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How to Build LMS System: Types, Development Steps and Contractor Selection [2021 Update]

29 Apr 2021

13 Min

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Elearning is on the rise now, and according to the latest projections, the value of the eLearning market will exceed $336B by 2026. These astonishing numbers and overall industry profits generate many questions from those who want to join in with their own digital solution or, namely, create learning management system for business needs.

LMS creation

All sectors of e-learning industry is on the rise now.

The most frequently asked question amid the industry’s success is how to build your own learning management system. In this article, we will answer this question and analyze such points as the types of LMS systems, vital features, and list all the stages of creating a learning management system step-by-step. Without further ado, let’s get started.

What Is a Learning Management System?

Before we start discovering how to create your own learning management system, it is worth delving into the basics and understanding what exactly LMS is.

LMS or learning management system is software that allows educators to create, share and manage various training courses and programs. To provide this functionality, LMS includes various tools that simplify the creation of educational content such as scripts, presentations, audio, and video materials, as well as establish the entire learning process through thorough pacing, various assessments, grading systems, and much more. Usually, LMS systems consist of two parts:

  • Admin interface. Through this interface, educators conduct all interactions with the learning management system. This interaction includes managing existing courses, creating new courses, adding students, analyzing progress, communicating with students, and much more.
  • User interface. This interface may look different depending on which device it is launched on, but all platforms have one thing in common. Through this interface, students enroll in the course and interact with the educator’s content.

Types of Learning Management Systems

When your business requires a unique LMS solution, you must choose one of several types. Each of them has its own distinctive features and satisfies the different needs of the customers.

  • Free LMS. The name speaks for itself. Such systems are free and often open-source, which allows them to be modified to suit your needs. However, unlike paid counterparts, they often do not have good long-term support from the developer. The free systems are Thinkific, CANVAS, and Schoology.
  • Commercial LMS. Commercial systems are ideal for serious educational environments with 24/7 support and flexible plans that can include multiple features. However, the price tag of such LMSs can be overpriced by some companies that do not have very large resources. The commercial systems are Adobe Captivate Prime and Docebo.
  • Enterprise LMS. This type of LMS is designed to solve training problems in huge companies with 500 or more employees. Distinctive features of such systems are high scalability and a huge list of built-in functions that can cover most of business training needs. Some of the most famous enterprise learning management systems are EdApp, Looop, and GnosisConnect.
  • Individual LMS. Such LMS systems are aimed at meeting the individual needs of a particular educator or the needs of small companies. They are also endowed with important functions that allow you to create and manage learning content. This type includes such LMS as TalentLMS, NextThought, and eFront.
  • SaaS LMS. This is one of the most common LMS systems. Such systems are rapidly deployable due to the cloud structure and include frequent free updates. The most famous SaaS LMSs on the market are Knolyx, Dokeos, and Nimble.
  • On-premise LMS. This software is a separate product that is installed on the customer's servers. This approach allows you to achieve high protection of user and corporate data. However, the flexibility of these solutions and the complexity of upgrades leave much to be desired. Systems in this class are Cortex Learn LMS, Moodle LMS, and Chamilo.
How to create LMS

All types of LMS and famous examples of each type.

Now, when we’ve dealt with basics, it’s time to proceed to the most interesting part of our article.

How to Build a Learning Management System From Scratch

The process of creating an LMS is a multistep process that you should be prepared for. Without knowing these stages, you are risking to make mistakes along the way and receive unsatisfying end results. We will talk about each step in detail to provide you a complete picture of how to create an LMS system for your business.

Step #1. Draw up a Project Plan

This is one of the most important steps that serve as the foundation for all subsequent development decisions. At its core, this plan is your forecast for the future, which concerns the ratio of the estimated development costs and the profit that you will receive. Also, at this stage, the future shape of your LMS is outlined.

To create a project plan, you should ask yourself the following questions:

  • Why do you need to create your own LMS?
  • What problems of the organization do you want to solve with the help of the developed LMS?
  • Who will develop and implement the LMS?
  • What resources are you willing to spend on creating and developing an LMS?

