On-Demand Learning, Performance Management Show Growth, Results

Enterprise learning technology has become complex and more strategic. Fueled by both domestic and global competition, organizations are addressing the challenges of training widely dispersed employees, business partners and customers

Enterprise learning technology has become complex and more strategic. Fueled by both domestic and global competition, organizations are addressing the challenges of training widely dispersed employees, business partners and customers who may only share one characteristic … access to the Internet. Trends toward online learning and emphasizing learning’s impact on business results have stimulated the development of new learning and performance management choices.

As the enterprise LMS evolves into a critical component of a company’s performance management strategy, the LMS also must be able to integrate with other applications and ensure a seamless user interface and functionality across the enterprise. Learning leaders must then select an LMS solution that meets their business needs and integrates with the organization’s overall IT strategy.


Increasingly, organizations are turning to on-demand technology to implement an LMS that meets their unique business demands and solves their distinctive organizational challenges.

On-demand (also called “Software as a Service” or “SaaS”) is hosted and supported by a vendor as a service, which users access via the Internet without the need to deploy and maintain an on premise IT infrastructure. Clients benefit by receiving product updates automatically “pushed” from the LMS provider to the client. SaaS eliminates all the headaches, hassles and risks associated with traditional on-premises software.

On-demand vendors focus on key strength areas and develop strong partnerships to provide “best-of-breed” solutions that meet the client’s needs on a broader scale. For example, GeoLearning has developed partnerships with industry leaders that offer complementary and robust functionality. In addition to its LMS, GeoLearning provides clients with Success- Factors for performance management, WebEx for Web conferencing, and Knowledge- Advisors for training analytics as part of its overall best-of breed solution. This integrated suite of products and services offers deep and rich functionality. This is in contrast to traditional on-premises software vendors that offer a suite of products with broad, but sometimes shallow, expertise.

The adoption rate for on demand learning management systems is skyrocketing. According to a 2007 Gartner research report, on-demand technology has grown significantly and will continue to do so.

“Ease of use, rapid deployment, limited upfront investment in capital and staffing, plus a reduction in software management responsibility all make SaaS a desirable alternative to many on-premises solutions, and they will continue to act as drivers of growth,” says Gartner’s research director Sharon Mertz.

According to Gartner, SaaS revenue will surpass $5.1 billion — a 21 percent growth over 2006 revenues. In terms of total market share, Gartner reports SaaS adoption is close to 70 percent in e-learning and Web conferencing.


Compared with traditional on-premises LMS software, the on-demand delivery model is appealing to HR and training professionals for several reasons, including lower start-up costs, reduced total cost of ownership, and rapid deployment. Bersin & Associates research indicates on-demand solutions are highly effective and scalable. Web services technology makes integration with a company’s system easier than ever and speeds up the implementation time frame from months to days.

SaaS offers several advantages over traditional integrated on-premises solutions. According to Bersin’s findings, the actual functionality available in a traditional, on premises suite is more limited than that of focused, best-ofbreed vendors.

For example, development tools are widely available from many specialized companies. And although adequate, the LMS-provided tool set is missing some features you find in a focused, best-ofbreed, third-party tool. Purchasing a suite, then, might force you to trade perceived benefits for a system that might not actually meet your company’s needs. Although a single-vendor solution might seem to provide higher levels of accountability and control, it can create the opposite problem: If a suite provider cannot meet an organization’s full needs, the buyer essentially has put all its eggs into one basket and might not have recourse.

In addition, the human capital and IT infrastructure required to implement and maintain this type of solution is high, and it might slow deployment, thereby eliminating or significantly reducing return on investment.

With an on-demand SaaS solution, the vendor takes responsibility for delivering the system and implementing upgrades. Vendors own, deliver and manage SaaS technology remotely, leaving maintenance and upkeep with the vendor — not the client.

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