The Customer Training LMS: How to Build the Business Case

Michael Daecher
Sep 23, 2019 10:20:38 AM

Adopting or changing a learning management system (LMS) is one of the most important decisions that a company with a major investment in customer training will ever make.

If your company's growth is tied to retaining customers and reaching and engaging with ever more customers -- and whose isn't? -- having the right LMS is essential. Retaining customers will always be a challenge without it.

However, before your organization frees up the budget for a customer training LMS, management is going to want to see, and approve, a business case.

A business case is a document that runs anywhere from one page to hundreds of pages and tells the story of a proposed significant change to the organization, why the change is essential, and what will be the anticipated impact on the business. It describes and assesses the benefits, costs, risks, timeline, impact on the company, and the potential return on investment (ROI).

The LMS business case is the tipping point — here's what will tip it one way or the other

The purpose of the business case in this situation is to convince senior management to green-light the project and secure you and your team the funding and other resources it needs for the customer training LMS.

The business case you produce should be researched, well thought-out, and written by you with input from the LMS search team (more on that later). Brevity is desirable — attention span is always in short supply.

Realize that the focus of these senior executives is investment and return. You must focus on the dollars and cents. They care little about anything else.

Therefore, the take-away of the business case must be about how the customer training LMS will contribute to the single-minded effort of reaching, teaching and keeping customers. (In contrast, if you were engaged in internal education, the business case would be more focused on productivity, compliance and efficiency.)

9 essential elements of a business case for a customer training LMS

While there are many generic business case templates available from online sources, here is what we believe are the nine essential elements of a successful business case for justifying the acquisition of a new LMS to manage your customer training program.

1. Executive summary of the LMS business case (most will read this first; you should write this last)

This is a brief overview of everything that's in the business case from 50,000 feet. It uses short paragraphs and lots of bullets. Think of it as the "Cliff's Notes" for your executives. Someone could read it in a hurry and understand all the basics. Everyone will read this first, hoping not to have to go any further. This section is enormously important and must tell a compelling story quickly from a high level. 

2. Cost/benefit analysis of the LMS business case is the heart of the matter

Most financially minded company leaders turn immediately to this page, and if they don't see a clear and compelling picture, they won't read anything else. As we said at the start, those executives in a position to say yes or no to your proposal are primarily concerned with investment and return. The cost/benefit analysis is the core of the case.

Keep it simple. You must understand it completely, because you will be asked to defend it.

Lay out the costs — both immediate (or one-time) and recurring. Then contrast that with any anticipated savings and the potential return — immediate and recurring. Customer training hardly ever presumes expectation of a short-term increase in revenue. What you need to focus on -- aside from immediate and one-time costs -- is customer adoption, time to value and ultimate retention contrasted with "business as usual." How does adopting the LMS help your company achieve its strategic goals?

3. Illuminate the opportunity of the customer training LMS

This is the introduction to the business case. You are primarily addressing the opportunity at hand.

Coverage includes what the problem is, what the issues or opportunity is that needs to be addressed, and why it is important to your organization. You should also touch on what the desired outcome is and what advantages your company will realize by moving forward on your proposal, including quantifying the benefits and explicitly stating inherent risks of not acting.

Example customer training opportunity:

The future of our company varies by our scalability. To realize our potential, we must provide more self-paced training to customers and we must switch to a more powerful, agile, dedicated LMS that will help us oversee training of our customers more effectively and efficiently. The result will be greater customer satisfaction, shorter time to value for customers, and reduced cost of customer training and support.

Implementing a "learning network" and increasing the use of digital training and video will result in more usage of our products by our customers, generating more customer commitment and loyalty to our product lines, thereby promoting more growth.

If we do not migrate to a new LMS, the risk we face is that our competitors that have invested in upgrades of their learning technology will be better positioned to woo, educate and draw the attention of our customers. It is likely that these factors will contribute to our higher customer churn and lower customer retention.

4. Introduce the LMS business case team

You, as the leader of the LMS search team, are the driving force behind this business case. The others on the search team were selected because of their subject matter expertise or constituency. Being on the search team requires these executives and managers to actively contribute to this business case.

To build legitimacy, you should present who is on the team and their responsibilities. It will be assumed that they have signed-off on the content (and it must be so).

5. Why the change in LMS is needed and what the key features and benefits are


What has been your process for analyzing the current state and what have you found?

For instance, you need to lay out:

  • How the old LMS (or lack of an LMS) is inadequate;
  • What new benefits are required; and
  • Why there is a need to implement a modern customer training LMS.

Here's where you explain your search criteria for the new LMS and what vendors will be considered and why. You can also summarize the important take-aways from your evaluation.

It's important to express the urgency for making this decision, what will happen if the company does nothing, and whether there's an acceptable middle ground.

6. The customer training LMS recommendation must be compelling and quantifiable

This is where you introduce your LMS recommendation and provide a detailed and compelling rationale. That includes coverage of:

  • The reasons behind your recommendation;
  • Why this LMS is the right one; and
  • What its specific benefits are.

You also need to include the cost, in detail, within a contextual framework, so that the decision makers are strongly persuaded of the rightness of the proposal.

7. How this LMS purchase affects the organization and what steps must be taken

Your organization is used to the current LMS or lack of an LMS. Introducing a new one will likely change some responsibilities and workflows. This section is where those concerns are addressed.

You can also list the efficiencies to be realized and whether it will be necessary to hire or reduce staff or bring in expert consulting for a period.

8. Course migration and LMS integration issues

Any adoption of new software will have an impact on the technical infrastructure of your company -- even when it's software-as-a-service (SaaS). This section will discuss how the data generated by this solution will tie into existing tech in use, including your CRM, financial systems and other related programs.

9. Two LMS implementation timelines are needed

Present the project management timeline with important milestones, resources required and completion dates. Logical divisions might be:

  • Implementation;
  • Testing and training; and
  • Full-on operation.

We'd advise two timelines, however: one to provide an overview for management and another with more details for the actual implementation.

Preparation for the LMS business case presentation, preparation to get the green light

The good news is that as the leader/writer/compiler/editor you'll be able to see the strengths and weaknesses of either adopting or switching to a new LMS to manage customer education.

Here are a few of the questions you should ask yourself:

  • What is the single biggest reason my company should do this?
  • Will this investment yield enough return?
  • Is this aligned with our organization's strategic plans?

If the answers don't pass your sniff test, do not present. Press pause, go back and repair what's wrong.

If the answers are solid and fill you with hope, move forward. Set a date for your presentation to the executive team. Once that’s secured, distribute the report before the meeting, leaving enough time for all to read it. (But, going into your meeting, don't expect them to have read it.)

Careful thinking will allow you to prepare your presentation by anticipating questions and objections. It would be a good idea to have your LMS search team in attendance to provide details, responses and explanations as required.

And don't forget, success will only come from a strong focus on the financial side of things. The financial side of customer training is retention and growth. More on that in a future post.

But next in this series is guidance on how to establish a baseline for your current state.

63 Questions to Consider Before Selecting a Customer Education Platform

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