Xerox focused on the importance of ensuring the right job fit for candidates. Aside from reducing recruiting time and improving retention, ensuring the right job fit is important from a cost perspective. Data revealed that the cost of a bad hire can be ~30% of an employee’s first year salary, and to replace an employee can cost ~150% of salary.

Ideally, companies should be using assessments to determine both job fit and cultural fit. However, only 30% of organizations use cultural fit questions when assessing candidates, which is surprising, as poor cultural fit is one of the top reasons why employees leave. It is important for candidates to know about the values of their prospective employer, their views on work-life balance, and so on.

An increasing number of companies have contracted to evaluate candidates prior to onboarding using Massive Open Online Courses (MOOCs) and ~75% of organizations using MOOCS say they have had a positive impact on hiring and recruiting. However, the downside of MOOCs is that completion rates are very low. Also popular are Small Private Online Courses (SPOCs), but whether companies use MOOCs, SPOCs, or other forms of candidate evaluation, the fact remains that companies can’t afford to make wrong hiring decisions. Allowing candidates to self-opt out of the application process during assessment is an effective way of enabling hiring managers to focus their time on more suitable candidates and improve quality of hire.

RPS and K4 presented data to further support the case that organizations need to hire the right talent the first time. The global workforce is aging, and more people are retiring: the median age of the workforce increased from 39.4 years in 2000 to 42.3 years in 2012. However, at the same time, tenure has decreased from 4.6 years in 2000 to 3.5 years in 2012, with millennial tenure at only 2.3 years.

While there were ~5.6 million unfilled American jobs at year-end 2015, 41% of organizations report that the labor pool does not meet their hiring needs. So, in addition to needing to hire the right talent, it is imperative to ensure an effective onboarding process to retain talent at the start. However, 30% of organizations rate their onboarding process as ineffective, and 54% rate onboarding as only somewhat effective. But for those organizations who rate onboarding as effective, 84% say best practices include instructor-led training, shadowing, and short-form content. In summary, effective learning starts at the very beginning of the employee life cycle with pre-employment, then progresses to onboarding, knowledge capture, and knowledge transfer.

Given the skill set shortages faced by many companies, there will need to be tighter linkage between recruiting and learning to ensure that any new hire skill gaps are addressed by immediate learning plans. I will look more closely at the connection between recruiting and learning in an upcoming blog.

NelsonHall’s most recent learning BPO (LBPO) market analysis reveals the following are top drivers for LBPO:

• Cost effectiveness and efficiency. It may not always be the number one reason why clients outsource learning, but it is one of the top drivers for ~70% of buyers. Clients are looking to provide learning services that are better and less expensive than they can provide internally and are also looking for the flexibility of having a variable cost structure
• Talent development to improve workforce capability and performance. Clients are looking to improve employee skill sets, including management and leadership skills. As companies increase their hiring and baby boomers are retiring (~10k people per day in the U.S.) clients are looking to  develop skill sets internally and ensure knowledge transfer of those leaving the workforce
• Client realization that while they need to invest in learning again, they no longer have the capability and are unwilling to reinvest internally
• Improved business results and ROI. Through investments in learning, clients are looking for improved productivity and faster speed to market
• Clients are seeking increased levels of innovation, including in technology, delivery of services and process improvements. A number of clients have changed vendors for reasons including the need for more innovation
• Need to focus on more strategic objectives. The learning organization is not a core competency of most companies and clients are looking to reduce their administrative burden to focus on top business priorities including talent management
• Consolidation and centralization of multiple learning organizations within the same company
• Development of a social and more collaborative learning strategy.

An example of a learning outsourcing contract that reflects several of these key drivers is KnowledgePool’s £3m, three-year learning services contract award by a U.K. insurance company this month. KnowledgePool will provide Managed Service Provider (MSP) services and manage all external learning for the client's 13,900 employees in the U.K. MSP services will include:

• Sourcing
• Evaluating
• Administering
• Managing

Further services provided by KnowledgePool include:

• Independent training procurement, including consistent terms and preferential rates
• Learning administration
• Technology, including people and processes for data reporting
• Advice and guidance to utilize informal and blended learning
• Learning analytics.

In addition to cost savings, maximizing its ROI, and improved learning to improve employee performance, a key objective for the insurance company is to free up its in-house learning and development team to focus on its' more value-added and strategic objectives.

What will be the leading driver for learning outsourcing going forward? In 2010, talent development was ranked number eight amongst the reasons for outsourcing learning, in 2012 it moved to number three, and in 2014 it reached the number two spot. Talent development shows every sign of becoming the No. 1 reason for outsourcing learning in 2015 and beyond.

