Professional Documents
Culture Documents
Josh Bersin
September, 2005
© Bersin & Associates
The Convergence between Learning and Performance Management Systems 2
Table of Contents
Table of Contents ................................................................. 2
Executive Summary.............................................................. 4
Overview ..................................................................................... 4
Business Drivers........................................................................ 17
Case Studies....................................................................... 38
Conclusions: ....................................................................... 41
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The Convergence between Learning and Performance Management Systems 3
About Us ............................................................................ 48
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The Convergence between Learning and Performance Management Systems 4
Executive Summary
Overview
This research report examines the emerging convergence between
Learning Management and Performance Management Systems and
defines a new category of HR applications we call Talent
Management. Information in this report was obtained by examining
trends and implementation practices in 552 different organizations.
The detailed methodology and demographics of the study are
described in Appendix A: Study Methodology and Demographics,
on page 42.
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The Convergence between Learning and Performance Management Systems 5
This broad set of application needs has made it difficult for HR and
Training executives to decide which systems to build or buy.
Although ERP vendors (primarily SAP and Oracle) sell integrated
suites, the suites still are missing pieces. As a result, most HR and
training organizations today have a wide range of manual
processes, internal systems, and vendor products that make up
their tapestry of HR systems.
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The Convergence between Learning and Performance Management Systems 6
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The Convergence between Learning and Performance Management Systems 7
Although all these applications work together, each of the two areas
has a different focus. HR Management focuses on HR processes
and resource planning: How do we run the employee part of the
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The Convergence between Learning and Performance Management Systems 8
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The Convergence between Learning and Performance Management Systems 9
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The Convergence between Learning and Performance Management Systems 10
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The Convergence between Learning and Performance Management Systems 11
HR View
Of the World
Training View
Of the World
Performance
Management
Skills & Line of Business
Competencies Performance Issues
1
Federated: We define the “federated” model of training in our best practices in
training organization study. Federated organizations have a central group (i.e., the
Federal Government) and decentralized groups (i.e., the State Governments).
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The Convergence between Learning and Performance Management Systems 12
The key areas where HR and Training work closely together are:
¾ Leadership Development
¾ Performance Management.
Each of these five areas has something key in common: they are
both development- and process-oriented. They focus on the
development of people, but this must be done at a corporate-wide
level for consistency and broad adoption. We call these functions
the “Learning & Development Domain.”
Our best practices research finds that in these five areas, Training
and HR professionals work closely together. In the latter,
Performance Management, HR tends to take the lead.
2
The High Impact Learning Organization, an in-depth study of best practices in the
management and operations of corporate training. Available to research members or
for purchase at http://www.bersin.com/research/high_impact.asp.
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The Convergence between Learning and Performance Management Systems 13
20%
9%
553 responses
553 responses
© Bersin & Associates May, 2005
May, 2005
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The Convergence between Learning and Performance Management Systems 14
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The Convergence between Learning and Performance Management Systems 15
Alignment at Aetna
Assessment
Scorecards
Development Plans
Aetna Business Strategy Tool
Technology Competency
Map
3
The Aetna integrated performance management case study is available to Research
Members at http://www.elearningresearch.com.
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The Convergence between Learning and Performance Management Systems 16
Defining an LMS
Learning Management Systems are a well established corporate
application for the management of training, e-learning, compliance,
customer education, and corporate universities. Our research tells
us that the LMS market in 2005 is approximately $450 million and
growing at 15-20% per year.
E-Learning
E-LearningPlatform
Platform
1980’
1980’s Make
AICC MakeE-Learning
E-LearningPossible
Possible
1990’
1990’s AICC Make
MakeE-Learning
E-LearningEasy
Easy
Training
TrainingManagement
ManagementSystems:
Systems:
Automate
Automatethe
theProcess
Processof
ofInstructor-
Instructor-Led Training
Instructor-Led Training
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The Convergence between Learning and Performance Management Systems 17
Business Drivers
The business drivers for an LMS implementation continue to be
focused on administration and efficiency. LMS typically are
purchased by training organizations to help them manage the
logistics, enrollment, tracking, and measurement of the training
function. These functions are very difficult to do by hand and often
are business critical for compliance applications, product launches,
new company initiatives, and many other applications.
Manage Training Manage and Consolidate Align Training Implement SkillsReduce Training Meet Regulatory
Administration Deploy E- Training Processes and Costs Compliance
Learning Information Competency
Mgt
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The Convergence between Learning and Performance Management Systems 18
There also are many strategic issues driving the decision to buy and
implement an LMS: without an LMS, most organizations cannot tell
how much money they are spending on training; they cannot
measure and report on critical compliance initiatives; and they
cannot deliver skills and competency-based programs.
