What Is a Learning Management System? A Small Business Guide

A learning management system (LMS) is a platform that makes it easy to organize, manage, and administer your small business’ training content. Also commonly referred to as a training management system or learning experience platform, LMS software simplifies the administration of employee-specific and companywide training while tracking employee progress, performance, and satisfaction. This makes it an excellent solution for businesses in highly regulated industries and companies that prioritize employee training and growth.

How Learning Management Systems Work

Individual employees can be assigned personal login credentials to a cloud- or software-based LMS to access unique training materials. Once training is underway, administrators can monitor each employee, looking at completion rates, progress (through training requirements), and performance (through online assessments). This data can be analyzed within the LMS or be synced with a human resources information system (HRIS) or other talent management tools to draw correlations between training and employee satisfaction, advancement, and attrition.

Cloud-based LMS

Cloud-based LMSs are hosted on the internet and accessed by logging in to a web portal that houses all of a business’ training materials. No software is required, so this is an excellent format for businesses that rely on remote training sessions.

They provide an efficient way for organizations to manage their courses, messages, and content across multiple devices. They also allow users to access learning resources from anywhere, at any time. In addition, cloud-based LMSs are cost-effective, making them a great choice for small businesses and organizations that need to scale quickly.

Software-based LMS

Software LMSs are programs loaded directly onto your computer that allows individual access to training materials. Unlike cloud-based, where you can access your training from anywhere, using software LMS will likely require you to log in to one dedicated device. This could potentially slow training, but can allow for more control and security than cloud-based platforms.

Once logged in, system administrators—like a business’ HR team—can upload educational resources, create and administer quizzes and other assessments, and track the progress of individual learners or the team as a whole. Many LMSs streamline this process through automated notifications to keep employees on track.

Using an LMS With an HRIS

If your business relies on an HRIS to manage its HR needs, integrating it with an LMS can improve data syncing and streamline reporting. Not only can an LMS-HRIS integration make it easier to track employee progress, but it can also simplify the onboarding process and reduce discrepancies and the amount of time spent entering data.

Having all of your business’ HR and training data in one place can also help your team spot relationships between training and other important metrics like employee productivity, engagement, satisfaction, and turnover.

If you already have an HRIS, contact your account manager to find out what kind of LMS options are available. Some platforms, like BambooHR, include built-in training tracking that can take the place of a full LMS; others require a third-party integration.

What To Look for in an LMS

The best LMS for your business depends on a number of factors, like budget, number of employees, and whether you’re in a highly regulated industry. However, there are several more common features to consider when choosing a platform. Some of the most helpful LMS features include the ones listed below.

Integrations

If you use an HRIS, talent management software, payroll service, or other platform to manage and administer your business’ HR strategy, look for an LMS that can integrate with those tools. Integrations make it easier to sync employee data and can significantly reduce the time spent entering and analyzing that information. Larger companies with the infrastructure to develop their own proprietary LMS can design custom LMS tools to integrate with current systems.

Automations

Automations and notifications can help both HR leadership and employees meet their training goals. By setting up course completion deadlines and training timelines, your business’s HR department can ensure employees are getting automated reminders when it’s time to meet specific training requirements.

These automations and notifications also make it easier for HR to monitor where each individual learner is in the training process—and identify who is falling behind or failing to meet compliance requirements. For training beyond your company’s minimum requirements, many LMS options can use algorithms to make additional course recommendations based on the user’s interests, role, and performance.

User-friendly Learning Hub

Having an easy-to-use centralized learning hub means your business’ HR team and other employees can quickly and conveniently access training materials. Not only does this improve the learning process, but it can also cut down on the frustration that often comes with training and certification requirements.

Look for an LMS that offers an enjoyable user experience for learners and a streamlined interface for those managing and tracking employee training.

Tailored Training

If you’re offering training to team members in different departments—like engineering, marketing, and sales—you may want to provide a different learning environment for each. In this case, look for an LMS that lets you personalize the training experience by curating relevant coursework for each employee or department.

Depending on the type of training you plan to offer, you may want an LMS that features adaptive assessments and quizzes that automatically adjust based on a learner’s mastery of the materials.

