Highlights and Trends in the HRO Market for H1 2013: Part 1

Amy L. Gurchensky, HRO Research Analyst, NelsonHall

It’s hard to believe that H1 2013 is complete, which makes it an ideal time to recap highlights and trends from the HRO world this year.

Overall Activity

There was a healthy number of new contracts awarded across all HRO service lines in H1 2013. In addition, renewals and contract extensions signed were consistent with H1 2012. There was, however, an increase in activity with organizations changing their existing service provider, particularly within benefits administration and RPO.

For the last few years, attention has been on the mid-market (500-10k employees), among other things, as an area for growth within HRO. Quarter-over-quarter, mid-market activity has made strides relative to the large market. In fact, in H1 2013, the majority of activity reported was from the mid-market.

Beyond HRO, the number of HR software contracts signed globally was up substantially compared to H1 2012. For example, in the U.S., ADP was awarded a contract for its Vantage HCM platform, including HR, payroll, benefits and onboarding modules, by The Paradies Shops covering 4k employees. In the U.K., Ceridian gained traction with its automatic enrollment module with Asda for 175k employees and WH Smith for 16k employees.

Payroll

Despite being a mature service line, payroll outsourcing does not disappoint. The biggest news reported in H1 2013 would have to be ADP’s acquisition of Payroll S.A., which will expand its LATAM payroll capabilities to Chile, Argentina and Peru. ADP already had in-country services in Brazil, and had capabilities through GlobalView and Streamline to serve multinationals in other LATAM countries.

Other news within payroll includes Acrede opening an office in Singapore to expand its global payroll reach into Asia-Pacific. Growth opportunities in the region include Japan and South Asia-Pacific.

RPO

The RPO market continues to be a hot one to watch. Contracts were awarded in various countries, including the U.S., U.K. and China, and ~20% of contract activity in H1 2013 was from multi-country deals.

The level of M&A activity was consistent with H1 2012, but the level of RPO partnerships has dwindled. Nevertheless, RPO vendors were busy expanding service offerings and delivery capabilities, and launching new websites. Some examples include:

• Randstad Sourceright launching an RPO integrated assessment program
• Manpower U.S. launching a multi-channel delivery model
• Ochre House launching a COE to drive innovation
• Randstad Sourceright opening a shared services center in Budapest
• Hays launching a new mobile website
• AMN Healthcare launching a redesigned website.

Although technically within H2, it is timely to mention the Pinstripe and Ochre House merger.

Learning

After a rather long lull, the learning BPO market has shown many signs of improvement. New contracts include Raytheon and GM Korea for content development and training administration services, and delivery of sales and non-technical training.

GP continued its acquisition frenzy focused on strengthening and expanding its geographic footprint with Prospero Learning Solutions (Canada) and Lorien Engineering Solutions (U.K. and Poland). Not to mention Capita’s acquisition of KnowledgePool.

Stay tuned next week for more highlights and trends from H1 2013 that are specific to benefits administration and MPHRO. I’ll also share some insights on what to expect in H2 2013 based on NelsonHall’s recent HRO Confidence Index survey.

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Talent2’s Competitive Edge

Linda Merritt, HRO Research Analyst, NelsonHall

The NelsonHall HRO team recently spoke with Mary-Sue Rogers, Talent2’s global general manager for HR managed services, for an update on the major Asia-Pacific, pan-regional HRO service provider with ~2.6k clients across 30 countries. Its client base includes companies of all sizes in both the private and public sectors. The company had a busy fiscal Q4 2013 winning more than 60 contract awards across its service lines, including payroll, RPO, learning and HR advisory services.

The Asia-Pacific HRO Market is Competitive

Asia-Pacific is a huge and diverse region with many of the individual nations still considered “emerging markets,” with opportunities for long-term growth. Talent2’s in-region competitors are largely global HRO providers, some span all service lines and others go head-to-head-on a single service like RPO.

So how does a ten-year-young company compete with many of the biggest names in HRO? Its competitors also have in-region locations but find it hard to match Talent2’s 40+ HRO-dedicated locations supporting 31 languages in 16 Asia-Pacific countries, including parts of the Middle East. In May 2013, Talent2 further expanded its operations in support of the Asia-Pacific region by opening a service delivery center in the Philippines.

Succeed With a HRO Competitive Edge

It is a core part of providing multi-country services to offer local subject-matter expertise on employment rules, regulations, taxation and compliance reporting, and all of the competitors can provide such services directly or through vetted local partners.