NelsonHall has recently begun its sixth global LBPO market analysis, targeted for completion by summer 2015, and will include the very latest analysis of drivers for LBPO.

2014 was a busy year for HRO with ~60 partnerships, mergers and acquisitions combined. We now take a look at what to expect in 2015 and beyond for each HRO service line, including service offerings, market developments, and growth.

MPHRO driven by continued shift to cloud-based platforms

• The Multi-Process HRO (MPHRO) market will grow with a mid-single digit CAAGR through 2018
• In terms of revenue, North America will be the largest region, and LATAM will grow the fastest
• Offerings will continue to be structured around a core model, including payroll and HR administration; benefits and recruitment services will continue to be the most popular add-ons
• Workday use will increase in MPHRO contracts; other cloud-based platforms such as Employee Central will penetrate as well. Momentum among existing MPRHO clients for cloud-based platforms will pick-up significantly by 2017
• Partnership activity will far exceed acquisitions, with partnerships primarily focused on cloud-based platforms and analytics (in 2014 ~3/4 of all HRO contracts were platform-based, of which the majority were cloud-based)
• The proportion of mid-market clients will outnumber large market activity by 2016 (in 2014 the mid-market represented 45% of the market, up from 35% in 2012)
• Demand for end-to-end MPHRO deals will be almost non-existent, as buyers continue to seek specialists for some of their services (e.g. learning) and reduce risk by not having one vendor provide all HRO services.

Benefits Administration exchange offerings will be key

• The benefits administration market will grow at an upper single digit CAAGR through 2018, with the majority of activity coming from the private sector
• The U.S. market will be driven by a need to control costs and be compliant with legislation; the U.K. market will be driven by auto-enrolment legislation
• Within Health & Welfare (H&W) services, private health insurance exchanges, reimbursement account admin, and leave of absence offerings will grow the fastest through 2018
• The main emphasis for vendors will be to develop or enhance exchange offerings (e.g. launching an exchange geared towards the mid-market, adding extended lines of coverage); other efforts will focus on enhancing existing Employer Shared Responsibility offerings
• Technology updates will continue to focus around expanding portals with additional features, and improving the user experience, in an effort to further engage participants
• Multi-country benefits admin activity will take one of two approaches: leveraging existing benefits brokerage and consulting relationships, or focusing exclusively on a technology platform.

Learning key to attraction, development and retention of talent

• The Learning BPO (LBPO) market will grow at mid-high single digit CAAGR through 2018, with Government being the largest sector with growth led by Healthcare
• Selective LBPO contracts will continue to outpace full LBPO, led by content development, including the conversion of instructor-led training (ILT) to e-learning
• Client learning spend will accelerate for job skill training and professional development for purposes of attraction, development and retention of talent
• Vendors will continue to strengthen and integrate their talent management service and technology offerings with learning, both organically and via M&As and partnerships
• Clients will seek the help of LBPO providers to select and implement social learning platforms. Vendors who can help clients monitor and measure their effectiveness will have a competitive advantage
• Vendors will explore adding Corporate Massive Open Online Courses (MOOC) capability as clients seek to further reduce costs and reach a wider net of learners
• E-learning will continue to exceed ILT, though ILT remains important, including for hands-on learning and role-playing, e.g. performance management.

Payroll outsourcing driven by multi-country and platform integration

• The payroll market will show solid mid-single digit global growth. Primary growth is driven by demand for multi-country services and for integrated HCM/payroll cloud integration and/or interfaces
• There will be increasing uptake of employee access to payroll information via mobile, particularly in the U.S. Half of clients globally have self-service, and access pay statements online
• Payroll consolidation will continue to support geographical expansions
• Payroll services will develop by greater focus on technology and automation, including integrating with HR-cloud offerings and using platform-based outsourcing
• Retail, manufacturing, and financial services will continue to be the largest purchasers of payroll services
• Cost and compliance will remain fundamentally important requirements of payroll outsourcing.

RPO and MSP (Contingent Workforce Outsourcing) the fastest growing HRO services

• RPO and MSP are the fastest growing HRO services, expected to continue with mid-teen CAAGR through 2019, in a market driven by increased demand for talent
• Vendor consolidation and partnerships will continue to expand into new geographies to meet demand for global RPO / MSP services
• In the candidate-centric market, services will develop to support greater capability in analytics, improved visibility of labor market supply data, and workforce planning processes to address growing talent shortages. Candidate engagement and a streamlined process will remain a fundamental focus
• Technologies to support mobile marketing and video interviewing will be increasingly popular
• Vendors will continue to invest in onboarding services that go beyond the initial hire to support year 1 retention, and are expected to play a larger role in recommending employee progression and career advice for candidates to support retention
• Contingent workforce management services will grow in Statement of Work (SOW) programs and direct sourcing services to ~28% by 2018
• Requirements for diversity sourcing will be reinvigorated following the new legislation in the U.S. on veteran hiring
• Blended RPO / MSP services will increase in adoption, driven by a focus on developing optimal workforce strategies and bringing greater value to engagements through single governance and reporting and broader analytical insights on the total workforce.

