Factors To Consider While Calculating LMS cost


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Learning management system has become a necessity of every organization, small or big, with the changing scenarios and rise in online training demands. This trend of online training is sure to evolve further with time. This has made it mandatory for the corporates to factor in the learning and development costs in their annual budget.

With thousands of options available, how do you calculate the cost that you should allocate per user in your organization? Before you even start shortlisting the LMS companies, list down your choices based on your needs. Listed below are some of the factors that you must not miss out on while calculating the cost of your learning management system.

Setup and maintenance cost

There is an upfront setup cost or licensing fee that you should start with. Some LMS vendors include it in the per-user cost while others might have the same with a different header. Any system would require regular updates. Consider if the cost is included in the package or not. Other software maintenance services will also incur some costs that you should not forget to factor in. And, whether you are paying an amount for fixed users or the cost is based on per user basis and what will be the additional cost in case the number of users exceeds the threshold. What will be add ons that you might require as the add ons, at times, might cost you a mighty amount.

Active user count

 Based on your requirements, keeping an account of active users should be considered while calculating the cost of the LMS. Some vendors charge and count the users based on the number of logins whereas others count and charge only on active users. The users who remain inactive for more than a specific agreed period are not considered active by such providers. This helps you get the actually required count of accounts required. Do not forget to factor in the cost of external partners.

Support Services

Post-sales services are mistakenly assumed to be free. However, ensure before finalizing the LMS vendor whether they provide the services for free or they charge for the same. For example, some of the companies include chat and phone services in the package while the physical visits can be charged for. Check it and include the same if the vendor is charging from you.

Learning and development team 

Be it posting the content, designing the course, or providing technical support, every collaborator also would require a login and must be factored in for a cost calculation. Every member of the training team will be a user and should be accounted for.

Along with this, you must consider the options for the possibility and requirement of the expansion. With a growing business, the requirement of expansion will not only be from a business perspective but you will have to expand your training team as well. Considering the business forecast and plan, factor in the cost of expansion. With the expansion of business, you would require more accounts for your enterprise partners as well. Taking additional accounts later may end up costing more and will surely exceed the proposed budget. Thus being proactive in keeping room for expansion is a safe and optimistic strategy.

Take inputs from the team

Business teams are the best people to let you know what they want and the exact headcount you should be looking for cost evaluation. Similarly, taking inputs from LMS admins and other key players might provide you an insight on some of the considerations that you either might have missed or will lead to an accurate estimation of per-user cost amounting to the overall cost.

Conclusion: All the factors mentioned above along with other hidden costs will surely help in arriving at a realistic budget. However, ensure to compare the prices of various LMS software with Cornerstone LMS pricing to get the best value for your investment.


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