Talent2 demonstrates deep knowledge of local regulations as well as cultural and business environments. It knows the nuances that others may miss, which can help develop a service offer that is right on the mark for design and cost. For example, in the first instance, Talent2 addresses the following questions:

• What style of payroll service center support is preferred by employees in different areas of its region?
• What are the differences in an MNC headquartered in the West versus one headquartered in the target region?

As a result, 50% of its clients use multi-country services led by payroll and followed by RPO. Some start with one targeted country and add more over time.

Quality services and competitive pricing, along with its deep knowledge, provides a winning combination for Talent2, achieving a NelsonHall estimated ~10% growth in FY 2013.

Then Change to Remain Competitive

Talent2, which became a private company in 2012, is working its way through its stated development roadmap. The multi-pronged plan is focused on upgrading and rationalizing its technology platform to meet current and future client needs and going environmentally green to control internal costs and lower the total cost of ownership for its clients.

HR services are changing rapidly all over the world, as are client needs and interests, and no service provider can long rest on its laurels. Therefore, the question arises: does your HRO service provider’s competitive edge match your needs today, and will it tomorrow?

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Mercer on the Move

Linda Merritt, HRO Research Analyst, NelsonHall

This week I attended Mercer’s always well managed and informative analyst forum in Boston, MA. The meeting was focused on the talent consulting line of business.

Talent Management on the Rise

Mercer research indicates that human capital issues are a top CEO concern and managing talent is becoming a board of directors’ issue, moving beyond the traditional CEO succession planning and compensation to overall talent and workforce planning. The new Mercer Talent Barometer Survey, which was introduced at the 2013 World Economic Forum, reports that 60% of the 1,200 global companies surveyed are investing more in talent, but only 30% feel that their workforce plans are highly effective.

The business of talent has become both exciting and disruptive, with possible new entrants, globalization, media, innovations, and opportunities. (Talk about new entrants, eHarmony is considering getting into the talent matching game!)

With a possibility of double-digit growth, the talent group looked at how to grow across the talent value chain by expanding its services, tools and technology offerings for talent, rewards, and communications to increase growth and leverage Mercer’s depth of experience and capabilities.

The answer will become apparent over the next few months as more packaged solutions are launched that combine consulting, information, and technology to meet the needs of clients that want a less-customized consulting approach with “off-the-shelf” packaged and reusable services and tools.

Workforce Planning Versus HR Analytics

Some elements that will be leveraged are already mature and solid revenue producers. Surveys, benchmarks, and analytics for compensation/total rewards and job structures are a more than $200m line of business. Globalization of the revenues is already well on its way, with about equal distribution from North America, Europe, and emerging markets across 57 countries.

Instead of focusing on HR analytics, Mercer is emphasizing data acquisition and integration, data modeling, as well as data visualization as it applies to a wide range of workforce and data that drives business results. This may mean a consulting and outsourcing services engagement, it may mean workshops and training, or self-service use of integrated SaaS technology platforms with one or more Mercer products.

Think Big, Start Small, Move Fast

There are a lot of moving parts in Mercer’s strategy to create an integrated talent solutions portfolio.

It is brought together under the go-to-market Talent Impact label that includes new and existing products and services to forecast, engage, mobilize, reward and assess talent. Behind the scenes Mercer will be streamlining its own architecture into fewer and more integrated technology platforms to support the new offerings.

There is a lot to be done in a short time, but that is in alignment with the “think big, start small, and move fast” philosophy of Orlando Ashford, senior partner and president of Mercer’s talent business. Mercer is on the move!

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Let’s Not Forget About Learning

According to a survey by KnowledgePool, a U.K.-based managed learning services provider, 70% of internal client learning and development (L&D) organizations are too busy doing daily fire-fighting to focus on strategic talent and learning issues in their company. Out of 104 L&D managers, 69% say their training department does not have enough resources and 42% say that training receives inadequate support from senior managers. Yet 80% of L&D managers said they could improve their organization’s training ROI; 77% think new opportunities for improvement could be identified through rigorous analysis of their training spend and evaluation data; and 75% say improvements could be made by using more informal and on-the-job learning methods.