We look forward to an exciting year!

Amy Gurchensky, Liz Rennie, Gary Bragar

Intrepid Learning Solutions brings in capabilities that include:

• Consulting services, including development of learning strategies, measuring their effectiveness and benchmarking 
• Course curriculum design and development, for a variety of programs including IT training, leadership development and products and services education
• Instructors, trainers and facilitators to provide classroom instruction
• Administration, including logistics to ensure timeliness and effectiveness of instruction.

Though the acquisition does not include Intrepid’s cloud-based learning technology, which will continue under the Intrepid Learning brand after closing, clients will have access to it via the establishment of a strategic partnership between Xerox and Intrepid Learning Inc. The technology is Intrepid Agile, which includes the Learning Hub. The Hub hosts curricula that can be used during training sessions and leveraged on‐the‐job for ongoing action planning, assessment and performance support. It also includes Intrepid Agile corporate MOOC (massive open online courses) for corporations which NelsonHall expects to be a key growth service offering.

Via the partnership alliance, clients will have access to Xerox’s e-learning, consulting, administration and classroom training programs and the aforementioned Intrepid Learning, Inc. technology. Intrepid Learning, Inc. will have access to Xerox's LBPO services for clients looking for more than technology only.

Intrepid Learning's core learning BPO (LBPO) service offerings span delivery, content design and development and administration and technical support. Intrepid Learning provides learning delivery across all delivery modes, with around two thirds instructor‐led classroom training (ILT) and one third e‐learning modes, of which is a mixture of web-based training and virtual instructor-led training (VLT). 

A recent focus has been helping its clients improve engagement and retention of talent with the provision of:

• Leadership courses
• Onboarding programs
• Sales enablement courses and programs
• Performance management.

Intrepid Learning brings to Xerox a number of referenceable brand name clients. It has historically focused on North America, and had been looking to expand globally, including into Europe, where Xerox generates more than a quarter of its LBPO revenues.

Intrepid Learning will complement and strengthen Xerox's service offerings, also its target markets, in particular the manufacturing sector. And Intrepid Learning's 260 employees transferring to Xerox, which will continue to operate from their Seattle and Mukilteo, Washington locations, will have expanded career opportunities working for a larger company (Xerox Learning Services has >900 employees globally).

Xerox is one of the top five LBPO providers in the U.S. Intrepid Learning Solutions is in the top ten. This acquisition will further strengthen Xerox's presence in the U.S.

The Shifting Gears: Automotive Technician Training Program, is a multi-year partnership between Raytheon, GM and the U.S. Army. The training, conducted by Raytheon Professional Services (RPS), is a customized 12 weeks program with an on-base technician training curriculum that includes classroom, online and hands-on technical training. The program commences in August at Fort Hood in Texas.

After graduation veterans receive career counseling, job placement recommendations and employment assistance from Army centers and then have access to available GM technician jobs.

In addition to the Shifting Gears program, eligible veterans are provided free access to web-based training programs via GM's Service Technical College.

Raytheon Professional Services has been providing training to GM globally for over 15 years and also helped to establish the GM Service Technical College. Earlier this year RPS partnered with the Universal Technical Institute to launch the First GM technician career training program. RPS created the partnership to develop a pipeline of talent to meet demand at GM for the hiring of its auto service technicians.

This is an important initiative and a win-win for all parties involved, most importantly for returning U.S. military. It is a good example of how innovation and creativity can be used in outsourcing, in this case, via partnering, to help meet client business needs, while helping those who need to find jobs. Per the U.S. Bureau of Labor Statistics, the 2013 unemployment rate for veterans who served on active duty in the U.S. Armed Forces was 9.0%. This compares with an overall 6.2% U.S. unemployment rate announced August 1, 2014.

Based on interviews with LBPO clients across North America, Europe and Asia Pacific, below is a summation of potential benefits, their immediate importance, client satisfaction, the delta of the aforementioned, and future importance:

Based on the above data, in terms of current importance, vendors are meeting and exceeding client expectations except for measuring learning effectiveness & analytics. Measuring learning effectiveness and analytics increases in future importance for a delta of -15% from current levels of satisfaction & should be a top priority of vendors.

