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Talent Management Software Market Size, Share & Industry Analysis, By Component (Solution and Services), By Solution (Performance Management, Talent Acquisition, Learning Management, Compensation Management, and Others), By Enterprise Size (SMEs and Large Enterprises), By Deployment (Cloud and On-premise), By Industry (IT and Telecommunication, BFSI, Government, Healthcare, Education, Manufacturing, and Others), and Regional Forecast, 2019-2026

Region : Global | Format: PDF | Report ID: FBI100374

 

KEY MARKET INSIGHTS

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The global talent management software market size stood at USD 5.19 billion in 2018 and is projected to reach USD 11.09 billion by 2026, exhibiting a CAGR of 10.0% during the forecast period.

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Mobile technology is expected to positively influence market growth of talent management software. An emerging trend of big data analytics in the HR industry is likely to create lucrative market opportunities in the coming years. As stated in an article published by the Society for Human Resource Management (SHRM) in 2017, companies with workforce development initiatives observe a 67.0% higher level of engagement and a 30.0% lower turnover rate than companies without the workforce development initiatives. This data reflects on the fact that workforce monitoring will ensure to drive the demand for talent management across various organizations.


Increasing the need to enhance various factors in the healthcare industry such as patient satisfaction, reduce nursing turnover and employee productivity are driving the demand for talent management software. IT and telecommunication sector, on the other hand is estimated to hold a major talent management software market share. Asia pacific market is estimated to observe a remarkable growth attributed to the expansion of various industries such as agriculture, IT and telecommunication and others across the region.


MARKET TRENDS


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Mobile-technology Swaying Adoption of Talent Management Software


Mobile-technology has facilitated distance learning and mobile-compatible job applications. According to a report published by Glassdoor, a website where employees anonymously review companies, 53.0% of the users use mobile devices to search for job opportunities on the internet. A mobile-compatible talent management software solution empowers the HR manager to drive the profits of the organization rather than managing the employees. According to a CIO report 2016, 91.0% of the corporate employees have adopted mobile applications. As a result, the trend towards the integration of mobile technology is growing to streamline employee communication and enhance personalization.


Growing Integration of Big Data Analytics in HR is Currently Trending in Market


The incorporation of big data analytics into human resources management practices is gaining popularity among many enterprises and strengthening their business decisions. According to a resource-based theory, big data analytics has the potential to accelerate the performance of the organization and enhance business competitiveness. Big data analytics enables enterprises to implement data-driven programs, and plot trends and patterns that provide quantitative data. According to the Wall Street Journal, Xero Limited, leveraged big data to determine the reasons for employee dissatisfaction and retention. By analyzing this data, the company minimized the employee attrition rate by 20%.  This data illustrates the integration of big data analytics in HR operations such as talent acquisition, performance management to influence the market growth.


MARKET DRIVERS


Predictive Workforce Monitoring is Pushing Towards a High Growth Trajectory of Market


The advent of disruptive technologies such as artificial intelligence and big data analytics has led to the emergence of predictive workforce monitoring with distinct needs of engagement, communication, and recognition. Organizations are likely to leverage the next-generation talent management solutions to anticipate future talent needs. For example, PacifiCorp, an energy provider tracks the employees with technical and leadership qualities within the organization. This helps the company to exhibit a significant competitive advantage and reap benefits within the organization. Also, predictive workforce monitoring supports talent decision-makers to identify the specific transformations that are related to future business outcomes. These factors are expected to boost the market in the coming years.


Increasing Demand for Anticipatory and Flexible Talent Sourcing Ensures Adoption of Talent Management Software


The traditional and rigid recruiting practices are insufficient to tackle the recruiting challenges posed by the diverse, modern and empowered workforce. To address the talent needs, organizations will support advanced automated solutions such as talent management software. Leveraging these platforms enables the organization to establish talent match databases to support internal employee activities. For instance, in 2015 British Petroleum (BP) has deployed a talent matching system where employees can share their resumes and receive notifications of employments and projects that suit their talents. The combination of flexible and anticipatory sourcing reflects as the most cost-effective and efficient way for organizations to maintain talent levels from the modern workforce perspective. The aforementioned factors are expected to boost the market growth in the forthcoming years.


