You need to train more than 1,000 managers in how to use a new performance-management system. Done conventionally, the logistics and costs are next to impossible. Experts say that more than 50 at a training session is both unwieldy and ineffective. Consequently, to train that many managers you would have to reserve a corporate meeting room more than 20 times or rent expensive meeting space. You also would need to accommodate the schedules of the trainer and your managers -- many of whom must fly in and spend a night or two in a hotel. There's also the matter of lost productivity while managers are in training. But aviation-electronics systems manufacturer Rockwell Collins Inc., a Cedar Rapids, Iowa, division of Rockwell International Corp., avoided all that hassle by training 1,000-plus managers with a 26-minute online tutorial. The task was accomplished in two weeks. Companies are rapidly moving to e-learning because of the fast pace of change in today's information-driven economy. "E-learning addresses the issues -- shorter product life cycle, increasing skills gaps, rapid technology changes that require ongoing learning, and increasing product complexity -- that face business today," says Paul Jeffries, president and CEO, LogicBay Corp., a Minneapolis company that provides e-learning services. "With faster product cycles and slamming market windows, it is imperative that manufacturers quickly and efficiently train the people who can impact the sales, service, and use of their product." What types of corporate training seem best suited for e-learning? Three areas seem to be emerging: new-hire training, new-product information, and situations where knowledge needs to be transferred to a large group of people or to a group of people who are geographically dispersed. IBM Corp., for example, has moved online virtually all the content of the first three phases of management training for its first-line managers. This eliminates the need to send them to off-site locations over the course of a training period that formerly stretched out over six months. For new-product introductions, e-learning obviates the need to fly in sales reps and distributors or to send experts across the country in a whirlwind tour that leaves them exhausted and the company unable to tap their expertise for an extended period of time. That's especially critical to organizations such as Cisco Systems Inc., San Jose, which must train over 5,000 salespeople and account managers worldwide on a continuing basis for hundreds of new products annually. At Intel Corp., Santa Clara, Calif., where learning is decentralized by business unit, the Technology and Manufacturing Group that supports factory training intends to move 80% of that learning online within three years. In addition, there is a push throughout the organization to move "anything that is dull and deadly in a classroom lecture to electronic learning," says Ron Dickson, training benchmark manager. These e-learning approaches -- live Webcasts, tapes of live Webcasts, Web-based self-paced tutorials, and Web-based instructor-led learning, as well as CD-ROM instruction -- are changing the way companies transfer knowledge and information to employees and customers. "Classroom training is a 19th-century artifact -- if not an artifact of the medieval times," says former U.S. Dept. of Labor Secretary Robert Reich. "It tends not to be tailored to the needs of a particular individual. With e-learning, you can go at your own pace and do training when you need it and when it's convenient for you." E-learning is "best used for a distributed workforce or when you are involving supply chain partners" where there is a need to get the information out rapidly and to deliver a consistent message, says Chris Reed, vice president, corporate strategy, Centra Software Inc., Lexington, Mass., which helps companies conduct live Internet Webcasts. Intel's Dickson points out another advantage: "We can create one learning environment electronically so the consistency of the learning is the same everywhere," regardless of whether the person is in the Silicon Valley or in Asia. "It eliminates the variability that can occur." Whenever there is cognitive information -- such as a market strategy or a policy-based issue -- that you need to share with an audience that is dispersed, e-learning is a good approach, Dickson adds. "It will get knowledge out faster, better, and cheaper." IT to management training Still in its infancy, e-learning accounts for less than one-fifth of corporate training, and 80% of that is for IT or technical training. In dollars it was less than 7% of the $62.5 billion that International Data Corp. (IDC), Framingham, Mass., says was spent on corporate training in 1999. But IDC expects all that to change. The research firm projects that by 2003 corporate e-learning spending will reach $11.4 billion, almost a threefold increase from the 1999 level. "E-learning will be 40% of corporate training" in terms of both dollars and courses, says Cushing Anderson, IDC's e-learning specialist. Nearly 60% of electronic learning will be Web-based, he adds, and by 2003 some 53% of e-training dollars will be spent on management-development, product-introduction, and human resources training. Making e-learning possible are the technological advances in the workplace over the last two years -- more desktop computers, increased Internet access, improved megahertz on laptop computers, and more bandwidth. "It is cost, convenience, and effectiveness," says IDC's Anderson. "E-learning takes into account what people already know and then trains them for what they need to know. It condenses the time needed to accumulate knowledge. In addition, you can bring training to more people and get more training to more people" for the same dollars without the time and location restrictions associated with classroom learning. That's something that Intel's Dickson says is critical in an Internet economy where the skills needed to succeed change overnight. "The knowledge and skills that workers have today will diminish rapidly. So we have to find ways to replenish that knowledge and those skills more rapidly in the future." As a result, within many major corporations "the learning process . . . is being fundamentally rethought," says Centra Software's Reed. "Because technology has emerged so that you no longer have to wait for a class to be scheduled