Learning & Talent Systems Core to Driving Performance

Learning & Talent Systems Core to Driving Performance

By Catherine Upton
and Jerry Roche

As technologies evolve, the enabling software has evolved. Learning and talent management systems (LMS/ TMS) are more

feature rich, integrated with other enterprise software platforms, and are core to driving enterprise performance.

In Elearning! and Government Elearning! magazines’ Learning and Talent Management Systems Buyer Survey, 35% of all respondents plan to add, change or replace their current system. Executives expect to invest an average of $818,466 on their new system(s), up from $439,000 from 2012, an whopping 86% increase.

This speaks to the value enterprises are placing on employee performance. The survey tallied 243 responses, 73% coming from the corporate sector and 27% from the public sector.

LMS/TMS Investments Grow

Most striking is that corporations, government-funded organizations (including education) and non-profits are equally committed to the investment in enterprise-wide development and talent management. Eighty-seven percent of all respondents have an LMS or TMS in the organization, up from 82% in 2012.

Furthermore, of those respondents who plan to add, change or replace their LMS, 71% of will do so over the next 24 months. Thirteen percent of respondents do not own a current LMS or TMS, down from 18% in 2011.

While TMS systems are still early in  adoption compared to TMS, Talent suites are increasing in utilization at 28%, up from 22% in 2012, an increase of 27% year-to-year. SaaS-based TMSs account for 17%, and enterprise-based TMS’s account for 11%, double that of 2012.

Eighty-eight percent of future buyers indicated a platform preference for their next LMS or TMS. Cloud/SaaS-based LMS accounted for 45% of future purchases. Use of LMSs that are on premises (behind the enterprise firewall) has declined from 23% to 19% from 2011, while open-source LMS popularity has remained constant at 7%.

Six percent use an enterprise learning content management system (LCMS); 12% use a SaaS/cloud-based LCMS; and 7% use an open-source LCMS.

Eighty-eight percent of LMS deployments are across multiple locations, 39% of which are multinational, while 22% are deployed at single locations only. Similarly, 62% of TMS respondents are using their system across multiple locations and 34% support multi-national sites.

In 2013, the survey queried system satisfaction separately for LMSs and TMSs. Ratings were 1 for excellent to 5 for very poor, meaning the lower the score, the better the satisfaction.

For LMS satisfaction, scores ranged from a low of 2.66 to a high of 2.20. Reliability repeats as the highest-rated system feature. New Features and Capabilities is only fair, the first time they have been a comparative sore point. Interoperability is the perennial complaint among current users.

For the TMS, Reliability repeats as the a good rating of 2.09. However, Flexibility, Scaleability and Interoperability are the limiting factors for current system owners.

Important factors to consider when buying a new system changed in 2013: Price and Quality still lead while Customer Service drops to fourth in 2012.

Brand Preferences

Fully 94% of respondents can name their LMS brand, up from 89% in 2012. And, 7% named multiple LMS systems operating in house. Unprompted, 82% of respondents could name at least one brand of LMS.

Despite mergers and acquisitions, more than 43 brands were owned across the respondents’ organizations. For the second year, SumTotal Systems leads in LMS brand ownership, up to 13% — but the gap is closing fast. Consolidations bumped some brands up like Oracle and SAP near market leaders. A proliferation of independent LMS brands continues with first-timers WestNet, Agilix, Geometrix, Intellum, OpenText and others making a showing.

When provided a list of brands, those owning more awareness across respondents shifted to SAP/SuccessFactors (65%), followed by 2012’s leaders Blackboard and Moodle (63%) followed by Oracle/Taleo/Learn at 54%.

Meanwhile, 86% of TMS owners named their brand, up from 59% in 2011, while 10% have multiple TMSs deployed in the organization. Top brands owned are: (1) Oracle tied with SuccessFactors which jumped 18%; (3) Halogen; and (4) Cornerstone OnDemand.

The TMS industry is still in its infancy with only 27% of respondents operating one. Brands that had the largest brand awareness improvement (prompted versus unprompted) were Kronos, a virtual unknown in 2012; Saba rebounding from 2012; and SumTotal, which is most known for LMS. All brands were positive (except Oracle which lost 7 points) from the decline of the merged brand scores of Taleo/Learn/PeopleSoft.

Features Sought

Buyers are seeking more capabilities in their new LMS, wanting Integrated Reporting, Mobile Authoring, Social Network Tools, Virtual Learning and Cloud/SaaS Systems. Talent system buyers’ top “must-haves” in their future systems are: Skills Gap Analysis, Career Development, Performance Management and Performance Reviews — all repeats from 2012.

Increasing in importance to prospective buyers was Quality (up 3 points), Interoperability (up 6 points), Reputation (up 6 points) and Open Architecture (up 22 points). Drops in importance were reported for Customer Service (declined 22 points), SCORM Compliance (declined 16 points) and Awards (declined 4 points).

Other interesting developments:

>> Course Tracking (91%), (78%) Assessment (76%) and Web Conferencing repeat as the top “must” features of new systems.

>> Big jumps occurred in: Course Marketing (+20 points), Collaborative Authoring (+13), Workforce Planning (+13), and Peer Ratings (+11). The trend is clearly working collaboratively, effectively and driving learning consumption.

>> The largest year-to-year declines by percentage points are: Rapid Development (-17 points), Recruitment (-14) Testing and Assessment (-14) and On-Demand Learning Options (-11). In most cases, the drivers are maturing markets or conditions.


>> The LMS and TMS is increasing in importance in the enterprise, evolving with more features and services.

>> The functions of LMSs and TMSs are becoming more diverse. While 82% of respondents use LMS/TMS to support employees in the traditional sense, 62% report supporting external constituents versus just 53% in 2012.

>> Satisfaction with current LMS or TMS is a reoccurring problem with owners.

>> Improvement in buyer knowledge should aid in system selection and satisfaction in future years. Fully 99% of respondents call themselves “familiar” with LMSs and TMSs; 30% percent rank themselves “expert.” For LMSs alone, 77% of current owners consider themselves “expert” or “very familiar.”

>> Getting TMSs to “play well” with other systems is a key priority for current system owners.

>> Potential buyers ranking Interoperability higher than ever is an indication the importance that LMSs and TMSs must work well with other enterprise systems.

>> Large gaps between unprompted and prompted brand awareness indicates a great opportunity to convert prospects into customers with brand marketing investments.

>> When the unprompted-prompted gap is close, it indicates that brand has saturated its segment and needs to expand outside the core base into other venues to grow. SumTotal Systems and Cornerstone OnDemand are at this level.

>> Further consolidation across the LMS category saw significant loss of brand awareness for Taleo, Learn.com, Plateau and GeoLarning (now marketed under Oracle, SAP and SumTotal Systems, respectively). This creates opportunity for independent brands like Desire2Learn, Meridian KSI and others.

>> Only 54% of all respondents could name a TMS brand unprompted. Meaning, education is needed to improve the adoption rate and value proposition of this solution.

>> Potential buyers ranking Interoperability higher than ever is an indication the importance that LMSs and TMSs must work well with other enterprise systems.

—The Learning & Talent Management Study is conducted annually by Elearning! and Government Elearning! Magazines. Past studies can be downloaded and benchmarked against current year. Learn more at: www.2elearning.com

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