Learning Management System

The Ins and Outs of Learning Management System Development: Types, Steps, and Price

Table of Contents

Learning management systems, also known as LMS, have gained significant prominence recently, especially in online education. These software applications are invaluable tools for educators, helping them streamline and manage their teaching processes effectively. Notably, a diverse array of learning management system software is in use today, with prominent examples such as Blackboard, Canvas, and Moodle leading the way.

As the demand for online learning resumes to soar, the LMS market experiences continuous growth and evolution. According to projections from Statista, the eLearning market is poised to reach a staggering $400 billion by 2026, highlighting the remarkable opportunities in LMS software development.

So, if you’re considering creating a learning management system software, now is the prime time. In this guide, we’ll provide a concise, step-by-step approach to help you build your custom LMS, covering the basics of development and factors affecting costs. Let’s begin.

The Main Types of Learning Management Systems

Before we get into how to create your own learning management system, let’s first take a look at its significant types:

1. Open-source LMS

Open-source LMS platforms provide extensive flexibility and customization options as users have access to the underlying source code. Organizations favor it with in-house development teams or specific customization requirements. It allows them to tailor the LMS to their unique needs but may require significant technical expertise to manage effectively.

2. Commercial LMS

Commercial LMS solutions are pre-packaged software systems that require purchasing licenses or subscriptions. They are well-suited for organizations seeking ready-to-use, feature-rich solutions with professional support. Commercial LMS providers typically offer comprehensive features, updates, and customer support, making them a reliable choice for various businesses and educational institutions.

3. Installed LMS

Installed LMS, or on-premises LMS, involves hosting the software on an organization’s servers. This type of LMS provides complete control over the software and data but necessitates dedicated IT resources for server maintenance, security, and updates. Large organizations with the infrastructure and technical expertise often choose this type of LMS development to manage their servers.

4. SaaS LMS

Software as a Service or SaaS LMS solutions are cloud-hosted and accessed through web browsers. They are subscription-based and managed by the LMS provider, handling updates, security, and maintenance. SaaS LMS is an attractive option for smaller organizations or those looking for a hassle-free, cost-effective solution, as it eradicates the need for extensive in-house IT resources.

5. Integrated LMS

Integrated LMS solutions seamlessly connect with an organization’s other software systems, streamlining data exchange and workflows. Building an LMS of this type benefits organizations looking to centralize and automate their learning processes by integrating with existing HR management or content management systems.

6. Non-integrated LMS

Non-integrated LMS operates independently of other systems within an organization. While it provides core learning management functions, data transfer and coordination with other systems may require manual effort. Organizations often choose non-integrated LMS solutions where integration with other systems is not a priority or when they have standalone training needs without extensive data sharing.

How to Create a Learning Management System: A Step-by-Step Guide

Now that you know an LMS’s basic types, discover how to create an LMS website/app with this step-by-step guide from scratch. This 8-step guide can help you sidestep the mistakes and fulfill all your custom website development needs.

Below is an overview of these steps.

Step 1: Study the Idea and Plan the LMS Development

The first step revolves around examining the idea and planning the development process. The goal here is to design and develop the LMS to ensure an outstanding learning experience for the users.

A few key questions to address are as follows:

  • What are the goals and objectives of the LMS?
  • Who will be using the LMS?
  • What features and functionality are required?
  • What is the budget for the project?
  • What is the timeline for the project?

The Discovery Phase

During this phase of LMS development, the primary focus is gathering essential information. It includes understanding client needs, the target audience, existing learning content, the chosen LMS platform, and the project budget. Collecting this data is a critical preliminary step before any development work can commence.

Gather Information: It includes your business goals, needs, and vision. Having a project manager and business analyst assess these aspects is vital. Additionally, conduct market analysis to identify the most profitable niche and formulate a solid LMS development strategy.

Competitor Research: Examine existing LMS solutions to identify best practices that can serve as groundwork for your development. It can streamline the process and reduce costs by avoiding unnecessary reinvention.

Scope of Work: Define the scope of work based on your business model and specific requirements. Determine the methodology and establish a project timeline.

User Stories: Create a list of tasks and functionalities you want your LMS to perform. These user stories serve as the basis for technical specifications and project planning.

Architecture Design: Develop a conceptual architecture that outlines the components and their interactions within your LMS. This provides a clear concept for stakeholders and allows developers to anticipate potential technical challenges.

