Tambellini Group Spotlight


Higher Education Reverses Upward Trends in Technology Investment Selections, With Sharp Declines in 2022 from Previous

Tambellini Group’s 2023 Student, Finance, and HCM Systems US Higher Education Market Share, Trend, and Leaders Reports uncover unexpected insights on technology investments for 3,316 institutions.

Irvington, Virginia – April 20, 2023After strong year-over-year growth in 2021, higher education institutional selections for modern administrative systems across finance, human capital management, and student declined by double-digit percentages in 2022 amid growing economic uncertainty.

The Tambellini Group’s 2023 US Higher Education Market Share, Trends, and Leaders reports for Student, Finance, and Human Capital Management (HCM) systems showed the following:

  • 17 percent decrease in finance selections in 2022, compared to a 63 percent increase in 2021.
  • 24 percent drop in HCM selections, compared to a 67 percent uptick in 2021.
  • 25 percent decline in student selections, compared to a 98 percent surge in 2021.

Because these three systems comprise the core of an institution’s technology infrastructure, shifting to cloud-based systems is a high-impact and expensive technology investment that signals an institution’s long-term commitment to fundamentally changing its operations. Large research universities (R1 & 20K+ FTEs) spend anywhere from $30-100 million with vendors on these projects, and small institutions can spend more than $5 million in the first five years of implementation.

“The declines in all major areas of selections in 2022 reflect the magnitude and impact of the resource challenges almost every higher education institution faces, including staffing shortages, declining enrollments, and overall economic uncertainty,” said Vicki Tambellini, CEO and Founder of the Tambellini Group.

“Despite those challenges, it’s also important to note that the overall 10-year trend data show higher education institutions making continued steady progression towards investing in modernizing their technology stacks. We expect this pace to gradually increase as more institutions plan for the eventual replacement of on-premises applications.”

2023 Notable Trends and Findings:

  • Student vs. Finance and HCM: The overall adoption of SaaS-architected student systems lags behind the market’s adoption of finance and HCM systems by approximately 4 percent.
  • Student Systems: 2022 selections still outpaced the number of student selections in each of the preceding years from 2016-2020.
    • Finance and HCM Systems: 2022 selections outpaced each of the preceding years from 2018 to 2020.
  • Market-Wide Adoption: While institutions are steadily moving their student, finance, and HCM systems to the cloud, the predominant deployment method for new selections has shifted from cloud hosted to SaaS-architected.
    • Student: More than 84 percent of U.S. higher education institutions with student solutions have not yet selected a SaaS-architected student solution.
    • Finance and HCM: More than 80 percent of U.S. higher education institutions with finance and HCM solutions have not yet selected a SaaS-architected solution.
  • Vendor Landscape: Among the six top vendors chosen by at least 1 percent of the higher education market: Anthology, Ellucian, Jenzabar, Oracle, Thesis, and Workday—the market share by vendor has experienced minimal changes over the last year, though vendor preference varied substantially by size and type of institution.  

Report Methodology and Data

The 2023 Financial Management and Human Capital Management Systems US Higher Education Market Share, Trends, and Leaders Report and 2023 Student Systems US Higher Education Market Share, Trends, and Leaders Report are supported by primary research conducted by Tambellini researchers and analysts. Tambellini reports on postsecondary institutions and schools selecting the top vendor solutions. Tambellini tracks more than 11,500 US institutions in the Tambellini Database, including merged or closed institutions. The data included in these reports are based on selections at 3,316 US higher education institutions and include all vendors with at least 1 percent of the total U.S. higher education market share in finance, HCM, and student systems.

About the Tambellini Group

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 annual and unbiased research reports that provide insight and analysis on the changing technology landscape. With nearly 5 million data points, including over 20,600 global institutions and more than 100,000 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.

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