Tambellini Market Trends Report Shows Remarkable Growth in Higher Education Cloud Investments

Tambellini’s 2022 Finance and HCM Market Trends and Leaders report provides surprising in-depth insights covering higher education’s current technology strategies and future plans, culled from data on 4,300 institutions 

Irvington, Virginia – March 28, 2022 – Delayed pre-pandemic projects and strong market pressures to replace sluggish legacy technology systems prompted the biggest surge thus far in higher education’s investments in modern cloud infrastructure, according to an annual technology trends report released today by Tambellini Group.

The 2022 Financial and Human Capital Management Systems US Higher Education Market Share, Trends, and Leaders report shows that the rate of increase in both finance and human capital management (HCM) system selections during 2021 rose substantially over the previous year, continuing a strong upward trend:

• 63 percent increase in finance selections over 2020, compared to a 40 percent in 2020 over 2019 and 20 percent increase in 2019 over 2018.
• 67 percent increase in HCM selections over 2020, compared to a 45 percent increase in 2020 over 2019, and 17 percent increase in 2019 over 2018.

“Many institutions finally had the bandwidth to resume long-term technology projects that had been paused since 2020 due to pandemic-related factors, and others that struggled with the limitations of outdated and inflexible technology were motivated to move forward and modernize,” said Vicki Tambellini, CEO and Founder of Tambellini Group.

“We expect that the valuable benefits cloud-based systems offer in enabling remote work and learning, enhancing cybersecurity, and streamlining operations will continue to drive growth in the higher education market for years to come, despite considerable costs and downward budget pressures on institutions.”

2022 Notable Trends & Findings:

• Market-wide Adoption: Only 3 percent of the higher education finance and HCM market have made a modern cloud selection since 2015, when such systems became available.
• Vendor Landscape: Among the seven major vendors serving at least one percent of the higher education finance and HCM market—Anthology, Ellucian, Jenzabar, Oracle, SAP, Unit 4, and Workday—Workday was selected the most overall, followed by Ellucian as the second-most popular option.
• Public vs. Private Institutions: Public institutions experienced the most significant growth in selections at 59 percent, after holding steady at 56 percent for the last two years, while total selections for private institutions dropped to 41 percent, compared to 44 percent for the prior two years.
• Selections By Size: Midmarket institutions (with enrollments between 5,000 and 19,999) were the only market segment that increased their share of selections over 2020, rising 9 percentage points to 31 percent. Institutions with enrollments less than 4,999 dropped from 73 percent of selections to 65 percent, and those with 20,000+ enrollments decreased 1 percentage point to 4 percent of total selections over the previous year.

When purchasing and implementing a new cloud-based administrative system, institutions are making a high-impact, expensive investment signaling a long-term commitment to fundamentally changing their operations. Large research universities (R1 & 20k FTEs) can spend anywhere from $30–100 million on these projects, and even a small institution can spend more than $5 million in the first five years of implementation.

The report is based on Tambellini Group’s unbiased research, extensive interviews, and proprietary data from more than 4,300 US higher education institutions and covers all vendors serving at least 1 percent of the marketing.

Three administrative systems form the backbone of an institution’s technology structure: finance, HCM, and student systems. Tambellini’s 2022 Student Systems US Higher Education Market Share, Trends, and Leaders will be released on May 17th.  

About the Tambellini Group

The Tambellini Group is the leading independent technology research, analyst, and advisory firm dedicated exclusively to higher education.​ Tambellini Group members benefit from more than 100 unbiased research reports every year that provide insight and analysis on the changing higher ed technology landscape. With over 20,100 global institutions and more than 84,000 technology selections, the Tambellini Group’s proprietary Education Institution Technology Profile Database^® is unparalleled in the industry. Founded in 2001, Tambellini Group is a woman-owned business and a certified Great Places to Work^® company for 2021–2022.

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