Integration and e-learning have proven to be two of the best areas of IT investment, according to Nucleus Research analysts in a 2002 publication on technology investments that were bringing high returns (see "Which IT Investments Bring the Highest ROI?" at http://Advisor.com/doc/11103). Nucleus has expanded on those e-learning findings to offers tips for a successful plan.

Analysts studied a range of e-learning projects -- from small, department-level programs to multi-billion dollar programs addressing a global user base. In a report on their findings, they say some companies, including IBM and Lucent, are achieving an ROI of more than 1,000 percent with e-learning.

The most successful companies used similar strategies:

• They determined goals they wanted to achieve with the project before they started talking to technology vendors.
• They stuck to short launch timelines. Nucleus researchers recommend you keep your launch timeline, at least for launching the initial pieces of the project, under six months.
• They planned for moving employees to the new learning system. Those companies with the best ROI were those that trained users in the new technology and dealt with adoption issues.

• First-tier benefits are based on eliminating existing costs. These include reduced travel expenses, HR overhead, regulatory compliance, and customer support costs. Researchers give the example of Lucent, which saw a 2,302 percent ROI in 1999 by cutting back on travel expenses and fees for third-party instructors.
• Second-tier benefits occur when companies use e-learning to support changes in the company's strategic direction. For example, Lucent achieved second-tier benefits through improved manager productivity when it launched reporting and tracking features they could use to follow employee progress without having to prepare reports manually.

• Low-fidelity: These require the least student-teacher interaction, and are the best choice for e-learning replacement because they can reduce training expenditures while preserving the instructional value of the original subject matter. You can usually assess these courses with a completion or retention test. They can typically be replaced with Web-conferencing tools such as PlaceWare or WebEx, Nucleus says. An example might be an introductory course for Microsoft Excel, or a pharmacy that wants to see e-learning ROI by replacing classroom-based safety certification training with e-learning.
• Medium-fidelity: These courses rely more on student-teacher interaction and influences job performance and corporate revenues more directly. Related e-learning programs will probably cost more, but could bring a bigger payback. Nucleus says most courses that model traditional learning environments fall into this category. Researchers' advice: Companies should weigh benefits such as reduced travel against the cost of developing content and infrastructure.
• High-fidelity: These courses are customized to the needs of each learner and requires a lot of student-teacher interaction and personal evaluation of progress. You can generate ROI by using technology such as simulation and agents to improve the quality of learning, boosting productivity while reducing delivery costs. For example, IBM used to run a five-day event to train 5,000-plus managers in IBM culture and strategy, but it decided it needed an ongoing training process rather than a quick training session. Its Basic Blue for Managers combines classroom instruction with virtual collaboration tools, interactive online simulators, and a Web-based learning infrastructure.