BUYER CASE STUDY The Organic Ap proach: Intrepid Learning Solutions' Learning Outsourcing Agreement w ith Autodesk

Peter McStravick

IDC OPINION
In March 2005, Intrepid Learning Solutions announced a two-year training outsourcing agreement with Autodesk Inc., a software and services company based in the United States. As part of the engagement, Intrepid is providing training outsourcing services to Autodesk's channel partner readiness program and consulting group while also providing additional services to the entire company. IDC believes that this deal signifies the following trends in the select training outsourcing market: ! Not all training outsourcing opportunities present themselves as requests for proposal (RFPs). ! The use of open or flexible contract agreements is allowing vendors to showcase their entire suite of services. ! Vendors are adopting both a packaged and an organic approach to market their outsourcing services. ! The message of increased visibility is resonating strongly with companies with decentralized training functions.
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IN THIS BUYER CASE STUDY

On March 15, 2005, Intrepid Learning Solutions announced that it had been selected by Autodesk Inc. to provide training outsourcing services to the company's channel readiness training program. This document provides a comprehensive view of the evolution of the deal, including the key issues of the decision-making process, components of the engagement, and the current state of the engagement. This study is based on phone interviews with Glenn Oclassen Jr., director, North America Channel Readiness, Autodesk, and Laura Moraros, director, Client Management, Intrepid Learning Solutions.

Filing Information: May 2006, IDC #201513, Volume: 1, Tab: Others Corporate Learning and Performance: Buyer Case Study

SITUATION OVERVIEW
Organization Overview
Autodesk is a software and services company located north of San Francisco in San Rafael, California. Founded in 1982, the company was first known for its AutoCAD product, one of the first drafting applications for the personal computer. Today, Autodesk is a global organization that serves more than 6 million users through six different service lines providing solutions to the building, manufacturing, infrastructure, digital media, and wireless data services industries. In FY05, Autodesk recognized over $1.2 billion in revenue. The training needs within a company of this size are enormous. Autodesk employs a decentralized training strategy to address the unique training requirements of all of its internal and external constituents across its six different service lines. Of particular importance to the company are its channel partners, which account for 90% of Autodesk's revenue. Not surprisingly, channel readiness is a major training initiative within the company. Although this decentralized approach was adequate to meet the training requirements of the company's individual groups, Autodesk recognized that from the enterprise level it had limited visibility into its collective training needs and little means of providing structure or consistency across all business units. As a first step to address this issue, Autodesk brought in Intrepid Learning Solutions in 2003 to conduct an analysis of the company's customer education organization operation, a group responsible for building content in support of Autodesk's end users. Following the successful completion of the analysis project, Autodesk contracted with Intrepid again to develop training content in support of the company's Manufacturing Solutions Division where it developed a curriculum for the division's channel partners called Manufacturing 101. Simultaneously, the company was also contracted to provide performance support to assist Autodesk's partners in implementing complex software solutions. Through this organic approach, Intrepid was able to establish itself within Autodesk, prove its value, and become one of the company's preferred vendors. As Intrepid's presence within Autodesk continued to grow, and Autodesk's desire for training expertise continued to spread across business lines, the stage was set for Autodesk to make a bigger commitment to Intrepid for its training services. As Autodesk's Glenn Oclassen told IDC, "In an incremental project-by-project, deal-bydeal scenario, Intrepid made themselves invaluable to us to such a point that we recognized that it was to our strategic advantage to leverage a longer-term partnership with Intrepid in order to capitalize on the economies of scale they could provide and better leverage the visibility they had into our company." This evolution of its relationship with Autodesk is consistent with Intrepid's overall growth strategy, which is to actively pursue training outsourcing engagements while continuing to prove the company's value to its clients with each incremental opportunity.

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Scope of the Deal

Effective January 28, 2005, Autodesk signed a two-year agreement with Intrepid Learning Solutions for a host of learning services, the foremost of which are content development services in support of Autodesk's channel partner readiness program, partner technical training, and performance support solutions. The specific terms of the agreement, however, are broad in scope to allow Autodesk to draw on Intrepid's expertise in any training area the software company deems appropriate. The range of services Intrepid provides to Autodesk as part of this agreement include: ! Primary services: # # Content development for channel partner readiness program Performance support solutions

! Additional services: # # # # End-user training in support of Autodesk's full suite of products Learning strategy and analysis services Evaluation, measurement, and reporting services Learning management administration services system (LMS) implementation, support, and

Content development workshops

These services will be provided by Intrepid's Client Services and Consulting Development groups. Neither company was able to estimate the percentage of training services Intrepid is managing under the terms of this agreement, given the volume of training that occurs at Autodesk and the company's decentralized structure. With the majority of Autodesk's training budget for channel partners spent externally, no one from Autodesk was rebadged as part of the outsourcing agreement.