Sound like an opportunity for outsourcing? You bet!  The good news from NelsonHall’s most recent quarterly HR Outsourcing Confidence Index is that learning services, which has been the last of the HR outsourcing service lines to recover, is expected to continue to strengthen as the year progresses. Following several strong quarters of growth within RPO, the need is now shifting toward implementing and optimizing learning programs. Good news in learning since the beginning of Q2 includes:

• Genpact winning a content development contract by JobSkills in India
• Raytheon Professional Services winning a contract to develop an e-training program for NATO
• CIBER’s Federal division winning a 5-year training development contract with a potential value of $30.7m by the Center for Strategic Leadership, an institute of the U.S. Army War College
• Accenture winning an e-learning contract with a major bank that may later add classroom ILT
• General Physics winning $3m in 5 new contracts from energy companies across Africa, the Middle East, South America, and Asia
• Edvantage group winning a safety e-learning contract by Yara International, providing 7 interactive e-learning courses for 3,000 technicians, operators, engineers, and supervisors at 30 plants across 17 countries.

In NelsonHall’s last learning BPO report, top drivers of why companies are outsourcing learning, which support KnowledgePool’s findings, include:

1.        Lowering costs (average client savings of 26%)
2.        Increasing training effectiveness and ROI
3.        Improving the quality of learning for employees
4.        Accessing experts in the industry whose core competency is                       learning
5.        Flexible services, aligning learning with the customer’s                                 strategic objectives
6.        Focusing on strategic work, not transactional activities.

Look for increased learning outsourcing to continue the remainder of 2011, including by the likes of IBM who continue to see increased demand globally. In 2012, I think learning outsourcing will really soar. Although uncertainty in the economy continues to cause delayed decision-making, there is no doubt in my mind that we will see a boost in learning as companies unanimously agree talent management is more important than ever. To improve and engage talent, you have to invest in your people. There is only so long you can just say the words, eventually you have to walk the talk!

Gary Bragar,  HR Outsourcing Research Director, NelsonHall

Top Topics at Last Week’s HRO Europe Summit

Although a working trip for me – as a learning session co-presenter with Raytheon, and on two panels, one on learning and one on RPO – I can easily say last week’s HRO Summit Europe got great marks in my book. About 40 percent of participants were buyers – a rare occurrence at conferences these days – with the balance being presenters, providers, analysts, press, researchers, staff and others. Discussions were lively and engaging, and…need I say anything about the beauty of Amsterdam, especially its architecture and canals?

My co-presentation with Raytheon, a learning outsourcing session called, “Bridging the Customer-Provider Divide,” was immediately followed by the learning panel, and witnessed buyer questions including: 1) What role does the retained HR learning organization play, including the role of the retained learning director, HR business partners and governance team?; 2) What lessons learned should a buyer that has just implemented a learning BPO contract incorporate?; 3) Why we are seeing more selective LBPO contracts and less full LBPO contracts?; and 4) What role does LBPO play in retaining knowledge as more employees will inevitably begin to retire? 

While tracks and presentations covered the HRO gamut, two of the major focuses were talent issues and RPO. Dr. Peter Cappelli, Director of the Center for Human Resources at the Wharton School of Business, opened the conference with a keynote entitled, “A Question of Talent.” He began by discussing that, in the 1950’s and 1960’s, 24 years of service with just one company was the average tenure per employee. At the time, companies invested heavily in continuous training, and believed in lateral and upward mobility. He then moved to the sobering stats of today’s workforce. Companies of course still want loyal employees, yet very few do little to give their employees in-turn loyalty, and only one in four of succession plans are utilized. The result is organizations spending thousands of dollars in employee development, only to lose them to competitors.

It almost feels as if organizations accept this as a looming cloud norm in today’s workforce environment. But I vehemently oppose that viewpoint. If you look at the pure financials alone, conservative estimates are that it costs one and a half times as much of an employee’s salary to replace that individual due to the cost of recruitment, development, learning curve, etc. How can that possibly be perceived as good business? I am feeling like an evangelist as I’ve written about it so many times in my blogs, but employee satisfaction and robust initiatives focused on talent retention are vital to competitive advantage and business growth.

One of the largest and most well attended tracks at the conference was on RPO. I was also a member of an RPO panel discussion entitled, “Deep Dive: Driving the Future State of RPO,” along with Alexander Mann Solutions, SourceRight Solutions and a professor from Lancaster University. One question posed by a buyer member in the audience was how RPO has evolved. Each panelist, of course, had its own answer. Mine, not surprisingly as an industry analyst, is that by providing what I call “value-added services” or what I consider to be the “richer RPO services,” you are a true end-to-end RPO provider. This means: 1) services on the front end in workforce planning, talent strategy and employment branding to ensure the right employees with staying power are hired; 2) services in the middle to manage internal recruiting/mobility; and 3) services on the back end, including robust onboarding and ongoing, bi-directional employee engagement.

