RP - Learning Performance Go OnDemand - Why HR & Amp Training Professionals Are Flocking To Software As A Service - Chris Howard - GeoLearning - 47pg

About Us
Who We Are
• Industry’s primary research firm focused
on What Works® in enterprise learning
and talent management
Research Areas
• Planning & Strategy
• Content Development
• Enterprise Learning
• Learning Technology
• Performance Management
• Talent Management
• HR and Talent Systems
Offerings
• In-Depth Studies and Reports
• Research Memberships
• Workshops
• Benchmarking
• Advisory Consulting
Copyright © 2007 Bersin & Associates. All rights reserved. Page 2

Agenda
The challenge of enterprise learning technology
Defining an “integrated learning technology solution”
Emerging role of talent management
The SaaS Model
• What it is
• Cost of ownership
• How to select the right solution

Adoption of Learning Technology
LMS 60%
Virtual Classroom 57%
Rapid E-Learning Tool 40%
Application Simulation
Tools 39%
EPSS or KM Tool 26%
LCMS 25%
Podcasting 9% © Bersin & Associates

2007 Corporate Learning Factbook
www.bersin.com/factbook

LMS Market Evolution
Talent
TalentManagement
Management
Performance
PerformanceManagement
Management
Skills and Competencies
Skills and Competencies
Where
Whereare
areyou?
you? Enterprise
EnterpriseLearning
LearningApplication
Application
Consolidated Data and Analytics
Consolidated Data and Analytics
Integrated
Integratedwith
withOther
OtherLearning
LearningComponents
Components
ERP, HR, and application integration
ERP, HR, and application integration
EE-Learning
-Learning Platform
Platform
Make
MakeEE-Learning
-Learning Possible
Possible
Make
Make E-LearningEasy
E- Learning Easy
Training
TrainingManagement
ManagementSystems:
Systems:
Automate
Automatethe
theProcess
Processof
ofInstructor-Led Training
Instructor-Led Training

Benefits of LMS System
46%
Strategic
Strategic
38% Efficiency
Efficiency
25% 23%
Biggest
BiggestBenefits:
Benefits:
Information
Informationand
and
Content Distribution
Content Distribution
11%
6%
Tracking and Facilitate E- Manage Improve Training Meet Regulatory Reduce Training
Reporting Learning Enterprise-wide Efficiency Compliance Costs
strategy Programs

Challenges of Implementation
31%
24%
21%
19%
Biggest
BiggestChallenge:
Challenge:
14%
Customization
Customization
10%
Customization Content Integration with Ongoing IT Support System

to meet Integration HR IS Administration Performance
Business Needs

LMS “Dis” Satisfaction:
The LMS business is difficult - lots of work still to do
Excellent Rating, 10.00
Scalability, 7.10
Product will continue,

7.00
Content Integration, 6.80
Vendor Service, 6.30
Systems Integration, 6.20
Testing/Assessment, 6.10
Ease of Upgrade, 6.00
Ease of Customization,
5.70
Out of Box Functionality,
5.50
Reporting, 5.10
Very Not Somewhat Very

Disappointed Happy Happy Happy
© Bersin & Associates: LMS Customer Satisfaction 2007, available at www.bersin.com/lmssat n=500+
The Content Integration Problem
61%
61%of
ofLMS
LMSUsers
UsersCite
Cite
Content Some
ContentIntegration
Integrationas
asaa Problems,
Problem
Problem 42%
Many
Problems,
29%
No Problems,
18%
NA, 8%
Study conducted in May 2004, 10,000+ Surveys

The LMS Ecosystem
Call Call
Center Center
Course Course
LMS Internally
“Learning Integration Platform” Developed Content
Assessment HR and Other 3rd Party

and Competencies Corporate Systems Content Leadership Performance
Training Mgt Training
Course Course
Skillsoft,
Skillsoft, Others

Four Stages of E-Learning
Where are you? Stage 4: On Demand

Stage 4: On Demand
LCMS, Performance Support, Search
LCMS,
LCMS,Performance
PerformanceSupport,
Support,Search
Search
Stage
Stage 3:
3: Integrate
Integrate && Align
Align
LMS, governance, competency-based, performance management
LMS,
LMS,governance,
governance,competency-based, performance
competency-based, performancemanagement
management
Stage
Stage 2:
2: Expand
Expand
Blended
Blendedprograms,
programs,rapid
rapidee-learning,
-learning, outsource
outsourcesophistocated
sophistocatedcontent
content
Stage
Stage 1:
1: Get
Get Started
Started
Get content online: Buy off the shelf – one size fits all
Get
Getcontent
contentonline:
online: Buy
Buyoff
offthe
theshelf
shelf––one
onesize
sizefits
fitsall
all
© Bersin & Associates

