Ventana Research Analyst Perspectives

Talent Management Market Contracts Further as SumTotal Acquires Softscape

Posted by Mark Smith on Nov 28, 2010 10:17:09 AM

The market for talent management software continues to consolidate as SumTotal will acquire Softscape to bring together a combination of customers, people and products that reaches more than 25 million users and 1,800 customers globally. This purchase follows three other recent ones: ADP acquiring WorkscapeKenexa acquiring and Taleo acquiring The result is fewer but stronger software companies providing applications that enable human resources departments and others in the organization to manage workforce performance. In recent years SumTotal has gone through a transition of management and rationalization of products from acquisitions with financial backing from Vista Equity Partners to help stabilize the company. On the other hand, Softscape had been growing organically over the last 15 years through its closely held ownership to expand its presence across the world. While SumTotal specializes in learning and collaboration along with performance management, Softscape has a complete HRMS and talent management suite that includes recruiting, onboarding, performance, compensation, succession planning and analytics.

Now the market has moved beyond applications tailored for HR administrators to those that managers and members of the workforce use to support the development, collaboration, retention and optimization of talent across the enterprise. Many organizations have adopted some or all in a series of applications that address recruitment, onboarding, performance review, compensation and incentives and succession planning, all of which can contribute to creating and managing a single profile for each employee that can be a common reference for people at all levels of the organization. I expect that the product strategy for the combined SumTotal and Softscape will begin with basic integration of products while it builds a more integrated platform and set of applications over the coming year, along with release of new mobile applications. Softscape’s latest release continues its evolution of an entire talent management platform and suite with advances in what the company calls a talent network, support for coaching and workforce analytics.

Organizations that already use software from Softscape and/or SumTotal should find the combined entity responsive to their needs since it will be a significant competitor in the market that has a stake in helping customers expand into workforce performance management with its applications. The new entity should be a leader in the consolidated talent management market where ADP, SuccessFactors and Taleo also have strengthened their positions. SumTotal now can scale the company upward while investing in marketing and sales promotions; it will need to be more visible to gain a foothold in customers’ new evaluation and application selection processes.

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Mark Smith – CEO & EVP Research

Topics: Human Capital Management, Softscape, Business Performance, Workforce Performance, HRMS, SumTotal Systems, Talent Management

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Mark Smith

Written by Mark Smith

Mark is responsible for the overall direction of Ventana Research and drives the global research agenda covering both business and technology areas. He defined the blueprint for Information Management and Performance Management as the linking together of people, processes, information and technology across organizations to drive effective results. Mark is an expert in technology for business from Performance Management, Business Intelligence, Analytics to Information Management across finance, operations and IT. Mark has held CMO, product development and research roles at companies such as SAP, META Group, Oracle and IRI Software. He has experience across major industries including banking, consumer products, food and beverage, insurance, manufacturing, pharmaceutical and retail and consumer services.