Rumors of Skillsoft merging

Skillsoft Exploring the Art of the Merge to Survive (and Thrive)?

Machine learning and the Internet have taught us something illuminating about career and talent development. In job-related learning, the idea of curating content has won. But it’s more than this. We have learned that the algorithms behind machine learning are capable of being wildly effective in determining what an individual career professional is interested and in need of learning. Systems utilizing these capabilities are able to pull the relevant content from disparate sources and push that to the employee. And, the industry has found, the employee is more than apt to self-direct her individual edification, to the mutual benefit of herself and the organization she works for.

This basic idea has won in entertainment (e.g., Netflix) and several other industries, too, for that matter. The analogies are inexact, but vendors that rely primarily on creating their own learning content and expecting a caged audience in the form of their customer base to remain happy and benefit from it are no longer operating under a business model that’s viable over the long haul. And this brings us to Skillsoft….

From observing Skillsoft’s decisions over the past half a decade or so, you can tell the vendor has at least accurately anticipated these wild storms of disruption and innovation in how employees consume content and where it originates. For several years, Skillsoft has done its best to remain competitive in these circumstance as newcomers such as Degreed, OpenSesame, the since-acquired Grovo, and others moved with the typical agility and heft that well-funded start-ups exhibit. Even so, Skillsoft’s sage efforts do not appear to have staved off an inevitable and predictable loss of customers.

Plenty of smart people call Skillsoft and its sister organization, SumTotal, their professional home. So, it’s comforting to learn that this 800lbs gorilla in the corporate learning space may have a plan to live another day. Industry news indicates that Skillsoft may be in talks to merge with another 800lbs gorilla, Global Knowledge Training, a provider of skills training services and a considerable content library of its own. There is talk that the two may even go public together via a mutual special purpose acquisition company (SPAC).

Nobody at either firm is confirming the development, reports say, so it may just be a rumor. It’s a loud rumor and would be the logical move — and a lifeline for Skillsoft, which filed for bankruptcy protection earlier this year. On a massive scale, Global Knowledge Training engages in just the type of conventional, planned, regulatory environment-driven on-the-job education that may represent the last remaining safe bastion for learning content that’s created by the vendor delivering it.

What’s more, the move would enable the two entities to combine their market share to weather the competitive storm further and, from a position of relative strength, give Skillsoft the precious additional time it evidently needs to migrate existing customers from older products to Percipio, the vendor’s decent stab at the learning content curation model. Success here would deliver both companies from the downward spiral and eventual irrelevance.

This is a sound strategy. When two entities combine their market share, they buy themselves time to innovate and remain competitive in fast-evolving market spaces. Legacy vendors employ the tactic often, It’s happened a couple times recently, in HCM.

Look at Saba Software and Cornerstone OnDemand, the most recent example. Prior to acquiring Saba, the latter had already done a fantastic job in continuing to innovate its learning-related business. (Full disclosure, I worked there for a season.) But both were facing a future of fewer customers still interested in obtaining a traditionally defined and partitioned full talent management suite from a separate vendor for it given that vendors of end-to-end technology for HCM offer perfectly serviceable functionality for talent management.

And, then, there’s the mother of all high-tech industry mergers, that of Ultimate Software and Kronos. The two now go by the combined juggernaut named Ultimate Kronos Group — UKG, for short. With SAP, Oracle and Workday making an ever more compelling case to the average customer to go to one source for software for the entire enterprise, including HCM, a juggernaut such as UKG makes a strong bulwark indeed. UKG can marshal its considerable shared resources to become the must-have HCM point solution when and if this new normal that these enterprise software vendors peddle becomes reality.

Whether Skillsoft is really going to join forces with Global Knowledge Training remains a rumor. In reality, it would create a juggernaut indeed, and the strategy might even work: They could well succeed in buying themselves the time needed to become the must-have point solution in corporate learning. They’d certainly live to see another day — and, certainly, a cornucopia of attractive options from the competition would continue to be available to potential customers.

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