There are other shifts occurring, including interest in global RPO, and I will cover more on that and learning outsourcing issues discussed at the conference in upcoming blogs!

Gary Bragar, Lead HRO Analyst, NelsonHall

HRO Can Help Stem Absence Management Cost Hits – But There’s More

A recent CyberShift survey found that one third of the 1,088 respondents cited absence management as a continuing top priority. Yet 53 percent of the survey participants stated they did not have an automated system in place for absence, leave, vacation and FMLA tracking. This is a pretty scary statistic, especially when, per CyberShift, unscheduled absenteeism can cost businesses more than $760,000 per year in direct payroll costs alone.

At the same time, forward-thinking buy-side companies over the past couple of years have awarded absence management contracts to HRO providers, and the vendors are beefing up their absence management offerings. Let’s take a look.

Absence Management Contracts

• MidlandHR was awarded 10 contracts in the last two years for its iTrent HR and payroll software, including its absence management modules, by the University of Exeter, Capel Manor College, Oxford City Council, NetworkersMSB, Pentagon Investments, Preston College, Which? (yes, this is an actual company name), Manchester Fire and Rescue, Kent County Council and Farnborough College
• Wipro implemented Oracle’s PeopleSoft Enterprise HCM 9.0 for Jammu & Kashmir Bank in India. Modules implemented include absence management and approval workflow
• NorthgateArinso won a five-year contract with Hastings College for its ResourceLink HR platform, which supports absence management
• Convergys entered into a five-year contract renewal for multi-process HRO services with a leading business services company; components of the contract include absence management and leave administration
• Hewitt was awarded several unnamed contracts that include absence management
• Raet won a 10-year contract with OSG for its online HR portal, which includes absence management

Providers’ Enhanced Absence Management Offerings

Just a couple of weeks ago, Capita acquired FirstAssist Services Holdings Ltd. to strengthen its capabilities in health and workforce management, including absence management. In January, Hewitt added participant advocacy services to its absence management offering. In August, Ceridian added Presagia’s employee leave management software to support its leave management services. And Xchanging announced an alliance with absence management specialist FirstCare through which the two parties will jointly go to market with FirstCare’s absence management and occupational health pre-employment screening services and Xchanging’s portfolio of HRO services.  

Here’s my take. Leveraging software and services for absence management tracking is a great step in the right direction when it comes to stemming costs. But equally, if not more, important is drilling down into the why’s of non-authorized and non-sick absences. This maps to blogs I’ve written over the past year that focus on rampant employee dissatisfaction. Unhappy employees are more inclined to call in sick simply because they don’t want to go to their jobs. Get to the heart of employee dissatisfaction, fix what is truly broken across the enterprise, and absenteeism will decrease. Strong leadership and performance management training is invaluable in helping determine the root of employee discontent. Corporations lacking internal training programs of this type can leverage offerings from both full-scope and pure-play learning services HRO providers.

Gary Bragar, Lead HRO Analyst, NelsonHall

HRO (and overall BPO) Total Contract Values up in Q1 – Q3 2010

During NelsonHall’s recent quarterly BPO Index Call, our CEO John Willmott stated overall BPO contract values were up for all BPO sectors, including HRO, both on a rolling twelve-month basis from 2009 – 2010 as compared to 2008 – 2009, and up year-to-date Q1 – Q3 2010 as compared to Q1 – Q3 2009. This is all good news, but not a surprise given that we are beginning to see some recovery from the recession.

Looking specifically at HRO, total contract value (which includes the value of the full term contract plus any renewals) in Q1 – Q3 2010 was up nine percent. The growth came primarily from North America, while Europe declined as it is coming out of the recession a bit slower and clients in that region continue to be more cautious about outsourcing their HR processes. Although its total contract values isn’t as large as in North America, contracts are still being awarded in Europe, e.g., wins in Q3 by Logica, Midland HR, HR Access, Raet and CPH Consulting, as recently cited by my colleague Linda.

HRO growth in Q3 2010 was particularly led by RPO, similar to numerous other points during these tumultuous times. But here, I’d like to take a quick look at why the learning services market is starting to recover (please see Linda’s October 5 blog entitled, “Recapping the Not-so-Dog-Days of HRO’s 2010 Summer” to see a few of the recent learning contract awards.)