Areas where vendors are doing well and should continue strong emphasis include:

• Linking learning to talent management, which needs to continue as an area of focus as future importance increases 9%
• Employee self-service, which increases in importance 10% for a delta of -7% from current satisfaction levels
• Cost savings, though strong in satisfaction, continues to be a high priority.

The LBPO tool is available to NelsonHall clients at http://research.nelson-hall.com/sourcing-expertise/hr-outsourcing/ and is also available for a limited period free-of-charge to strategic sourcing managers. The tool covers a number of learning business situations including organizations seeking talent development, learning process transformation, cost reduction and multi-country learning.

Twenty-one LBPO vendors are included in NEAT for NelsonHall’s “speed-to-source” initiative.  The NEAT tool sits at the front-end of the vendor screening process and consists of a two-axis model: assessing vendors against their “ability to deliver immediate benefit” to buy-side organizations and their “ability to meet client future requirements”.

The NEAT analyses themselves are based on a combination of vendor and client interviews. The vendors are scored against a wide range of criteria, establishing a number of scenarios, each with different weightings to represent a different business situation or client business need.

To add further value in speeding up the sourcing process clients are able to input their own weightings and tailor the tool to their requirements. So they might say:  “This set of weightings for this business need looks about right to me but I want to place more emphasis here". With this interactive tool, they can tailor the weightings to meet their own specific sourcing requirements.

1. Reaction; evaluation about how the participants felt about their learning experience including course feedback forms and comments from participants including through communities
2. Learning; evaluation of the increase in knowledge after the participants learning experience including pre-post course test scoring and feedback in performance reviews and appraisals
3. Behavior; evaluation of applied learning through observation of on-the-job behavior including from customer feedback and peer review
4. Business results; evaluation of effect on the business including financial results and customer satisfaction

Utilization of Kirkpatrick analytics to measure business results is important for several reasons, including:

• Being able to demonstrate the value of learning programs and to receive future budget allocation
• Reducing wastage of ineffective learning
• Improving content design to enhance the employee learning experience

Learning services providers continue to show the most mature analytics processes of all HR services.

• For a multinational consumer goods company, Accenture helped increase sales via development of a training campaign to address slow sales growth, market share and brand penetration in China. The campaign resulted in a ~$50m increase in sales
• For a U.S. headquartered aerospace and defense provider with 80k employees globally, Raytheon Professional Services, using 6 sigma training, increased sales per employee from $175k to nearly $250k, +43%

Some business metrics are about reducing costs, rather than increasing sales:

• For a German bank needing to reduce 3rd party vendor costs by 15% and enable key personnel to focus on higher value activities, IBM improved rate cards, renegotiated contract terms and performed vendor rationalization; resulting in a 23% savings
• For a metals and mining client’s IT learning group, Talent2 developed standard templates, updated and validated ~2,000 core materials to be common, resulting in 19% less “how to” calls to the helpdesk.

Vendors continue to make investments in analytics:

• Aon Hewitt and Xerox partnering with Knowledge Advisors to enhance their analytics offering and help clients improve learning effectiveness and business impact
• GP Strategies acquired the Effective-People and Effective-Learning companies in Denmark

There are numerous examples of improved results, but there is still a long way to go. Beyond Kirkpatrick level 1, deployment and utilization by clients of levels 2-4 decline each phase. All vendors offer levels 1-4 but there is variation. Some offer levels 1-3 at no additional charge, with level 4 contracted separately or on a project basis. Others offer 1-4 at no additional charge.

• Xerox finds most companies will do level 1, some will use level 2 and fewer use levels 3 and 4 due to cost and time to measure on the job behavior and business results
• Similarly, Talent2 finds utilization rates by clients at around Level 1: 100%, Level 2: 80%, Level 3: 15%, Level 4 <10%

NelsonHall believes that utilization seen by Talent2 and Xerox are consistent across LBPO, with Level 2 Learning closer to ~50%.
   
Per NelsonHall’s Q4 2013 Learning BPO market analysis, analytics capability is among the key vendor selection criteria. A major challenge for vendors is not just providing analytics as part of the service but getting clients to take the extra step and measure business impact. Clients need to take ownership and make the investment to measure impact to the business, which in addition to job skills and employee development, is the purpose of training employees!

GP Strategies is also supporting some of its U.S. headquartered clients in their global expansion. One example is Cigna Healthcare, which has been a Learning BPO client for six years. Cigna began its contract in the U.S. and expanded to countries including Korea, China and the Philippines. As for future global expansion, prospects include an existing $10m p.a. revenue U.S. client that is considering expansion into Canada and Europe.