The Four Stages of E-Learning
www.bersin.com/stages

Innovative Approaches to Learning
Supports the Talent Development Process and Appeals to GenX Learners
Expert Learning on Demand

Coaching Communities Career
Programs of Practice Curriculum
Self
Assessment
Re
EPSS te
nt
Tools Training io
n
is
Event L os
Job t
Aids
Novice Traditional Training

Time

Integration with Performance Support
Online Help
Courses
LCMS Help System

Enterprise Context for the LMS
Enterprise Portal
Documents Goals
Job Aids Perf Plans
Courses Price Lists Organization
Webcasts Videos Assessments
Assessments Audios Benefits
Events Powerpoint Compensation
Podcasts PDFs HRMS
Presentations Word
Excel
LMS Other Data HR Apps

Directions of the LMS Market
Increase in Enterprise Learning Capabilities
Tools, LCMS, Content Integration, Analytics, Domain mgt,
Collaboration Systems, Publishing, Performance Support
Search, Web-services, Portals, Self-publishing,
Communities of practice, blogs, wikis, online video…
Increase in Talent Management Capabilities

Employee profiles, job descriptions, performance management,
succession planning, HIPO selection, manager/employee portals,
assessment, recruiting, applicant tracking, internal recruiting,
compensation, workforce analysis, career planning, candidate
selection, competency analysis, skills-gap analysis,
integration or building of HRMS,interface to external data sources
Today’s LMS Systems

Agenda
The SaaS Model
• What it is

Enterprise Learning Technology
Portals: Employee | Manager | Customer | Partner
Tools
Collaboration (Webcast, Discussion, Blog, Wiki) Career Development
Content Development Tools Succession Planning
Learning Talent
Learning Content
Learning Content
Content Management (LCMS) Performance Support 360 Assessment
Management Management
Application
Performance
Content Interfaces
LMS
Reporting
Management
Programs, Courses, Objects, Assessments Goals, Objectives, Performance Plans,
Prices, Fees, Student Hours, Credits, Resources, Development Plans, Assessments
Certifications, Scores, Completions, Ratings Reviews, Ratings, Rankings
Competency Requirements, Organizational Competencies, Skills
Data
Job and Role Descriptions, Open Requisitions
Data
Organizational Data (Relationships, Hierarchy, Geography)
Management - ERP
Compensation Data (Current, planned, short/long term)
Employee Profile Data (Demographics, History)

Tools

Learning Content
Learning Content
Application
Performance
Content Interfaces
LMS
Reporting
Management

Data

Tools

Learning Content
Learning Content
Application
Performance
Content Interfaces
LMS
Reporting
Management

Data

Types of Integration to Consider
Tools

Learning Content
Learning Content
Content Management (LCMS) Performance Support Sourcing & Recruiting
Application
Performance
Content Interfaces
LMS
Reporting
Management
Data
Data
Management - ERP

Agenda
The SaaS Model
• What it is

Workforce Demographics
Critical Talent Management

Capturing and Sharing
Succession Planning Knowledge
Identification of Key Leaders Mentoring
Management & Leadership
Recruiting
Development
New Hire Training
Onboarding
At-Risk Industries
Government
Energy
Oil & Gas
Telecommunications
Manufacturing
25-34 35-44 45-54 55-64 65+

© Bersin & Associates

Evolution of the HR Function
Talent
Management
Competency Management
Performance Management
Strategic HR Succession Planning
Recruiting
L&D Business Integration
Org Design
Personnel Total Compensation
Succession Planning
Communications
Department Competency Management
Pay for Performance
Payroll Business Partner Leadership Development
Benefits
Recruiting, ATS
HR Portals
Business Function Compensation
Learning Management
Payroll Systems
© Bersin & Associates: Performance Management 2006: Market Analysis, Trends, Best Practices
and Case studies, available at www.bersin.com/perfmgt

Traditional HR Processes and Systems
Slow response to changing business needs
• Do not clearly understand where current critical talent
Silos in HR •
gaps exist
Lack of disciplined workforce planning to drive future
talent needs and capabilities
• Hiring strategy and development planning not in sync
• No clear picture of future “talent profile”
• Leadership pipeline in jeopardy
Recruiting – Applicant Tracking
Disconnected and Cumbersome

Leadership Development
Learning & Development
Compensation - Benefits
Succession Planning
• Data and processes not integrated
Workforce Planning
• Talent not shared across businesses/units

