Calculating the ROI of your e-Learning courses


calculating the ROI from elearningIf you’re reading this post, you already know that e-learning is an important tool for the modern enterprise. You have already deployed, or are preparing to deploy, an LMS platform to cover your organization’s training needs. And you probably already have an intuitive grasp of the ways e-learning can benefit your business and its bottom line.

That’s all well and good, but as a business you also need to verify your investment. If you’re a department head, having to pitch the need for an LMS solution to the upper management to secure the appropriate budget, you know all too well what we mean. It’s all about return of investment, or, as we affectionately call it in business circles, ROI.

So how do you even begin to calculate the ROI of the e-learning courses you have deployed? It can be a little tricky, but there are several indicators you can watch for, both qualitative and quantitative.

1. Reporting it

The most basic way of measuring the success of your e-learning courses is built-in in your LMS platform. Any capable LMS would offer numerous reports and statics to assess the performance of your students.

This doesn’t fully answer the question about the overall returns of your investment in e-learning, but is a necessary first step to measure how your employees are progressing with their courses. If, for example, most employees fail miserably on their tests and grades, it will be futile to expect the courses to have a positive impact on the company’s operation.

It’s only after you assured that they are progressing nicely that you can measure secondary effects from their newly acquired knowledge and skills.

2. Ask your employees

The persons taking your e-learning courses are in the best position to assess if and how they helped them with their day-to-day work. So ask them.

Arrange a series of face-to-face chats, or maybe a written survey, in which you ask them about their experience with the e-learning courses, what new skills they acquired, and how they believe they will help them perform better at their job.

Ask for concrete examples, and have them recall some specific instances in which their newly acquired skills helped them. Don’t forget to ask for their complaints too; things that they believe could be improved in the courses, content that they feel is irrelevant to their jobs, etc.

3. Ask your clients

If you are a client facing business (not all are), then it might be a good idea to keep your clients in the loop regarding your e-learning efforts.

After your training courses are done, tell your clients about your ongoing efforts to educate your employees, and ask them if they have seen any improvements in their interactions with them.

4. HR to the rescue

As a company you already have some way to evaluate new job applicants. Perhaps you even have a whole HR department devoted to the task.

Have them check the employees that have taken the e-learning courses as if they were new hires.

Have them go with them through interview questions and test tasks, checking their progress, and comparing it with their initial hiring interview results.

5. Check whatever metrics your business quantifies

Most companies track a plethora of metrics related to their operation and performance. Study them, and compare them before and after the courses, to indirectly measure the impact of your e-learning program.

Anything that should have been improved by the training, and you have metrics available for it, you can statistically compare.

If for example you were training your help center operators, then examine their number of successful resolutions of customer issues per day, before and after they had their training. Or, if you were training your network technicians, you can check if their training had any impact on your networks downtime.

6. ROI is more than direct profits

The above are ways measure the benefits your business had from deploying an e-learning program. Such qualitative improvements are extremely important, as they help the company grow and build better products and services.

Even if it doesn’t directly involve money, everything we discussed above will improve your company’s business prospects and will eventually translate into financial gains:

  1. Having a more knowledgable and skilled employee for the same salary as previously, amounts to saving money on hiring people with the new skills you need.
  2. Employees use their newly acquired skills and techniques they learned to increase their productivity, thusly improving the ratio between their pay and the amount of work they do.
  3. Better client satisfaction also leads to customer loyalty and potentially increased sales.

7. Check your accounting books

Ultimately, of course, any company exists to make money, and you’ll want to be able to measure your ROI in direct profits.

For this, you’ll have to first wait for the e-learning courses to complete, as well as a small period of adjustment, as employees try to put their new skills to practice. Then, by all means, check your books to see if there was any measurable uptick in profit or revenues that could be attributed to the training.

The tricky part is to exclude any unrelated factors that could have also been responsible for any changes in your revenues.

Learning is a long term investment

All in all, don’t think of e-learning as something that will result in an immediate increase in your bottom line.

E-learning is not as a much a revenue-building (or cost-cutting) measure, it’s a long term investment in the health of your company.

An effective use of e-learning in your enterprise or organization will help it be more agile and will future proof it against changes in the market and the industry.

In the fast paced economic and technological climate, retraining in general, and e-learning in particular, is not a luxury, it’s a competitive necessity.


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