How To Improve Your LMS ROI: 5 Features to Consider

How To Improve Your LMS ROI: 5 Features to Consider


Absorb LMS


Investing in a learning management system (LMS) isn’t just an expenditure, it’s a strategic investment in organizational growth. The search for a suitable LMS goes beyond just selecting a platform that will get used to onboard new hires, you need to find a system that supports company goals and helps impact the bottom line.

Modern LMS systems are designed to shape learning effectiveness, increase efficiency and improve the learner experience. Making them an essential tool for enterprises of any size and across verticals for corporate training and educational institutions.

Organizations have been increasingly introducing LMS platforms to their tech stack; with a Training Industry Report showing that 98 percent of large companies, 96 percent of midsize companies and 80 percent of small companies are using an LMS to deliver training.1 With the LMS market projected to reach $76 billion by 2030, the widespread adoption of LMSs for workplace training is only expected to continue.2

Return on Intelligence Podcast: How do you evaluate learning in retail and take measurement beyond spreadsheet metrics?

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Understanding your LMS’ ROI

How you calculate the ROI for your LMS ultimately comes down to how your business and its bottom line are supported by your training programs. Monitoring and working to improve these results long-term is a key factor in helping your organization to:

  • mitigate lost time, money, resources and effort
  • track the effectiveness of training
  • measure what value the learning and training opportunities helped create
  • justify learning and training expenses

Step-by-step guide on calculating LMS ROI

Understanding your LMS’ ROI is crucial to determining its impact on your organization's success. Here's a breakdown on how to work it out:

  1. Gather data and costs: Compile all relevant data associated with the LMS implementation. This includes initial setup costs, licensing fees, content creation expenses, and ongoing maintenance fees. Don't overlook indirect expenses like employee training hours or potential productivity losses during the implementation phase.
  2. Identify benefits:List the tangible and intangible benefits that can be tracked from your LMS. Tangible benefits could include reduced training expenses, increased productivity, or cost savings. Intangible benefits might involve enhanced employee engagement, improved retention rates, or streamlined compliance adherence.
  3. Calculate ROI: Employing a basic formula such as ROI = (Profit/ Investment) x 100 allows you to quantify the ROI percentage. Additionally, consider using metrics like payback period, net present value, or internal rate of return for a more comprehensive evaluation of the LMS investment's profitability.
  4. Communicate the ROI Analysis: Compare and communicate the results of your ROI analysis. Assess if the benefits outweigh the costs and determine the calculated ROI percentage. Effective communication of these findings to stakeholders via charts, graphs, or narratives underscores the value and impact of your LMS deployment.

Conducting an in-depth analysis helps your organization make informed decisions, optimize LMS usage, and identify its role in supporting overarching business goals.

5 LMS features to use to improve your ROI

LMS features can either considerably improve or hinder learning outcomes. Ultimately you need data from them to decide what is, and what isn’t, working to build the most effective online training.

The top 6 features to look for in your next LMS — to not only improve your ROI but also enhance the overall learning and training experience for employees — include:

1. Custom reports

Custom reports within an LMS offer a tailored approach to monitoring training effectiveness, enabling organizations to track metrics specific to their objectives. Maximizing ROI with custom reports:

  • Identify key metrics: Pinpoint crucial performance indicators aligned with organizational objectives, allowing for targeted assessment and informed decision-making.
  • Personalized user roles: Use the custom reporting capabilities to assign varying access levels, ensuring relevant data reaches specific teams or managers.
  • Highlight progress and gaps: Create reports focusing on certification progress or course completion rates, aiding in recognizing top performers and identifying areas for improvement.

2. Course authoring tool

A comprehensive course authoring tool streamlines content creation, positively impacting ROI by reducing costs associated with outsourcing content creation and enhancing content agility.

Maximizing ROI with a course authoring tool:

  • Rapid content development: Enable learning and development teams to swiftly create and update content, ensuring it remains aligned with evolving organizational needs without additional expenses.
  • In-house content creation: Reduce outsourcing expenses by empowering teams to produce high-quality content internally, eliminating third-party costs and potential delays.
  • Customized learning paths: Tailor courses to individual learner needs, enhancing engagement and knowledge absorption, thereby elevating the overall ROI.

