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

The Economy Will Rock, Let HRO Help You Roll With It!

The economic news continues to be as shaky and widespread as the East Coast earthquake this week in the U.S. The 5.8 quake was shaky with localized impacts, but it was not devastating. The older solid bedrock foundations under the East Coast mean that even a moderate earthquake can ring like a bell far and wide, which lessens the destructive impact overall.

The economic uncertainty will likely continue for some time and at some point we must all get on with business, even when there is some rocking and rolling. In my (non-financial expert) opinion, the economy is having an East Coast-style quake and is not facing the destructive seismic forces seen in 2008-2009. Companies able to tell the difference can gain an edge in the market while others panic and dither.

Talent management (TM) is about gaining and leveraging a competitive edge, whether it is in the form of recruiting, developing, or retaining talent. TM is a hot HRO topic and vendors large and small, software-only and full-BPO, and everyone in between are angling for a growing talent management footprint. Why? Because that is what they are hearing from surveys and directly from clients and prospects. That’s good news. Clients are once again recognizing the importance of TM and vendors are listening, investing, innovating, partnering, and acquiring more TM capabilities.

Our NelsonHall HRO analyst team just talked with several IBM Global Process HRO leaders including Mary Sue Rogers, General Manager of Global HR, Learning & Recruiting and John McGlone, Global Process Leader of Compensation and Benefits, on their TM point of view.  Part of our wide-range discussion was the infrastructure needed to support the tools and processes of TM. The underpinnings, like the impact of bedrock on earthquakes, have an integral role to play in the success of a TM program.

According to John, some look to “technology as the solve,” not understanding that it must work hand in glove with TM infrastructure, processes, and execution. TM strategy, policies, and consultation are all also important. TM is where all that is HR comes together and it is the perfect place to develop a dynamic balance of internal capabilities, a top-tier TM application (ERP module or specialty product) with HR outsourcing services that can provide and manage the talent and HR administrative infrastructure.

Another point we touched on with IBM is client maturity on the HR and TM journey. One size does not fit all. First, be sure the HRO vendor and TM products and services selected are appropriate for current use. Then, whether you have the luxury of building from scratch, or must get started with only modest changes to what you have, see that your HRO service provider has an applicable roadmap for development as business TM needs and capabilities change.

Don’t panic and dither. Rock and roll with HRO!

Linda Merritt, Research Analyst, HRO, NelsonHall