9%
17%
4%
7%
1%
12% 5%
Note that the largest player in this chart (the blue 21% player) is
“other” – smaller vendors who have 20-30 clients or fewer (for
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The Convergence between Learning and Performance Management Systems 19
detailed data, please read our LMS 2004 and 2005 Market
Research4).
Implementation Realities
When organizations implement an LMS, they quickly find that one of
the biggest challenges is data integration. The LMS must have a
consistent set of information about every employee (or every
customer). The LMS must have information about each learner’s
job role, location, language, and where they fit in the organizational
hierarchy.
Corporate
University
European
Manufacturing
Sales
Plant
Enterprise Enterprise
LMS HRMS
Central
CentralAdministration
Administration
Course
CourseCatalog
Catalog Payroll
Payroll
Reporting
Reportingand
andAnalysis
Analysis Organization
OrganizationHierarchy
Hierarchy
“System
“Systemof ofRecord”
Record” Accounting
AccountingCodes
Codes
Integrated
Integratedwith
withHR
HR “System
“SystemofofRecord”
Record”
Employees
Employeesand
andContractors
Contractors
4
LMS 2004-2005: Facts, Practical Analysis, and Trends for Corporate Buyers,
Vendors, and Consultants. Available to research members and for purchase at
http://store.bersinassociates.com/lms-2004.html.
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The Convergence between Learning and Performance Management Systems 20
As the Figure 10 shows, typically the LMS gets this information from
some HR Management System (HRMS), which is the system of
record for employees. The HRMS houses business critical
information, such as employee start date, salary level, benefits, etc.
It usually is a legacy system that has been in place for some time.
The LMS only needs a subset of this information, but it must be
kept consistent.
Integrated Data:
How Important is HR Integration?
Very
Important,
40%
Critical, 28%
Not Somewhat
Important, Important,
16% 16%
Study conducted in May 2004, 10,000+ Surveys
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50%
40%
30%
20%
10%
0%
Performance Leadership Succession Change Talent Assessment Metrics Recognition
Management Development Planning Management Retention
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The Convergence between Learning and Performance Management Systems 23
40%
30%
20%
10%
0%
Alignm ent w ith Developm ent Achieve Pay for Increase Allocate Skills Prom ote the Achieve Other
Corporate Plans for Financial Goals Perform ance Retention of to Right Jobs Best Metrics
553 Responses Goals Im provem ent Best
553Managers
HR Responses
HR Managers
Worldwide
Worldwide
May 2005
May 2005
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80%
73%
70%
60%
50%
% of Total People
40% 38%
30%
20%
12%
10% 8%
7%
2%
0%
Goals aligned Annual Creating & Creating & Assessing Assessing Assessing job Assessing job Define EPM-
with corporate performance tracking tracking skills and employee performance performance Other
goals review employee measurable competencies peformance based on based on peer
development goals on a team business reviews
plans metrics
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Weaknesses in HR Today
High What
Whatare
arethe
theHR
HRfunctional
50% HighGrowth
Growth functional
Areas areas
areaswhich
whichyou
youfeel
feelneed
need
Areas
45% most
most improvementininyour
improvement your
organization?
organization?
40%
35%
30%
25%
20%
15%
10%
5%
0%
Skills & Succession Perform ance Leadership Learning E-Learning Com pensation Payroll &
Com petency Mgt Planning Managem ent Training Managem ent Planning Benefits
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Adoption of PM Today
Fewer than 1/3 of
Fewer than 1/3 of
organizations have
organizations have Enterprise
an enterprise-wide
an enterprise-wide
program
program
Wide,
Enterprise
Somewhat
Wide Adoption
Adopted
32%
28%
No Guidelines
or Standards
7%
Some
Guidelines, No
Standards,
Standards
Vary
13%
20%
553 Responses
553Managers
HR Responses
HR Managers
Worldwide
Worldwide
May 2005
May 2005
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None
4%
Little
10%
Somewhat Spotty
31%
553 Responses
553Managers
HR Responses
HR Managers
Worldwide
Worldwide
May 2005
May 2005
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PM Systems in Use
Paper Based
58%
In-house
Developed
SW
24%
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Very Satisfied,
15.8%
Somewhat
Unsatisfied, Satisfied,
1.6% 35.8%
Not Very,
10.5%
553 Responses
553Managers
HR Responses
HR Managers
Worldwide
Worldwide
May 2005
May 2005
What this tells us is that the system itself is less important than the
automation process. When implementing these systems companies
see great improvements in productivity and access to data, thereby
making them wonder how they lived with paper-based processes for
so long. As we continue this research, and the number of
automated systems grows, it will be interesting to see if these
satisfaction levels stay as high.