In learning, providers are introducing new training offerings largely focused on certified training courses, primarily technical areas including IT. Training is coming back to life, and the initial emphasis is on strengthening direct job-related skills. Making sure IT professionals can keep up with professional certifications can also be a way to build engagement and head off turnover as the employment market improves. There was also some introduction of new leadership development courses, perhaps indicating a return to a focus on the future by investing in management skills development. Finally, social learning is continuing to make inroads, and Expertus introduced its new platform, ExpertusONE, which facilitates communities of practice, expert networks and mentoring, in addition to normal learning system functions. Other new learning offerings introduced in Q3 included those from Raytheon Professional Services, QA and Edvantage Group.

It will be interesting to see, at the end of Q4, which HRO processes, regions and industries are the leaders and laggards. But much, much more to cover before then, including my “Targeting Learning BPO Market Analysis” to be published later this month.

Gary Bragar, Lead HRO Analyst, NelsonHall

Recapping the Not-so-Dog-Days of HRO’s 2010 Summer

One of the biggest HRO stories of 2010 will be the flurry of big and small acquisitions in the benefits administration space. The three big acquisitions – ACS and ExcellerateHRO, ADP and Workscape, and Aon and Hewitt – have recently closed.

As acquisition mania played out, many HRO deals were getting done, and this week, as the weather has finally, thankfully, started to cool, I’m taking a look at some of the deal activity over the long hot summer.

There were not a lot of announced deals in benefits administration, but a Hewitt summary indicates plenty of activity was still quietly going on. Hewitt won new awards across the span of benefits administration in the large and mid-market, including several in defined benefits and defined contributions. But the greatest activity was in health and welfare, and for point solutions like dependant audits and flex spend accounts.

While not necessarily matching North America in total contract value, the U.K. and Europe were also quite active in HRO. Logica was awarded a £10m payroll and pensions HRO contract extention by U.K’s Metropolitan Police, with new scope this time around including increases in employee and manager self services and electronic pay slips. And Midland HR won a deal for its iTrent HR platform including HR administration, employee and manager self-service, payroll, talent management and workforce planning.

In RPO, CPH won a contract with Opal Telephone, and Alexander Mann was awarded  a contract for recruitment and contingent labor by Cobhan. On the continent, HRO activity included HR administration and payroll deals by Reat and HR Access in the mid-market.

ADP parlayed existing payroll services for KAO, a Japan-based consumer products manafacturer, into extended HR administration and payroll services across Asia Pacific including China, Hong Kong, Indonesia, Malaysia, Philippines, Singapore, Taiwan, Thailand, Vietnam and Japan. In addition, ADP won a global managed payroll services contract with BT that will cover more than 40 countries in North America, Europe and Asia Pacific when fully implemented.

It was refreshing to see a spate of learning contract awards won by Expertus, General Physics, Intrepid and The Learning Associates. However, as most of the learning outsourcing activity was in the public sector, we still need to see more of an uptick in the private sector before we can say learning is fully on the road to recovery.

RPO maintained its lead position as the most active single service area, with the greatest increase in revenues and new contracts. RPO activity was highest in the U.S., followed by the U.K., and was spread nicely across providers including Alexander Mann, CPH, Kelly Services, Manpower, PeopleScout and SourceRight. Several of the awards were for contingent labor or combined RPO, with the contingent labor focuses indicating that employers are still cautious about a full return to permanent hires.

There were no announcements of the HRO mega-deals of yore, but it was very nice to see the increased activity levels across many HRO service lines and service providers. Now that the cooler weather of fall is here, we’ll  hopefully see an even more serious return to getting business done before the end of the year!

Linda Merritt, Research Director, HRO, NelsonHall

Don’t Rain on My HRO Parade

The HRO community deserves a break, and the latest NelsonHall HR Outsourcing Confidence Index is here to deliver with lots of good news. Strike up the band and let’s have a virtual HRO parade!

To gauge HRO confidence, we use a scale in which 100 equals no change and 200 means all participants are highly confident. Compared to the dearth of optimism at 115 in Q2 2009, the 3Q 2010 HRO Confidence Index is at a high of 168. HRO vendors stating they are much more confident in their HR outsourcing business increased from a dismal 10 percent to a buoyant 41 percent.

We have been reporting for some time that pipelines are filling and looking better, and that continues. And yet, providers’ financial results have not yet shown a logjam break in frozen decision-making and willingness to commit in many HRO service lines.