Key Issues in the Decision-Making Process

Autodesk had a number of criteria that influenced its decision to work with Intrepid Learning Solutions on a long-term basis: ! Demonstrated patience. Autodesk's decentralized training model required significant analysis by the company to gain an understanding of the scope of its global investment in training. Autodesk therefore appreciated Intrepid's willingness to work with the company while it assessed its learning needs and determined whether an outsourcing arrangement made sense. Autodesk says it did not see this patience from some of the larger training outsourcing providers, which were quick to push for a training BPO arrangement.

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! Good cultural fit. As with all outsourcing agreements, the intimate nature of the working relationship requires a good cultural fit between the service provider and the client. Intrepid had demonstrated through a number of successful projects that it understood Autodesk's business. ! Training experience. This goes without saying perhaps, but an important factor for Autodesk was Intrepid's breadth of training experience. Through its earlier project work with Autodesk, Intrepid was able to showcase its breadth of services, which included content development, instructional design, adult learning theory, program management, and analysis consulting. ! Economies of scale. By the time Autodesk considered an outsourcing solution, Intrepid had established itself within the company with a number of project-based training engagements. From a simple procurement standpoint, it made financial sense for Autodesk to make a long-term commitment with Intrepid to secure better rates and recognize greater economies of scale. ! Ability to fill the white space. As a global, multidivisional organization, Autodesk was looking for a service provider that could provide greater visibility into Autodesk's training needs across each of its business units and give candid feedback on the company's best practices and areas for improvement. Autodesk described this quality as the ability to "fill the white space." Intrepid's experience working with many of Autodesk's business lines gave the vendor the opportunity to observe enterprisewide patterns and identify inefficiencies, redundancies, and areas where Autodesk could achieve greater scale.

Governance Structure Team Autodesk

The relationship with Autodesk is managed via Intrepid's Team Autodesk, a group of dedicated account managers. These managers are responsible for overseeing the training needs of their respective stakeholders, which include North America Channel Readiness, Partner Technical Training, Autodesk Consulting, Worldwide Sales, Manufacturing Solutions, Infrastructure Solutions, Building Solutions, and Collaboration Solutions.

Challenges and Solution

As a large, decentralized software company, Autodesk faces many training challenges, including consistency of training content, process, and methodology. The company views its outsourcing agreement with Intrepid Learning Solutions as a vital first step in addressing many of these issues. To date, Autodesk has realized significant value from its engagement with Intrepid, in particular: ! Improved training product for channel partners. Autodesk sells a significant majority of its software through a mature channel partner sales model. Therefore, it is vitally important to the company's success to make sure these partners are knowledgeable and up-to-date on each Autodesk product. Autodesk is leveraging Intrepid's expertise in instructional design and content development to provide its partners with training content that is available before or shortly after product release and is more effective.

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! High levels of consistency. Historically, Autodesk's six business units each engaged with different content developers to produce their channel partner training materials for their respective products. This model placed the consistency of message, mode of training, and training content at risk. Since signing the agreement with Intrepid Learning Solutions, there is an overarching level of consistency to these offerings. Intrepid ensures that the user interface, level of interactivity, level of intuitiveness, and overall quality are similar for all training offerings and deliverables. A channel partner that is aligned with a specific Autodesk division now sees the same forms and approaches of content as it does from the rest of Autodesk. ! Increased visibility into overall training needs and processes. With the absence of a central organization responsible for training at Autodesk, the company needed greater visibility into its training needs from the enterprise level. Through its close working relationship with many of Autodesk's business units, Intrepid Learning Solutions is able to play the role of third-party observer and provide Autodesk with a dashboard into its channel readiness development needs and practices. ! New structured development processes. By working with Autodesk's partner technical training group and drawing on its experience in content development, Intrepid Learning was able to design a robust process methodology for all of Autodesk's technical training. Today, a structure is in place that specifies the content development process from the time that a need is identified in support of a particular project to when a subject matter expert is engaged, to the actual process around how that content gets built, when reviews happen, which developers are involved, and how it ultimately gets delivered to the resellers. ! Ability to leverage training expertise across the enterprise. The open-ended nature of the outsourcing agreement with Intrepid Learning allows Autodesk to draw on the vendor's training expertise and employ it wherever it is deemed most valuable. For example, following a series of channel partner training projects, Autodesk asked Intrepid to provide coaching to its internal group responsible for developing training presentation materials for Autodesk's annual owners' and principals' strategic conference. This opportunity has since grown into a content development workshop series in which Intrepid regularly presents to Autodesk's internal content developers. ! Ability to economically scale to meet the company's growing training needs. As training needs increase, Autodesk scales its training resources through Intrepid Learning by taking advantage of the agreement's variable cost model. ! A trusted advisor in learning transformation. In providing services to Autodesk, Intrepid Learning is serving as trusted advisor in helping the company meet its goal of transforming the channel partner readiness program. Autodesk's recently formed channel readiness council only became possible after each of the business units had adopted Intrepid's consistent design methodology. Now with everyone using the same model, the council has become a mechanism for establishing metrics for measurement, comparing results, and sharing successes

