Life or Death: Building a Corporate Learning Culture

Posted on December 3, 2008. Filed under: Enterprise Learning, Talent Strategy | Tags: , , , , |

Witness the number of companies undergoing a wrenching transformation (read “potential death”) in today’s economy: the US Auto industry (GM, Ford, Chrysler) , the US Newspaper industry (LA Times, NY Times), and many elements of the financial services industry.

A recent global survey of 1100 business leaders by Boston Consulting Group found that one of the top three things keeping CEOs awake at night was their ability to “build a learning organization.”   Our research shows clearly that organizations can be broadly grouped into two types: those that “learn” and those that “don’t.” Those that “learn” have an uncanny ability to evolve: they are what we call “enduring” companies, and they find ways to continuously change their products and services as markets change.

Examples of companies that “learn” include UPS – which started as a horse and buggy delivery company and is now a global logistics company operating in every mode of transportation.   Another is Caterpillar, a company which has evolved its products from steam-driven tractors to a broad array of building equipment and services around the world.

Our High Impact Learning Organization® research demonstrates that companies which have a “learning culture” have much greater financial returns over a 10-20 year period – in fact the HILO 80, the 80 top companies in our 780 company research group, deliver more than 10% greater earnings growth and over 15% revenue growth over a 10 year period than the average in their industry.

Building a Learning Organization is a Matter of Life or Death

Today, with the economy clearly at a low point, an organization’s ability to learn is a matter of life or death.

So what is a “learning culture” and how do you build one?  Well there When we look at companies which endure and prosper over long periods of time, we see that they have an uncanny ability to innovate, reinvent themselves, and adapt to change.   Our research and upcoming Learning Culture assessment discovered that there are nine independent pillars which drive an adaptable learning organization:

  1. Executive Culture.  Do line executives truly support and reinforce the business processes and investments needed to support innovation and learning?  Do they take a personal interest in employee and leadership development?  Do they regularly move business leaders throughout the company to gain new perspectives?  Do they maintain funding for learning and innovation initiatives?  Do they drive and manage change?  Do they take risks and encourage and support new products?
  2. Managerial Culture.   Are line managers incented, coached, and directed to build capabilities in their teams?  Are they paid to develop people and innovate?  Are they empowered and motivated to be coaches and not just managers?  Are their a variety of support and development programs for managers to provide feedback and development for their people?  Are they rewarded for experimentation and innovation?  Are they open to “bad news?”
  3. Customer Culture.  How close are product, service, and support teams to customer needs?  Are there vigorous and regular processes for customer input?  Do customers have many ways to interact with the company and provide input?  Is customer input considered sacred and valuable?  Are customer facing roles given high priority and respect in the organization?  Is there a free-flowing set of customer needs available to everyone who creates or produces a product or service?
  4. Operational Culture and Process.  How are line organizations incented and organized?  Are employees provided with the opportunity to change processes and products when necessary?  Are their programs and systems to monitor and improve quality and customer service?  Are customers intimately involved in process and product development?  Are their processes in place to learn from mistakes or does the team “shoot the messenger?”  
  5. HR, L&D, and Leadership Development.  Does the HR and L&D organization have the funding, mandate, and executive support to build organizational and leadership development programs?  Do they support knowledge sharing programs?  What stage of maturity is the company’s leadership development program?  Are their regular opinion surveys and other forms of feedback from employees and customers which drive organizational change?  Is innovation rewarded and incented?
  6. Financial Support.  How is employee development, knowledge management, innovation, and training funded?  Does each business unit or operational unit have to find money in their own budget to accomplish such tasks?  Is there budget for skunk works or new ideas?  Is there a corporate funded group which promotes innovative development teams and programs?  Are such programs monitored and supported year after year or do they get cut during bad times?  Does the organization benchmark its spending against its peers?
  7. Career Planning and Employee Mobility.  Does the company have a plan, model, or process for career planning?  Is it easy or possible for someone to change roles or move into a new position regularly?  When a reorganization takes place, is there a way for people to move from team to team without penalty?  Are job rotation and developmental assignments regularly offered?  How well do managers understand and participate in the career planning process?
  8. Employee Development and Alignment.  How are employees developed and measured?  Do they have an incentive to build new skills, learn new things, and get involved in new projects?  Is development considered a valuable part of an employee’s career?  Is there a widespread goal development process and how does it accomodate the time needed to build new processes and systems?
  9. Technology Investment.  Is there an ongoing investment in technology infrastructure to support learning, knowledge sharing, employee connectivity, social networking, e-learning, content management, and other tools.


