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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The HILO 80 – Leaders in Corporate Learning

Posted on August 13, 2008. Filed under: Enterprise Learning, Organization & Governance | Tags: , , |

This week we introduced an important new set of research and recognition, the HILO 80® – the top 80 organizations we benchmarked in high-impact corporate learning through our High Impact Learning Organization® research program.

Methodology:   On an annual basis, we investigate the highest impact best-practices in corporate learning, looking at more than 50 different elements of the corporate learning strategy, organization, systems, processes, and governance.  In addition to understanding how these companies manage and implement their learning strategy, we also look at their performance:  performance in workforce readiness, in adapting to change, in talent management, and a variety of other business measures.

The result of this research is a set of modern and actionable best-practices which truly drive results.  These results are summarized in our Top 17 best practices, as well in the High Impact Learning Organization® research.  (I highly recommend you read it, it is one of the most complete research studies in this topic I have ever written.)

In addition, however, we also decided to look at precisely who these “high-impact” organizations are.  With close to 750 companies participating in this research, we had a lot of data to work with.  What we found was that there are a set of organizations that perform far above the average, and we named these the HILO 80.

How they Differ from the Rest:

If you look at these organizations, you find that they are good at many things.  They have strong executive sponsorship for enterprise learning, they invest continuously during good and bad times (but they do not necessarily spend more per employee on training!), they have adopted collaborative and informal learning strategies in addition to formal learning, and they run corporate training like a business (not like an education organization).  They have strong leadership, they hold themselves accountable to the business, and they spend money wisely, measuring the adoption and effectiveness of programs rather than institutionalizing training as an employee “benefit.”

The biggest thing I would like to point out is that they have a strong “learning culture.”  We are going to talk a lot more about what this means throughout the year, but consider the following simple chart:

Impact of Learning Culture

Impact of Learning Culture

When we ask people (employees, managers, and HR staff) how well their organizations value learning, we see a bell curve (the green area).  A small number of companies (3%) believe learning is valued at all levels, but the vast majority find it to be a “spotty” focus area.  When we look at the high-impact group, however (and impact is measured in business terms, not HR terms), you find a strong skew to the right.  These high performing companies are using learning as a business strategy (the topic of the another recent post).

If you dont understand what a “learning culture” means, consider a few of the following top 50 indicators we found:

  • Does your organization value career development as part of performance management?
  • Do people rotate into and out of training and development positions as part of their career?
  • Does your organization value error-reviews and investigation of the causes of mistakes or does it punish people associated with failures?
  • Does your organization maintain its investment in L&D during bad times?
  • Does your organization engage leaders and managers in the development process?
  • Does your CEO and COO consider employee development important enough for them to spend time on?

There are many other business processes which create a learning culture, but one thing is for sure, the HILO 80 do get it.

We built this list for two reasons:  first we want to recognize and reward these organizations for discovering the tremendous power of workforce development in their business success, and second to give our research members and readers a set of role models to learn from.  Many of the companies in the HILO 80 list will be presenting at our research conference, and many are being profiled in our case studies. 

I hope you seek them out individually as places to work, places to learn from, and organizations to emulate.

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Make Learning part of your Business Strategy

Posted on July 31, 2008. Filed under: Enterprise Learning, Learning 2.0, Learning Programs | Tags: , , , , , , |

One of the important lessons we have learned from our High Impact Learning Organization® research is the simple but profound fact that learning is part of a corporate business strategy.   While many HR and business leaders still believe that “training” is department which improves workforce productivity and should be treated as an expense item, our research clearly finds otherwise.  Corporate learning is a critical part of any enduring business strategy, similar to finance, marketing, sales, and manufacturing.

Consider the following:

Change is the biggest challenge organizations face:  There are five distinct phases of any business – startup, rapid growth, maturity, decline, and rebirth (or death).

Figure 1:  The Lifecycle of a Business
 

Every company we talk with is going through this cycle – whether its Apple with the i-Pod, Starbucks in Coffee, AIG with its insurance business, Fidelity in 401k, or Target in retail.  The lifecycle takes place across its entire organization or across its individual products and services.  (We will be talking much more about the way talent management strategies vary across these phases in upcoming research.)

The reason for this cycle is the nature of competitive markets.  Whenever a company finds a profitable market, others eventually find new ways to serve it.   This process creates competition and buyers become more savvy.  Prices go down, and the leaders must now find a way to climb further “up the value chain.”  Today we see this happening to Starbucks, for example.  This process of continual evolution is not something you do occasionally, in today’s rapidly changing markets you have to do it all the time!

