Cornerstone and Saba: What this transaction means for the industry



By Michael Rochelle, Chief Strategy Officer and Principal HCM Analyst, Brandon Hall Group

It has been a busy period for large-scale acquisitions in the HCM technology space. On Monday, it was announced that Cornerstone plans to acquire Saba. Many industry experts focus on the financial aspects of the deal, including the cash generation for Cornerstone and the combined base of 7,000 customers, complete with a list of corporate logos that would be the envy of any provider. This deal makes Cornerstone the largest learning and talent provider in the industry.

We have a different perspective on the transaction.

This potential blockbuster deal begs the question of how important it is to have learning and talent management integrated into the ultimate unified technology platform. The Saba acquisition is clearly Cornerstone’s answer to the question by combining arguably the largest R&D resources in the industry.

It’s still early to clearly determine what the final impact of the combined companies on their respective current and future customers will be. What we can say is that the potential for groundbreaking innovation coming from such a large R&D team is very exciting. In this era of a fourth industrial revolution and the digital transformation of HR, the acquisition of Saba could be a bellwether for what will drive future transactions: providers that need to build substantial intellectual property and know-how into their teams to stay ahead of the product innovation curve.

At this point, the future of Saba as an organization is unclear. As with all large acquisitions, it will take time for Cornerstone to unveil its plans for Saba. From what we can see, both organizations will continue to operate autonomously until the acquisition closes.

Michael Rochelle @MichaelRochelle, Chief Strategy Officer and Principal HCM Analyst, Brandon Hall Group

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