MARKET RESTRAINT


Limited Use of Talent Analytics is Likely to Restrict Market Growth


Data analytics plays a vital role in promoting business decisions. However, some organizations are wedged to the traditional talent management procedures such as turnover, cost-based metrics, and others. Hence, the slow adoption of upgraded talent analytics solutions is expected to affect market growth and may lead to a steady growth during the forecast period. Similarly, inconsistent integration and execution of talent programs are likely to restrict market growth. For instance, according to the 2016 international journal of business management and economic research (IJBMER) report, only 21.0% of organizations incorporate talent practices constantly. Hence, with growing awareness, it is expected that the adoption of talent management software will increase in the near future                                         


SEGMENTATION


By Component Analysis


Solution Segment is Expected to Gain Traction During the Forecast Period


By component, the market is classified into solutions and services. Talent management solutions offered by the companies include Oracle’s talent management cloud, IBM Corporations’ talent management software, talent management suite offered by Cornerstone On Demand, Inc., among others. These solutions are used by the organizations to automate HR activities, increase employee performance and improve business performance. The increasing adoption of these solutions by the end-users is likely to expand the market size.


Along with solutions, the companies offer professional services including consulting, training and support & maintenance. These services offered by the market players help businesses to overcome specific challenges such as cloud migration, deployment of new hardware among others. Also, the professional service portfolio involves planning and strategy, implementation, and adoption of the product for the future growth of the organization. Thus, with the rising adoption of talent management solutions, these services are expected to have moderate growth compared to the solution segment.


By Solution Analysis


Performance Management: One of the Most Strategic Solution within an Enterprise


The solution segment is categorized into performance management, talent acquisition, learning management, compensation management, and others (career & succession, rewards management).


Performance management is a template-driven setup that enables the organizations to configure the performance process and provide visibility into how much each employee contributes to the upliftment of the organization. This integrated intelligence allows the HR administrators and managers to effectively manage and monitor the overall performance of the process. These processes include task completion, employee ratings, and other performance details. These are the primary factors that boost the need for performance management solutions in the companies.


Whereas, talent acquisition comprises automated recruiting, sourcing and on-boarding process. This solution empowers the organizations to improve talent acquisition effectiveness and proficiency by streamlining and automating the recruiting process and provide insights for recruiting staff and strategies. For example, the Oracle Talent Acquisition cloud enables the enterprises to select an appropriate candidate by creating actionable strategies using multi-level assessments and screening. Thus, the above factors drive the demand for talent acquisition solutions across various organizations.


Learning and development solution offers a comprehensive solution for tracking, delivering, managing and reporting on all types of informal and formal learning. This is a centralized platform that allows employees to learn through online, virtual, classroom, on-job training including assessments, social learning, and self-learning. These are some of the factors that surge the need for learning and development solutions across the end-users.


Compensation applications are generally adopted by large enterprises and are often closely connected to services associated with compensation benchmarking. Compensation applications play a vital role in developing strategic plans and forecast business requirements. Among the talent management applications, compensation applications are observing low adoption from the past few years. However, with the growing adoption of talent management solutions, this application area is likely to offer opportunities for enterprises.


Career and succession planning solution delivers software tools to map employees for future development. These capabilities of career planning help the organization to develop a future workforce by providing suitable insights into how existing competencies fit with future job requirements. Large organizations implement more succession management applications as compared to small and mid-sized organizations. These applications are expected to witness slow adoption in the coming years.


By Deployment Analysis


Cloud-based Software to Witness Surging Demand Owning to Enhanced User Experience and Flexibility


By deployment, the market is segmented into on-premise and cloud. Cloud-based talent management is a new standard for organizations looking to replace or update the existing solutions. Organizations with existing on-premise applications require the consideration of some factors when compared to cloud advantages. These include business-specific customizations, hardware, and tax implications, upgrade requirement and others.


