eLearning Developer

So how much does it cost to hire an outside eLearning company? It depends. There are many different kinds of eLearning companies. There are large content development companies that have substantial staffing and associated overhead to cover, a panoply of “one-man-band” eLearning companies run out of garages around the world, and mid-range “boutique” companies that offer competitive pricing due to low overhead, but that have adequate resources and experience to tackle a wide range of projects. The hourly rates a company may charge is largely dictated based on several key factors:

• Fixed Bid vs. Hourly Costs
• Large brick and mortar vs. Virtual companies
• US-based vs. India or “off-shore”

Fixed Bid vs. Hourly Costs

Many companies will not disclose the actual time and tasks that make up an eLearning development project (fixed bid). While a fixed bid ensures that the vendor cannot go over budget, a conflict is created whereby the vendor’s goal is to keep costs and scope as low as possible, even though the client may discover down the line that it wishes to increase the project complexity. The answer to evolving client needs is often “That’s out of scope so it will cost you more”. This can be frustrating. Whenever possible, work with vendors that offer development programs based on actual work effort. Estimates should be given based on a solid understanding of client expectations, and every effort should be made to come in on time and budget.

Large brick and mortar vs. Virtual companies

There are several large US-based eLearning companies that charge higher hourly or fixed bid project rates because they have a large full-time staff overhead to cover. If a company is not working at 100% capacity, they have to charge hire hourly rates to cover their ongoing costs. For example, even though they may have costs of $40 per hour for an instructional designer, this designer may not be working at 100% efficiency on paid projects. Therefore, the firm may have to charge and extra 15% or more on this person’s time. On the other hand, many one-man-band or small companies essentially hire freelance talent to work on projects on an as-needed basis. While they may charge lower rates, their quality and ability to meet deadlines is suspect.

US-based vs. India or “off-shore”

Many off-shore companies will claim rates of $18-$25 dollars US for eLearning development. Many India-based eLearning development companies are actually quite talented, but low hourly rates do not tell the whole story. While the hourly rates may be low, the actual project costs can end up being much larger as a result of several factors:

• It is not uncommon for any firm that has a signficant time and cultural difference from you to take 3-4 times the number of hours to produce the work you desire. This is not an India-specific issue, but a global fact of doing business.
• Significant time, cultural, and language differences should not be under estimated. These factors remain considerable impedances to eLearning project management including time, cost, and quality.

When comparing eLearning companies, check their portfolio of work and confirm with satisfied clients that the project came in on-time, on-budget, and with minimal frustration.

Creating custom eLearning is both an art and a science. There are a wide range of tasks that must be completed and specific instructional design and technical skills required. This article on “creating eLearning” provides a high-level overview of major eLearning development roles and responsibilities and the amount of time that should be allocated and budgeted for each.

eLearning Instructional Design vs. Courseware Authoring

The eLearning development process can be generally divided into two major areas – Content Development and Courseware Authoring (aka Media Production). Content development is a function of Instructional Design during which the target audience is defined, the learning objectives (or outcomes) are identified, the course outline is created, content/narration is written, storyboards are created, and all content is reviewed and approved for production. Media Production begins by taking the narration (if this is an audio/visual course) and recording the eLearning script digitally, cleaning up or producing visuals (photographs, 2D and 3D graphics and animations, etc.) and assembling these “digital assets” into a standards-compliant (generally AICC or SCORM) format in a meaningful way.

Primary Instructional Design Tasks

The time required to perform quality instructional design can vary greatly, depending upon several factors such as

• Creating totally new and custom eLearning course-ware vs. content conversion
• Complexity of the subject matter
• Level of interactivity and visual stimulation desired

Creating totally new and custom eLearning courseware vs. content conversion

Converting existing content (PowerPoint files, lecture notes, stand-up training, existing quizzes/tests, etc.) makes the job of producing eLearning based on this content much faster. Custom eLearning courseware from scratch.

Complexity of the subject matter

Highly theoretical, subjective, and complex content generally takes longer to create than objective skills-based training (such as computer applications training).

Level of interactivity and visual stimulation desired

Writing detailed analogies and creating custom illustrations and animations to support the written and spoken word takes longer than communicating factual information in a very straightforward and literal way.  Whenever possible, budget time for your instructional designers to develop meaningful visuals and supporting narration, rather than simply list bullet points supported by “eye candy” (great looking photos/images that do not substantively support the given concept).

High-level Instructional Design Tasks

Let’s look at a high-level listing of instructional design tasks based on the following scenario: You wish to convert your existing employee onboarding course “New Employee Orientation” to an online format. The course generally lasts 4 hours as instructor-led, but you believe you can create this course as a one-hour online course supported by in-line interactivities/games, and a post-test.

The total labor for the above is 156 hours. Note that these hours are based upon using a highly skilled and experienced team comprised of eLearning development experts who have created dozens of hours of courses already. Internal training departments that are new to this process will find that times take significantly longer as they overcome significant learning curves.

This project plan also spans approximately 4 weeks and incorporates the following staff members:

• eLearning Project Manager
• Instructional Designer/Writer
• eLearning Content Editor
• Graphic Designer

For information regarding tasks and times related to the courseware authoring process, please see the eLearning design articles on this website.