• Learning plans not linked to assessments and skills
gaps in current talent pool
Not responsive to employee demands

• Employees want career development
• Millenia generation expects growth and flexibility
• Defined career paths and competencies not clear and
consistent
Administratively intensive
• Data entry is repetitive
• High volume of manual work to complete HR review
processes
• Difficult to obtain executive-level talent information

Integrated Talent Management?
2 3
Sourcing Performance
& Recruiting management
HR Systems
1 & Metrics 4
Talent Strategy Learning &
& Planning Development
Competency
Management
7 5
Compensation Succession
planning
6
Leadership
Development
High Impact Talent Management Framework
Planning
Talent Strategy & Planning
Comp Base Comp

Business Critical Talent Target Metrics Process Systems
Strategy Strategy & Measurement Governance Strategy
Plans
Sourcing & Performance Succession Leadership
HR Systems & Metrics
Recruiting Management Planning Development
Compensation
Sourcing Formal Programs
Goal Setting Calibration Meetings
Candidate Pools Stretch Assignments
Cascading Goals Talent Reviews
Assessment Executive Education
Self-Assessment HIPO Identification
Employer Brand Coaching
Manager Assessment Career Planning
Recruiting Mentoring
360 Assessment Talent Migration Plan
Selection Job Rotation
Development Planning
Assessment
Competency Assessment
Evaluation
Performance
Job Corporate Leadership Functional
Pay for
Competency Management Profiles Values Competencies Competencies
Onboarding Management Leadership Coaching/Mentoring

Training Curricula Programs
Role-based Operational E-Learning Developmental
Long Term
Short and
Incentive
Curricula Training Strategy Assignments
Content Development Certification

& Delivery Learning & Development Programs

A New Role for Learning
Performance-Driven Learning Talent-Driven Learning
Drivers: Business performance issues in Talent and leadership gaps, critical skills
operational units and functions shortages, engagement and culture
Goal: Develop individual capabilities and fill Develop organizational capabilities driven
performance gaps by competencies, not performance
Examples: Sales Training, Customer Service Multi-tier leadership development
Training, Field service certification New-hire onboarding programs
Organization: Aligned by job within function Aligned to all job roles in a job function
Timeline Months or even shorter Multiple quarters to years
Complexity Functional Enterprise or Divisional-wide

Integrated with: Product launches, new service offerings, Performance management, recruiting,
geographic expansion succession planning
Challenges: Performance consulting, program design, Resource allocation, program design, job
manager engagement alignment, manager adoption
How to Solving business problems: sales, Filling and solving talent gaps (ie.
measure service, quality, turnaround shortages, recruiting goals)
success

Example: Wal-Mart
Situation: Store hiring and
personnel processes developed SVP
around goal of reducing costs HR
Problem: Millions of dollars of legal HR 5 Divisions

problems, turnover, and inconsistent VP
development of store managers
HR
Solution: Integrated HR talent- Director 29 Regions
driven learning curriculum, with
certification, for all 4,077 HR
professionals HR 382 Markets
Manager
Developing competency model for
1.8 million people, behavioral HR
3740 Stores
assessment tools, 180 job families Coordinator

HR Software Markets
Category Core Functionality Market Maturity
& Growth
Manage all aspects of training, scheduling, Middle Majority
LMS compliance, e-learning, content management,
learning paths, customer training, e-commerce, Fast Growth
collaboration, reporting
Goals, performance plans, appraisals, Early Majority
Performance assessments, competency assessments, ratings,
Management rankings, development plans, succession planning Very Fast Growth
Applicant tracking, resume database, workflow Majority

Recruiting management, source analysis, career portals,
hiring metrics, recruiter portals, manager portals Slowing & Rebuilding
Employee data and history, job profiles, corporate Late Majority
HRMS hierarchy, compensation history, key training,
language, and employee profiles Stable
Compensation plans, short term plans, long term Early Adopters
Compensation plans, incentives, budgets, interface with sales
and financial systems Slow Growth

The Prevailing Wisdom
LMS
Performance
Management
Recruiting Talent
Management
HRMS Suite
Compensation

Agenda
The SaaS Model
• What it is

Three Models for Enterprise Software
Model Where is Software? Licensing Model Tenancy and Architecture
Licensed Installed and You purchase the Software is installed on your
operated in your software and pay servers, using your database,
organization. 18-22% per year and can be integrated with
for support and your internal systems.
service
Hosted Installed and You may Software is installed on a third
“Single- operated in a third purchase the party company’s servers,
Tenant” party location. software or rent it, using their networking to
and a third party provide access, with a
charges you to dedicated database for you.
operate it.
On-Demand Installed and You “rent” the The software is installed on
SaaS operated by the LMS software and pay the LMS vendors’ servers and
“Multi- vendor. an annual fee for shares database and other
Tenant” software resources with other clients.
availability.

