Announced on a Saturday, this deal signifies that the Tech Titans may be loosening their purse strings to make acquisitions that help them with long term growth (see a related Aragon Research First Cut on SuccessFactors). For SAP, this signifies that a growth via acquisition strategy may be a long term play for them. Note that for others, such as the IBM Software Group, this strategy has worked successfully for years.
Aragon Research will be doing a full First Cut with analysis of this announcement, which was announced today, December 3rd, 2011. It is clear now that there is a trend that has Talent and HCM Suites appear to be coming together (see Aragon Research First Cuts: Talent and HCM Part I and Part II).
One thing that we will be looking at long term is how well does Enterprise Learning fit inside a Talent Suite. In Enterprise Content Management (ECM) for example, Web Content Management never really got absorbed as part of that Suite (note, Aragon Research covers Learning as part of its Knowledge topic).
In the short term, this will put some pressure on remaining providers of Talent Management Software (Cornerstone OnDemand, Saba Software, Silkroad, Sumtotal Systems, Taleo, Ultimate Software, Workday) on what they do:
1. Remain standalone;
2. Combine forces with another Talent or HCM provider;
3. Get bought by a bigger tech titan (ADP, IBM Oracle, SAP).
Regardless, this may signify that with the better unemployment numbers that just got issued in the US, that it is a good time for large enterprises to loosen their purse strings and make some acquisitions.
Stay tuned for our Aragon Research First Cut early next week.