In the past six months GP Strategies has established 14 new legal entities in countries in EMEA, Asia and Latin America. Its latest legal entity was established in April in the Philippines. In particular, GP Strategies is seeking to grow in Asia Pacific. Upon GP Strategies acquisition of Blessing White in October 2012, in 2013 the company began selling leadership training into its client-base, delivered via Blessing White.

It appears that GP Strategies is now moving on from the phase of driving international expansion by inorganic growth. CEO Scott Greenberg recently stated further acquisition activity has been put on the back burner for a while while it focuses on deployment of new clients.

Consistent with NelsonHall’s research findings, clients are looking for vendors with global learning capability for reasons that include cost reduction, compliance, increased efficiency and consistency.

Expect GP Strategies to achieve organic revenue growth in Q2 2014 between 12% and the low teens.

When IBM acquired Kenexa for $1.3bn in December 2012 (with Kenexa integrated into IBM’s Software Group and operationally aligned to IBM GPS), much was written at the time of how this would strengthen IBM's Smarter Workforce strategic initiative by creating an integrated software platform across human capital management, analytics and social technologies. 

Though Kenexa certainly strengthens IBM’s technology offering, as I wrote at the time Kenexa has also strengthened IBM’s talent management services capabilities around consulting, RPO, and advisory services around employee engagement and leadership development.

Per the theme of the conference, in order to have an energized workforce you need to have an engaged workforce, which stems from an organization’s leadership. As evidenced by several client examples, Kenexa has strenghened IBM's ability to improve employee engagement. 

The Kenexa conference featured a session of how Kenexa helped seven clients get smarter about their workforces of which six described improving employee engagement:

• Giant Eagle, leveraged assessments to improve recruiting for ~11-12k hires per year by reducing the workload of reviewing 250k candidate applications per year. Kenexa assessments for cultural fit screened out 30% of the applications.  Results included a 12% decrease in time to fill in the first 6 months, with a 25% decrease after 12 months. There was also a 10 point increase in hiring manager satisfaction
• Pizza Hut wanted to improve the ability of its leaders to engage teams and develop managers. Kenexa helped by:
  • Studying the client’s best leaders to find out what they do every day to get results
  • Identifying key traits that predict candidate success
  • Connecting people with competency models and right positions
  • Building a framework for selection, development and performance and then assessing  and measuring potential
• The Hartford, used Kenexa surveys. Employee engagement results went up 8% in 1 year, with talent development increasing 14% with an 88% response rate
• Monsanto, uses Kenexa organizational survey and engagement survey tools. Kenexa also helped to identify attributes of top leaders and select the right leaders
• Eat’n Park, has used Kenexa to do employee engagement surveys since 2006. Now includes engagement in its incentive plan and has moved the survey to the Fall to coincide with the compensation cycle
• Burlington Stores, uses Kenexa to conduct engagement surveys and Kenexa is in the process of providing recommendations for improvement
• Caterpillar, has used Kenexa for engagement surveys since 2001. Last year implemented its first global engagement survey to include demographic data for its 70k participants, which uncovered previously unknown barriers to engagement. An employee opinion survey was then launched which was a leading indicator of business results and profit.

There were several RPO sessions where clients described their outsourcing journey with Kenexa. Kenexa was a significant boost to IBM’s standalone RPO business. Though IBM has been providing standalone RPO to GM for several years, up until Kenexa, RPO was primarily provided with IBM’s MPHRO services. Kenexa brought in some large global RPO clients including Eli Lilly, Baker Hughes and Ford. Per NelsonHall’s January 2014 RPO market analysis, in terms of revenue, Kenexa, an IBM company, is the largest RPO provider in Latin America and in the top 5 in North America, Asia Pacific and EMEA (excluding the U.K.). For 2014 Kenexa IBM has a strong RPO pipeline including a couple of large global prospects. To enable growth investments are being made including in employer branding.  

General Conference

Havas Worldwide, talked about the implications of workers no longer staying with the same company for life. Lessons include:

• Culture wins, i.e. how you feel at work
• Command and control is obsolete, have to trust people
• Be flexible, one size does not fit all
• Move people around and across the organization, cross pollenate talent
• Don’t be stingy with rewards and recognition, the #1 reason people leave jobs
• Support a healthy work-life balance
• Boost career trajectories, not just on the job training but career development, e.g. send to conferences. Interesting employees become interested employees
• Being the best at one thing is no longer enough
• Hire for passion
• Reward failure (a successful try)
• Build a growth culture
• Stay curious – if think you have it all figured out you are doomed, need to keep employees learning and they will come to you with new ideas, etc.