Data & Compliance Tracking

One benefit of LMSs in business is that they let HR professionals track an employee’s progress through available training materials. Not only does this let businesses better understand the status and effectiveness of their training strategy, but it also makes it easy to spot patterns in employee behavior.

For example, using data available through an LMS may reveal that highly trained employees are more engaged and have a lower attrition rate. Likewise, you may find that employees who are not required to complete periodic training are less engaged and, therefore, more likely to leave the company.

If your business is in a regulated industry, look for an LMS that offers compliance tracking tools. These features make it easier to track individual knowledge, performance, and gaps, while creating a compliance record that can be referenced in an audit.

Reporting & Analytics

For many business owners, reporting and analytics are among the most important features of an outstanding LMS. While your HR team may be able to administer training courses without too much effort, tracking who has completed and passed each training requirement can be more daunting.

Common reporting features include progress and completion rates, assessment results, participation and engagement, and time logs. Many businesses can also benefit from analytics that track learner satisfaction and course ratings. Consider how you plan to utilize an LMS and choose the most beneficial reporting tools based on those needs.

Assessment Tools & Test-out Options

In addition to using adaptive assessments to tailor the user experience, many HR departments find value in advanced assessment tools for tracking employee progress. This can help your team measure everything from learner engagement to comprehension and, ultimately, retention.

If assessments are an important element of your business’ training strategy, look for an LMS with options like quizzes, exams, simulations, and feedback mechanisms to help learners improve over time. Where appropriate, assessments can also help employees test out of lessons. Ultimately, this may reduce the time employees spend in unnecessary courses—thereby improving productivity and reducing burnout or frustration stemming from excessive training.

Smart Scheduling

For businesses that rely on synchronous learning—rather than just asynchronous content like slides or pre-recorded video—choose an LMS that offers smart scheduling. These tools make it easier to find times that work for large training groups and offer more flexible scheduling options that don’t interfere with employee productivity.

Security Protocols

Security may not be the first thing that comes to mind when choosing an LMS, but it’s important to choose an option that will protect employee data and your business’ valuable proprietary information. For example, you can increase security by choosing a single-tenant LMS that can only be accessed by your team rather than a multi-tenant option that hosts multiple clients.

Pros & Cons of an LMS

LMSs are a great tool for training and development. They allow for easily tracking and managing training sessions, as well as providing easy access to past sessions for review. LMSs can also be used to distribute training materials and recordings, prompting participants to revisit training materials during or after the session. However, there are also some cons to using an LMS that should be considered before making the investment.

Who an LMS Is Right For

In the business context, LMSs are generally aimed at simplifying training, but there are certain businesses that will benefit more from the technology than others. Businesses likely to benefit from an LMS are those:

• Operating in a highly regulated industry that requires regular training and certification renewal
• Requiring employees to participate in corporate training videos during onboarding and beyond
• Relying on a large remote workforce that can benefit from having an LMS with scheduling and tracking tools
• Providing training products to customers, especially via client-specific login credentials

Every business is unique, and your company may benefit from an LMS even if it doesn’t fit into one of the categories above. LMSs may also be a good option for business owners who want to:

• Streamline the administration of companywide training and certification requirements
• Provide a more consistent training experience across all employees
• Track employee-specific training progress and generate reports to illustrate educational milestones
• Meet training requirements imposed by law or industry-specific regulations
• Reduce employee education-related expenses by limiting travel, optimizing efficiency, and eliminating expensive overlap that can stem from disorganized training

How to Choose an LMS

Top LMS Platforms

The top LMS platforms offer something unique for each business, such as industry compliance, new hire training, and performance management. Choosing the right platform depends on the factors listed above. We recommend that you consider from the following:

• 360Learning: Best overall employee training software
• TalentLMS: Best for industry compliance
• Trainual: Best for onboarding/new hire training
• SAP Litmos: Best for supporting employees in multiple locations and languages
• Bridge: Best for performance management and testing

Bottom Line

Whether you’re a small, heavily regulated business or a large company with extensive onboarding materials, an LMS can help you organize and administer the resources necessary to meet your goals. Beyond just training your employees, you’ll also gain insight into how education requirements can impact performance, well-being, and overall job satisfaction. If you’re considering an LMS, take time to evaluate your needs and research providers before signing up for a paid platform.