Learning Technology Evolves: Integrated Platforms Are Arriving
The enormous market for training and learning tools is very fragmented. Today there are more than 200 LMS vendors, more than 30 LXP vendors, and thousands of vendors who build collaboration tools, mobile learning tools, content development tools, and analytics tools. (Roughly 12% of the $240 Billion corporate training market is spent on tools.)
While each of these categories is filled with great vendors, something else is happening: a move from what I call “horizontal” to “vertical” or integrated learning platforms.
Some History: This Has Happened Before
If I go back to my early days in e-learning (circa 1998), the technology-based training market started this way. When the internet first began we found dozens of tools from companies like Macromedia, Trivantis, and others to help us cobble together web-based training. It was an exciting, innovative time (similar to now) when every new idea seemed good.
In the early 2000s, however, the market grew up. Companies became familiar with web-based courseware and decided they wanted a “virtual university” that integrated it all together. The result? The “integrated LMS” came to market.
Prior to this time, there was a robust market for “training management systems,” but these didn’t manage e-learning – so a new breed of LMS vendors was born. The early vendors were Docent and Saba, but soon enough all the LMS vendors (Learn.com, Pathlore, Plateau, others) went out and bought or built “vertical” solutions.
By “vertical” I mean the vendor has decided to put together a “stack” of solutions that address all parts of your learning needs, as opposed to a “horizontal” solution where they sell their slice of the problem to many different customers. It’s like selling “car radios” vs. “cars.” For a while, there was a big market for independent car radios (yes this used to be a big thing), but now it’s more or less integrated because the technology has evolved and matured.
During this time we saw Saba acquire Centra and a set of assessment tools. Docent acquired Click2Learn. And almost every LMS vendor started to build and buy content management systems, assessment tools, e-commerce software, and other related technology. All with a focus on building a “vertical” or end-to-end corporate training solution.
You know what happened next: the LMS market got stale and a new breed of learning experience, micro-learning, and adaptive learning tools was born. (Read more here.)
The new paradigm was different: LMS’s no longer fit the bill, we need continuous learning, micro-learning, and learning in the flow of work. Vendors like Pathgather, EdCast, Degreed, Fuse, Axonify, Bridge, and many others were born. And we ended up with a marketplace like this.
This is all great if you like building your own learning stack, but we’ve more or less reached the stage where L&D executives are fed up.
In most of my meetings with Chief Learning Officers today (and CHROs) they tell me “how do I get rid of all these vendors calling me all day?”
We’ve just about gone far enough: buyers are becoming fed up. Corporate training leaders don’t have the time to be “shopping” all the time, so they want more integrated solutions. And vendors are figuring this out.
The New Learning Stack
Now that we’re about 20+ years into the applications of the internet (and web-based education and training has been through a long journey), a new “technology stack” for L&D is starting to make sense. And it looks a bit like this (I’ve simplified it a lot).
This stack, as you can see, has many important elements – each part of the end-to-end learning experience. A modern corporate learning solution embraces all the types of content on the right, and includes all the elements in the stack, each being used for different types of employee development needs.
And note that I put the LMS at the bottom – as a less important part of the solution. While still needed, I believe the LMS systems of today are more likely to be integrated into the ERP or HCM platforms, and the more “experiential” parts of the system will be where the value is added. And this is where all the “platform integration” is starting to happen.
One way to think about this is to look at the picture below. I”m not trying to cover all vendors in all markets, but you can see that many of the learning platforms today are becoming more integrated or more “vertical.”
Example of More Integrated (or Vertical) Learning Platforms
Let me talk about Degreed, EdCast, Fuse Universal, 360Learning, Inkling, Bridge, CrossKnowledge, and Nomadic Learning as examples.
There are many examples of this trend, but let me just point out a few so you can see what I mean.
Degreed: Degreed just closed another $75M of funding (this company is going down as one of the most heavily funded firms in this market, with $40M of debt), to expand its growth. Now no longer satisfied to be an LXP company, Degreed is investing heavily in various forms of skills assessment to help companies deliver skills-driven learning. The company is now closely partnering with several LMS companies, and I believe it’s quite likely they buy an LMS next. Why? Their customers are looking at Degreed as an LXP platform and simply saying “I need to do much more.” (I’ll be explaining what Unilever and others are doing in followon articles.)
EdCast: EdCast’s knowledge cloud, which started as an LXP, is expanding through its Leapest acquisition to become a “full stack” learning solution that includes LMS and a vast library of content. Because EdCast started life with a broad goal of integrating knowledge and learning, the company is moving well beyond LXP to become an integrated corporate learning and knowledge platform.
Fuse Universal: Fuse is an innovative company that started with a mobile-first LXP-like learning system. Now the company builds learning communities, handles various forms of content development, and is building a highly scalable end-to-end AI-based delivery system for larger organizations. One of their clients uses Fuse to manage learning for all their hotels around Europe, so it is becoming an end-to-end platform.