The development process can progress once these considerations are thoroughly examined and documented.

Step 2: Define the Core Features

In the next step, the focus shifts towards outlining the essential features that your learning management system development must entail. The complete set of LMS features can vary based on your client’s specific needs; however, there are fundamental functionalities that are crucial for providing an effective and engaging learning experience.

Here’s a brief explanation of these must-have features:

  • User Permissions: Allows customization of user access to maintain security and control.
  • User Management: Enables grouping of students, assignments, and communication.
  • Data Reports: Provides insights by tracking student performance and progress.
  • Knowledge Assessment: Allows the creation of tests and quizzes for evaluation.
  • Notifications: Keeps users informed about new content, deadlines, and results.
  • Centralized Materials for Learning: Organizes learning materials for easy access.
  • Course Management: Empowers users to create and manage courses efficiently.

Besides, here are a few additional features to consider when creating an LMS software:

  • Personalized UX: Customizes learning content based on user history and role for better engagement and skill development.
  • Offline Learning Tracker: Tracks offline learning activities and assessments when downloading content for offline use.
  • Compliance Checker: Ensures compliance with internal policies and regulations by tracking proper training.
  • Smart Scheduling: Facilitates convenient scheduling for one-on-one learning sessions.
  • Gamification: Adds game-like elements to boost engagement and knowledge retention.
  • Integrations: Connect the LMS with software like CRM and email systems for streamlined operations.
  • White Labeling: Allows users to customize the LMS interface with their branding for a personalized look and feel.

Step 3: Pick the Right Tech Stack

After deciding on the features, choose the tech stack depending on the LMS’s type and functionality. It is necessary to pick the right tech stack to ensure the LMS is secure, smooth, and running appropriately.


The backend is the hidden engine that processes and stores LMS data. Popular frameworks like Django and Node.js are often chosen for developing the backend of an LMS. These frameworks provide the system’s core functionality, handling data storage, user management, and other critical processes.


The front end encompasses everything visible and accessible to users. LMS interfaces are often developed using technologies like HTML, with additional libraries such as Vue.js or React.js. These front-end technologies ensure a user-friendly and interactive learning experience.


Relational databases like MySQL are commonly integrated with LMS platforms. They offer speed, reliability, and data integrity, making them well-suited for storing and managing the vast amount of information typically associated with learning management systems.


The choice of hosting service impacts the performance and security of the LMS. Amazon Web Services (AWS) is preferred for cloud-based LMS development due to its robust infrastructure, data privacy measures, and cost-effectiveness. Alternatively, DigitalOcean is known for its speed and reliability, offering an alternative hosting solution.

Step 4: Create LMS Specification and UI/UX Design

Once done with the tech stack, proceed to make a specification. This document thoroughly outlines the aims and needs for an LMS, as well as the concept, features, and development technology. In addition, the schematic depiction of the future LMS is built at this stage, and costs are assessed.

Next, the designers visualize the future LMS once all criteria have been established and documented on paper to create the best learning management system. For complex architectures, they first generate LMS mockups and wireframes. If everything looks fine, they create UI and hand it to developers to convert it into a viable product.

Step 5: Get a Professional LMS Development Team

An in-house development team has various benefits, like complete control and clear communication. However, forming a team from scratch can be time-consuming and tiresome if you don’t already have one. It is also more expensive than outsourcing because hiring people is a long-term investment designed to meet a steady flow of duties.

So, how do you construct an LMS if you don’t have an in-house team? Outsourcing can be cost-effective for one-time tasks because you simply pay for the work done, and no long-term commitment is required. A professional development team will use the right software development tools to ensure a high-quality product.

Benefits of Outsourcing LMS Development

If you want to develop a learning management system, outsourcing can offer several key advantages:

  • Easy Team Scaling: Outsourcing allows you to flexibly adjust the size of your LMS development team based on project needs. You can expand or shrink the team without the hassle and expenses of hiring or firing in-house staff, ensuring that you have the right expertise when you need it.
  • Save Time and Costs: When you outsource, you don’t need to worry about providing office space, equipment, or training for in-house employees. This leads to cost savings and a quicker start to your project. Additionally, outsourcing companies often have expertise in developing similar software, speeding up development and reducing costs.
  • Established Development Process: Outsourced development teams often bring a wealth of experience, utilizing tested practices and established routines. Team members are familiar with each other, collaborating on numerous projects, which results in faster and more cost-effective development. Effective communication and streamlined processes are vital advantages.
  • Reduced Risks: When you outsource, your tech partner invests in the development process, aligning their interests with yours. They are equally motivated to ensure timely and effective work because you pay for the value received. This shared responsibility reduces risks and promotes successful project completion.