AMC, which serves 200m guests per year, is in an industry where turnover rates of 200% are common.  A key lesson about recruitment was, to quote Red Auerbach “if you hire the wrong person for the job, all the fancy management techniques in the world won’t help you”. After it deployed a Kenexa screening tool, turnover reduced from 200% within a few years to 90%, with guest satisfaction improving by 25%, which correlated directly to employee productivity and profitability. Kenexa also identified common key talent in the client’s top general managers. Where GMs were in the highly recommended engagement survey rating, unit level cash flows were up 18%, and concession productivity $20 per hour per employee higher than other locations, equating to $300k per location on an annual basis.

Scott Adams, creator of Dilbert offered a few pearls of wisdom, including having complementary skills improves your odds (e.g. he is not the best artist or writer or comedian but has combined complementary skills), and having a positive attitude widens your field of perception.

Summary

During the past year IBM has seen an increase in the number of requests from clients to help improve their culture, including engagement and leadership development. As evidenced by its clients at the conference, Kenexa has complemented and strengthened IBM’s talent management capability.

Pre-acquisition, turnover rates at Kenexa were historically low at around 8% and they have decreased post acquisition, providing further evidence of walking the talk.

The Learning business process outsourcing BPO tool is available to NelsonHall clients at http://research.nelson-hall.com/sourcing-expertise/hr-outsourcing/ and is also available for a limited period free-of-charge to strategic sourcing managers.

The tool covers a number of learning business situations including organizations seeking talent development, learning process transformation, cost reduction and multi-country learning.

Suppliers of Learning business process outsourcing covered by this NelsonHall Vendor Evaluation and Assessment Tool (NEAT) include Accenture Learning Services, Aon Hewitt, Aptara, Capita, Expertus, Genpact, GP Strategies, HCL, IBM Global Services, Infosys, Intrepid Learning Solutions, Neeyamo, NIIT, NGA Human Resources, QA, Raytheon Professional Services, Seertech Solutions, Talent2, Tech Mahindra, TrainingFolks, and Xerox Learning Services.

The NEAT (NelsonHall Vendor Evaluation and Assessment) tool for Learning BPO is part of NelsonHall’s “speed-to-source” initiative.  The NEAT tool sits at the front-end of the vendor screening process and consists of a two-axis model: assessing vendors against their “ability to deliver immediate benefit” to buy-side organizations and their “ability to meet client future requirements”.

The NEAT analyses themselves are based on a combination of vendor and client interviews. The vendors are scored against a wide range of criteria, establishing a number of scenarios, each with different weightings to represent a different business situation or client business need.

To add further value in speeding up the sourcing process clients are able to input their own weightings and tailor the tool to their requirements. So they might say:  “This set of weightings for this business need looks about right to me but I want to place more emphasis here". With this interactive tool, they can tailor the weightings to meet their own specific sourcing requirements.

• Multi-process HR BPO services.
• Payroll Services
• Benefits Administration
• Recruitment Process Outsourcing
• Learning BPO.

The new Managed Services Program (MSP) demonstrates NelsonHall’s commitment to the HR field and in combination with the other HR programs, will provide the most comprehensive HR analysis on the market. Growth in the Recruitment Process Outsourcing is the highest of all the service lines. The scarcity of key talent and the increasingly global nature of employment markets has seen a market develop to even serve director and interim management positions. NelsonHall’s MSP program will evaluate:

• What is the market size and projected growth for the global MSP market by geography?
• What are the top drivers for adoption of MSP?
• What are the benefits currently achieved by users of MSP?
• What factors are inhibiting user adoption of MSP?
• Who are the leading MSP vendors globally and by geography?
• What combination of services is typically provided within MSP contracts and what new services are being added?
• What is the current pattern of delivery location used for MSP services and how is this changing?
• What services are delivered from onshore and which from offshore?
• What are the challenges and success factors within MSP?

The NEAT (NelsonHall Vendor Evaluation and Assessment) tool will be applied to the MSP service line. NEAT is part of NelsonHall’s “speed-to-source” initiative.  It sits at the front-end of the vendor screening process and consists of a two-axis model: assessing vendors against their “ability to deliver immediate benefit” to buy-side organizations and their “ability to meet client future requirements”.

The NEAT analyses themselves are based on a combination of vendor and client interviews. The vendors are scored against a wide range of criteria, establishing a number of scenarios, each with different weightings to represent a different business situation or client business need.

To add further value in speeding up the sourcing process clients are able to input their own weightings and tailor the tool to their requirements. So they might say:  “This set of weightings for this business need looks about right to me but I want to place more emphasis here". With this interactive tool, they can tailor the weightings to meet their own specific sourcing requirements.

If you would like to participate in or join the MSP program, please contact Guy Saunders. 

Effective-People and Effective-Learning offer HCM technology for:

• Recruiting
• Onboarding
• Compensation
• Succession planning
• HR analytics.

