HRchitect’s MarketMinute: Oracle Announces Acquisition of Taleo

February 13, 2012

Last week, Oracle, an enterprise application software vendor, announced the acquisition of Taleo, a cloud-based human capital management (HCM) solutions provider, for $1.9 billion and a little over five times the projected 2012 revenue for Taleo.  Members of HRchitect’s executive team – Matt Lafata, Rick Fletcher, Ron Hanscome, John Hinojos, Tom LaMarre and Alex Tellez – met to discuss the transaction, on the implications to the talent management marketplace, during the most recent Market Minute.  Audio from the discussion is available here.  Key takeaways are always posted to The Puzzling World of HRtechnology blog and appear below.

Initial reactions:

  • It makes sense long term to have Integrated Human Capital Management.
  • The continued consolidation and acquisition of best-of-breed vendors by the ERP’s may create a commoditization of talent management features in the industry.
  • We may see an opportunity cost of integration over innovation.  Internal thrashing and energy that would be spent on innovating each of the particular product suites may instead be spend on providing good integration paths between the Oracle core products and Taleo capabilities.
  • How will products that currently integrate to Taleo be affected?
  • What does the product roadmap look like?  Oracle has historically had a tightly controlled approach to talking about product releases until they are almost out the door.  It may be hard for customers to get a good understanding in advance of what the roadmaps look like and what the impact will be on their own organization’s strategy.
  • How will Fusion and the Fusion applications be reconciled with the deeper, in many respects, best-of-breed / talent management capabilities that Taleo brings to the table?
  • A year ago the industry was seeing the talent management vendors consolidating and moving toward the suite vendors going after the mid-sized core HR vendors to create a whole human capital suite.  Over the last couple of months, the ERP vendors who have a lot of cash, have been picking these players up, largely because acquisition is an easy way to add cloud / SaaS capabilities to their product offerings.

Should existing Taleo customers be concerned about the acquisition?

  • Clients who are not Oracle shops are already expressing concern.  However, Taleo’s integration tools are agnostic – they currently work well with a number of HR systems – so there will be limited impact there.
  • Don’t panic.  No immediate changes will happen to the Taleo product offering or support are expected.

With this move by Oracle, and SAP’s previous acquisition of SuccessFactors, what about Workday?

  • Workday has build out talent management (performance, career development, succession planning and compensation) and for a first or second-version offering, is really very strong and all delivered within the context of an integrated HCM application.  However, recruiting and learning are the two remaining outliers.  Workday has chosen not to build these out.  The question remains if they will go outside of their organic approach and acquire someone, or will they continue to partner in the delivery of recruiting and learning?  The next few months should prove important in them determining that strategy.

Final thoughts:

  • As with all acquisitions, intent or strategy around it is one thing, execution is an entirely different thing.  The success of this acquisition will depend on how well the strategies are thrashed out, and how well they are executed.
  • The HR technology marketplace continues to move and shake with mergers and acquisitions.  It is always wise to go into an evaluation of an HR system with eyes wide open and consider all of the decision drivers that are most important to your organization, before deciding on any vendor

Further Consolidation in the HCM Space…And it is Far From Over

September 2, 2010

 

Two or three years ago, HRchitect clients were typically buying one talent management module at a time. They would buy the most urgently needed application at the time and then evaluate their options again later when it was time to purchase an additional module. Even though they would evaluate their incumbent vendors, this would sometimes result in organizations buying that second or third module from a different vendor because that new vendor may have become stronger in that area than when they were first considered.

That trend has changed in the past year or so where clients are buying multiple modules or entire talent management suites at once vs. one-off stand-alone applications. Organizations today appreciate integrated talent management and prefer dealing with one software vendor. They don’t want to manage multiple talent management software vendor relationships, don’t want to take responsibility for all the interfaces, etc. It’s probably also a sign that the economy has improved as people are truly buying multiple modules at one time.

HRchitect defines Integrated Talent Management (ITM) as a comprehensive approach to maximize the engagement, performance and effectiveness of the workforce by deploying integrated processes and enabling technologies is never more true than it is today.

Organizations are buying into the concept of tighter integration of learning management, performance management, succession planning, and compensation management built around a competency model. Vendors were fighting the notion for a while of completing their ITM integration, but now really understand why it is important. In addition, most vendors will agree that Talent Acquisition is not as important to be in the mix, but should still be offered by the vendor.

Except for the lower-end market, the typical corporation has also bought into the fact that strategic human capital management will come from one software vendor while transactional HRIS will come from a secondary software vendor.