These nine pillars are not easy to build.  In fact, they often take years to build – but we find that high performing, enduring companies do each of these things well.  In the coming months we will be introducing a new set of research and assessment tools to help organizations understand their ability to “learn.”  

While many of these things seem “soft” – in fact they are “hard.”  They demand a focus from business leaders, HR, IT, and line management.  They touch the way a company is managed and the way the company works.  Does this matter today, in the middle of a recession?  You bet it does:  if your company wants to survive during a slowdown, you must be able to adapt quickly and effectively.

Watch for more on this topic in coming months – and a major launch of our research in this area at IMPACT 2009®.

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Talent Management in a Slowdown – Update

Posted on June 22, 2008. Filed under: Enterprise Learning, HR Systems, Organization & Governance, Talent Management | Tags: , , , , , , , |

In the last few months we have read more and more about the global economic slowdown.  Jim Cramer, the Wall Street pundit, wrote in today’s New York Magazine, that he has never seen things as dismal as they are on Wall Street.  Today the State of California announced a 5.7% unemployment rate, an increase of almost 12% over last month.  And I have noticed a fairly steady increase in HR and L&D leaders now looking around for work.

How is this affecting our HR and L&D organizations?  Our most recent Business of Talent® survey shows a similar impact on corporate HR and training.  Today 45% of HR and L&D executives cite “reductions in cost” as their top priority for the coming quarter, an increase of almost 30% over the last three months. 

In our just-released High Impact Learning Organization® research, we see similar trends.  Today’s L&D managers and executives cite “reducing the cost of training” as their #2 challenge, after business alignment.  And for the first time ever, people cited “building a business plan for learning” as their #3 challenge – illustrating the need to further take L&D investments and make them business-relevant and operationally excellent.

But in the midst of such news, we see many many good things coming.  As I mentioned in our earlier post on the economic downturn, “only when the tide goes out can you tell who is swimming naked.”  Now is the time for HR and L&D to become more relevant than ever.  In fact, one could argue that business slowdowns are good for talent organizations – they force us to become laser focused on what really matters now.

Witness some critically important things going on:

  • Organizations are focusing very heavily on building critical capability models for success.  Such models are mandatory to determine who to hire, who to develop, and who to lay off.  Organizations such as British Telecom, Microsoft, Chevron, GSK, Mercer, and Pemex are all spending significant new dollars to identify their critical competencies.  Such work is strategic and long-lasting.
  • Organizations are looking more carefully at HR systems investments.  We now see RFPs from companies which look far more carefully at the business strategies behind talent management, rather than projects to “automate” processes which may or may not be adding value.  One of the world’s leading consumer packaged goods organization recently asked us to help them rebuild their business case for talent management systems after spending six months gathering requirements.  Such an effort is good – it creates focus and business alignment in HR systems investments.  Nothing is worse than buying HR software to find that noone wants to use it.
  • Informal learning is exploding.  We are just about to publish a major research report on the use of social networking in corporate L&D.  Organizations now realize, often driven by cost reductions, that the corporate L&D organization can not possibly build all the content the company needs.  They are starting to invest in social networking and communities of practice as a mainstream solution.  In fact, in our High Impact Learning Organization Top 18 findings, we found that informal learning and content sharing are now more important to success than the traditional disciplines of performance consulting.
  • Centralization is coming back.  Almost all the clients we talk with now are looking for ways to reign in spending on L&D and other HR initiatives throughout the company.  Such efforts may look like cost savings from the outside, but inside they are driven by the intense need to coordinate L&D and HR efforts to build an integrated talent management process.  Caterpillar, Aetna, Rogers Communications, Wellpoint, and other clients are all focusing heavily in this “strongly centralized federated approach.”

