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Why distance education can be a key learning-tool for companies and organizations?

Why distance education can be a key learning-tool for companies and organizations?

August 04, 2016 | By: Dovi Weiss, Ph.D. & Yair Adibi, M.Sc.

When exploring why distance education is becoming so popular, the first question that should be addressed is: "Is distance education economically efficient for the company and for the trainee?".

The costs that are attached to traditional education and learning are exponentially high due to a number of factors such as; institutional buildings (a major expense for any study center), property taxes, water, electricity, insurance for each trainee, and site security.

On the other hand, distance education has lower variable costs! These costs are infinitesimal because every learner can study from their home or from any other location with internet access. In addition, the institution does not need to cover all the previously mentioned expenses (thus lowering the tuition rates). There are, nevertheless, high initial costs in distance education that include developments, designing, and producing instructional content.

An educational/training institution with high fixed costs requires a large number of customers in order to have a meaningful return on an investment. This is where economies of scale become important. As the company gains market share and increases its output, the fixed costs (business expenses that are paid regularly) is divided among a larger number of customers. Therefore, the distance education companies will be able to offer a lower tuition for students. Distance education also saves student expenses related to transportation and provides flexibility for those with irregular work schedules.

 

In economic terms, this situation can be construed as equilibrium: the point where supply equals demand for a product and the economic forces are balanced. We can expect that distance education as a positive trend will expand all over the world since it is profitable for educational institutions once they obtain a certain market share.  As for students, online courses offer a less expensive, more flexible and accessible channel to get an education than the traditional venues.

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