Cloud-based solution provides several advantages over on-premise solutions such as improved user experience, regular software updates, better analytics and reporting among others. However, existing on-premise solutions can be integrated into cloud-based services which is contributing in the adoption of cloud-based solutions.


By Enterprise size Analysis


Growing Expenditure on Talent Management among SMEs to Add Impetus to Market


Based on enterprise size, the market has been divided into small & mid-sized enterprises, and large enterprises. Small and mid-sized organizations are the fastest-growing segment in the market, owing to customized and cost-efficient solutions. Large enterprises are more likely to increase expenditure in core HR activities such as staffing, development, and compensation resulting in market share dominance throughout the forecast period.


By Industry Analysis


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IT and Telecommunication and Healthcare Industries to Account for Highest Market Share


By industry type, the global market is segmented into as IT and telecommunication, BFSI, government, retail, healthcare, education, manufacturing, and others. Among these, the talent management software in IT and telecommunication and healthcare industry is projected to witness a surging demand. As businesses expand, talent management becomes a necessity to achieve data management and the regulatory needs of the workforce. The growing adoption of next-generation software solutions equipped with advanced technologies such as artificial intelligence is expected to encourage the adoption of talent management solutions across the industries.


Technologies such as machine learning, robotic process automation, and intelligent automation is already creating a profound impact on payments, compliance, among other banking functions. Banks require agile and adaptive workforces to understand how these technologies would be applied. As a result, these factors drive the need for talent management solutions across the BFSI industry.


Increasing demand for enhanced customer experience and better services is escalating in the retail industry. Hence, there is a need for retail managers to adopt effective strategies for better sales revenue and improved employee performance. Thus, an organized performance management solution is likely to enable retailers to achieve business goals.


REGIONAL ANALYSIS


North America Talent Management Software Market Size, 2018 (USD Billion)

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Asia Pacific is projected to Witness Significant Market Growth


The global talent management software market has been analyzed across five major regions including, North America, Europe, Asia Pacific, Middle East, and Africa and Latin America these regions are further categorized into countries.


North America market generated a revenue of USD 2.02 billion in 2018 and is expected to continue its dominance in the global market during the forecast period. According to a 2018 study by Cornerstone OnDemand Inc., North America is the major buyer of cloud HCM solutions attributed to the presence of HCM technology vendors such as Oracle Corporation, IBM Corporation among others and early adoption of cloud applications. These factors are responsible for the growth of the market in this region.


Asia Pacific is projected to witness a flourishing market growth of talent management software in the coming years. The continuous expansion of multinational corporations and substantial IT budgets is a significant factor driving the market in Asia Pacific. Robust digital initiatives such as ‘Digital India’ and growing inclination of companies towards automated business processes are fueling the demand for talent management software solutions across the region.


The European institutions primarily focus on employee engagement and motivation. Ongoing crisis like Brexit has enabled the European Union to deliver faster outputs across wide areas including the service sector. The European Union has developed a talent management strategy intending to ease the burden of overworked staff and other professional growth. These aspects drive the demand for automated talent management process in Europe.


The Middle East and Africa, and Latin America market are expected to have a steady market growth. The increasing mobility of employees across cultural and regional boundaries is one of the factors contributing to the growth of the region. However, adequate investments in technology and the need for skilled workforce will expand the market size in the region.


KEY INDUSTRY PLAYERS


Key Players Focusing on Expanding the Product Offerings and Services


The global talent management software market players are focusing on expanding their product offerings and services integrated with advanced technologies such as artificial intelligence. For instance, in November 2018, IBM Corporation announced that IBM Talent & Transformation solution provided AI skills training. This solution helped the organization to leverage the advantages of artificial intelligence to build a modern workforce.


Similarly, in October 2019, Peoplefluent announced the expansion of its HR solutions for recruitment, succession, compensation, and performance for mid-sized enterprises with 1000-5000 employees. Product portfolio expansion would enable the companies to address several market opportunities in different sectors.