We are preparing a series of reports on the economic trends driving HR, so stay tuned.  Even if the economy does continue to slow down, I hope you believe, as I do, that such a slowdown will not last beyond early to mid 2009.  My experience talking with hundreds of organizations shows me that even in times of great dislocation, our economy is filled with entrepreneurial and creative spirit to build new businesses in the face of change.  And change is something we must deal with in good times and bad.

More to come…  your comments welcome as always.


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On the Minds of HR and Learning Leaders

Posted on May 17, 2008. Filed under: Enterprise Learning, Organization & Governance, Performance Management, Succession Planning, Talent Management | Tags: , , , , , , , , , , , , , , , , , |

We recently completed our annual research conference and I had a wonderful opportuinty to meet and talk with 15 different HR and L&D executives in a special roundtable.   The theme of our research conference is The Business of Talent®, and as you will read, this theme comes through in almost every organization.  Talent management is a strategic business tool, not an HR initiative.

Commerce Bank and TD Bank:  Michelle Fetterman-Gaughan, vice-president and talent planning manager, discussed how her bank is going through a major merger with TD Bank – impacting 74,000 employees.  Commerce Bank developed a complete competency model for its commercial lending operation, which now must be merged and integrated into TD Bank’s competency models.  A key challenge ahead is the blending of corporate cultures and different competency models and systems.  Michele believes that Commerce Bank’s existing competency strategies will be extremely valuable during and after the merger, as new roles and responsibilities are defined.

Turner Broadcasting – Improving Competitiveness:  Michele Golden, vice president, talent management for Turner Broadcasting, discussed how this global media company faces intense competition in every market.  The company is putting together a three-year roadmap to create common processes, linkage of pay to performance, and new goal alignment systems to improve innovation and competitiveness.  She is collaborating with business leaders throughout the company to help craft these new integrated processes.

Aetna – Transition from Turnaround to Industry Leadership:  Deborah Kelly, head of Learning Services at Aetna, discussed how the company’s management-led turnaround was built on Aetna’s pioneering work in competency analysis, job analysis, and integrated management processes.  Now that Aetna is an industry leader, the challenge is how to take Aetna’s integrated talent management process and build processes and systems to foster innovation and leadership, not just execution.  Deb’s presentation is available to IMPACT attendees on the IMPACT 2008 Online community site

Verizon Wireless – Improving Talent Migration and Culture of Learning:  Lou Tedrick, Vice President of workforce development at Verizon Wireless, discusses how the company relies heavily on operational training and rapid development processes to keep its sales and service teams up to date on new products and services.  But as the company’s products continue to grow in volume and number, there is a need to drive learning down to the line manager level, simplifying the process and forcing individual managers to train workers on an informal basis.  In addition the company is now working to start migrating talent across the business entities to promote leadership development and deeper levels of succession management.

Boeing – Developing Technical Skills in the Manufacturing Workforce:  Ed Chang, senior project manager at Boeing, discussed how the average age of a Boeing manufacturing worker is 48 years old and as much as 15-20% of the workforce will retire in five to seven years.  One of his key objectives in attending the conference was to network with other attendees to identify best practices in building technical skills in newly hired workers.  The manufacturing skills required at Boeing take years to develop.  Ed’s challenge is to develop a wide variety of technical development programs to fill the anticipated gap.

