In 2007 we saw the emergence of a new market for talent management suites. By my count, we now have over 30 vendors offering their own version of a “suite”. Some suites are far from integrated, some are getting close, and only a few are well-integrated.  These include:  Authoria, Beeline, Cezanne, CornerstoneOnDemand, Cytiva, Halogen Software, iNQUATE, Kenexa, Lawson, Learn.com, Meta4, NuView, Oracle/PeopleSoft, Plateau, Saba, Salary.com, SAP, SilkRoad, Softscape, StepStone, SuccessFactors, SumTotal, Technomedia, Taleo, TEDS, Ultimate Software, Vurv, Workscape, and Workstream.

This new market is crowded and no vendor can claim market share today. So it is not surprising that we expect 2008 to be the year of market consolidation.  Already, Workstream is expected to announce its buyout/merger plans this week.

For corporate buyers, this means there is a strong possibility that the vendor solution you select today will be acquired or will acquire additional companies – leaving serious question marks when it comes to its ability to provide consistent levels of service and ongoing product support. To mitigate this risk, we recommend that you conduct a thorough analysis the long-term viability or as we refer to it - “staying power”.  I know it sounds painful, but the easy way out - depending on rumors or speculation from competitive vendors - is not a sound strategy. Here are a few essential questions I recommend you ask your prospective vendors:

• Is the vendor public or private?
• What is the size of the company (revenue - over 20M)?
• What is was the vendor’s revenue growth rate from 2006 – 2007 (over 15%)?
• Does the vendor have a track record of growth?
• Does the vendor have a track record of profitability?
• Is the vendor profitable?
• How long has the vendor been in business?
• How long has the vendor supported the application(s)?
• How long has the vendor offered an integrated suite of applications?
• How many customers does the vendor have?
• How much does the vendor invest in research and product development as a percentage of revenue?
• Has the vendor recently entered a new market (e.g. Europe, Asia)?
• How many customers have implemented multiple modules/applications in the suite?
• Does the vendor have a large number of similar customers (industry and size) that are successful in similar initiatives?
• Will you be in good company (quality of customer base)?
• Has the vendor recently released a new platform (or do they have near term plans?
• Has the vendor recently acquired another company?
• Does the vendor have a track record of acquiring other companies?
• Can you explain why this vendor is unique?

 

If you are in the process of evaluating vendor solution providers and asking these questions, please read our research on Talent Management Suites or give us a call.