This paper examines the strategic planning process for "Computer Learning Online," a fictional internet startup called Freddie Corporation that intends to offer online computer courses, including Unix System Administration. Structured as a series of 17 essential questions every e-learning startup should address, the paper covers topics such as novelty of the business concept, value creation, economic advantage over traditional businesses, revenue generation, target market size, technical capabilities, branding, regulatory hurdles, competitive threats, management expertise, and exit strategy. Drawing on early 2000s e-learning market data from sources such as the International Data Corporation and industry news, the paper argues that online computer learning represents a highly promising and rapidly growing business opportunity.
"Corporate training is evolving into performance support. I don't see them as courses. I see it as a knowledge resource. You work with a manager, find your deficiencies, and go online for the tools to improve." — Steve Teal, e-learning director at Bristol-Myers Squibb Co., the $19.4 billion-a-year pharmaceutical company in New York (E-Learning News).
Online computer learning classes offer not mere courses, as Teal suggests, but a rich array of study material and a complete guide that equips individuals with the awareness needed for computerized learning. Freddie Corporation, a well-reputed name in the cyber world, is planning to launch an internet-based e-learning company focused on computer education. Although generating profit through the internet is becoming more common as firms enter the cyber race with the latest technology and innovative ideas, it is not as simple as it appears. Making money and building a profitable business in the virtual world is far from easy.
Therefore, before a startup company goes public online, it must conduct not only a market survey but also carefully examine several other aspects to ensure a promising future. For Freddie Corporation to undergo a successful business venture offering online classes on Unix System Administration, the following questions are essential considerations. The answers provide a highly useful guide for any internet-based startup company intending to conduct online computer classes.
The very first consideration is to assess the novelty of the business concept, as this helps Freddie Corporation attract value-added investors. The more unique a business proposition is, the easier it is to gain a competitive edge. The business venture selected by Freddie Corporation has immense potential to create value and generate substantial returns in the form of profit and technological development. What gives this proposition an advantage is that researchers in the field have rated online learning as the number one business opportunity among the top ten business opportunities for 2003, 2004, 2005, and 2006 (E-Learning News). Since this concept of learning is still in the process of development, Freddie Corporation can certainly benefit from this innovative yet highly challenging frontier.
By entering the cyber race of online learning, Freddie Corporation's primary aim is not monopoly but rather to provide students, employers, employees, mentors, instructors, researchers, and all those connected to the world of computers and the internet with the endless benefits of the quickest form of learning — e-learning.
The business venture offering online computer classes has an enormous potential to create value for its customers and to add value to the broader system of streamlined businesses. Freddie Corporation assists various companies in increasing technological awareness through e-learning. Companies that educate their employees through online computer courses offered by Freddie Corporation will be able to "launch quick changes, ramp up new hires, facilitate faster growth, acquire and retain the best people, increase job satisfaction, and improve customer service" (E-Learning News). This is because Freddie's online computer learning classes offer "always-on training for problem solving, closing knowledge gaps, and educating distant employees worldwide" (E-Learning News), in addition to equipping individuals with the latest computer courses that determine successful careers.
Furthermore, online computer learning under Freddie Corporation's management provides effective and efficient communication methods, thereby reducing communication problems and costs for its clients. The e-learning computer classes with expert instructors also save the precious time of faculty members, students, and employed professionals interested in online computer education. By using advanced technological approaches, Freddie Corporation enables its clientele — including students, working women, researchers, busy employers, and first-line supervisors — to extend "the learning process while compressing the amount of necessary face-to-face time" (How to Get Started with E-Learning).
Traditional businesses do run profitable operations, but they do not prove as lucrative as enterprises offering e-learning. Since Freddie Corporation offers online computer learning, it will have an advantage over other traditional businesses worldwide, particularly in the economic sphere. By offering online courses to companies, academic institutions, research communities, and governmental agencies requiring Unix System Administration, Freddie will attract more consumers and generate significant turnover. By offering online learning to its own employees, the company will be able to augment its productivity many times over compared to traditional businesses (E-Learning News). Moreover, Freddie Corporation can reduce training and travel costs through internet-based computer learning, thereby achieving "competitive advantages" (E-Learning News).
In addition, by using the latest technology and the fastest medium of communication, Freddie Corporation minimizes the communication barriers that increase cost and inefficiency — saving hundreds of dollars that traditional businesses typically incur as a result of slow and ineffective communication systems.
