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They're online and on the job. Managers and hamburger flippers are being E-trained at work. Training and professional development are the corporate equivalent of spinach: essential for pumping up performance but hard for employees to swallow. Many recall the coffee and doughnuts served between sessions better than the content of the text or lectures. Thus, when Circuit City moved most of its training online over the past year, salesman Andre Harris, a reluctant reader, figured he'd skate through the tutorial on digital camcorders with a minimal amount of effortЦuntil he saw colleagues who'd mastered the material ringing up all the commissions. Harris returned to the back-room computer lab and consumed every course offered. Today, he's the Sterling, Va., store's top salesman, able to counsel customers on each nifty feature of some 18 models that gleam atop his display counters, as well as the computers and TVs down the aisle. Not bad for someone who had been working in the warehouse only six months earlier. Success stories like Harris's are selling employers from automakers and software firms to hospitals and pharmaceutical companies on the value of electronic training. From a flicker in 1998, corporate E-learning has flared into a $2.3 billion market, making it one of the fastest-growing segments of the education industry. That's still a mere sliver of the nearly $57 billion that Training magazine estimates companies now spend on employee instruction. But the concept is expanding swiftly to encompass everything from university-based online certificate programs for firefighters and M.B.A. programs for executives to computer CDs on managing diversity created by courseware companies like NETg of Naperville, Ill. The technology-research firm IDC in Framingham, Mass., sees the industry continuing to grow at a 50 percent annual clip, topping $18 billion in 2005. The U.S. Army alone will spend more than $450 million over that time to beam classes into bases and foxholes worldwide. Behind the wild enthusiasm is the imperative to stay competitive in a fast-changing economy. Gone are the days of long product cycles, 12-week management courses, and hefty travel budgets to cover in-person training. The winner is often the one who zaps new information out to the sales force fastest. Rather than fly trainers to 7,000 dealerships, General Motors University now uses interactive satellite broadcasts to teach salespeople the best way to highlight features on the new Buick. Six months before rolling out a hot new pickup, GM used the broadcasts to teach mechanics how to repair it; at one point, 1,400 employees around North America were watching. "If we'd had to send everyone to a bricks-and-mortar class, we never would have got all of it done," says GM learning chief Donnee Ramelli. Fast and cheap. E-training can also shave companies' costs and inconvenience while it saves them time. Pharmaceutical companies like Merck are conducting live, interactive classes over the Web, allowing sales reps to bone up on the latest product information at home rather than fly to a conference center. Intel employees out west can pursue an M.B.A. program designed exclusively for them from Babson College in Wellesley, Mass., via laptop, without having to take a sabbatical from work or decline out-of-town assignments. Recognizing the benefits, Motorola's admired corporate university already conducts 30 percent of its training online and aims to deliver half its courses electronically in the next few years. McDonald's trainees will get a taste of Web-based learning later this year by logging into Hamburger University and honing such skills as how to assemble a made-to-order burger or properly place the drink on a tray. Even before the September 11 terrorist attacks, which left many employees loath to travel, some experts predicted that 80 percent of corporate training would be delivered electronically in three years. Lofty predictions about the dominance of computer-based training have been made before, howeverЦand all have proved wrong, notes industry veteran Jim Howe, chief technology officer at Usertech/Canterbury, an East Norwalk, Conn., E-learning firm that creates customized programs to teach employees how to use new payroll and other systems. Why? Most computer-based training sessions are just flashier versions of classroom instruction, says Howe. They are full of text and "eye candy" graphics, and short on the engaging, interactive functions like search engines or instant messaging that make the medium so powerful. Think "PowerPoint on steroids," says corporate trainer Anita Rosen, cofounder and CEO of ReadyGo, a Mountain View, Calif., company that makes a Web-course "authoring tool," software that lets firms put their own material online. "No one wants to sit for seven hours watching page turn after page turn." One obstacle to the spread of online training, say experts, is the mismatch between what employers really needЦcustomized courses that are tailored to a firm's products and its unique corporate cultureЦand what they can afford. A British Telecom study found that 80 percent of companies prefer developing their own training courses in-house. But creating even one customized E-course can take months, involve armies of experts, and cost anywhere from $25,000 to $50,000. Thus, most companies either stick with classroom training or buy generic courses (how to do performance appraisals, basic business ethics) from dozens of firms whose off-the-shelf offerings account for about two thirds of corporate E-training content. The third of the market that is customized involves partnerships between companies like Intel or PricewaterhouseCoopers and universities that create M.B.A. programs for company executives, and deals like that of Circuit City with DigitalThink. The San Francisco-based E-learning systems provider offers soup-to-nuts service, from designing a course using in-house material and putting it online to tracking student performance. For