Besides that, while drawing the shape of the future LMS, one should not forget about the monetization model. Often, many LMS systems are paid to exclude any advertisements and banners that may distract students from the learning process. However, let's take a closer look at the possible monetization options:

  • Paid software with a trial period. Even though paid LMS systems are widespread, they compete fiercely in the market with free systems. In order to for users to start buying your LMS system, you must provide a high-quality product that will offer users unique solutions that no competitors have.
  • Freemium software. At its core, this software is free. You offer certain functionality for free, but to unlock any other useful things, the user will need to make a purchase. For example, your LMS might have chat functionality for basic communication, but video calling with screen capture might be a premium feature requiring purchase.

To draw up a thorough plan you better use various examples. To make a perfect project plan, take a look at our project canvas example.

Step #2. Come up With Features

You can’t start creating a learning management system without knowing what features will be in it. So you need to define all functionality beforehand. We can highlight several must-have features that should be implemented, and no LMS can deliver a proper learning experience:

Must-have features for LMS.

FeaturePurpose

Course management

One of the most important functions of LMS systems, which is the basis of everything. Thanks to it, educators can manage existing courses (change tags, description, hide or add ready-made courses to the list) and create new ones. A convenient editor should be built into the course management to allow educators to create a course of any format and any complexity from scratch. To do this, it is worth implementing tools that allow you to work with text, images, audio, and video files.

User and group management

This feature is vital for building a clockwork learning process. It allows teachers to organize students into groups, assign assignments to entire groups or individual students, send private messages and notifications to students, and much more.

Reporting and analytics

Without detailed analytics, it is impossible to find out the results of training and its success. This feature is represented by a student progress journal and teacher report. In addition to providing superficial data such as final grades and credit counts, analytics can provide vital data for course improvement. Keep track of which assignments are taking too long for students, the overall results in specific topics, and much more. Analyze the situation to understand what aspects of the course or teaching material can be improved.

Testing and assessment

Assessment is the most important stage of training, as it allows you to find out how the students learned the new educational material. This module should have the tools to create various assessments, ranging from simple tests with one answer to multi-answer quizzes and tasks requiring a detailed answer. Besides, it is worth introducing tools for setting deadlines and time limits for a particular test.

Reminders and announcements

These features are the basic way of communicating with the course students. Through notifications, you can inform students about the new course material that has appeared, the assigned assignment, the nearest deadlines, and the test results that can be checked.

User roles and permissions

Safety comes first. User roles and permissions allow editors to customize access to certain course blocks, information and functionality to ensure data security.

Step #3. Think Through Responsive Design

When developing a learning management system, you should have a well-thought-out design of the future system in your hands since half of the user experience depends on the design. In addition to the correctly selected color scheme and block design, the entire system should look flawless on all existing browsers (if you are developing a web solution) and on all possible device screens (if you are developing a cross-platform solution). Also, do not forget that the LMS should be intuitive for all participants in the process, be it a teacher, student, or administrator.

Step #4. Pack all Information Into Specification

The next step in building a learning management system is a specification. A specification is a document in which all information about the business, business goals, the idea of ​​the LMS system, the requirements for it, its features and technologies, on which future development will be based, is described in detail. Having drawn up such a document, you can find a contractor and develop an LMS based on this specification.

However, it is worth noting that drawing up a specification can take a lot of time without the proper experience. If you are not tech-savvy and do not have experience writing specifications, you should contact a company that will help you by introducing the discovery phase. Cleveroad provides first-class discovery phase services for businesses of all domains. For more than 10 years of market experience, our skilled Business Analysts made hundreds of detailed specifications starting from small startups to large enterprises.

In this phase, you will communicate with representatives of the company who will organize information-gathering meetings to find out all the details of the project, the goals of your business, and the requirements for the project. Also, this phase includes the creation of wireframes, which are a schematic representation of the future LMS interface. The final stage of the phase is a detailed estimate that will give an accurate answer on the final cost of creating an LMS.

