| It's no secret that software companies operate in | | | | normally occurs in-person on Day 1 of the training |
| a very competitive space where rivalry is | | | | engagement. |
| increasingly fierce and where profit margins can | | | | Taking it one step further: Reducing each trainers |
| be razor thin. New, smaller software companies | | | | travel schedule by 1 day is good, but it isn't good |
| are sprouting up each month and the leading | | | | enough. Software companies employing this |
| software companies continually make strong | | | | cost-reduction method should take it one step |
| advancements forward leveraging massive cash | | | | further to enhance their end-user customer's |
| flow reserves. This cycle makes it difficult for the | | | | experience. They need to make sure that their |
| mid-sized software company to compete because | | | | end-user customers are learning what they need |
| (a) they don't typically have the cash flow | | | | to know to ensure time isn't being wasted |
| necessary to take giant leaps forward in the | | | | covering the same topics when the trainer visits |
| industry and (b) because they need to continually | | | | the customer site in-person. |
| move forward to stay ahead of the smaller | | | | To do this, the software company needs to look |
| software companies that are vying for their slot | | | | at how they plan to deliver the online training to |
| in the marketplace. Consequently, making the | | | | their end-user customers. They will want to make |
| jump from an unknown to a mainstream brand | | | | sure that the end-user customers can track and |
| can prove to be very difficult for the mid-sized | | | | manage the online training portion of their |
| software company. | | | | sessions, whether it is self-paced custom |
| Finding ways to create new revenue streams and | | | | e-Learning content or real-time online trainer |
| to decrease current costs is imperative to the | | | | student collaboration. Selecting this delivery |
| success of companies caught in this cycle. They | | | | platform can be difficult but it should include the |
| need to be thinking on their feet, thinking ahead | | | | following basic functions: |
| and thinking creatively, all at the same time. This | | | | 1. Student Knowledge Assessments |
| can be a daunting task, as any software | | | | 2. Student Success and Progress Tracking |
| executive will tell you. | | | | 3. Real-Time Interactivity |
| Despite all of the challenges that face the | | | | 4. Self-Paced Learning Delivery |
| mid-sized software market, there are several | | | | By selecting a delivery platform that addresses all |
| ways to create these much needed revenue | | | | four of these facets of end-user customer |
| streams and to decrease current costs. New | | | | training, the mid-sized software company can not |
| advancements in technology and its use in training | | | | only decrease their own costs but enhance their |
| and development make generating these revenue | | | | client/vendor relationship by delivering more than |
| streams possible. | | | | what is normally expected or experienced in |
| Setting the Stage | | | | today's software market. What's the bottom line? |
| It is almost taken for granted that when an | | | | The customer is pleased with their user's |
| organization purchases a software package from | | | | performance and the value they received from |
| a reputable vendor, a certain amount of end-user, | | | | the software company. |
| customer training will be either bundled into the | | | | Step 2: Creating Revenue Using Custom |
| purchase price or made available to them for an | | | | e-Learning Content |
| additional cost. If training isn't available to the | | | | Now that we have lowered our costs, the |
| end-user customer, the learning curve on the new | | | | company needs to look at how they can use |
| software package is going to be fairly steep, | | | | their new learning technology to generate new |
| depending on the complexity of the software. | | | | revenue streams for their organization. |
| Typical training expense categories associated | | | | Take this scenario: The mid-sized intranet portal |
| with most mid-sized software companies include: | | | | software company used in the scenario above |
| 1. The salaries of offline trainers | | | | now has their own proprietary basic end-user |
| 2. The travel expenses of offline trainers | | | | e-Learning module to cover 1 day's worth of |
| 3. The costs of producing hard-copy training | | | | what was previously onsite training. The company |
| manuals | | | | has effectively reduced their overall, offline |
| 4. The time involved in offline, onsite customer | | | | training costs. Now it is looking for ways to |
| training | | | | generate new revenue streams using this |
| These expenses should be under a watchful eye | | | | technology to (a) make back their initial purchase |
| and should be consistently viewed as expenses | | | | costs and to (b) create more profit potential for |
| that could be alleviated to some degree to not | | | | the entire organization. |
| only improve the company's attractiveness in | | | | Creating the revenue: One way for a mid-sized |
| competitive bid situations but to increase the | | | | software company, such as the one we're using |
| profit margins of the supplemental training | | | | in our example, to create this much needed |
| services provided by the company. | | | | revenue stream is to create subsequent, more |
| At the same time, in the background, mid-sized | | | | advanced, self-paced, custom e-Learning training |
| software companies should be looking for ways | | | | modules. Attractively priced, these learning |
| to create new revenue streams that they aren't | | | | modules could be made available to their end-user |
