Corporate training isn’t just for the workforce any more. E-learning’s advantages and other incentives are spurring organizations throughout the world to outsource the training of their business and consumer customers. Driving the bandwagon is a fraternity of outsourcing suppliers eager to build a new revenue stream.
For executives of software provider Intuit Inc., it was one of those eureka moments. Sales of the company’s QuickBooks software were suddenly spurting, and a new analysis revealed why: Professional accountants were referring the product to their corporate customers after taking an e-learning course that made them certified users.
“We discovered that accountants who received their ProAdvisor Certification were referring QuickBooks to their small business customers at four times the rate of those who simply use the software,” says Rich Walker, Intuit’s director of accountant and advisor relations. “It is a causal relationship.”
Launched two years ago, Intuit’s new customer training initiative is out-tasked to Cleveland-based Convergys Corporation, a business process outsourcing firm that recently acquired e-learning content provider DigitalThink. Convergys Learning Solutions helped create the courseware and now manages the training via its scalable web-based platform, the L5 Learning Delivery System. It supplements Intuit’s classroom training program begun seven years ago with Dallas, Texas-based Real World Training.
Intuit is also part of the fastest-growing trend in learning – the outsourcing and out-tasking of customer training initiatives to suppliers that create e-learning courseware and perform numerous other services. Just like Intuit, many organizations are discovering unexpected benefits from offering e-learning courses on their products and services to business and consumer customers.
The bandwagon is gathering momentum on several continents. Can’t decide which digital camera or cell phone to buy? Step up to the retail store’s handy kiosk and take a tutorial about the product you’re considering. Want to know more about your broker’s financial services and tips on investing? Take an e-learning course on its Website.
The trend is being driven by cost-saving e-learning technologies able to deliver learning inexpensively—when and where they are needed. “Customer education outsourcing is growing at a 25 percent clip,” reports Doug Harward, CEO of The Exceleration Group, a Cary, North Carolina-based management consulting firm that specializes in corporate education. A recent study by the firm estimates that 58 percent of the emerging market in training outsourcing is in customer education, while only 42 percent of the market is in employee education.
Serving the market’s needs is an expanding army of training providers that ranges from small content developers to large business process outsourcing (BPO) firms. They assist their clients in discovering how e-learning technologies enable them to increase customer satisfaction, reduce training costs and increase revenues. The technologies also scale to larger audiences at a fixed cost, decrease the cost of delivery and improve core product adoption rates.
In addition, outsourcing suppliers promise to
- help their customers launch new products with improved communication
- increase satisfaction and loyalty
- enter new geographies with minimal cost
- improve quality and convenience of training through blended just-in-time learning.
They also can get customers on-board more quickly, improve adoption rates of new product features and upgrades, and improve learning with customer and partner certification programs.
Although software and personal technology suppliers are among the highest profile manufacturers to out-task elements of their customer training, they aren’t alone.
Organizations in a variety of fields are turning to e-learning to train their wholesale customers, dealers, and channel partners, often bidding adieu to classroom training. For example, automobile manufacturers rely heavily on learning outsourcing firms to train their dealer networks and other business customers. Among other fields:
● Healthcare. Medical products and pharmaceutical companies are aggressively employing e-learning technologies to train physicians and other healthcare workers on the use of their products. eTrinsic, a Louisville, Colorado, developer of simulation-enabled content and proficiency measurement technology, says its product is used by clients such as Eli Lilly, Bristol-Myers Squibb Welch Allyn, and Merck to train end-users, including non-professionals in home care settings.
● Professional associations. Business and professional associations are out-tasking the development and delivery of e-learning courses to their members to meet certification, continuing education, and other goals. Doing so not only attracts and retains members, but offers a meaningful revenue stream for the organization. For example, the American Psychological Association received US$4 million in revenue in only four months by providing a $300 certification course to members on the Health Insurance Portability and Accountability Act (HIPAA).
● Agriculture. Worldwide agribusiness company Syngenta recently began employing e-learning to reach farmers and other remote customers with training about a variety of product-related issues including applications to promote healthier crops. Syngenta outsources the activity to Productivity Point International (PPI), Research Triangle Park, North Carolina.
Supplements or replaces in-house training
To be sure, customer training is not a new endeavor. “Customer training has always been near to the hearts of product managers,” claims Frank Fedorovich, vice president of commercial sales for IT training company Global Knowledge. “But as the economy has squeezed costs out of organizations, many companies no longer have resources in-house to produce it,” he says. Clients typically seek selective out-tasking relationships rather than the complete outsourcing of all product training, but such contracts can ultimately lead to the outsourcing of entire product lines, says Fedorovich.
Customer training differs dramatically from workforce training in that it is typically a product support activity launched by the sales and marketing department, not from within HR. Marketing executives are not as concerned with an individual’s competency as they are in bottom-line results—increasing customer satisfaction and retention.
Harward says customer education activities normally support indirect revenue generation, such as reducing failure costs and risks in use of a product, or generating sales of core products. Among the most popular and effective customer training models are those created by Cisco and Microsoft. While retaining ownership of its intellectual property, Cisco has created a network of authorized education partners (such as Global Knowledge) that offer training on its products.
For learning outsourcing companies, customer training represents an enticing market that is less subject to budgetary fluctuations than workforce training. “Companies live and die on the success of new product launches, and are committed to budgets that ensure their success,” says Fedorovich. “They will invest in their customers even in hard times,” he says.
Global Knowledge’s own move into customer training was initially driven by requests from clients, says Fedorovich. Its expertise is in IT and enterprise training, where it offers more than 700 courses in 13 languages, covering such companies as Cisco, Nortel, Microsoft, Oracle, Red Hat, and Foundstone.
Global Knowledge recently created a customer-training program for a major client company that supports automobile dealerships with a variety of services. The supplier provided an e-learning course on the financing and insurance offerings available to use for the dealer’s customers. Global Knowledge’s hosted LMS documents each customer’s experience with the course, and then provides feedback to the client company.
The Cary, North Carolina-based company will roll out a marketing campaign before yearend to promote its new customer training services, he says. It will initially focus on b2b and b2c computer and electronics hardware training.