoft and Smartforce merged7, and there have been a number of high profile failures along the way.So together with a heightened level of confusion about what is available in the e-learning marketplace, purchasers are also ultra cautious in making any decisions.And yet they must, if e-learning is to survive within their organisation and reach its potential.

So how can purchasers help themselves and become more prepared for the task of making future e-learning purchases?The second part of this article looks at the two main ways: Education and the Vendor Section Process.


First of all, as we have suggested earlier, an organisation’s e-learning team needs to have a far wider skill set than they currently hold.Some of the things they need to understand are:

·how to build the e-learning strategy – so that it fits with the business strategy 

·how to design appropriate e-learning solutions – so that the best technology and techniques are employed for the different learning needs and learners in the organisation

·how to promote and market e-learning internally – so that employees can find what they want when they need it

·how to evaluate and validate e-learning – so that managers can measure the success of e-learning in terms of its impact on the organisation

How does the e-learning team acquire such skills?Well, there are both formal and informal ways of learning about e-learning.Which is the most appropriate for the team will depend on the factors previously cited: the extent of the learning problem, the types of learners involved and their particular styles of learning as well as the corporate culture.But here are just two options:

The e-Learning Centre is the place to find out everything you need to know about e-learning in an informal way.It specialises in providing quick access to relevant information about e-learning, and understands that the majority of its users have ad hoc queries about e-learning and are not looking to work through the material in any formal way.e-Learning Centre users (which number well over 500 every day) dip in and out on a regular basis, finding resources as and when they need them.

For a more formal approach to helping e-learning teams acquire the skills they need, FM Systems, an e-learning consultancy company  uses its unique E-Learning Toolkit.Recognising that every organisation is unique, this generic tool set is customised for each organisation.FM Systems works alongside the core team to help them understand all the issues involved in implementing e-learning within the organisation. These are then documented in the online Toolkit so that they can be disseminated via the company intranet to the wider team members.

But whatever, the approach that is taken to equipping the team with the necessary skills, this is only the first step in approaching the task of purchasing e-learning products and services.It will have provided the team with an understanding of the techniques; now it is time to buy the technology.

Vendor selection process

Approaches to buying e-learning vary greatly.Whereas some people are pretty much happy to go with the first system they see, others spend time gathering information before making a final decision.

Most receive a large number of brochures, demo CDs, free trial subscriptions and invitations to vendor seminars every week.Although these are excellent ways of finding out about the variety and nature of solutions and systems on the marketplace, they are unlikely to provide enough information to make an appropriate purchasing decision.So where else can purchases find out about the marketplace?

Well, the vendors themselves can’t be expected to give independent advice about the best products, solutions or suppliers.After all they are there to sell their own products not someone else’s!Ideally, what is recommended, is to seek vendor-neutral independent advice to help define what is to be purchased, identify who has the products and services that meet requirements and provide guidance on how to buy it.Consultancy companies, like FM Systems and the e-Learning Centre can help with the purchasing of single applications through to running e-learning preferred supplier programs for global organisations.

Those who prefer not to use the services of a vendor-neutral consultant, will first need to research the e-learning marketplace thoroughly.This will involve finding out about all the different suppliers of the required e-learning product or service.In the past this would have been a daunting task, but a new publication, the European eLearning Directory 2003, which has recently been produced by the e-Learning Centre and FM Systems, will make life a lot easier. 

The Directory is the first comprehensive guide to the e-Learning marketplace in Europe.It provides details of around selected 150 vendors of e-learning solutions, systems and technologies operating in 25 European countries. It also contains 55 pages of indexes: listing vendors by 7 regions, 65 vendor categories and 12 industry classifications. 

In putting together the Directory, a number of ground rules were set to try and ensure the suppliers represented passed a minimum threshold.These ground rules included:

·having been in the e-learning business for two years or more - it was felt that this was a sufficient amount of time for a business to become established in the marketplace, and although it does not guarantee longevity, ensures that the vendor has some history in the industry

·having a physical office in at least one European region operated by them and not a partner - this was due to the fact that it was known that some purchasers had had bad experiences with vendors who were not based in the same geographical region as themselves, for instance they were unable to respond quickly and easily to requests for support, etc

·providing named clients in Europeto reference - these would help to demonstrate the type and number of clients the vendor had worked with in the past

·e-learning must represent a significant part of their revenue – e-learning was not to be just a new label on an existing service or solution. 

Updates and new entries to the Directory are made available online at the Directory website, as vendors are constantly redefining their products, services, representation and partners in an effort to position themselves appropriately in this changing market.

People often think they have the resources to research the marketplace themselves, hence they are often reluctant to purchase market reports or surveys because of the cost involved. But to do this effectively and thoroughly requires a considerable amount of time and effort.If the time (and money) spent on the task were quantified, in most cases it would far exceed the cost of an industry report or survey.At €255, the Directory therefore represents good value in terms of locating e-learning vendors operating in Europe.[Readers of this article, however, are being offered a special discount.By entering the Discount Code: DIR20 onto the purchase form, you can obtain a copy of the Directory for the special price of€199 (or £125).

Once suppliers of a particular product or service have been located, the next part of the process is to create a shortlist of these to be pursued further and then apply some due diligence.This might involve one or more of the following:

·submitting a RFI (request of information) to selected vendors to find out more about them and their products or services

·shortlisting vendors on the basis of their response to the RFI using some system that incorporates a wide range of issues and allows a variety of people to have input to the decision 

·running a selection process, e.g. inviting vendors to a presentation or expo – to see their products in action and to question them further about its functionality or their services

·reviewing/scoring vendors and advising vendors of the outcome – making sure that everybody comes to a consensual agreement about the vendor of choice, and that the vendors who did not succeed are informed as to the reasons 

·negotiating contracts with selected or preferred supplier(s) – to create an ongoing partnership for the future

The due diligence aspect of the process can take some time to implement, but it will provide an excellent opportunity to address meticulously all the issues of concern, like the vendor’s viability in the marketplace and the longevity of the product.

Of course at the end of the day, nothing can mitigate against unforeseen circumstances in the vendor’s activities or in the marketplace itself.But if these guidelines are followed, it is believed that not only will purchasers be more enlightened and more prepared but also more successful in their purchasers of e-learning products and services in the future. 


1The state of e-learning: Looking at history with the technology hype cycle, Kevin Kruse, e-Learning Guru

2 Informal learning: the learning revolution, The Manage Mentor

3 A conversation with Tom Kelly, Else Schelin and Gene Smarte, e-Learning Magazine, January 2002

4 The e-learning industry: retrospect and prospect, Barbara K Beach, Learning Circuits, September 2002

5 Time matters and profit returns: implementing the right e-learning platform, Jay Cross, Internet Time Group

6 Peoplesoft acquires e-learning firm Teamscape, Richard Karpinski, Internet Week, August 2002

7 Skillsoft Smartforce merger is complete, Smartforce

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