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Estimating Costs and Time in Instructional Design

Note that budgeting is not included in most ISD models, but as more and more Learning/Training Departments are being called upon to justify their expenses, I'm including it here.


Learning activities are budgeted in a wide variety of ways, so the degree of estimating the costs will depend upon the organization you are working for. Generally speaking, the closer you are to your customers or clients, the less you have to estimate. For example, a small Training and Development department located within a manufacturing facility might only have to justify its time and capital expenditures, while a training vendor will probably have to give a full development estimate before a training program is approved.

Budgeting training is often a difficult chore as plans are often based on training an “average person.” But, as we soon learn, although there are many models and statistics of an average person to be found in various literatures, there are actually no average people to be found! We are all unique in some form or manner. This makes any activity that must place a variable on people highly uncertain and inaccurate at times.

Although the budget may not be correct the first time, especially if the training is new or complicated, it still should be performed at this time to give the training staff a goal to aim for. The budget or the program can be adjusted when more information has been obtained. After all, this is what the ISD model is all about, performing evaluations throughout the various phases and then using the feedback to adjust the program for the desired results.

After performing the initial budget, it might seem that the training program will be quite expensive, but as Gary Wilber, CEO of Drug Emporium, Inc. said, “The expense isn't what it costs to train employees. It's what it costs not to train them. You realize that as you grow.”

If it becomes evident that the resources to implement the best training strategy are not available, then it is important that all the personnel involved in the project are brought in on the decision making process, to include both clients and training designers.

Training Cost Guidelines

Listed below are some various estimates for estimating training costs. Remember, these are only estimates, as they will vary with experience, type of training, skill level, etc. After implementing a few training programs, you should adjust these estimates by taking into account your actual training costs. This is one reason for maintaining a well-organized audit trail.

Estimating Development Hours

Bryan Chapman of Brandon-Hall listed these average design times to create one-hour of training:

Note that these are averages, thus any one program might take as little as one hour or up to 500 hours depending on the person's design skills and knowledge of the subject, amount of material to be converted, and the type of transformation needed.

eLearning Development Time

With most instructor led classes, a lot of the material is put into outlined form as it is expected that the instructor will fill in a lot of the blanks, such as integrating or leading the learning methods. With elearning, you have to put in all the content and get it to perform the learning methods by itself. Thus, elearning has traditionally been a lot more expensive up front as it cost more to develop. However, the real savings come from other factors, such as travel, seat time, and administration costs. It generally takes at least four times as long to build elearning, than it does classroom training. Of course, this depends on such factors as the tools you are using, learning methods, and what content you already have that are learner-friendly, rather than instructor-friendly.

If the elearning looks more like a PowerPoint presentation, then a 1:1 is probably close, however, the more elearning moves away from looking like a PowerPoint presentation and looks more like an interactive package, then the more the ratio starts to increase.

Development times to create one-hour of elearning:

(The eLearning Guild, 2002)

Instructor Preparation Time

Dugan Laird (1985), listed these instructor preparation times (based on U.S. Civil Service estimate):

Seat Time

Seat time is the time spent by the learner in a learning environment. For many types of content, elearning clearly offers an advantage. The research generally shows that there is at least a 50% reduction in seat time when a course is converted from classroom learning to elearning. Brandon Hall reports it is a 2:1 ratio.

“Brandon Hall, editor and publisher of the Multimedia and Internet Training Newsletter, cites an overall 50 percent reduction in seat time required for a student to learn the same content using online training as compared to in a classroom” - (Rosen, 2000).

Of course, a lot of this has to with the type of content. For example, we normally read at least twice as fast as compared to someone speaking. Thus, courses such as compliance training offer a seat time advantage due to rather than having an instructor do all the talking, we can now just read it (most people read much faster than people can speak).

However, if we are practicing a new skill, then there is normally no real time advantage, as we need the same amount of time to practice in an elearning environment as we do in a classroom.

Interactive Multimedia Instruction (IMI)

200 to 500 person-hours for each instructional hour of IMI. If your organization is inexperienced, expect your average developmental person-hours to be closer to 450-500 man-hours per instructional hour.

The 1995 August/September issue of CBT Solutions Magazine reported that 221 hours was the average development time.

USMC Multimedia Guideline for Percentage of Development



Prepare Project Plan


Conduct Course Content/Learning Analysis


Develop Instructional Media Design Package


Develop Prototype Lesson


Develop Flowcharts


Develop Script/Story boards


Produce/Acquire Media (Photos, audio, video)


Author Course


Evaluate the Course (In-Process Reviews)



Interactive Courseware (ICW) Development Costs for Multimedia and Computer Based Training (CBT):

(U.S. Navy Estimate - Klein, Mallory, Safstrom, 1997)

Baseline estimate from which you can begin the process of determining the total number of hours it will take to design, develop, and evaluate one hour of ICW. The table shows a baseline estimate based on experience from Air Force ICW projects. The estimates are broken down into level of presentation and type of training. Program management time is included in the estimates. Estimated Hours of Development for One Hour of ICW Level of Presentation:

ICW (Interactive Courseware) Air Force Estimate:

Type of Training Knowledge Skill Attitude
I - Basic 30-200 hours 30 75 200
II - Medium 75-250 hours 75 125 250
III - High 200-600 hours 200 400 600

Case Study

Verizon Communications has been doing elearning for about three years. It takes them between 40 to 80 hours and costs $15,000 to $30,000 to develop one hour of elearning (George, Mcgee, 2003). This includes the instructional designer, project manager, and outsourcing fees (the instructional designer takes the content that is written in instructional design format to three other companies and an in-house group for bids). The content comes from SMEs who explain to instructional designers how it is done (for example, installing DSL). If the employee has to perform hands-on activity, a simulation is programmed.

They are now creating courseware in learning objects (they call them knowledge objects). Verizon says once they develop enough learning objects, they will be able to build courses in five hours or less ($10,000 to $15,000) as they will only have to create one or two learning objects instead of an entire course of them. Their goal is that if someone requests a class in the morning, they will have it online that evening.

Next Steps

To help with estimating training costs, see the Excel Spreadsheet Cost Estimator.

View the Analysis Templates (contains several analysis templates)

Return to the Table of Contents

Pages in the Analysis Phase:


Chapman, B. (2006). PowerPoint to e-Learning Development Tools: Comparative Analysis of 20 Leading Systems. Sunnyvale, CA: Brandon Hall Research.

Chapman, B. (2010). How Long Does it Take to Create Learning? [Research Study]. Published by Chapman Alliance LLC. Retrieved from http://www.chapmanalliance.com/howlong/

The eLearning Guild (2002). The e-Learning Development Time Ratio Survey. Retrieved from http://www.elearningguild.com/pdf/1/time%20to%20develop%20Survey.pdf

George, T., Mcgee, M.K.(2003). Educational Advantage. Information Week, March 10, pp. 57-58.

Klein, D.E., Mallory, C.A., Safstrom, D.W. (1997). Analysis, design, and implementation of a web-based training system for multi-criteria decision support, integrating hypertext, multimedia-based case studies and training software. Monterey, CA: Naval Postgraduate School. (PDF file)

Laird, D. (1985). Approaches To Training And Development (2nd ed.). Reading, MA: Addison-Wesley.

Rosen, M. (2000). Specific needs influence type of Web-based training. Puget Sound Business Journal, July 30.