Elearning - April/May 2008 - (Page 30)

startatthetop >>Training is of increasing importance in the changing U.S. labor market. In 2006, total spending on training grew by 7 percent, the highest growth rate in years. This growth is fueled by the dramatic needs for talent in U.S. corporations. Demographic changes, the aging workforce, and changes in the profile of U.S. education have created talent shortages in most organizations. As it’s no longer possible to “hire skills,” they must be developed internally. This increase in skills-building has created what we call “talent-driven learning organizations,” which focus on organization-wide talent issues, not just individual workers’ skills. This increased focus and new spending demand the use of a corporate LMS. >>LMS systems themselves are evolving. Nearly every LMS vendor has developed a new set of capabilities for performance management, succession planning and competency management. Vendors understand the new market for talent management solutions, and the LMS is taking on an ects take years to cost-justify and complete, and we believe this consolidation will continue for years to come. The enterprise market (large organizations with employees primarily located in one country) is growing very significantly. These enterprises also have multiple LMS’s, but they tend to have only one corporate training system. These companies may use a platform from SkillSoft (or one of the other midmarket players in sales or often start their journeys into the LMS market through a single training program or program area (like sales training, customer training, partner training or elearning for compliance). This market is growing at a rate of more than 40 percent per year, and most LMS vendors have made major changes in their business models to reach this market effectively. LEADERS, SPECIALIZED VENDORS GAIN MOMENTUM At the same time, the LMS market has grown and matured rapidly. Today, the level of technology and features in LMS systems can be overwhelming. They include, among other features: >>classroom scheduling and resource management; >>e-learning management >>content management >>customizable portals >>domain management >>certification management The fastest growing segment of the LMS market is midmarket organizations with between 2,500 and 10,000 employees. increasingly important role as the hub or core of an integrated talent management platform. CONSOLIDATION + ADOPTION Most vendors have tried to focus on the global enterprise market (large organizations with global operations), so it is the most penetrated. Our research indicates that as many as 70 percent of U.S. global enterprise companies already have some type of LMS. These organizations typically have multiple LMS’s, many of which are outdated and poorly used. In this market, there is a clear trend toward consolidation and the adoption of an enterprise-wide global platform. These consolidation proj30 April / May 2008 Elearning! customer training), but would like to consolidate these into a single corporate system. We believe this market is growing very rapidly and is still under-penetrated. Finally, the fastest-growing segment of the LMS market is in midmarket organizations (companies or departments serving fewer than 10,000 learners). These are smaller, often fast-growing companies with highly focused, expert training organizations. They often do not have a lot of IT support but realize tremendous value from an LMS. These organizations have many of the same complex needs as enterprise buyers, but their budgets and support staffs are far less. They tend to favor an ondemand or hosted solution, and they will >>e-commerce >>configurable course catalogs >>competency-based learning >>analytics This rich feature set has created a significant barrier to entry. In fact, the number of LMS vendors in the market is stable for now but will likely continue to shrink over the coming years. Seven vendors now command more than 50 percent of the market. We believe a shift is under way toward a market of “leaders” and “specialized vendors.” The leaders each have market shares of 4 percent or greater in terms of revenues and customer bases of 200 or more; the specialized vendors tend to have

Table of Contents Feed for the Digital Edition of Elearning - April/May 2008

Elearning - April/May 2008 Editor's Note Contents News Targeting Africa Locating Courseware People in the News Upcoming Events Deals Trendlines Web Services Building a Learning Culture Measuring the Learning Experience Making Learning Fun and Social LMS's 2008: What You Need To Know Learning Leader: CA Case Study: AVI Case Study: IBM Case Study: QualComm WBS Case Study: National Center for State Courts Case Study: Grundfos Pumps Case Study: Virginia Tech Pop Quiz Last Word

Elearning - April/May 2008

For optimal viewing of this digital publication, please enable JavaScript and then refresh the page. If you would like to try to load the digital publication without using Flash Player detection, please click here.