Over the last year or so we have talked with hundreds of companies about their desire to transform their corporate training programs to take advantage of social networking, knowledge management, communities of practice, and better models of blended learning. As we studied dozens of high performing training programs through our Learning Leaders® program, we realized that today's corporate training world has fundamentally evolved. Fig: Evolution of Modern Corporate Training   How Corporate Training and Learning has Evolved As this chart shows, over the last 10 years the corporate training world has gone through four major phases. Throughout the 1980s and 1990s, traditional instructor-led training (which still makes up more than 60% of all training delivery today), was our primary form of training, and it was complimented by various forms of technology (CD ROMs, VideoDisks, VHS tapes, Video Broadcasts) - with a goal of increasing reach and reducing cost. In those days technology-supported training was called CBT or CAT.
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The LMS market continues to heat up as two private equity firms bid for SumTotal Systems. This week Vista Equity Partners upped its bid to $4. 75 a share (up from $3. 80 several weeks ago), bringing SumTotal's market capitalization to over $150 Million. (This is nearly twice the market cap of Saba, who's revenues are roughly equal.
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A very important partnership was announced today: IBM announced a major commitment to Saba as its primary learning management technology partner. Background on IBM's Learning Platform Business: IBM has been in the corporate learning market for many years. In the 1980's, the company offered a wide range of corporate training tools and systems, including PC development tools, content development services, and mainframe-based training products. After the acquisition of Lotus, IBM expanded its corporate learning offerings with a series of learning management solutions including Lotus LearningSpace, IBM Workplace, and the Lotus Learning Management System. Lotus LearningSpace, which included technology purchased from Macromedia, was actually one of the industry's first enterprise e-learning management system which integrated collaboration into more formal online training approaches.
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We have been carefully looking at the Talent Management Software market over the last few weeks, and the first quarter of 2009 was a bit of a disaster. The market for performance and succession management software, which we believe finished 2008 around $520M in size and is expected to grow to $655M in 2009, had a fairly bad Q1 (this does not include software for recruiting and learning management systems). The recession clearly forced most corporate and government buyers to postpone their purchases. We believe the whole market saw "new software sales" of less than $30-40M in new talent management tools in the quarter (this does not include applicant tracking software and learning management systems, which are both larger markets). This shows growth of around 5.
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In April we published our bi-annual State of Learning and Talent Measurement research and again the news is mixed.   (Report available here at no charge. )  A few tidbits for you to think about: Only 16% of the 400+ responding organizations have a strong learning and talent measurement program in place, and almost half (49%) have no real measurement strategy to speak of.   The remainder have measurement programs and program owners, but limited resources. 28% of respondents have little or no clear view of the existing skills gaps in their organization today, and 77% have "some but limited" view of organization skills gaps.
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