The acquisition includes capabilities around sales and support of the SuccessFactors BizX platform. The companies are partners with SuccessFactors and SumTotal.

GP Strategies continues to make acquisitions to strengthen its service offerings and global capability. This is GP Strategies fourteenth acquisition in the last four and a half years, and its 23rd since 2006. Combined with organic growth, including its large multi-year global learning BPO (LBPO) services contract with HSBC, NelsonHall estimates that since 2009, GP Strategies has more than doubled its LBPO revenues. Once fully implemented and deployed across HSBC affiliates globally, GP Strategies anticipates that HSBC will be its largest client.

Learning is an integrated and integral component of talent management. According to NelsonHall's Q4 2013 LBPO market analysis, vendors continue to strengthen and integrate their talent management service and technology offerings. SaaS talent management continues to accelerate across all HRO service lines, including combined with LBPO. Client learning spend will continue to accelerate for job skill training and professional development for purposes of attraction, development and retention of talent.

The acquisition is expected to close by the end of March 2014.

Expect GP Strategies to continue acquisitions to expand its global capability and its HCM services.

MPHRO

• We predict the Global MPHRO market will grow at mid-single digits CAAGR through 2017
• The Shared Service Transformation segment will continue to grow mainly as a result of contract expansions and renewals with existing clients, but the Multi-Country Standardization and Core Business Focus segments have the highest growth rate 
• MPHRO offerings will continue to be structured around a core model with recruitment services as the most popular add-on as companies focus on adding back talent; in the near-medium term, demand will increase for learning, performance and compensation administration
• Increased partnership activity, primarily for technology, with acquisitions focused on strengthening existing standalone HRO offerings (typically by vendors with $400m+ in HRO revenues)
• Higher levels of multi-shoring from offshore vendors as clients demand onshore and nearshore support; Philippines and China will grow as preferred offshore locations
• Workday use will increase as MPHRO providers such as Aon Hewitt market this platform as part of its offering
• Proportion of mid-market clients will continue to grow making up the greater share of new contracts and MPHRO pipelines

Benefits

• The global benefits administration market will grow at mid-high single digits CAAGR through 2017
• Demand for DB and DC core services will primarily consist of second generation contracts and beyond; H&W administration as well as additional H&W services, specifically health insurance exchanges and health and wellness services, will grow as a result to control costs and comply with changing legislation
• Vendors will increase headcount and add chat services from onshore centers to enhance delivery strategies
• Multi-country benefits admin activity by MNCs will continue to grow moderately with providers that can leverage existing benefits brokerage and consultant relationships

Learning

• Learning BPO (LBPO) market will grow at mid-high single digit CAAGR through 2017, led by the Government sector
• Selective LBPO contracts continue to outpace full LBPO, led by content development, including the conversion of ILT to e-learning. However, full LBPO continues its resurgence as clients re-invest in learning but do not want to rebuild their internal learning organizations and instead seek greater value by outsourcing a larger share of their learning if not in its entirety
• Client learning spend accelerates for job skill training and professional development for purposes of attraction, development and retention of talent
• Vendors continue to strengthen and integrate their talent management service and technology offerings. SaaS talent management continues to accelerate combined with LBPO and across all HRO service lines
• Clients budget for social learning and seek LBPO vendors for collaborative technology. Within two years, clients will also seek help to monitor and measure the effectiveness of their social learning programs
• ILT continues to remain important but e-learning delivery continues to exceed ILT, including increased usage of VLT for geographically dispersed workforces and m-learning to access content for self-paced e-learning on smartphones and tablets

Payroll

• Solid mid-single digit global growth, led by Latin America and Asia Pacific
• Compliance is increasingly important to reduce risk by ensuring adherence to ever-changing tax laws and regulations, for both domestic and multi-country payroll
• Multi-country payroll continues double-digit growth as MNCs look to standardize and consolidate onto one global platform with one vendor for consistency of process, technology and service for increased efficiency
• Mid-market outsourcing continues high growth due to demand for platform-based payroll
• Pricing is per payslip or per employee per month and is expected to decrease due to pricing pressures from payroll buyers
• Where MPHRO services are provided, payroll will continue to be the initial footprint

RPO

• RPO will continue to be the fastest growing HRO service, with mid-teen CAAGR through 2017
• Vendor consolidation and partnerships continue to expand into new geographies to meet demand for global RPO
• Talent shortages deepen resulting in increased employer branding and talent pool development. Vendors increasingly help their clients with a more robust on-boarding process that includes new hire and employee engagement, employee surveys, and retention strategies. More vendors perform internal hiring of employees for their customers and also play a larger role in recommending progression of employees
• Blended RPO and MSP, including temporary hiring, increases to develop optimal workforce strategies
• For deeper insight, please see NelsonHall’s Targeting RPO market analysis published soon

Last week, Raytheon hosted a symposium in London which considered how companies benefit from tapping into the social internet age to maximize learning value across employees and customers, and examples were provided with case studies. Whether you are still experimenting with or actually embarking on delivering a mobile strategy, the discussions and findings at Raytheon’s symposium were thought-provoking.  Here are some highlights.  .

