Four costly risks your online learning management system can help you mitigate



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Reduce the chance of reputational damage, boost staff retention, and improve health and safety: your online learning management system can help protect your company from risk

The road to getting a new online learning management system for your organisation may have been full of traffic, bottlenecks and potholes – but your final destination is now in sight. First, you secured stakeholder buy-in for LMS investment, then overcame common objections, and you’ve now learnt how to boost user engagement in your corporate elearning platform.

But do you know what business risks you can mitigate when using an LMS?

There are a few financial implications your company could open itself up to by missing out on compliance or health and safety training. Not only will this affect your reputation, but it may dissuade the best talent from applying for open roles. So here are four potential problems you can overcome with your online learning management software.

This isn’t legal advice, so contact an expert to get any legal guidance you require on these issues.

Four less-obvious risks facing growing organisations

  1. Compliance
  2. Health and safety
  3. Reputation and competition
  4. Talent

1. Compliance

Think risk, think compliance – think compliance training. An LMS enables you to deliver impactful and effective training that reduces the chance of non-compliance in your organisation.

The risks of non-compliance because of inadequate training are significant. California-based Molina Healthcare was given two administrative penalties by the Department of Managed Health Care in December 2018 for “significant lapses in the insurer’s grievance process for enrollees”. The $217,500 fine covered 44 violations of state statutes and regulations – 13 of which infringed California’s Health and Safety Code. Part of the corrective action plan included training for service representatives on grievance definition and resolution, plus how to document and audit these cases.

There are other financial losses you could incur, too. The UK government’s Cyber Security Breaches Survey 2022 found that 39% of businesses surveyed had identified a cyber-attack over the past 12 months. Of those, 83% were phishing attempts and 21% were more sophisticated attacks (such as denial of service, ransomware, and malware attacks). For those companies that reported material outcomes – where money or data was lost – the average estimated cost per attack was £4,200; that rose to £19,400 if you considered just medium and large enterprises.

The survey also asked about the indirect costs of the most disruptive attack in the previous year, such as time when jobs couldn’t be performed, equipment was replaced, or the value of lost files or intellectual data. Of organisations that reported breaches with an outcome, the mean indirect cost was £1,050; this increased to £3,770 for medium and large businesses only. This 2020 report stated it’s difficult for companies to accurately estimate these costs, so these figures might be conservative estimates of the financial penalty of poor cybersecurity. Raising employee awareness through training – facilitated by your LMS – can go a long way to mitigating the risk of cyber-attacks. In fact, in a 2021 report by Proofpoint, 80% of organisations said that awareness training reduced phishing susceptibility.

And then there’s the General Data Protection Regulation, or GDPR. This and other privacy laws shouldn’t be a barrier to training provision, but you should make sure your people are fully trained on its requirements – and, of course, collect any employee data in line with the GDPR. The maximum fine in the UK is £17.5 million or 4% of your company’s annual global turnover (whichever is greater). As with cyber security breaches, these penalties can be avoided by providing your people with timely, relevant, and engaging training activities, delivered through your LMS.

Finally, don’t forget the 2010 Bribery Act. If a bribery offence is allowed to take place, businesses are at risk of an unlimited fine and must return any financial gain from the action. Serious crime prevention orders must be implemented, and directors disqualified from such positions for up to 15 years.

How can Ciphr LMS reduce the risk of non-compliance?

When you provide compliance training it will mean, for example, you won’t have people operating equipment without the correct guidance or personal protective equipment (PPE), or releasing toxic materials into the environment. Compliance training is also relevant to office-based employees – educating employees on the risk and impact of discriminating against others based on age, race or gender, and maintaining their knowledge of industry-specific regulations, such as the Senior Managers and Certification Regime (SMCR).

One more thing your LMS can do here: give you vital data. Records can show you’ve provided compliance training to your workforce, which you may need to demonstrate to a regulator. Integrated HR and LMS systems offer additional insight here, such as identifying which employees need annual recertification.

2. Health and safety

Whatever the size, sector, or location of your organisation, the health and safety of your people is top priority. Remember, the Advisory, Conciliation and Arbitration Service (ACAS) states that employers are responsible for the health, safety and wellbeing of their workforce, whether on-site or elsewhere. And while employees also have a responsibility to take reasonable care of their health and safety at work, both physical and mental, managers should keep in regular contact with team members and work with them to find suitable solutions.

Related: The essential LMS implementation plan: expectations, estimated timelines and exceptions

How can Ciphr LMS reduce health and safety risks?

This is where your online learning management system comes in: you can use it to store information from one-to-one meetings, as well as distribute and monitor the completion rates of relevant health and safety courses.

The Health and Safety Executive (HSE) says employers should provide employees with information about workplace risks and how they’re protected – and also offer instruction and training on how to deal with such risks. This should also include any contractors and self-employed staff, plus those with particular training requirements (eg new hires, or those changing roles).