Freddie Corporation can attract investors from universities — the highest level of academic institution — that are actively seeking web-based communication and teaching solutions. Good universities have massive funding and large reserves that can be leveraged through adequate correspondence and convincing presentations. Research communities are also a solid source of revenue. Research centers and market research firms such as the International Data Corporation, the National Institute of Standards and Technology, and various association management organizations are always seeking sources that reveal significant data and research material, and they earn millions in return.
In addition, by gaining a management buy-in — that is, taking all fundamental stakeholders into confidence, including senior management and the top executives of Information Technology and Human Resources departments — the startup firm can generate substantial revenues (How to Get Started with E-Learning). Top management can assist in tapping dormant revenue-generating sources and creating more capital for the upcoming online computer learning firm.
The size of the target market for Freddie's online computer learning courses can best be gauged by the research findings of the International Data Corporation (IDC), one of the top market research firms, located in Framingham, Massachusetts (E-Learning News). An extensively researched IDC report highlights the significance and scope of the online learning business, as well as the rapid pace at which companies worldwide are recognizing the importance of internet-based instruction and education (E-Learning News).
The IDC report reveals that almost half of academic institutions, including universities and colleges, in North America have begun educating their students through online learning facilities and internet-based computer courses (E-Learning News). The IDC expects a "compound growth rate of 147%" per annum through 2005 (E-Learning News). Furthermore, "IDC expects the U.S. market for corporate e-learning to more than triple from $4.2 billion in 2001 to $18 billion by 2005. The U.S. Army last year allocated $500 million to creating an e-university that will deliver courses to its personnel" (E-Learning News). IDC also "predicts the market will grow from $6.6 billion in 2002 to $23.7 billion in 2006" (E-Learning News).
According to the National Institute of Standards and Technology, the potential target market for online learning "is expected to exceed $46 billion by 2005" (E-Learning News). The Association Management notes that "e-learning is the fastest growing Web application since e-mail. More than 75 percent of colleges and 90 percent of Global 2000 companies have invested in online learning. More than 2 million courses are now online and accessible to learners of all occupations and interests. Millions of people have taken online courses, and the number is growing exponentially. Some estimate that 50 percent of all continuing education will be delivered via the Internet by 2004" (E-Learning News).
Considering these surveys and their findings, Freddie Corporation has a vast target market as large as the endless business opportunities that online computer learning courses offer.
In order to formulate the best lectures and delivery methodologies for learners of Unix System Administration and other online courses, Freddie Corporation has resolved the issues concerning business and associated learning requirements (How to Get Started with E-Learning). The company has fulfilled all the required technological essentials to make its online classes full of innovation and valuable information. Freddie Corporation has decided to utilize the approach referred to as "digital surround" by Elliot Masie (How to Get Started with E-Learning). This technologically advanced approach uses "e-learning components to support and extend classroom learning events. E-learning components that can 'surround' a classroom-based event would include online assessments, e-mail access to tutors, collaborative tools, and coursework" (How to Get Started with E-Learning).
According to a guide for startups, "the Learning Management System (LMS) is the core piece of technology that drives most e-learning strategies" (How to Get Started with E-Learning). With this in mind, the systems administrators and consultants at Freddie Corporation have gained hands-on experience with various systems and have decided to use an Application Service Provider (ASP) (How to Get Started with E-Learning). Freddie knows that beginning with a large-scale operation immediately could be counterproductive. Therefore, the company runs a pilot project to test the accuracy of its online learning programs. The team recognizes that "a logical first step is a pilot project, a small-scale implementation designed to generate useful data points and test the value of e-learning" (How to Get Started with E-Learning).
An ASP is considered the best pilot option as it provides a simpler, lower-risk option with lower associated costs. Freddie Corporation has used the following guidelines for its pilot project (How to Get Started with E-Learning):
Having a system in-house affords greater control but can require purchasing, installing, and supporting additional hardware. Intranet deployments allow greater integration with internal systems such as HR and often allow more administrative functions. An ASP solution can be set up quickly and cost-effectively because the hardware and software are managed by the ASP provider. ASP solutions generally require all participants to have internet access, and the IT department must confirm that firewall security restrictions will not prevent access to needed web content.
Furthermore, the final assessment team at Freddie Corporation has confirmed that all areas where technology plays a vital role are covered, including (How to Get Started with E-Learning):
With the help of Broadband and VOD (Video on Demand) technologies, Freddie Corporation is well-positioned to generate the essential traffic and stickiness needed for a sustainable online presence (E-Learning News).
"Trademark strategy, IP law, and competition threats"
"Team expertise, skilled workers, and investor attraction"
"Exit route planning and final recommendations"
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