Strategic Partnerships and Acquisitions by Cornerstone OnDemand, Inc. to Strengthen its Market Position


Cornerstone OnDemand, Inc. offers a human capital management platform that comprises of four product suites including a recruiting suite, learning suite, performance suite, and an HR administration suite. To achieve a stimulating growth in the market and gain a competitive edge, the company has adopted partnership and acquisition scheme as a part of its business strategies. For instance,



  • November 2019 - Cornerstone OnDemand, Inc. and Kronos, a provider of human capital management (HCM) solutions and workforce management partnered to offer an enhanced learning experience to the employees. 

  • February 2020 - Cornerstone OnDemand, Inc. acquired Saba Software, a talent experience solution provider. This acquisition will enable Cornerstone OnDemand, Inc. to expand the product offerings and help a diverse group of clients with the right learning and development opportunities.


List of Key Companies Profiled:



KEY INDUSTRY DEVELOPMENTS:



  • February 2020 – Orion Novotus, provider of recruitment process outsourcing chose Saba Software’s Talentlink solution to enhance its range of services. Orion Novotus will use Saba Talentlink solution capabilities to enhance the custom recruitment process.

  • November 2019 - SumTotal Systems, Inc. released an enhanced mobile experience for learning. This new release is compatible with the existing mobile talent development offerings of SumTotal Systems, Inc. intending to provide talent development in a personalized way.


REPORT COVERAGE


The talent management software market report highlights leading regions across the world to offer a better understanding of the user. Furthermore, the report provides insights into the latest industry trends and analyzes technologies that are being deployed at a rapid pace at the global level. It further highlights some of the growth-stimulating factors and restraints, helping the reader to gain in-depth knowledge about the market.


An Infographic Representation of Talent Management Software Market

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REPORT SCOPE & SEGMENTATION














































 ATTRIBUTE



 DETAILS



Study Period



  2015 - 2026



Base Year



  2018



Forecast Period



  2019 - 2026



Historical Period



  2015 - 2017



Unit



  Value (USD billion)



Segmentation



By Component



  • Solution

    • Performance Management

    • Talent Acquisition

    • Learning Management

    • Compensation Management

    • Others (Career & Succession, Reward Management)



  • Services



By Enterprise Size



  • Small and Medium Sized Enterprises (SMEs)

  • Large Enterprises



By Deployment



  • Cloud

  • On-premise



By Industry



  • IT and Telecommunication

  • Healthcare

  • Banking, Financial Services, and Insurance (BFSI)

  • Government

  • Education

  • Manufacturing

  • Others (Retail, Energy, and Utilities)



By Region



  • North America (the U.S. and Canada)

  • Europe (the U.K., Germany, France, Scandinavia and the Rest of Europe)

  • Asia Pacific (Japan, China, India, Southeast Asia and the Rest of Asia Pacific)

  • Middle East & Africa (South Africa, GCC and the Rest of the Middle East & Africa)

  • Latin America (Brazil, Mexico, and the Rest of Latin America)



Frequently Asked Questions

Fortune Business Insights says that the market of talent management software was valued at USD 5.19 billion in 2018

Fortune Business Insights says that the market is expected to reach USD 11.09 billion in 2026

Growth of 10.0% CAGR will be observed in the market during the forecast period (2019-2026)

Within the industry segment, the IT and Telecommunication segment is expected to lead during the forecast period

Predictive workforce monitoring and increasing demand for anticipatory and flexible talent sourcing is expected to primarily drive the market growth

Oracle Corporation Cornerstone Ondemand Inc., SAP SE., Sumtotal Systems Inc., are some of the top companies in the market

Asia Pacific is expected to grow significantly exhibiting a highest CAGR.

The revenue of the market in North America in 2018 was USD 2.02 billion

Talent Management Software Market Size, Share and Global Industry Trend Forecast till 2026
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