How the Models Differ
Model Upgrades and Fixes Cost Considerations $ Model
Licensed You are responsible for You must purchase the You own the
patches and fixes, and software as a capital software and it
likely will install when investment and budget for is yours to
you have time. implementation, operations, maintain.
fixes, and upgrades.
Hosted The hosting vendor You typically purchase the You own the
“Single- installs these patches software and pay an annual software but
Tenant” and upgrades fee for implementation, someone else
whenever you are operations, fixes, and maintains it and
ready for them. upgrades. operates it.
On-Demand The LMS vendor All your fees are monthly or The LMS vendor
SaaS installs these patches annual and the LMS vendor provides it to
“Multi- and upgrades takes on any cost of you as a
Tenant” transparently to you, hardware, database, fixes, service.
whenever they want to. and other service.

Cost of Ownership - Licensed
Cost model follows cost of any capital purchase (buy)
Annual
Costs Initial
Initial
Implementation
Implementation
System purchase
System purchase
Implementation
Implementation
Integration System
System
Integration
Systems Integration Upgrade
Systems Integration
Content integration
Upgrade
Content integration
Training
Training
Change Management
Change Management
Custom Report Generation
Customizations
Customizations
Enterprise LMS
Licensed
Time
Cost of Ownership - Hosted
Cost follows model of capital acquisition by a leasing agent (lease)
Annual
Costs Initial
Initial
Implementation
Implementation
System purchase
System purchase
Implementation
Implementation
Integration System
System
Integration
Systems Integration
Content integration
Upgrade
Content integration
Training
Training
Change Management
Change Management
Customizations
Customizations
Enterprise LMS
Licensed
Hosted
Time

Cost of Ownership - SaaS
Cost follows model of a rental agreement (rent)
Annual
Costs Initial
Initial
Implementation
Implementation
System purchase
System purchase
Implementation
Implementation
Integration System
System
Integration
Systems Integration
Content integration
Upgrade
Content integration
Training
Training
Change Management
Change Management
Customizations
Customizations
Enterprise LMS
Licensed
SaaS
Time
Cost of Ownership - Licensed
Initial Deployment Ongoing Ongoing
Infrastructure Personnel Infrastructure Personnel
5-20% 5-15% 5-15% 50-85%
Hardware Needs analysis Hardware Scheduled
Software Configuration upgrades maintenance
Security Tuning and Testing Network Unscheduled
Networking Launch Security maintenance
Monitoring tools IT Staff training Bandwidth Outage response
Reporting tools End-user training Redundant End-user support
Facilities systems IT staff training
Backup and support
Helpdesk Upgrades and add-
ons
Security monitoring

Cost of Ownership - SaaS
Setup Deployment Ongoing Ongoing
Fees Personnel Costs Personnel
2-5% 3-5% 80-90% 5-10%
Vendor setup fees Application testing SaaS subscription System
Integration with fees administration
other systems Working with
Configuration (typically include vendor
implementation, End-user support
Launch and end support, upgrades,
user training and marketing
end-user support,
content integration,
and other services)

TCO Calculator: You can Compute

Operational Comparison
Licensed SaaS
Content Vendor tests content but Vendor takes full responsibility and
responsibility lies with you must deliver integrated solution
Integration
Systems Highly flexible but complex Relies upon vendor’s programming
interfaces (APIs) and services
Integration
Cost A typical capital cost justification Much lower initial costs and can be
is needed justified as a new expense
Justification
Typical High cost Vendor’s services
Long implementation Vendor’s experience
Risks Possible failed configuration Flexibility of product
Best Fit Global enterprise, heavy IT Enterprise or mid-market, fewer
commitment resources
Customer Fair but rarely high Generally higher if the fit is right
Satisfaction
Key Vendors GeoMetrix, Oracle, Plateau, GeoLearning,
Saba, SumTotal, SAP CornerstoneOnDemand,
Learn.com, MeridianKSI, TEDS

Selecting an SaaS Vendor
Licensed or OnDemand SaaS
ASP (Multi-Tenant)
How they 1. Revenues from licensed 1. Revenues from subscription fees
software (1/3) 2. Revenues from subscription fees
Make Money
2. Revenues from support 3. Revenues from subscription fees
contracts (1/3) 4. ……
3. Revenues from implementation
services (1/3)
Biggest Selling Software Developing Software

