What Is a Learning Management System? Small Business Guide
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Robie has more than five years of content writing experience and specializes in writing about payroll and human resources software for small businesses.
This article is part of a larger series on Payroll Services.
A learning management system (LMS) is a software that makes it easy to organize, manage, and deliver your small business’ training content. Also commonly referred to as a training management system or learning experience platform, an LMS streamlines 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.
What is a learning management system capable of doing aside from organizing and tracking training? Most LMSes allow you to create training content using various media, such as videos and presentations. Others provide access to a library of learning courses with templates you can customize. Some even have gamification features to enhance the user experience, as well as online quizzes to measure success.
How Do Learning Management Systems Work?
An LMS stores all of your corporate training programs, online learning materials, and training-related information. To access the system, users are provided with the applicable login credentials. Most learning management systems come with user permissions, allowing system administrators to control who has access to specific features and training modules.
Once training is underway, administrators can monitor each employee and look at completion rates, progress (through training requirements), and performance (through online assessments). This data can be analyzed within the LMS or synced with a human resources information system (HRIS) or other talent management tools to draw correlations between training and employee satisfaction, advancement, and attrition.
LMS Software Implementation Options
In terms of software implementation, an LMS can be a cloud-based software or installed directly into computers. You can also install it on your company’s servers as a self-hosted solution. If you’re using an HRIS that supports third-party software integrations, you can connect an LMS to that platform. Click through the tabs below to know more about these options.
Top LMS Features to Look For
So, what should you look for in an LMS? The best LMS for your business depends on several 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, such as the ones listed below.
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.
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.
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.
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.
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—helping you identify the training content and learning tools that workers really need. This also improves productivity and reduces burnout or frustration stemming from excessive training.
One benefit of LMSes in business is that these programs let HR professionals track an employee’s progress through available training materials. Not only does this allow businesses to 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.
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.
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 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.
Pros & Cons of an LMS
Still wondering what an LMS is used for and why should you invest in one? Let’s look at some of its pros/cons to help you understand the system a little better.
| PROS | CONS |
|---|---|
| Makes learning easier for the user | Can be expensive to purchase and maintain |
| Consolidates training into one platform | Typically has advanced technology features that may require IT professionals to set up |
| Customizable to your specific business or industry needs | Requires maintenance of system securities |
| Enables metrics and performance tracking | Online training cannot fully replace on-the-job training |
| Provides access to e-learning modules for remote teams | |
An LMS is a great tool for training and development. While one of the benefits of using an LMS is to streamline the administration of training programs, it can also help:
- Enhance the company’s employee retention strategies for minimizing turnover and improving employee engagement
- Reduce employee education-related expenses by limiting travel, optimizing efficiency, and eliminating expensive overlap that can stem from disorganized training
- Minimize training costs of enrolling employees in third-party provided training programs—instead, your workers can access e-learning courses created by your HR team or in-house subject matter experts
Did You Know? According to a 2022 Workplace Learning report, among learning and development (L&D) professionals, 72% agree that L&D has become a more strategic function in their organization. A Global Corporate Training Market study also saw the rising trend of companies shifting their corporate training programs into online sessions to help save costs.
Who Is an LMS Best For?
In the business context, an LMS is generally aimed at simplifying training. While any organization providing learning courses can use an LMS, there are certain businesses that will benefit more from the technology than others, such as those:
- Operating in industries that require regular training and certification renewal
- Requiring employees to participate in online corporate training videos during onboarding and beyond
- Relying on a remote workforce that needs access to e-learning sessions
- Providing training products to customers, especially via client-specific login credentials
Best Practices for Selecting an LMS
If you think your company may benefit from an LMS, take the time to find a platform that can be tailored to your industry and training needs. Follow these steps when choosing a platform.
- Evaluate your business needs: Before shopping for an LMS, identify how your business plans to use the platform. Will you administer and track monthly training requirements or just onboarding materials? Do you plan to integrate the LMS with another HR platform? What kind of data do you want to gather from the LMS? Do you need a cloud-based LMS that employees can access from home or in the field? What is your budget?
- Identify must-have LMS features: The ideal LMS varies by industry and individual business. If you’re in a highly regulated industry, focus on tools that will let you track requirements and generate reports in case of an audit. If you handle large amounts of sensitive information, choose an LMS that offers robust security features.
- Research LMS vendors: Once you identify your non-negotiables, start researching LMS vendors to determine which options are in your budget. Of those, compare available features and identify anywhere from three to five top contenders to evaluate more closely.
- Demo top providers: Ease of use is one of the most important things to consider when shopping for an LMS, so take the time to demo each platform you’re considering. Many companies offer a live chat option or demo request form through their websites, but if that isn’t available, reach out via phone or email to request more information.
When you find an LMS that appears to meet your business’ training needs, work with a sales representative or sign up online. Some platforms even offer a free trial period so that you can experiment with the tools and user dashboard before committing.
Top LMS Platforms
The best learning management systems 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. If you’re looking for an LMS, here are our recommended solutions:
- Thinkific: Best overall employee training software
- 360Learning: Best for collaborative learning
- 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
To see how the above learning management systems compare with each other, check out our guide to the best personnel training software.
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.
