When you budget for a new Learning Management System, there are many considerations involved other than just the initial purchase of the system. This article unpacks what those are and how to evaluate each as you move forward with your employee training.

Budgeting for a learning management system isn’t as scary as you think.

As restaurants move towards cloud-based Learning Management Systems for employee training, one of the most important considerations to make is the total cost of ownership; this includes the cost of the purchase, operation, and maintenance. Within those specific areas are additional factors look at as well. The following is a breakdown of what needs to be examined in each of the 3 categories.

1. Cost Of Purchase

To determine the cost of purchase, your restaurant’s training organization will need to evaluate the following:

  • The software licensing fee.
    Does the LMS solution you’re considering charge by the total number of restaurants or total number of employees? Being that restaurants have high turnover rates, it makes sense to select a provider that charges by the number restaurants, rather than the number of users. You’ll also need to find out if they charge a one-time fee or have a monthly/ yearly subscription model in place, and budget accordingly.
  • Customization.
    If maintaining your brand is a top priority, you’ll likely want the layout of the LMS to match your restaurant’s brand. That being the case, you’ll need to look for an LMS that is easy to customize. To help reduce the costs associated with customization, make sure the system comes with built-in capability for modification. Making changes to a system that does not have this capability can be expensive and would likely require you to hire developers to do the job. Overall, shop for an LMS that’s flexible enough to incorporate your branding while keeping customization costs in mind.
  • Content development.
    To reduce content development costs, purchase existing training courses from an external provider that is compatible with your LMS. Also, make sure that the courses can be modified to align with your restaurant’s brand. Keep in mind that you will need a separate budget for content creation if your LMS provider does not include a function for building content.


2. Cost Of Operation

Cost of operation depends largely on whether your LMS subscription is cloud-based or self-hosted:

  • Cloud vs. Self-hosting.
    If you decide to self-host, you can eventually license the code and build it. However, you’ll need to create a budget that allows you to hire your own in-house IT experts to maintain the server. If you decide to go with a cloud service to host the Learning Management System, you’ll need to research the most reliable and secure options. While you may pay more for a monthly or yearly subscription, the hassles of operation will automatically be taken care of.
  • Support for growth.
    When expanding restaurant locations, your LMS must scale to meet the increasing number of workers. If you go the route of the cloud, make sure their services are multilocational—whether it’s across the country or across the globe—and scalability is in the contract. For instance, if your organization plans to go from 200 to 500 locations, budget for an Learning Management System that provides the flexibility to meet that expansion. If you are self-hosting, your IT department will need to grow as well and possess the expertise that is necessary to help the company scale up.
  • Security.
    Carefully examine the security capability of the LMS before making your purchase. You’ll also need to know if you have the capability to lock down user access as it relates to the mobile network and internet infrastructure. If you’re self-hosting, you should budget for the costs involved with hiring an IT team that possess the cybersecurity skills that will protect your restaurant employees.


3. Cost Of Maintenance, Etc.

Cost of maintenance depends on whether your Learning Management System subscription includes the following:

  • Technical support.
    Most cloud-based LMSs include technical support costs in their monthly/yearly subscription plans. If you self-host, make sure your IT department has a budget dedicated for technical assistance when employees they run into issues with the platform. If your operations runs around the clock, you’ll want to make sure tech support is offered 24/7.
  • Bug fixes.
    As with all software, LMSs will have bugs. The good news is that most will provide bug fixes at no additional cost. With the cloud, everything is being hosted and maintained by the vendor, including bug fixes. If you’re self-hosted, however, you’ll need to budget for the time and effort it will take your IT department to resolve any technical  issues.
  • Feature Updates.
    Along with preparing new training requirements come software improvements as well. While most vendors provide feature updates, not all will offer free upgrades. It largely depends on the software provider. If you want to build your own features into the system, you’ll need a vendor flexible enough to do so and also allocate a budget specifically for making any system modifications.
  • Content maintenance.
    Whenever content needs updating -whether related to a new point of sales system, revising the operations manual and employee handbooks, or the launch of a new product- the LMS system should be able to implement changes quickly and minimize the costs associated with maintenance.

Planning for the budget considerations listed above may take time, but you will be a great deal more prepared to deal with surprise costs associated with owning and building a training portal. If you don’t have an in-house expert to walk you through the process, reach out to a consultant.

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