3. Certification management

Efficient certification management within an LMS ensures compliance and skill development, impacting ROI by minimizing compliance-related penalties and enhancing workforce proficiency. An LMS will keep learners of all stripes compliant, organizations high-performing and will stave off the serious short- and long-term risks of noncompliance. These organizational shutdown, reputational damage, fines and losing millions to fraud. In fact, a typical organization loses close to $3 million in annual revenue to fraud.

Proper training using an LMS built to handle the nuances of compliance across different roles and industries will deliver skillful employees, efficient handling of daily operations, improved soft skills and optimal client relationships.

Maximizing ROI with certification management:

  • Streamlined compliance: Automate certification tracking and renewal reminders, reducing risks of non-compliance penalties, ensuring a compliant workforce, and avoiding associated financial losses.
  • Centralized training data: Create a centralized repository for certifications and training records, simplifying audits and demonstrating regulatory adherence, thus optimizing ROI.
  • Skill gap identification: Analyze certification data to identify skill gaps, enabling targeted training interventions that enhance employee proficiency and overall productivity.

4. Automated report scheduling

Automated report scheduling offers convenience and data-driven decision-making, impacting ROI by optimizing managerial time and ensuring the timely distribution of critical information.

Maximizing ROI with automated report scheduling:

  • Efficient data sharing: Schedule and distribute reports automatically, allowing managers to focus on strategic initiatives rather than manual report generation.
  • Timely insights: Ensure stakeholders receive timely data, facilitating informed decision-making and fostering agility in responding to training needs or challenges.
  • Customized delivery: Tailor report delivery frequencies and recipients based on specific requirements, optimizing communication flow and enhancing the effectiveness of training programs.

5. Gamification

Gamification injects elements of fun and competition into learning, boosting engagement and knowledge retention, positively impacting ROI by fostering a more motivated and knowledgeable workforce.

Maximizing ROI with gamification:

  • Enhanced engagement: Increase employee participation and enthusiasm for learning by introducing gamified elements, ultimately leading to improved learning outcomes and ROI.
  • Behavioral analytics: Use gamification metrics to analyze engagement patterns, identifying effective learning techniques and tailoring future content for better results.
  • Recognition and rewards: Leverage gamified achievements and rewards to acknowledge top performers, fostering a culture of continuous improvement and maximizing the ROI on training initiatives.

Maximize and improve your organization’s LMS ROI

While the features of an LMS are critical components to consider when working to improve the ROI of your learning and training programs, focusing on specific actions, like driving revenue, reducing costs and generally enhancing workplace productivity, can be a substantial boon to this objective.

Here are a few helpful tips to guarantee your system achieves the highest value for your organization:

  • Choose a cost-effective system: Organizations need an LMS that drives efficiency while cutting costs. This might include finding a system provider that offers tailored pricing options to meet your specific needs.
  • Improve mobility and accessibility: Employees should be able to access training materials at their convenience, from anywhere they might be needed. A powerful LMS will effectively remove barriers to learning and training opportunities in your organization.
  • Promote adequate professional development: The right LMS will promote professional development and help employees meet unique goals. By improving employee satisfaction through improved learning opportunities, organizations can increase employee retention and decrease turnover costs in the long term.
  • Reduce in-person training: In-person training is costly. Cut physical training costs—from venues and instructors to materials and travel expenses—with an LMS that streamlines the online training process and produces successful results.

Improving the ROI of your LMS should be a consistent objective worked on over time, to optimize usage and improve the training itself and employee satisfaction. Ultimately, choosing a high-quality LMS, and using it effectively, will lead to the most significant growth in the future. If you’re maximizing the potential of your LMS, a positive ROI is inevitable.

How Absorb LMS can help

For organizations looking for an LMS that elevates learning and training to new heights, Absorb Software offers the comprehensive solution you need. It’s a robust learning platform built to cater to your specific organizational requirements, with features that are tailored to optimize your learning and development processes by:

  • Empowering administrators through automation
  • Enhancing and modernizing the user experience
  • Offering actionable reporting and analytics
  • Providing pre-built and API integrations

These comprehensive features serve as the building blocks in delivering top tier learning experiences and significantly enhancing your LMS ROI. Additionally, our cloud-based technology ensures accessibility for learners anytime, anywhere, supported by round-the-clock customer assistance.

Ready to assess and improve your LMS ROI? Explore how Absorb LMS can support your training initiatives and drive substantial returns on your investment. Learn more about Absorb LMS reporting and analytics, or request a demo to get started!


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