Taleo Acquires Learn.com

In light of this, here are some of our specific thoughts on the Taleo acquisition of Learn.com that took place yesterday, September 1, for approximately $125m. We think this is a phenomenal acquisition for a couple of reasons.

For starters, Taleo as now the #1 talent management software company, sorely needed an LMS and competency management at its core. The learning market has particularly become hotter this past year or so as people have been replacing homegrown systems and older LMS applications. We have also seen the market change where people would buy an LMS in the past for a specific division of their company and are now looking for more comprehensive enterprise-wide applications.

A positive is that HRchitect has routinely ranked Learn.com as one of the top learning systems that we track. Similar to Taleo’s acquisition of Worldwide Compensation last year, Taleo has once again bought a quality product vs. just adding “brochure-ware”. Learn.com has a well developed learning system, and a good customer base as an extra bonus.

Taleo is already far along in integrating their compensation system into their organically developed performance management system.  The work ahead of them now will be in integrating their performance and compensation system into their newly acquired learning system. We are sure from Taleo partnering with Learn.com for some time now, they have already gone down this road for quite a few customers.

With Learn.com typically being a “mid-market play”, this is a perfect marriage for Taleo Business Edition customers (their mid-market product). There may be more of a challenge for Taleo Enterprise customers, as it is not typically a market that Learn.com has played in, as well as this may be a challenge for global organizations as Learn.com has typically been a “domestic play”.

Based on Taleo’s track record of integrating best of class products, they have the cash, the expertise and the resources to make good on promises to their combined customer base.

Lastly, with the addition of LMS, Taleo is now one of only a handful of companies that offer all the talent management components that HRchitect identifies in the Suite Life of Integrated Talent Management report. In the end, we believe Taleo will have one of the tightest integrated talent management suite offerings.

HRchitect also believes that this will spur large talent management software companies like SuccessFactors and Peopleclick Authoria to acquire an LMS in the very near future, and I am sure that is well underway for both of them.

Kenexa Acquires Salary.com

Also announced on the same day (actually before Taleo’s acquisition of Learn.com) was Kenexa’s acquisition of Salary.com for $80m. Salary.com has not been profitable and its stock price plummeting for some time now, so this looks like an attractive buy as we believe Kenexa can cut the bleed through economies of scale.

This acquisition brings Kenexa a wealth of compensation expertise and a robust compensation product line. Kenexa was in the process of developing a compensation system of its own, but has now bought one of the most robust compensation systems on the market. It also buys them an additional performance management application, which also brings up the challenge of  deciding how many to support. While Kenexa’s 2X Perform is fairly new, Salary.com’s system has gotten raving praise and won the HR Technology Conference shootout as well as an HRchitect Beauty Pageant in the past.

As we have seen in the past, after their acquisition of BrassRing and WebHire, is that Kenexa offered multiple applicant tracking systems. HRchitect believes we can count on this to be the same case in the interim, where Kenexa will offer multiple performance management systems but eventually center in on one. The Salary.com performance management system might be attractive to Kenexa since it is already integrated with the Salary.com compensation product line.

Salary.com also brings to Kenexa literally thousands of smaller customer organizations that Salary.com has sold into over the years.

A bonus in the purchase is Kenexa picks up a complete HRMS that Salary.com bought two years ago from Genesys. Salary.com didn’t do much with this product line but it still has a loyal customer following and a very robust payroll, human resources, and benefits application. With Kenexa putting the right window dressing around it to provide a consistent user interface and by creating tighter integration with its talent management modules, they would have an opportunity to compete with vendors such as Ultimate Software, ADP, NuView Systems and Workday. The jury will be out on how Kenexa delivers in integrating these together as they have typically not done this quickly, instead choosing to support multiple applications, as pointed out earlier. However, due to recent development activity from Kenexa, dedication to a uniform product line, HRchitect believes this will be a focus of theirs.

As HRchitect pointed out in its Integrated Talent Management report, we expect over the next 3-5 years to see the integrated talent management suite and core HRMS begin to converge into a single integrated Human Capital Management system.  The major ERP vendors such as Oracle, SAP and Lawson will continue to add more talent management features to their suite of products while the talent management vendors are beginning to add more HRMS capabilities. Or in the case of this acquisition, a talent management software company acquiring an HRMS and then working to integrate it into their talent management suite.

One of the other attractive items of the purchase is that it brings Kenexa a very well branded consumer site that has been an industry standard for benchmarking salary data.

With these two exciting acquisitions, the StepStone acquisition of MrTed a short while back, along with the recent acquisition of Workscape by ADP, stay tuned and hold on tight to see what happens next! No matter what happens, HRchitect will be here in our continuing efforts to help you solve the puzzling world of HR technology.