360Learning: This company has built a fairly amazing end-to-end learning platform that focuses on helping anyone develop, publish, manage, and administer their own content. This entire enormous use case (helping individuals in your company share their knowledge with others) is a huge untapped market, and 360Learning includes tools to build content, understand and support communities, identify key learner needs, and much more. The company is growing explosively because it is an “end to end solution” not just a platform.
Inkling: Inkling, one of the biggest players in the market (but not as well known yet), started its life as a content and publishing system designed to publish beautiful online documents and websites with interactive graphics and a beautiful mobile and desktop interface. We looked at Inkling as a platform to run bersin.com and almost bought it (Deloitte had a contract with another vendor). They have now established themselves as an end-to-end solution that supports mobile and deskless learning at companies like McDonald’s, Taco Bell, Whole Foods and other high volume retail, hospitality, and manufacturing companies. The platform is quite extensive and does things no other tool can do well.
Bridge, the newest platform by Instructure, includes integrated career exploration, skills management, learning management, content management, content development, assessment, and a whole platform for peer to peer practice and mentoring. The company positions itself as an LMS, but more and more it looks like an integrated learning and career platform.
CrossKnowledge, a company that is now owned by Wiley, started life as a content company and also built a complete learning experience. Many think of CrossKnowledge as an LMS company, but in reality their strength is in their integrated learning experience which includes many of the capabilities of LXP, collaboration systems, and instructor facilitation.
Nomadic Learning: the company I use for the Josh Bersin Academy is an integrated content management, delivery, development, collaboration, and LXP in one. Nomadic doesn’t sell the platform as a standalone system but believe me it provides an integrated learning experience in a way you cannot build with standalone products. NovoEd is another company with a similar set of capabilities.
And there are many more examples to come…
Where The Market Is Going
I’m not saying that innovation is slowing down: quite the opposite.
Tools for VR, embedded micro-learning, intelligent search, mobile content development, and many forms of assessment and video authoring are everywhere. In fact, we are in one of the most exciting cycles of innovation on all levels of the “learning stack.”
But as I talk with many Chief Learning and Chief HR Officers, they all tell me the same thing. “Will you please help me sort all this out?”
Buyers are simply overloaded.
Some large companies (JP Morgan Chase and Visa, for example), have senior learning architects who can sort out these tools, test them, and bring them together into a solution.
But many companies are getting tired of being the “general contractors” for their learning experience, and they want to start buying “a complete house.” So vendors are becoming more integrated.
I like to think about it this way: in the early days of our country, people built their own homes. If you weren’t good with your hands you didn’t have a very good house, because there weren’t many integrated solutions to buy. But as the housing and construction industry matured, general contractors came to market, and today it’s almost unheard of to build your own house. Sure you can do it if you really want to, but it’s risky and often more expensive than you thought.
The same thing is happening now in this cycle of learning technology. Just as the “cottage industry” of e-learning tools collapsed in the early 2000s to become the LMS market, this “cottage industry” of micro-learning, LXP, and continuous learning tools is also starting to come together.
We are still in early days, but I think today buyers can be even more discriminating in their decisions, and it’s time to look for more integrated solutions in the market.
What Will Happen to the LMS Vendors
What will happen to Cornerstone, Saba, SumTotal, SuccessFactors, and all the LMS vendors (including Oracle, Workday Learning, and more)?
While these are well-funded companies with lots of R&D, I think you’ll find most of them are very committed to the LMS (bottom layers) of the stack, and few have the time or resources to build out the entire learning experience. Cornerstone has clearly decided to invest in the LXP layer, and SuccessFactors offers Jam, which is essentially an LXP-type product on top. But as you look at the middle layers of the stack, they haven’t had the time to focus in this area, so the jury’s out whether they build integrated learning experiences or not.
Most customers tell me they’ve spent a lot of money on their LMS and they’re trying to buy easier to use tools around it, so this is likely to be where the market will go.
Remember It’s The Experience That Matters
Remember, employees (your customers) will not use a fragmented, complicated experience to learn. Completion rates and satisfaction is driven by the elegance and simplicity of the complete learning experience. While you can try to build this yourself if you work hard enough, a new breed of “more integrated” learning platforms has started to arrive, so I encourage you to look around.
One of the largest financial services companies in the US was a pioneer in the early days of LXP – they built their entire digital academy around it. When I visited them a few years ago they told me “we’re ready to do away with this product as soon as we select our next LMS, because the LMS vendors we want all have LXPs of their own.”
This is the direction of the market. We’re still a few years away from massive consolidation, but the trend is clear: integrated learning platforms are here. I encourage you to check them out.