or be available in three months, companies are asking how you do things differently." A case in point: Nineteen months ago, all training at Rockwell Collins was done in a classroom, says Cliff Purington, who was hired as manager of learning and development in October 1998. "We had five goals: link all learning and training to the business; move learning closer to the work environment; have training be 24 hours, seven days a week globally; have learning be of the highest quality; and provide more learning for less money." Purington created learning stations close to the work environment, resolved technical issues (half of the desktop computers didn't have sound cards), and shifted the learning responsibility to business learning councils at the business-unit level. He also changed the role of human resources from designing, developing, and implementing training to analyzing training needs and identifying the competencies needed to achieve business goals. Today, over half of the 400-plus courses that Rockwell Collins offers are delivered in an e-learning format, a change that has reduced its annual training costs by 40%. About 80% of the courses are off-the-shelf offerings. This month Rockwell Collins is adding some 50 virtual-classroom courses on manufacturing operations that it developed -- at a cost of $2,500 or less for each module -- using company experts. "They address core manufacturing competencies in a way that people can walk through the entire process with the help of the expert on that task. We have elevated training to a whole new status here," says Purington. "It is the first step toward becoming a learning organization." Also moving aggressively to e-learning is Dell Computer Corp., where more than half of formal learning now is delivered through technology. Since John Con, president, Dell Learning Center, joined Dell in 1995, he has worked to build e-learning seamlessly into the way Dell operates. All e-learning programs at Dell have a freshness date and are discarded after 18 months. By this year Dell expects 90% of its learning solutions to be totally or partially technology-enabled. Another example: IBM now offers five times the training content it did prior to e- learning at one-third the cost. That's an annual savings of $200 million, suggests brandon-hall.com, Sunnyvale, Calif., which last summer researched the e-learning practices of IBM and 10 other major corporations that use it extensively. Much of the savings attributed to e-learning is from reduced travel expenses. San Francisco-based equity research firm WR Hambrecht & Co. LLC estimates that two thirds of corporate training dollars are spent on travel. And there are time savings from e-learning that companies should not ignore. "If we save our 70,000 employees just 20 minutes a year, that alone is $1 million in savings," says Intel's Dickson. There also are cost savings in using e-learning for new-hire training, production process training, and even strategic planning, says Jackie Stern, manager, virtual classrooms, SAP America Inc., Newtown Square, Pa. Before virtual-classroom training, "we would bring people in [for strategic planning] or put whoever was available on a conference call," says Stern. "The virtual classroom gives us the ability to have two-way audio, the ability to ask questions as material is presented, and the ability to record it so others can see it or review it." In addition to cost savings, e-learning offers competitive advantages in the dissemination of information throughout a value chain. A case in point: SAP has used virtual-classroom learning since last January to get information about its software upgrades to customers more quickly. And it's now expanding that virtual-classroom approach to its facilities worldwide. At Autodesk Inc., San Rafael, Calif., "We want to help people up and down our value chain," says Jimm Meloy, director of learning and training. In addition to product information, the company's online learning center has links to 1,200 courses that help users of Autodesk products in their professional development. Autodesk's rationale? "Either we help them understand how to be more productive" or competitors will, say Wayne Hodgins, strategic futurist and director of worldwide learning strategies. Scott Andre, vice president, educational services, TechOnLine Inc., Bedford, Mass., which provides free online information for the electronics engineering community, agrees. "If someone is looking at two different pieces and deciding which one to use in a design and there is more information online about your product and how to use it, they are more likely to use your product." But, says Hodgins, don't expect training to become entirely electronic in the future. "You don't have to choose classroom learning or e-learning. The truth is that you now have a growing number of choices." E-learning's greatest advantage is its capability to "be there when you need to learn," adds TechOnLine's Andre. "You can learn at your own pace and at whatever speed you need to learn. It can be chipped into smaller pieces so people can go in and out of their training as their job allows them to." Recognizing employees' need for a way to update or refresh skills, the National Assn. of Manufacturers (NAM) Virtual University, in alliance with General Physics Corp., Columbia, Md., offers over 700 courses in 10 disciplines in both text-based and live class sessions. Individuals can learn and even recertify themselves in specific disciplines -- safety training or hazardous waste -- online. "They don't need to go to a seminar away from the office at a specific time," says David Walker, NAM's director of marketing and member services. More importantly, says Auto-desk's Hodgins, over the long term e-learning will "shift the control and power of training and learning to the learner," who will control access to information and expertise. "The strategy changes to less training and more learning," says Intel's Dickson. And therein lies what Rockwell Collins' Purington calls "the beauty of e-learning. People take what they need to take at a time when it is convenient for them and for the length of time that is needed because they are taking modules, not complete courses." In addition, the geographic center of learning has changed. "Prior to the advent of e- learning," says Purington, "the center of all our learning was in Cedar Rapids. Now it is global."