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and opportunities across all participating business units. Intrepid continues to work with the council to help define metrics, develop more precise measures of effectiveness, and assist in reporting results back to Autodesk.

Results
The focus for Autodesk during the first year of its agreement with Intrepid has been to make significant strides in getting its training house in order. A year into the agreement, Autodesk is extremely happy with the progress it has made and the value it is receiving for its dollar. Oclassen stated in his interview with IDC that the goal for Autodesk in entering the outsourcing agreement with Intrepid was not to spend less money, but to spend its money more wisely, and the company believes it is now doing that. As Autodesk enters the second year of the agreement, additional goals the company has set for itself include: ! Gradual reallocation of internal resources to more strategic activities ! Taking an increasingly proactive approach to training ! Improved measurement of training impact and effectiveness (i.e., Kirkpatrick levels three and four) ! Continued organizational transformation as business units recognize the growing value of training initiatives

ESSENTIAL GUIDANCE
Autodesk's experience in the run-up and implementation of this outsourcing agreement holds important lessons for vendors in the training outsourcing market: ! Recognize that not all opportunities present themselves as RFPs. As the Autodesk case shows, not all outsourcing opportunities go through a formal RFP process. Vendors of learning services, therefore, must develop processes for identifying these less visible opportunities as part of their business development strategy. ! Adopt an organic approach as part of the growth strategy. A packaged outsourcing solution is very attractive to clients who know they are looking to adopt that type of strategy. An organic approach, however, resonates with companies that do not have visibility into their training. As part of their growth strategy, vendors should adopt a dual approach that uses both the packaged and organic methods. ! Fill the white space. Particularly within decentralized training organizations, vendors should market the visibility they bring to clients. Vendors can provide an enormous value by filling the white space that exists between their clients' different business units and by establishing metrics and identifying similar patterns, common training needs, and areas where economies of scale can be realized.

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! Consider a flexible contract. Vendors should employ a flexible structure in the outsourcing agreement to encourage clients to use the full suite of their services. While the primary service Intrepid provides to Autodesk is content development for its channel partner readiness initiative, the contact between the companies is flexible enough to allow Autodesk to use Intrepid's expertise in a variety of capacities. This arrangement has allowed Intrepid to grow the value it brings to Autodesk and showcase its full range of expertise.

LE ARN MORE
Related Research
! Taking the Pulse of Training Outsourcing (IDC #34949, March 2006) ! IDC's Worldwide Perspective on Training Outsourcing (IDC #34621, December 2005) ! Worldwide and U.S. Business Process Outsourcing (BPO) 20052009 Forecast: Market Opportunities by Horizontal Business Functions (IDC #33815, August 2005) ! On the Outsource Looking In: Why Training Outsourcing Providers Aren't Serving the Little Guy (IDC #33557, June 2005) ! U.S. Training Outsourcing Services 20052009 Forecast: Demystifying Training BPO (IDC #33451, May 2005)

Copyright Notice
This IDC research document was published as part of an IDC continuous intelligence service, providing written research, analyst interactions, telebriefings, and conferences. Visit www.idc.com to learn more about IDC subscription and consulting services. To view a list of IDC offices worldwide, visit www.idc.com/offices. Please contact the IDC Hotline at 800.343.4952, ext. 7988 (or +1.508.988.7988) or sales@idc.com for information on applying the price of this document toward the purchase of an IDC service or for information on additional copies or Web rights. Copyright 2006 IDC. Reproduction is forbidden unless authorized. All rights reserved.

Published Under Services: Corporate Learning and Performance

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