Caterpillar – Global Model for People Management:  Fred Goh, director of strategic learning, Caterpillar University at Caterpillar discussed the company’s new integrated talent management model, which includes all elements of talent from recruiting to development to learning to diversity.  Caterpillar is building integrated career models throughout the company and using this new infrastructure to roll out Caterpillar’s new Global Manufacturing System.

Honeywell – Moving from Enterprise Learning to Integrated Talent Strategy:  Steven Teal, the former vice president and CLO of Honeywell, discussed how the company identified a tremendous gap in technical skills throughout its global defense and control businesses and realized that its enterprise learning function must migrate to an enterprise talent management function.  As he helped architect this new strategy, he realized that his existing role as CLO was no longer needed.  He helped the company define a new position, vice president of talent management, which will facilitate a more integrated approach to employee development, succession, and technical capability management.

Northshore Long Island Jewish Healthcare – Driving Performance through Leadership and Learning:  Kathy Gallo, senior vice president and CLO at Northshore LIJ, discussed how this well-known healthcare provider continues to be the largest and most profitable delivery operation in downstate New York.  Its talent development model, patterned after JetBlue’s flight training and GE’s leadership institute, provides deep levels of technical development for nurses and medical professionals, focuses heavily on leadership development and action learning, and focuses heavily on innovative learning techniques to drive the highest levels of patient care, employee retention, and performance.

Northrop Grumman – Retaining Talent in a Company of Acquisitions:  Kathy Thomas, vice president of learning and development for Northrop Grumman, described how this 120,000 employee organization operates as diverse business entities with loosely-federated model for employee development.  She described how the company uses a series of leadership councils to build consensus in its leadership development, executive succession management, and technical skills development across its broad and highly diversified businesses.

Yum! – Providing Consistent, Efficient, and Highly Focused Retail Training Worldwide:  Rob Lauber, vice president, YUM! University and global learning services, described how this one-million- employee powerhouse (Pizza Hut, KFC, Taco Bell, and other brands) is just now rolling out world-wide training systems and programs to provide consistent, sharable training programs in restaurant operations.  This complex implementation will give the company the ability to run brands independently yet provide tremendous sharing and efficiency in functional training, onboarding, food safety, and other important operational talent development needs.

Xerox – Implementing a New Strategy for Continuous Learning in Professional Services:  Gary Vastola, vice president, Xerox global services, discussed the implementation of a three-year plan to blend classroom, e-Learning, and Learning 2.0 tools to develop the knowledge and skills of Xerox services resources worldwide.  This operation will focus on promoting a continuous learning culture and has been incorporated into the overall Xerox global services strategy.

Aramark – Creating a Common Talent Scorecard among Broadly Distributed Operations:  Liviu Dedes, vice president of organizational effectiveness and development for Aramark, described how the company manages its widely distributed businesses in food service, prison operations, and other people-intensive businesses.  He discussed how he has instituted a standardized human capital scorecard across the corporation to facilitate operational reviews of talent, standardized processes, and global talent data to help his team implement focused programs to solve talent management problems throughout the company.

Wellpoint – Implementing an Integrated Talent Process and Performance-Driven Culture:  David Casey, vice president of talent management for Wellpoint, discussed how the company has been rebuilding itself after a major merger into a “leading innovator” culture by developing an integrated talent management strategy, centralized L&D strategy, and new process and systems strategy to drive leadership development, a performance-based culture, and faster response to talent gaps in the company.

The Business of Talent

These are only a few of the leaders who joined us this year at IMPACT 2008:  The Business of Talent®.  I was inspired and energized by the business focus and technical prowess of these leaders.  Enterprise learning and talent management is never easy and never a one-size-fits-all solution.  Each organization must use its skills in leadership, organizational development, and learning to build the right organization, processes, tools, and systems to drive business change.  Conference participants demonstrated that enduring organizations are “talent machines” – they focus on people first, and products and services second. 

We look forward to your comments.  And look for details on IMPACT 2009 coming soon.  We have even more planned for next year’s conference.

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