| currently capitalizing on to work in collaboration | | | | customers online without incurring any additional |
| with their cost-reduction initiative. | | | | offline training costs. |
| Step 1: Lowering Training Costs Using Custom | | | | In order to do this efficiently and without incurring |
| e-Learning Content | | | | additional offline training costs, the company needs |
| The first step to any well laid-out cost-reduction | | | | to make it easy for the end-user customer to |
| plan is to decrease the costs the organization | | | | purchase the more advanced training content and |
| currently incurs in order to get a better handle on | | | | make it easy for the end-user customer to track |
| profit potential from sheer cost savings. | | | | their own learners as they attend the training |
| Previously we outlined what our target cost | | | | courses so they can readily see its effectiveness. |
| categories are...now we're going to lower the | | | | By investing the money today to build the more |
| costs associated with those categories by | | | | advanced, custom e-Learning content, this |
| leveraging custom e-Learning content. | | | | mid-sized software company could realize profits |
| Take this scenario: A mid-sized software | | | | from the training modules within 12 to 24 months |
| company that develops intranet portal systems | | | | once they begin marketing and selling it to their |
| currently employs 3 trainers that are onsite with | | | | existing client base. Such profits would be |
| clients for end-user training 3 days per | | | | dependent on development timeframes, how |
| engagement and they each average | | | | they market their new training service and their |
| approximately 50 engagements per year for a | | | | chosen modes of delivery. |
| grand total of 150 days on the road per trainer or | | | | Taking it one step further: Making the more |
| 450 days on the road collectively. | | | | advanced e-Learning content convincing and |
| For these trainers, the onsite training program for | | | | attractive to purchase from the client standpoint |
| the end-user customer may look something like | | | | takes some ingenuity. People are very susceptible |
| the following: | | | | to purchasing something that is located right next |
| Day 1: Software Introduction and Primary | | | | to the checkout lane at Target. Similarly, it stands |
| Functions | | | | to reason that client of this mid-sized software |
| Day 2: Functional Use and Administrative Actions | | | | company will be more apt to purchase additional |
| Day 3: Real-World Functions and Labs | | | | e-Learning content if it is readily available to them |
| Lowering the costs: By leveraging custom | | | | and if they can purchase it without any hassle. |
| e-Learning content, the company used in the | | | | One way to accomplish this is to publish the new, |
| above scenario, can effectively reduce the onsite | | | | more advanced, self-paced e-Learning modules to |
| time required for each trainer, thereby reducing all | | | | the company's LMS portal and then make the |
| costs associated with the training program across | | | | modules available for purchase via credit card |
| the board. | | | | using e-Commerce or via standard invoice with a |
| By using a professionally designed, self-paced, | | | | single phone call. This essentially acts as the |
| custom e-Learning module to focus on the | | | | product stands we all see at Target next to the |
| Software Introduction and Primary Functions | | | | checkout lane. Since everyone needs to pass |
| training that normally occurs on Day 1 and then | | | | through checkout lane, it makes sense to put |
| delivering that learning module online to their | | | | additional products available for purchase there. In |
| end-user customers at the time of purchase | | | | other words, if the mid-sized software company |
| through an e-Learning Management System | | | | is delivering portions of their beginner training |
| (LMS), this company could decrease travel time | | | | program online to their end-user customers, this |
| for all 3 trainers by 1 day per engagement. This | | | | more advanced e-Learning content should be |
| would decrease travel time for each trainer by 50 | | | | available for purchase right next to those basic |
| days per year, or 150 days collectively during the | | | | training modules, thus, increasing its visibility and |
| year. In addition the end-user customers will | | | | increasing the attractiveness to buy from the |
| already be familiar with the software package | | | | client perspective. |
| before the trainers ever set foot in the front | | | | The Completed Solution |
| door. | | | | Because of the tight software market and the |
| This would successfully: | | | | strain put on mid-sized software companies to |
| Decrease the costs associated with those 150 | | | | perform, if these companies can decrease the |
| days of travel that are now being saved. | | | | costs associated with their current training |
| Enable the company's trainers to perform more | | | | programs and create new revenue streams at |
| training engagements OR enable the company to | | | | the same time, it becomes a win/win situation |
| decrease the number of in-house trainers it | | | | both for the vendor and for the customer. The |
| employs. | | | | software company gains a competitive edge and |
| Decrease the costs associated with creating and | | | | continues to move forward while the client gains |
| publishing the sections of the hard-copy training | | | | an easy-to-engage training program and added |
| manuals that deal with the Software Introduction | | | | value from their software vendor. |
| and Primary Functions training session that | | | | |