E-training to be effective, it has to both reach a wide audience quickly and deliver information in a way that allows the audience to actually absorb it. That means breaking lessons into short "chunks" and adding lots of pop quizzes, online discussion groups, or other interactive features that let students demonstrate what they've learned. It also usually involves some form of live instruction, whether delivered in person or electronically. Circuit City's tutorial on digital camcorders, for example, consists of three 20-minute segments. Each contains audio demonstrations of how to handle customer queries (which cables are needed to E-mail video?), tests on terminology, and "try its" that propel trainees back onto the floor to practice what they've learned. Students with questions can E-mail experts and receive a response within 24 hours. Some companies are experimenting with "synchronous mentoring," where employees all log in at a set time and chat with the instructor. Webcasts, in which the teacher presents material, are becoming increasingly common, too, as are blended programs that combine online and classroom training. Last year, some 21 percent of firms with E-learning programs surveyed by IDC were combining online material with class time; today, 32 percent do. Even in the hands-on world of medicine, where physicians in most states must take continuing medical education (CME) classes to maintain their licenses, the number of E-options has "exploded" to over 5,000, says retired psychiatrist Bernard Sklar, who maintains a list of offerings (www.netcan tina.com/bernardsklar/cmelist. html) . One place to embrace Web-based CME is Detroit Receiving Hospital, which has put 150 interactive case studies on the Web so that doctors inside and outside the hospital can log on and learn about the latest diagnostic practices or drug therapies. As in conventional morning rounds, physicians take a virtual patient's history, view the MRIs and blood smears, make a diagnosis, and suggest treatment. Internist Lavoisier Cardozo, who oversees mdmorningreport.com., says that working through all 150 cases has "helped me become more versatile." Offline, too. Preserving the human element was a key consideration when Intel joined forces with Babson Interactive, a for-profit spinoff of the college's Olin School of Business, to roll out a customized online M.B.A. for its employees. In fact, the program is evenly split between in-class lectures one weekend per monthЦdelivered by Babson professors who travel to Intel facilities in Arizona, California, and OregonЦand online projects and case studies that focus closely on Intel practices and products. "When you're building teams, you really need the intense face to face," says Thomas Moore, dean of executive education and CEO of Babson Interactive, who believes that the online collaboration and real-time cases will make the hybrid stronger than the classroom or electronic experience alone. PricewaterhouseCoopers's online M.B.A. program from the University of Georgia's Terry College of Business starts with on-campus classes to build camaraderie and foster teamwork among the consulting firm's road warriors, most of whom are information technology engineers. Says Sheri Shuey, who oversees the project at PWC: "We find that students who work in isolation don't benefit as much." One measure of the approach's success: Of the four dozen managers in each class, only one or two drop outЦand three have gone on to make partner. Employers bear the cost of these customized M.B.A.'s, about $30,000 to $40,000 per student. Stephanie Peacocke, an Intel project manager in the corporate quality network in Chandler, Ariz., appreciates the mix. "It's just good to touch base with everyone," she says of the six other local Intel students in her group. "There's a personality behind the name you're seeing on the screen." Moreover, the online work frees up class time for deeper discussions. "I feel like we optimize that face time," says Peacocke, who learned the value of voicing even half-baked ideas in brainstorming sessions, rather than holding back as usual, after doing improvisations and comedy sketchesЦpart of Babson's "creativity" curriculum. Having Intel examples to study, and hearing from classmates representing departments like finance and human resources, also have given her "a more holistic picture" of how the company works. If M.B.A.'s were looking for a case study on the positives of corporate E-learning, Circuit City would fill the bill. As recently as five years ago, every new full-time "sales counselor" would have traveled to the store's Richmond, Va., base for five days of classroom training. Today, with nearly 600 superstores, 50,000 employees, and a rapidly changing inventory of digital cameras, high-definition TVs, and other consumer electronics, the training needs are far more complexЦand they're ongoing. So Circuit City executives spent three intensive days talking about how to create a learning culture and get the best results, and hooked up with DigitalThink to design and post customized courses. They thus avoided the common trap of simply uploading the old text-based lessons onto a new delivery system. Because the company's core staff is made up of 18-to-30-year-olds with "point-and-click attention spans," says Jeff Wells, senior vice president for human resources, courses had to be short, fun, flexible, interactive, and instantly applicable on the job. "We were trying to create a direct link between learning and earning," explains Wells. In the year since the system debuted, the time needed to educate a new hire has fallen by half, and Circuit City has pared its training department from 83 people to 13. "Within a few hours, we reduced the training budget by 50 percent and improved effectiveness," says Wells. So far, at least, he has seen no downside. At outlets like the Sterling, Va., store, E-learning has translated into happier customersЦand more sales. That's the kind of green that could get any employee salivatin Author: Mary Lord |