Learn more about the discovery phase and its pipeline in our detailed overview.

Step #5. Development Process

When all preparations are set and done, you can proceed to the development stage. During this stage, UI/UX designers begin to create screen mockups for the future LMS based on specification and wireframes. Once the design process is finished, designers transfer all layouts to the development team. Developers use their technical expertise to turn attractive layouts into a working product. The development process consists of sprints. During each sprint, which usually lasts two weeks, developers must implement a certain part of the product's functionality.

The above process is the same for whatever path you choose, whether it's development with your in-house team or programming outsourcing. The only difference is that when creating a learning management system with your own team, you manage the entire development process, while an outsourcing company takes on this task for itself.

We’ve made a detailed overview of programming outsourcing, its pros, cons and purpose.

Step #6. Release Sequence and Marketing Campaign

When all the features are developed, and LMS is polished, it’s time for a release stage. However, do not expect that millions of students worldwide will immediately start using your product after the release. Without the most basic advertising, your release will go unnoticed. To avoid such a scenario, you should conduct a marketing company.

For the best effect, the company should be launched about a month before release. You can start by promoting your brand's social networks by creating publications about the upcoming release of your product, in which you advertise your LMS in detail and tell how your solution is better than the competitors. Also, do not forget about buying contextual advertising. It will help make your product visible, and you will be visible to Internet users for a long time. On the day of release and after it, you should not stop your marketing. Announce the release on social media, purchase advertisements where you invite to try your product, and submit posts in prereleases.

All of these methods will help you get your first users. The work with marketing does not end there either, since now the main task is to constantly monitor the campaign results. You should monitor how users behave, whether users go through your business funnel, whether they find your LMS useful, and much more.

Step #7. Feedback-Based Support

Your product has been launched live and is generating income. Now you can start thinking about LMS support and improvements. User reviews will help you with this. Analyze user reviews to understand what you managed to implement at a good level and which aspects of the LMS require certain improvements. This will help you plan for future updates.

In addition, now you can start implementing additional features that will expand the functionality of the platform and make the user experience even more enjoyable.

How to Choose a Reliable LMS Development Contractor?

Before you plan to create learning management system, you must decide how you are going to develop it. Many factors depend on this, from the complexity of the development process to its price. You can choose between three ways, which we will talk about next.

Option #1. Hire Freelancers

This is probably the first option that comes to mind when you have a goal to design an LMS. The reason freelancers are a widespread hiring option is that companies can work with professionals all over the world, and they usually charge less than the in-house developer you would hire as a team in your office.

There are many websites with thousands of freelancers specializing in various fields, and you are bound to find those with experience in creating a learning management system.

There are several popular platforms for hiring freelance developers:

  • Youteam
  • Upwork
  • Toptal
  • Fiverr
  • Freelancer.com
  • Supersourcing

One of the most common barriers to working with freelancers is language barriers and time zone differences. In addition, freelancers often work on several projects at the same time. Therefore, you should pay attention to the freelancer’s reputation so that he does not abandon your project one day.

Let's summarize the pros and cons of hiring freelancers.

Strengths and weaknesses of freelancers.

ProsCons

Cost-effectiveness

Language barrier possibility

Large pool of developers with different skills

Rather hard to manage

Numerous hiring platforms

Chances of project abandonment

Option #2. Assemble In-House Team

This option is radically different from the previous one. You hire app developers, rent an office and work as a team under one roof. In this case, communication is at a very high level, and you get more control over the entire development process and can make changes at any time.

However, not everything is so rosy with this method. Building your own team usually comes at a huge expense. You need to rent an office, furnish it, purchase equipment and licensed software. Besides, you must pay wages, sick leave, and vacation pay for each employee. Also, you will face a long process of finding and hiring employees. You will need to compete with large companies that attract specialists with huge salaries and numerous benefits.

