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Disruptive Technologies Spark Upheaval in Corporate Learning Technology
[August 23, 2004]

Disruptive Technologies Spark Upheaval in Corporate Learning Technology

SAN FRANCISCO --(Business Wire)-- Aug. 23, 2004 -- Web Services and Outsourcing Rewrite the Rules of Enterprise eLearning, Says New Report from Workflow Institute

In the latest news from Training Fall Conference & Expo and Workflow Institute, the market for corporate learning technology is in a state of flux. The sixty-page report by Sam Adkins, The 2004-2008 US Corporate Learning Technology Market, describes how disruptive technologies and outsourcing are dislodging first-generation learning products. Findings from the report will be discussed at the Workflow Learning Symposium, co-locating with Training Fall Conference & Expo, on October 11-13.

The New Corporate Learning Ecosystem

Learning content, technology, and services are in the midst of radical transformation and restructuring. The courseware content market has dried up. In the technology sector, revenues from collaboration vendors are surpassing those of the declining LMS providers. In services, the major trend is outsourcing. Outsourcers are avidly searching for lower-cost, higher-margin products to maintain their profit margins, and eLearning fills the bill.

The corporate eLearning Market in the US peaked in late-2001 at about $6.5 billion and has seen 15-20% negative growth in both 2002 and 2003. In 2004, the market leveled off and has remained flat. As of mid-2004, the market for conventional eLearning is $4.5 billion with content accounting for half of the revenues. The technology segment accounts for $1.1 billion, and the robust services sector accounts for $1.2 billion. By 2008, at least 60% of eLearning revenue will derive from services.

Outsourcing of entire training departments is a growing trend in the US, particularly in large companies with central training departments. This takes the buyer of technology out of the company and into the outsourcing industry.

A bigger shake-up is on the way, as Service-Oriented Architecture (SOA) replaces client-server technology. SOA is the key to converting learning into a true business process called Workflow Learning, which is executed by workflow engines and measured by Key Performance Indicators. Workflow Learning opens the door to the small and medium business market, 22 million firms that employ 54% of the US workforce.

Think Workflow Optimization, not ERP

Conversations once dominated by three-letter acronyms such as EPS, CRM, LMS, EAI, and LMS are shifting to the topic of Workforce Optimization. Workforce Optimization products focus heavily on improving human performance to increase productivity. They are designed to generate tangible returns on investments in systems and human capital. They are composite applications assembled from such categories as web content management, eLearning, compliance, simulation, and business process management.

Workers interact with Workflow Optimization tools through a single interface. Web Services dynamically generate an up-to-the-moment, custom screen to suit every worker. This is why savvy eLearning vendors such as IBM, Saba, Plateau and VCampus have deconstructed their features sets into Web Services. They clearly recognize that their own proprietary interfaces are not interoperable with SOA.

The Workflow Optimization market is over $42 billion at present and will reach $72 billion by 2008. About half of this revenue will come from small and medium business customers. Almost 20% comes from learning-centric content, technology and services. These products are characterized by a strong focus on the performance of a human worker in the workflow. By 2008, learning-centric products will generate revenues of over $15 billion.

Learning Technology

The Workflow Institute segments the Learning Technology market into simulation, collaboration, eLearning, and Workflow Learning. (Since the new learning is bundled, it no longer makes sense to break it into content, technology, and services.) The current market for Learning Technology in the US exceeds $8 billion. By 2008, these products will generate $15 billion. Except for conventional courseware-based learning, all the products are enjoying positive sales growth.

The market for Workflow Learning will top $2.5 billion by 2008. Most of this revenue will be derived from Workflow Learning for the new composite SOA-based versions of Enterprise Applications. These products are growing at an astonishing 70-75% annual growth rate.

As of 2004, companies spend $4.5 billion in Enterprise Application training. Just over 60% is still derived from classroom products. This is changing very quickly due primarily to outsourcers migrating clients to higher margin products.

Outsourcing (not to be confused with off-shoring) is hot; Training and HR functions top the list. The majority of this activity involves helping companies roll out new ERP, CRM and SCM systems and prepare for the constant change management events that are inherent in integrated enterprises. New Workflow Learning products reduce, if not eliminate, the need for training and helpdesk support. They generate incremental ROIs throughout the business year because they are tied to naturally evolving business processes. Workflow Learning products like RWD InfoPak, Epiance, and OnDemand not only generate first-tier cost-avoidance ROIs, they also achieve incremental ROIs as change management incidents occur throughout the business year.

About the Workflow Learning Symposium

Jay Cross, Managing Director of the Workflow Institute, will share conclusions from the new market analysis at the three-day Workflow Learning Symposium that is co-located with the Training Fall Conference & Expo in San Francisco. Participants may attend a series of presentations by industry experts and participate in hands-on demonstrations of advanced learning technologies. For more information about the Symposium, go to

About the Workflow Institute

The Workflow Institute serves decision-makers at the intersection of business results, enterprise systems, and human performance. We promote the understanding and use of real-time enterprise-level learning in industry and government worldwide. We Identify new developments and interpret technology trends. Our backgrounds in instructional design, enterprise computing, and software architectures, coupled with our passion for helping people make the most of technology, have positioned us at the forefront of the Workflow Learning movement. For more information, go to or email [email protected].

About Training Fall, incorporating Online Learning

Where will you find the largest gathering of decision-makers charged with developing and implementing e-learning? Only at the Training Fall Conference and Expo, formerly Online Learning, in San Francisco October 11-13. No other U.S. event brings together more resources, more expertise and more opportunities for you to accelerate your professional development and online learning curve. From the Expo hall and our Hands-on Learning Labs to in-depth breakout sessions and case studies, you'll find everything you need to create, deliver and manage training and online learning in your organization at Training Fall Conference and Expo. Plus, when you register for Training Fall, you'll receive FREE admission to Workflow Learning Symposium 2004. For more information go to

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