Setting up for success

Jane Massy, CEO of Abdi, claimed that Asian companies are showing the biggest uptake in deciding what to measure before undertaking a training program. She shared a few upfront steps before building a training plan to ensure its success.

1. Determine if governance is in place to ensure that training investments will support business growth
2. Clarify goals to confirm which business outcomes should be impacted
3. Segment and understand the learners to define what “unacceptable” looks like
4. Test the learner’s appetite for training to gauge whether the approach should be modified.

Finally, be sure to leverage survey and social tools to support training engagement.

Use benchmarking to support the business change

Laura Overton, MD of Towards Maturity, provided some statistics from the company’s 2013 Mobile Learning at Work report including one that around 70% of companies are planning to implement mobile learning in the next two years. Other statistics from the report were that top learning organizations are:

• Seven times more likely to agree (than non top learning organizations) that L&D staff have skills to exploit technology for business advantage
• Twenty-eight times more likely to encourage staff to share and solve problems
• Thirty-four times more likely to support a learner community and help learners communicate with each other
• Forty-six times more likely to train trainers to use technology to extend learning beyond the classroom.

She presented a case study of the British Army. It revealed 80% of soldiers use smartphones but only 30% of Army training staff do so. This statistic was used to overcome stakeholder resistance to m-learning.  45% of workers found mobile learning essential or very useful, for instance, for tips on what to do in a situation such as evacuating a building in a fire. From the study, Laura presented that 28% of workers already used their own devices to do their job better, whether or not the training department supported this. Mobile learning needs to support formal learning but should not be seen as a replacement.

Raytheon Introduction, Paul Swinscoe

Raytheon has a deep history in training, from flight simulations and helping NASA train astronauts for the Apollo landings in the 1960s and is now exploiting e-learning to support companies like Axalta.

Case Study: Axalta presented by Mick Monaghan

Axalta needed to train employees and also customers to help support the launch of a product. The success of the product launch depended on Axalta’s ability to engage effectively with a large customer user community and enable a large number to be trained quickly. The online training means the customer does not need to send engineers on training courses and they can pace their own training.

Axalta’s business challenge was that it had 42 customer training centers used for training on applying their paints. Customers were demanding cost reductions, participation levels were down, skills and knowledge of their products were eroding, and customers were asking for on-site help. Axalta delivered an e-learning program for product training which used graphics. As a result, the training effort to complete the course reduced from three days to two and customers are more receptive to training.  In Germany, 240 participants enrolled, a total saving of £180k. Other benefits include higher customer satisfaction from paints being applied correctly and fewer product complaints. Axalta now consider e-learning a “must-have”.

In the break we discovered that some companies who had invested in iPads had issues with using them for training as they do not have flash player. Huddle was being purchased by one company with whom I talked.

Talat Riaz, Raytheon on Training Mediums

Talat discussed the pros and cons of different training mediums including virtual classrooms, 3D graphics and QR codes.

• Virtual classrooms are incredibly effective. However, consider how to support these and extend the learning with social forums and mobile learning
• 3D graphics are extremely useful for training about complex technical structures that need pulling apart into components
• QR codes can help with the knitting of the virtual and physical world, particularly for point in time information where data and processes often change. Having the right data at the right time.

Jonny Gifford, Advisor from CIPD, and The “desire line”

People are always making paths where they desire to go – like a shortcut across a park. If we put fences up to try to change the path, we will not succeed. So why not let employees who are trying to do the best for your company explore and experiment? The path will over time be formed that fits your culture and company. From this, corporate communications will have a vehicle which captures the spirit of your company. Once desire lines are understood they can be enhanced and promoted.

Steve Land, Director, Motiv8 Training

Steve Lang reminded us how people learn and how the brain works. We all look for that sense of achievement. He reminded us that the best trainers are strong motivators. He scared us with memories of overhead projectors then highlighted how we have so much more to leverage from today’s technology to inspire and motivate trainees.

Overall, the event demonstrated how Raytheon is helping improve the effectiveness of learning delivery through the use of technology and e-learning.  It also demonstrated how e-learning and m-learning can't work in isolation: additional delivery methods and engagement channels such as virtual learning and learning communities need to complement the standard learning program to achieve successful learning outcomes.