Nov 6 HRchitect WebMingle Featured Taleo; Next Up is Aquire

November 6, 2009

Our weekly WebMingle is designed to give you some insight into the puzzling world of HR technology, discuss news from around the world that we find interesting, talk about upcoming events in our industry, and provide insightful interviews with people of our industry – who they are, what they do and why you should care. The WebMingle has become the most popular live weekly Internet show in the HR technology industry!

So what is a WebMingle? It is a meeting over the web where we do some business, socialize and yes, we mingle over the web. Thus, a WebMingle.

The 60-minute WebMingle on November 6th, the 43rd in our WebMingle series, featured Kevin Marasco, VP of Brand Marketing for Taleo. Kevin has great passion around talent management, marketing, business trends, innovation, and more. You can hear the excitement in his voice and we touched on a bunch of issues related to all of that including: 

  • Talent Management Trends
  • Taleo 10
  • Taleo World
  • Taleo Talent Grid
  • Macro Business Trends
  • Social Networking and Innovation
  • Global Talent Management
  • …and more

About Taleo

Taleo provides talent management software that helps companies develop their most strategic asset… people.  Taleo’s web-based solutions span the entire employee lifecycle, including recruiting, performance management, employee development and compensation. Unlike complex enterprise software or legacy HR systems, Taleo’s software is fast, mobile, social and designed exclusively to track and empower people.  Over 4,100 companies of all sizes – including 46 of the Fortune 100 – rely on Taleo to improve quality of hire, increase employee engagement and retain their top performers

About Kevin Marasco, VP Brand Marketing for Taleo

Kevin Marasco is vice president of brand marketing for Taleo. He is responsible for identity and brand management, creative services, website marketing and various marketing communication initiatives.  Prior to Taleo, he was senior vice president of marketing and sales support for Vurv (acquired by Taleo). There he was responsible for worldwide corporate marketing, communications, public relations, brand management, presales activities and sales knowledge management.

If you missed this past week’s WebMingle, or any of our past WebMingles, please visit our web site or www.HRWebMingle.com. You will see a complete list of upcoming guests and will be able to listen to past shows.

Our next WebMingle will take place on November 13 with Lois Melbourne, CEO and Co-Founder with Aquire, a Workforce Planning and Management vendor. We look forward to welcoming Lois to the HRchitect WebMingle next week.

We hope to have you join us!

Matt Lafata, HRchitect


Don’t Miss This Week’s HRchitect WebMingle with Kevin Marasco of Taleo

November 4, 2009

The weekly HRchitect WebMingle is designed to give you some insight into the puzzling world of HR technology, discuss news from around the world that we find interesting, talk about upcoming events in our industry, and provide insightful interviews with people of our industry – who they are, what they do and why you should care. The WebMingle has become the most popular live weekly Internet show in the HR technology industry!

This week’s guests will be Kevin Marasco, Vice-President of Brand Marketing for Taleo.

Taleo provides talent management software that helps companies develop their most strategic asset… people.  Taleo’s web-based solutions span the entire employee lifecycle, including recruiting, performance management, employee development and compensation. Unlike complex enterprise software or legacy HR systems, Taleo’s software is fast, mobile, social and designed exclusively to track and empower people.  Over 4,100 companies of all sizes – including 46 of the Fortune 100 – rely on Taleo to improve quality of hire, increase employee engagement and retain their top performers

Kevin Marasco is vice president of brand marketing for Taleo. He is responsible for identity and brand management, creative services, website marketing and various marketing communication initiatives.  Prior to Taleo, he was senior vice president of marketing and sales support for Vurv (acquired by Taleo). There he was responsible for worldwide corporate marketing, communications, public relations, brand management, presales activities and sales knowledge management. Prior to this role, he served as director of marketing for Vurv, formerly Recruitmax.  His prior experience includes a variety of marketing, design and technology roles.  Prior to joining Vurv, Marasco spent several years as a successful entrepreneur and independent investor. Marasco has a bachelors degree in Marketing from the University of North Florida and has completed executive education courses at Harvard Business School. He is a member of the CMO Council and is on the advisory board of Recover Gear.

Visit www.HRchitect.com/Knowledge/WebMingle to listen live on Friday, November 6th at 1pm CST to the 43rd show in our WebMingle series. If you missed any of our previous WebMingles, you can also access them from that page.