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The Convergence between Learning and Performance Management Systems 31
8% 8%
6%
4%
Ease of Use Flexibility in Integrate w ith Better m anage Features for Better Skills & More Consistent
Perform ance LMS self Review s Com petencies Usage
Planning developm ent
553 Responses
553Managers
HR Responses
HR Managers
Worldwide
Worldwide
May 2005
May 2005
Ease of Use
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40%
35% 34%
32%
30% 28%
25% 24%
20%
18%
15%
15% 14%
10%
10%
7%
6%
5%
0%
Employees could Managers could Executives could Training Training Data about Managers and Managers could Employees could Managers could
more easily more easily see how training managers could managers could people would be employees would view more quickly and more easily
create assign impacts see what develop better integrated have a single assessments easily identify identify
development development performance programs are in programs that for workforce place to go for all and better view and take the right candidates for
plans during plans to demand directly meet planning development employee training promotion
performance employees performance processes proficiency
planning needs
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Compensation
Employee
Skills and Competency
Performance
Management Succession
Management
Planning
Some Standard Performance Plan Workforce Analysis
Skills and Competencies Performance Assessment Workforce Planning
Many custom Development Plan
Assessment
Engine
Completions
Certifications
Scores
Course Catalog
Learning
Training
Management
E-Learning
Content
Competencies Mapped
to Learning Programs Assessment
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Natural Convergence HR
HRManagement
Management
Domain
Domain
Recruitment
Hiring
Job Bank
Compensation
Employee
Skills and Competency
Performance
Management Succession
Management
Planning
Some Standard Performance Plan
Skills and Competencies Performance Assessment Workforce Analysis
Many custom Development Plan Workforce Planning
Assessment
Engine
Completions
Certifications
Scores
Course Catalog
Learning
Learningand
and
Development
Development Learning
or Talent Management
or Talent Management Training
Management
Domain
Domain E-Learning
Content
Competencies Mapped
to Learning Programs Assessment
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Integrated Workflow
Integrated HR Data
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Case Studies
The following brief case studies describe examples of companies
that have built, or are building, integrated Learning and
Performance Management solutions. These are not intended to be
detailed case studies but rather examples of why organizations see
the value of a truly integrated solution.
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The company searched for solutions and the primary driver for a
new platform was Learning Management. Prior to implementation
of a new integrated platform, the company used spreadsheets, a
mainframe system, and Registrar, a PC-based system. The
organization has hundreds of training people in a decentralized
organizational model.
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Conclusions:
In most organizations today, the Performance Management and
Learning processes are owned by separate groups. But in many
organizations, there are major forces bringing them together.
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5
Available to Research Members or for purchase at
http://store.bersinassociates.com/governance.html.
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50,000 or more
employees
< 100 Employees
12%
18%
20,000-49,999
employees
10%
10,000-19,999
employees
9%
100-999 employees
5,000-9,999 27%
employees
8%
1,000-4,999
employees
16%
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Level of Respondents
Vice President
10%
Individual
Contributor
7%
Manager
53%
Director
30%
Other
14%
Learning &
Development
39%
HR
47%
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Respondents by Industry
Organization Industry-
Other
17% Technology
Marketing/Advertising/ 13%
Entertainment
2%
Pharmaceuticals
3% Professional Services
Government (Federal 14%
& Military)
3%
Healthcare
3%
Government
(State/Local) Education Manufacturing
4% 13%
5%
Transportation/Utilities Banking/Finance/
6% Insurance
Retail/Wholesale/ 10%
Distribution
7%
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About Us
Bersin & Associates is the only research and consulting firm solely
focused on What Works™ enterprise learning and human capital
management research. With more than 20 years of experience in
e-learning, training, and enterprise technology, Bersin & Associates
provides a wide range of services, including market research; best
practices; vendor and product analysis; corporate workshops;
corporate implementation plans; and sales and marketing
programs. Some of Bersin & Associates innovations include a
complete methodology for learning management system (LMS)
selection and application usage, an end-to-end architecture and
solution for training analytics, and one of the industry’s largest
research studies on blended learning implementations.
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