The final weakness is the complexity of management if you have no relevant experience. In this case, you will have to fork out for another project manager or technical director who will manage the development process for you.

Now, let’s sum up all pros and cons of an in-house team.

Strengths and weaknesses of in-house team.

ProsCons

Full control over the team

Long and challenging hiring process

No communication difficulties

Expensiveness

Freedom to make changes

Team management requires skills

Option #3. Outsource Development

One of the easiest ways to create an LMS system is to outsource the development to a professional IT company. In this case, you will receive top-level services at a reasonable price. This option does not force you to hire employees, rent an office, or incur other unnecessary expenses. Most IT companies already have the recruitment of professionals needed to get started with any project. Also, suppliers take responsibility for team management and product delivery.

If you have a limited budget, you can entrust the development of LMS to an experienced foreign company. You can choose any company from the world's most popular outsourcing regions that match your resources and requirements.

For example, Eastern Europe is considered one of the most famous outsourcing regions due to the high quality of IT professionals and low development rates. Ukraine is one of the most popular outsourcing destinations in this region.

Discover the main reasons why Ukraine is the most popular outsourcing region in Easter Europe and why it is worth outsourcing to Ukraine.

Now, let’s sum up all pros and cons.

Strengths and weaknesses of outsourcing.

ProsCons

Relatively cheap

Language barriers and time zone differences may still occur

Wide choice of tech vendors from all over the world

You can get any tech expertise you need

No need for management from your side (even though you have an option for it)

Fast project start

Now, let’s compare all three options side-to-side.

Comparison of all development options.

Hire freelancerAssemble in-house teamDevelopment outsourcing

Management opportunities

Full management (requires skills, inconveniences may arise)

Full management (requires skills)

Management is carried out by the vendor

Time to start

Hiring (requires technical knowledge) can take time and establish of clockwork development process may delay the app development

Long and complicated hiring and the need to rent an office leads to long preparation stage before development.

Development starts almost instantly if you have a ready-made specification. In another case you go through the discovery phase (2-3 weeks).

Risks

Pretty risky for long-term cooperation. Freelancers may abandon a project, source code, and app details may be disclosed, deadlines can be unmet.

Middle-risk. Meeting deadlines depends on your management skills. You can establish a complete NDA policy within your company.

Risk-free. Signing NDA on request, the vendor undertakes to comply with all announced deadlines.

Cost

Relatively cheap since freelancers cost less than full-time developers. The hourly rate may vary depending on freelancers’ location and their skillset

Very costly. Office rent, licensed software, fat paychecks, sick leaves, vacations for each employee.

Cost-effective option. Hourly rate depends on the outsourcing region. You are paying for full product development only.

Cleveroad Experience

Cleveroad is a leading European software development company with many years of work experience in the education industry. One of our recent projects tied with education is a School App.

How to create LMS

School App interface.

The main idea of this app is to unite students, teachers, and parents and provide all the important information regarding the learning process. Users can find detailed descriptions of school events, class schedules, notifications, helpful links, announcements, and more.

How to create LMS

Technologies we used to create School App.

Want to build an LMS?

Tell us your idea and our managers will consult and grant you a project estimate free of charge.

Frequently Asked Questions

LMS can help establish a seamless e-learning process for businesses of all sizes thanks to powerful features both for educators and learners. Educators can create any kind of courses, assessments, grading systems and so on, while students have an unlimited access to knowledge.

LMS or learning management system is software that allows educators to create, share and manage various training courses and programs. To provide this functionality, LMS includes various tools that simplify the creation of educational content such as scripts, presentations, audio, and video materials, as well as establish the entire learning process through thorough pacing, various assessments, grading systems, and much more.

To create LMS for your business needs you follow this sequential steps: draw up a project plan, come up with features, think through responsive design, pack all information into specification, start development process, launch marketing campaign and release the product.

There are six types of LMS systems: free LMS, commercial LMS, enterprise LMS, individual LMS, SaaS LMS, on-premise LMS.

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