Learning Management Systems
BuyerView | 2014
Every year, Software Advice talks with hundreds of companies looking for the right learning management system (LMS) for their organization. This provides us with unparalleled insight into the needs and wants of these types of software buyers. We recently analyzed 385 of our interactions with potential LMS buyers in 2013 to identify their most common pain points and reasons for seeking to purchase new software. This report outlines what we found.
Of the prospective buyers we spoke with, 36 percent noted they were using manual methods to train their employees—meaning they were conducting in-person training sessions, and using paper and pen (or Excel spreadsheets) to track course completion rates. Another 10 percent noted they had no training system in place whatsoever. Meanwhile, approximately one-third (32 percent) of participants said they already had an LMS in place.
Drilling down into the data, current LMS users most often cited a need for more features and functionality as their reason for seeking a new system. The next most common reason: unhappiness with their existing software. During our interactions with these types of buyers, they often noted that their system was too complex or confusing for employees to use effectively.
While LMS users were seeking a system with more features and functionality, by far the most common reason first-time LMS buyers gave for replacing manual methods was to improve efficiency. Many noted they were spending an inordinate amount of time tracking trainings on paper or in Excel spreadsheets, and were looking to streamline the process with specialized software.
Most LMS buyers said they were looking for a system where they would be able to upload and store training content they had already created. While content authoring was also a commonly requested feature, many buyers noted that it was a “nice to have” option, and said they would still consider systems lacking the ability to create content directly in the LMS.
Next on buyers’ wish lists: the ability to track training progress. As mentioned, many businesses reported they were using manual methods to track which employees had finished specific trainings, and were looking for a way increase efficiency by automatically monitoring completion rates.
The vast majority of the buyers we spoke with (76 percent) expressed a preference for Web-based software, while only 6 percent specifically stated they would prefer an on-premise (client-server) system. Many of the buyers we spoke with also noted that both trainers and trainees needed to be able to access the LMS remotely. This is likely the reason so many software buyers preferred this deployment type: Web-based LMS systems are accessible from any device with Internet access.
In addition to questioning buyers about their deployment preferences, we also asked about their timeframe for implementing a new system. Our data suggests that most buyers begin doing research only when they have decided to purchase and implement their new software in the near future. Well over half of the buyers we spoke with expressed a desire to implement a new LMS within less than 3 months.
Our sample set comprised a wide range of business sizes and revenues. It seems that all business sizes can benefit from a learning management system. However, the largest segments of LMS buyers were from companies that fell within the range of 101-1,000 employees.
When sorting potential buyers by their annual revenue, over a third of businesses generated between $6 million to $25 million per year. This finding is somewhat surprising, as these are relatively small businesses.
Finally, we found that many of the buyers we spoke with operated in highly regulated industries. In fact, healthcare and manufacturing companies constituted 22 percent of our data set.
In 2013, Software Advice analyzed data from 385 businesses seeking to buy new LMS software, giving us a five percent confidence interval (95 percent confidence level) for all LMS purchases nationwide. To further discuss or obtain access to any of the charts above, feel free to contact me at firstname.lastname@example.org.