Below is a list of some of our upcoming guests: 

Nov 13 – Lois Melbourne, CEO and Co-Founder with Aquire, a Workforce Planning and Management vendor

Nov 20 – Bob Tricarico, VP of Sales with HRsmart, a Talent Management Systems vendor

Dec 4 – Kevin Grossman, President of HRmarketer.com

Dec 11 – Joel Passen, Co-Founder and VP of Marketing with Newton Software, a Talent Acquisition Systems vendor

Dec 18 – Rick Fletcher, President of HRchitect, the leading HR Systems Consulting firm

Jan 29 – Tim Giehll, CEO of Bond Talent, a Talent Management Systems vendor and Author of “Human Capital Supply Chains”

We look forward to welcoming Kevin Marasco from Taleo to the HRchitect WebMingle this Friday and hope to have you join us as well.

Matt Lafata, HRchitect


HRchitect’s Beauty Pageant Webinar Series Continues on September 4 with Talent Management Systems

August 24, 2009

 

The HRchitect Beauty Pageant series of webinars, which has become the buzz of the industry, returned with a bang last week after a two month hiatus. Next week will be another action-packed Beauty Pageant, this time covering Talent Management Systems.

This series of webinars covers a different area of HR technology with each event. The concept allows attendees to see presentations from up to six leading vendors in a fun and informative format where the audience votes on the winner at the conclusion.

Last week, Hodes iQ took the crown for Talent Acquisition Systems, previously held by iCIMS.

The next exciting pageant, the twelfth in the series, will be on Talent Management Systems and will take place on Friday, September 4. The participants will be top vendors in this space, Jobpartners, Saba, Salary.com, SumTotal Systems, and Workstream. Two of those contestants have won Beauty Pageants in other categories in the past. 

The 90-minute webinar agendas will look like this:

Intro by HRchitect

Overview of the marketplace by HRchitect

Short vendor presentations (vendor order will be determine at random)

Q&A of vendors from the audience

Crowning of the Winner

Wrap-up

The sessions are moderated by Matt Lafata, VP of Sales & Marketing for HRchitect.

HRchitect developed a format to help guide each vendor with an outline of what should be covered during each portion of the pageant.  Since we have billed this as a beauty pageant, we tried to come up with pageant categories for vendors to loosely follow. Of course each vendor is free to follow their own format as this is simply a guideline:

Evening gown – To start off each portion, we are asking the vendor to come out in their best ‘outfit’ – corporate overview, history, specific identity, financial viability, marquee clients, leadership team, etc. This will be the grand entrance.

Swimsuit – Here the vendors will show some skin in this portion – usability, configurability, etc.

Talent – This portion will cover functionality, technology/integration, global ability, etc.

Interview – This will be the Q & A section from the audience. 

These beauty pageants are designed to give the audience a quick overview of the leading vendors and we are looking for creativity in presentations. Some of the past participants have gotten extremely creative in their presentations and we thank them for their time and efforts in doing this.

In November, iCIMS won the Talent Acquisitions Systems pageant and Cornerstone OnDemand won the Talent Management Systems pageant. Then in December, GeoLearning won the Learning Management Systems pageant. In January, we had our Mid-Market Talent Acquisitions Systems pageant and iCIMS was crowned the winner and our Onboarding pageant where SilkRoad was the winner. In February we covered Employee Performance Management where SumTotal Systems won and then mid-market HRIS where Spectrum HR was the winner. In March it was all about Workforce Planning Systems and Infohrm walked away with the crown. April brought us Compensation Systems where Workstream walked away with the crown and then we finished up the first leg of beauty pageants with Time & Attendance Systems in June, where Legiant was crowned the winner.

To view any of these past pageants, please visit the beauty pageant part of our website. We have a full schedule of 2009 beauty pageants on our site for the remainder of the year, and several vendors have asked that we create beauty pageants around additional topics, which we are currently in the process of scheduling.

Watch this blog for updates and visit http://hrchitect.com/News/Pageant for a listing of upcoming HRchitect Beauty Pageants and to register so you won’t be left puzzled by HR Technology!

 

 

Matt Lafata, HRchitect


Congratulations to our Talent Acquisition Systems Beauty Pageant Winner – HodesIQ!

August 21, 2009

 

Earlier today, HRchitect held the eleventh installation in our Beauty Pageant webinar series, this time focusing on talent acquisition systems. Participants included leading vendors in the talent acquisition systems world – Hodes IQ, HRsmart, iCIMS, SilkRoad, and Taleo.

All the presentations were fantastic and we had record attendance. At the end of the webinar, which featured a short overview of HRchitect and talent acquisition systems does, HodesIQ was crowned the winner. HRchitect would like to thank the vendors for participating and the attendees for judging the contestants.