Implementing Software Providing Services
focus for
Supporting Software Ensuring Renewals
organization
Key Vendors GeoMetrix CornerstoneOnDemand
Oracle, GeoLearning
Plateau KnowledgePlanet,
Saba Learn.com
SAP MeridianKSI
SumTotal TEDS

The Simple Difference
Licensed software
vendors sell products
SaaS vendors sell

subscriptions
The Simple Difference
Licensed software vendors

want you to “go-live”
SaaS vendors want you to

“deploy” and “renew”

Signs of a Great Supplier
Licensed software vendors who

have most of their customers
live on current releases
SaaS vendors who have high

renewal rates (> 90%)

Litmus Test for SaaS LMS Vendor
Multi-tenant architecture
All clients on same release of software
Rapid-deployment solution
Tier-one systems and networking facility
Documented Service-Level Agreements (SLAs)
Availability over 99.9%
Experienced with HRMS integration
Content integration services
Content available for resale
Learning services (design, program support, integration)
Understanding of learning programs
Understanding of talent management processes
High rate of renewals (>90% ideally)

Questions?
For more information:
www.bersin.com/lms

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About Us

Copyright © 2007 Bersin & Associates. All rights reserved. Page 2

Copyright © 2007 Bersin & Associates. All rights reserved. Page 3

Virtual Classroom 57%

Rapid E-Learning Tool 40%

EPSS or KM Tool 26%

Podcasting 9% © Bersin & Associates

Copyright © 2007 Bersin & Associates. All rights reserved. Page 4

Copyright © 2007 Bersin & Associates. All rights reserved. Page 5

Copyright © 2007 Bersin & Associates. All rights reserved. Page 6

Customization Content Integration with Ongoing IT Support System

Copyright © 2007 Bersin & Associates. All rights reserved. Page 7

Product will continue,

Content Integration, 6.80

Vendor Service, 6.30

Systems Integration, 6.20

Ease of Upgrade, 6.00

Very Not Somewhat Very

Copyright © 2007 Bersin & Associates. All rights reserved. Page 9

Assessment HR and Other 3rd Party

Copyright © 2007 Bersin & Associates. All rights reserved. Page 10

Where are you? Stage 4: On Demand

© Bersin & Associates

Copyright © 2007 Bersin & Associates. All rights reserved. Page 11

Expert Learning on Demand

Novice Traditional Training

Copyright © 2007 Bersin & Associates. All rights reserved. Page 12

LCMS Help System

LMS Other Data HR Apps

Copyright © 2007 Bersin & Associates. All rights reserved. Page 14

Increase in Talent Management Capabilities

Today’s LMS Systems

Copyright © 2007 Bersin & Associates. All rights reserved. Page 15

Copyright © 2007 Bersin & Associates. All rights reserved. Page 16

Content Development Tools Succession Planning

Content Management (LCMS) Performance Support 360 Assessment

Competency Requirements, Organizational Competencies, Skills

Copyright © 2007 Bersin & Associates. All rights reserved. Page 17

Content Development Tools Succession Planning

Content Management (LCMS) Performance Support 360 Assessment

Competency Requirements, Organizational Competencies, Skills

Copyright © 2007 Bersin & Associates. All rights reserved. Page 18

Content Development Tools Succession Planning

Content Management (LCMS) Performance Support 360 Assessment

Competency Requirements, Organizational Competencies, Skills

Copyright © 2007 Bersin & Associates. All rights reserved. Page 19

Content Development Tools Succession Planning

Content Management (LCMS) Performance Support Sourcing & Recruiting

Competency Requirements, Organizational Competencies, Skills

Copyright © 2007 Bersin & Associates. All rights reserved. Page 20

Copyright © 2007 Bersin & Associates. All rights reserved. Page 21

Critical Talent Management

25-34 35-44 45-54 55-64 65+

Copyright © 2007 Bersin & Associates. All rights reserved. Page 22

Copyright © 2007 Bersin & Associates. All rights reserved. Page 23

 Disconnected and Cumbersome

• Talent not shared across businesses/units

 Not responsive to employee demands

Copyright © 2007 Bersin & Associates. All rights reserved. Page 24

Comp Base Comp

Recruiting Management Planning Development

Onboarding Management Leadership Coaching/Mentoring

Disconnected and Cumbersome

Not responsive to employee demands

Problem: Millions of dollars of legal HR 5 Divisions