Step 6: Develop the First Version of Your LMS

In learning management system (LMS) development, an iterative approach to releasing is recommended for efficiency. Here’s how to create LMS with complex functionality in a short time-to-market:

Evaluate and Prioritize: Begin by assessing the list of LMS functions identified during the discovery stage. Prioritize these functions based on their importance and feasibility.

Essential Features List: Select the most crucial features, confirm them with the client, and integrate them into the initial version of the LMS. These features form the core of the system.

Gradual Additions: Subsequently, add second-priority functions to updated versions of the LMS and continue this process until all necessary features are integrated. This incremental approach swiftly ensures the development of a functional product, allowing the client to start benefiting from the LMS as development progresses, regardless of the project’s size.

This approach accelerates time-to-market and provides the flexibility to adapt and refine the LMS based on real-world usage. Additionally, if the client wishes to gauge market response to the new LMS, developing a Minimum Viable Product (MVP) is an option. While unsuitable for a broad audience, an MVP helps assess demand, customer willingness to pay, and whether the chosen functionality aligns with market needs.

Step 7: Create the Finalized Product

In LMS development, a structured workflow guides the creation of the final product. This process begins with a kickoff session where developers familiarize themselves with project specifications and design. Discussions follow to identify solutions, prioritize tasks, and integrate new features into the existing architecture, all subject to client approval.

Tasks are outlined in a project timeline, milestones are set, and sprints are employed for planning, execution, evaluation, and analysis to ensure efficiency. Regular communication is maintained through daily and weekly meetings. The collaborative approach culminates in client involvement in demo sessions to align development with expectations. Thorough testing ensures optimal system performance with each new version of the LMS.

Step 8: LMS Maintenance and Rollout

Once comprehensive testing confirms that all features meet the client’s requirements, the code is deployed following the systems development life cycle (SDLC) method. Before the official rollout, a detailed description of the LMS features and operational guidelines is prepared for user reference.

With the learning management system development completed and the LMS in operation, the services also extend to corrective and perfective maintenance. Continuous monitoring of LMS performance and user feedback collection enables clients to request necessary fixes or changes, ensuring the system remains efficient and up-to-date. This post-launch maintenance phase ensures a seamless and responsive user experience.

What Is the Cost of Learning Management System Development?

Determining the cost of custom learning management system development can be challenging due to various factors. As a reference point, developing a minimum viable product (MVP) for a typical web based LMS takes approximately four months. In Eastern European countries, where contractor rates range from $40 to $70 per hour, assembling a standard team can yield an MVP at an estimated cost of $150,000 to $300,000.

Comparatively, Western European developers charge $60 to $90 per hour, while U.S. contractors’ rates range from $100 to $200 per hour, leading to higher MVP costs corresponding to these rates. In India, developers charge $20 to $40 per hour, but potential challenges such as language barriers and time zone differences can affect remote cooperation.

Factors Affecting the Cost of LMS Development

Several factors can impact the cost of LMS development, including the following:

  • Hosting: LMS deployment on a hosting site incurs monthly fees ranging from $5 to $500 or more. Additional expenses may arise if substantial media content storage is required.
  • Third-Party Services Integration: Integrating external services like Amazon or Grammarly into the LMS can incur extra costs.
  • Specific Compliance Standards: Adhering to data privacy regulations or accessibility requirements may increase development costs due to additional security measures.
  • Additional Features: Implementing gamification, social learning, analytics, assessment tools, content authoring, and smartphone compatibility may entail extra development effort.
  • Multilingual Support: Expanding the LMS to multiple languages or regions involves translation, user interface adaptation, and addressing cultural differences, potentially reducing development costs.
  • Scalability: If scalability is a consideration due to a large user base or future expansion plans, development costs may rise. A scalable architecture that accommodates high user volumes and performance requirements often requires extra development and infrastructure expenditures.

Final Words

Lastly, if you aspire to build your learning management system with complete feature control, custom development is the ideal path to pursue. On the other hand, opting for outsourcing can help mitigate the risks associated with custom LMS creation and deliver a top-notch product, especially if you have limited resources at your disposal. Get professional software development services from Codment to turn your idea into a successful product!