HRchitect’s Director of Marketing and Corporate Communications, Tiffany Appleby, once again did a tremendous job in ensuring the pageant ran smoothly. It’s not an easy task coordinating each vendor’s presentation, setting up rehearsals, and then running the program the day of the event!

The HRchitect beauty pageant series of webinars has become the buzz of the industry since its debut in November 2008. This series of webinars covers a different area of HR technology with each event. The concept allows attendees to see presentations from up to six leading vendors in a fun and informative format where the audience votes on the winner at the conclusion.

Past Winners:

In November, iCIMS won the Talent Acquisitions Systems pageant and Cornerstone OnDemand won the Talent Management Systems pageant. Then in December, GeoLearning won the Learning Management Systems pageant. In January, we had our Mid-Market Talent Acquisitions Systems pageant and iCIMS was crowned the winner and our Onboarding pageant where SilkRoad was the winner. In February we covered Employee Performance Management where SumTotal Systems won and then mid-market HRIS where Spectrum HR was the winner. In March it was all about Workforce Planning Systems and Infohrm walked away with the crown. April brought us Compensation Systems where Workstream walked away with the crown and then we finished up the first leg of beauty pageants with Time & Attendance Systems in June, where Legiant was crowned the winner.

The Beauty Pageants schedule continues in September with Talent Management Systems on September 4. Current confirmed participants include Jobpartners, Saba, Salary.com, and SumTotal Systems.

To view any of the past pageants, please visit the beauty pageant part of our website. We have a full schedule of 2009 beauty pageants on our site for the remainder of the year, and several vendors have asked that we create beauty pageants around additional topics, which we are currently in the process of scheduling.

 

 

Matt Lafata, HRchitect


HRchitect’s Beauty Pageant Webinar Series Returns on August 21 with Talent Acquisition Systems

August 10, 2009

 

The HRchitect Beauty Pageant series of webinars, which has become the buzz of the industry, returns after a two month summer hiatus.

This series of webinars covers a different area of HR technology with each event. The concept allows attendees to see presentations from up to six leading vendors in a fun and informative format where the audience votes on the winner at the conclusion.

In November, iCIMS won the Talent Acquisitions Systems pageant and Cornerstone OnDemand won the Talent Management Systems pageant. Then in December, GeoLearning won the Learning Management Systems pageant. In January, we had our Mid-Market Talent Acquisitions Systems pageant and iCIMS was crowned the winner and our Onboarding pageant where SilkRoad was the winner. In February we covered Employee Performance Management where SumTotal Systems won and then mid-market HRIS where Spectrum HR was the winner. In March it was all about Workforce Planning Systems and Infohrm walked away with the crown. April brought us Compensation Systems where Workstream walked away with the crown and then we finished up the first leg of beauty pageants with Time & Attendance Systems in June, where Legiant was crowned the winner.

To view any of these past pageants, please visit the beauty pageant part of our website. We have a full schedule of 2009 beauty pageants on our site for the remainder of the year, and several vendors have asked that we create beauty pageants around additional topics, which we are currently in the process of scheduling.

The next exciting pageant, the eleventh in the series, will be on the ever popular Talent Acquisition Systems and will take place on Friday, August 21. The participants will be top vendors in this space, Hodes IQ, HRsmart, iCIMS, SilkRoad, and Taleo. 

The 90-minute webinar agendas will look like this:

Intro by HRchitect

Overview of the marketplace by HRchitect

Short vendor presentations (vendor order will be determine at random)

Q&A of vendors from the audience

Crowning of the Winner

Wrap-up

The sessions are moderated by Matt Lafata, VP of Sales & Marketing for HRchitect.

HRchitect developed a format to help guide each vendor with an outline of what should be covered during each portion of the pageant.  Since we have billed this as a beauty pageant, we tried to come up with pageant categories for vendors to loosely follow. Of course each vendor is free to follow their own format as this is simply a guideline:

Evening gown – To start off each portion, we are asking the vendor to come out in their best ‘outfit’ – corporate overview, history, specific identity, financial viability, marquee clients, leadership team, etc. This will be the grand entrance.

Swimsuit – Here the vendors will show some skin in this portion – usability, configurability, etc.

Talent – This portion will cover functionality, technology/integration, global ability, etc.

Interview – This will be the Q & A section from the audience. 

These beauty pageants are designed to give the audience a quick overview of the leading vendors and we are looking for creativity in presentations. Some of the past participants have gotten extremely creative in their presentations and we thank them for their time and efforts in doing this.

Watch this blog for updates and visit http://hrchitect.com/News/Pageant for a listing of upcoming HRchitect Beauty Pageants and to register so you won’t be left puzzled by HR Technology!

 

Matt Lafata, HRchitect


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