Why is this so important for businesses? Here are some figures to think about:

  • More than 200 people in the UK are killed in accidents at work every year
  • More than one million people are injured annually
  • More than two million suffer illnesses either caused by or made worse by work

So, is your LMS up to the task of keeping your employees safe and well? As a minimum, your training activities should cover:

  • First aid: the 1974 Health and Safety at Work Act (HSWA) states that workplace risks must be assessed and employers give appropriate first aid training to its workforce. The HSWA highlights employer duties to employees and the public, plus obligations employees have to themselves and others
  • Environmental responsibility: the 1990 Environmental Protection Act means organisations must ensure they minimise their effect on the environment with waste and pollution. So businesses must stay up to date with developments, or face penalties and reputational damage. In April 2016, a London-based company was fined more than £1.2 million when more than 17, 000 tonnes of waste was deposited and stored illegally

3. Reputation

A less-than-perfect health and safety record isn’t the only thing that could affect your brand’s reputation. Creating a culture of continuous learning – with your LMS serving as the foundation – will improve your company’s public image, and will make employees feel happier and more engaged at work.

It’s important to make sure your employees are equipped with the right technical knowledge and skills to perform their jobs effectively and manage their teams. Too many organisations are overlooking the need to train and support their managers; the Chartered Management Institute’s 2017 Management Manifesto stated there were more than 2.4 million ‘accidental managers’ in the UK, and estimated this cost the economy around £84 billion annually, while Investors in People subsequently found that 50% of employees leave a job because of a bad manager. But this might not necessarily be the fault of the manager themselves, as 71% of employers admitted they don’t train first-time managers.

Bad management and poor productivity are closely linked: improving management effectiveness by 0.1% leads to a 10% boost in productivity. And, if UK workers continue as they have been, they’ll be 32% less productive than people in the US and Germany by 2025. By halving the gap, we could add around £254 billion to our economy every year.

How can Ciphr LMS mitigate reputational and competitive risks?

It’s time to be proactive: don’t reserve leadership training just for your senior leaders – engage people at all levels with building skills such as communication and emotional intelligence. Take advantage of the functionality in your LMS platform to make activities more engaging. Quizzes can reinforce learning by checking competence while identifying points that will help adjust your training programme. Gamification will increase engagement and boost knowledge retention. Meanwhile, microlearning – short segments of training activities or material – enable people to acquire skills and information as an when they need it, and to repeat content to enhance long-term knowledge retention.

4. Talent

You could lose your best employees if you don’t offer suitable training. That’s because many people who are searching for a new role will want their new employer to offer great training and L&D programmes – which will advance their careers even further.

What’s the cost of replacing an employee who leaves versus reskilling them with training? A 2022 report by the Financial Services Skills Commission cites one 2021 study that estimates a business with 30, 000 employees will spend £57.3 million a year on onboarding and daily inefficiencies from turnover, while a 2018 survey it also mentions found that 92% of businesses believe skills shortages are affecting productivity and profitability because staff can’t use new technologies to their full effect.

Meanwhile, the CIPD Labour Market Outlook for winter 2022/23 found that more than half (57%) of employers have hard-to-fill vacancies, and that 47% of companies are planning to upskill staff as their favoured response to retention and recruitment issues. Yet, just over a year earlier, in the autumn 2021 report, the most common response to this problem was raising wages (47%, versus 44% planning to upskill existing staff).

How can Ciphr LMS help build talent and reduce attrition?

Move your skills development approach from ‘buying’ to ‘building’: collaborate across your recruitment, learning, performance management and succession planning functions. Your skills ‘building’ strategy should include leaders and managers to make sure they’re equipped to fulfil their roles, too.

Consider all workers, their career paths, their managers, and those skills your organisation needs to stay competitive. Compliance training will have little to no impact on someone’s decision to stay or leave, so moving towards a more value-added workplace training programme will help you hold on to highly skilled employees.

You can use the recommended learning function within Ciphr LMS to take the guesswork out of future activities, so employees can access the right type of learning content. You could also assign specific activities to staff after performance reviews to prepare for a career move, or strengthen skills across your team.

Reduce risks with your online learning management system

Your company will be affected by significant financial and reputational repercussions if you don’t offer your people training through a modern LMS. Employee engagement and morale might drop – leading to a fall in customer-service levels, and an exodus of top talent. Worst-case scenario? You break the law and pay substantial fines for non-compliance because of poor training.

Selecting an LMS that integrates with your HR system, such as Ciphr LMS, will help engage your people with learning, identify and plug skills gaps, and help your business make better-informed decisions. Start by booking a demo of our system, or download our brochure to learn more.

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This article was first published on, a Ciphr Company.