On the other hand, this quarter we finally see an upswing in contract value growth. In fact, we have a triple play of good news underway! HRO service providers are reporting increases in:

1. New contract activity
2. Scope expansion with existing clients
3. Volume in existing contracts

New contract activity is now outpacing increasing scope with existing clients. New deals signed, given the lag time before revenues flow, will take a while to show up in results. Volumes beginning to pick-up with existing clients will show up sooner in results, especially if vendors can gear up to increasing activity levels quickly and efficiently.

RPO and payroll continue to lead the parade to revenue growth recovery, with multi-process HRO also improving. While learning has been slow, its current 3.5 ranking in NelsonHall’s 3Q 2010 HRO Confidence Index indicates a much brighter outlook as compared to its score of 2.8 in Q4 2009.(Note that we use a scale of 1 – 5, with 5 being a strong increase.) 

Benefits administration outsourcing revenue growth expectations have been stable for several quarters around 3.5, but the outlook for pipeline growth is lower for benefits administration outsourcing than other HRO areas. Expected increases in health and welfare consulting should lead longer term to opportunities, but vendors are not seeing it yet. There may be short term distraction caused by the spate of mergers and alliances this year. ADP recently reported the successful acquisition of Workscape, now an ADP company, and Aon announced the leadership slate for the soon to be Aon Hewitt team.

Global delivery remains a factor in HRO growth in two ways. First, multi-country contracts, at 34 percent of deals, continue as organizations seek to standardize payroll and other HR processes. Also, acceptance of multi-shoring HRO continues. Onshore HRO delivery is still in the lead at 71 percent, but nearshore and offshore delivery are now 29 percent of HRO contract values.

People have parades for many reasons including celebration, commemoration and optimism. Our virtual parade is for optimism with a tad of celebration thrown in. Let’s save the full celebration parade for when the earnings results match the current high level of optimism.  Hmm, when and where do you think we should have a real HRO community parade?

Linda Merritt, Research Director, HRO, NelsonHall

Learning 2.0 Portals – From Buzz to Abundant Value to Increasing Innovation

In blogs earlier this year, I wrote about “The Buzz About Learning 2.0 Portals” and “The Abundant Value of Learning 2.0 Portals.” We’re now seeing providers building increasingly innovative components and capabilities into their learning portals, which can exponentially increase their value and usage.

For example, just yesterday Expertus announced it was recently awarded a virtual instructor-led training (ILT) contract by a large global software provider. Expertus will develop a virtual ILT program to train the client’s sales force on new products, and to educate technical sales architects. Delivered over the ExpertusOne social learning platform, components of the program include hosted live events around the world, live chat with international subject matter experts, hands-on labs, virtual classrooms, online proctors and technical support. And the client’s anticipated cost savings – through elimination of worldwide travel and events expenses – is up to $5 million. While these types of portals of course require a financial investment, such potential hefty cost savings provide justification.

Other examples:

• OCLC, a nonprofit, membership-based computer library service and research organization needed to bring together library staff and organizations around the world, and provide a venue that would allow them to engage in discussions, participate in groups, share content and engage in collaborative learning development. The solution it selected was Plateau’s Talent Gateway platform, which integrates social tools, content management, Plateau learning management, customer management and virtual meeting spaces. It’s enabling OCLC members to connect with colleagues across the library community using social tools, create custom content, join in conversations, create ad-hoc communities and learn relevant skills.

• Liberty Mutual is using Cornerstone OnDemand’s Cornerstone Connect to facilitate informal learning as part of the company’s front line management training program. Participants take part in an in-person, weeklong program, supported by supplemental online courses via Cornerstone’s learning management system. Using Cornerstone Connect, Liberty Mutual’s team has created a management community to maximize and extend the benefits of the training program. Components of the Cornerstone Connect platform include rich user profiles, status updates, live feed views, communities of practice, discussion boards, blogs, wikis, podcasts, rating and sharing of content, knowledge management, tag clouds and RSS feeds.

One of the common, and critical, capabilities across all these platforms – as well as those already offered or under development by other providers – is engagement. In an isolated e-learning environment, it’s all too easy for the mind to wander (“Did I remember to send that memo?” “Hum, I wonder if there’s any cake in the break room?”) and equally challenging to feel a sense of connection (“Is anyone else unclear about that point the instructor just made?” “Who can I ask, other than my boss?”) Social media capabilities such as discussion boards and live chats with peers and subject matter experts can significantly enhance engagement in, and the resulting value of, e-learning.

Expect to see an increase in uptake of Learning 2.0 portals that enable engagement via social media capabilities. The rapid deployment, learning enhancement and cost savings value prop is über compelling.

Gary Bragar, Lead HRO Analyst, NelsonHall