Caterpillar, one of our best practice research companies, is a good example here.  The company has evolved from steam tractors into a highly diversified global manufacturer of engines, machines, tractors, equipment,  services, and apparel.  During its  100+ year history Caterpillar’s people have had to “learn” a lot – and the company views learning as a strategic part of its business planning and execution process.

We call the companies which succeed over these cycles “enduring organizations,” and they are the focus of a major research effort we have been working on this year.

Learning is the core of Adapting to Change.

If you accept the fact that change is one of the biggest issues a business faces, then the ability to continuously adapt to change (organizational and individual learning) is one of the most important parts of a long term business strategy.   Unfortunately, many organizations don’t internalize this.

For example:  One of the most frequent questions we discuss with L&D leaders is the question of how to measure the value of training.  They ask this question because their leaders (VPs of HR or business leaders) question the investment in L&D and want to do a “zero based budget” each year.

The critical issue here is the top finding in our High Impact Learning Organization research:  the biggest driver of impact from learning investments comes from the development of an organizational “learning culture.”

 A learning culture has many elements, including the organization’s:

  • Ability to face up to its mistakes
  • Ability to use errors as a learning process, not a punishment process
  • Ability to sustain workforce development through bad times and good
  • Ability to break things that seem to work and improve them before they really break
  • Ability to coach people (the #1 high impact talent process)
  • Ability to rotate people into development roles at all levels.

These “cultural” processes in companies go far beyond the L&D organization – they infiltrate leadership, management, operations, rewards and recognition programs, and values.  (The top 50 elements of such a learning culture are part of our HILO research.)

We are just about to announce our HILO Top 80®, the 80 Leading organizations in our High Impact Learning Organization research.  When you look at this list, you will see many iconic brand names – but you will also see many small and mid-sized companies which are highly profitable, highly successful, and owners of their markets.  These organizations realize that learning is part of a business strategy.

Learning vs. Execution Culture

Many organizations call us to ask for help in “measuring training” or “reorganizing L&D” or “building a blended or collaborative learning strategy.”  These are critically important parts of executing the learning strategy of an organization.  But the learning culture goes further – it means that you must balance learning with execution in every single business process.  And we must be careful to balance the focus between “learning” and “execution.”  Many companies think they compete against each other, while in reality they are totally aligned.

Consider the following.  Are the two columns competitive or complimentary?

 Figure 2:  Execution Culture vs. Learning Culture

One may argue that “we don’t have time for learning,” we have a job to do.  Well that is true.  But of course if you are not “learning” while you “execute,” you are likely to “execute” yourself into oblivion.  Learning and Execution go together.

Examples of Learning as a Business Strategy

Consider Toyota.  How can Toyota manage to be first-to-market in hybrid automobiles, yet still continously compete against GM in trucks, mid-sized cars, and other existing markets.  Are the engineers at Toyota smarter than the engineers at GM? 

Absolutely not.  I have met several GM executives and they are among the smartest and most focused leaders of any business.  But somehow they have not built the same culture of continuous learning which Toyota has.  Toyota has many well documented processes which build and reinforce this culture of learning:  quality programs, Kaizan, career development, experimentation, and empowering line workers to identify problems and fix them.

Consider GM.  GM, for all its challenges, is an amazing company.  As they fight their high labor and medical costs and work to trim products, they are instituting many innovative new learning programs – and I sense that their learning culture is undergoing tremendous change. 

For example, GM has recently created a program called its “JumpStart” program for younger employees.  These GenX and GenY engineers and marketeers get together and have created career paths and development strategies in conjunction with the top 72 leaders at GM.  Recently the JumpStart team created a “car of the future” and went out and purchased a wide variety of electronic devices, music players, cell phones, and PC’s to demonstrate the opportunity for GM leaders to further innovate on user design and consumer electronics integration.  These initiatives are being thrust upon the “old guard” at GM to shake up complacent thinking and encourage innovation in products like the Volt, GM’s new electric vehicle.

Consider Bank of New York/Mellon.  In this organization, as in many other strong learning organizations, there is an assigned organizational effectiveness consultant located in each major business area.  This individual monitors and evaluates all work processes to look for opportunities to measure job effectiveness, find errors, and implement new opportunities for learning and performance improvement.  In effect, this role is a “learning culture” manager.

Consider EMC, one of the most successful high technology companies ever founded.  EMC sells a wide variety of disk storage, enterprise software, and IT services.  EMC has a business manager role entitled “Director of Business Performance” who serves as the performance consulting manager in each and every major business unit.  This person reports to the corporate university structure, but their job is to help the business unit implement continuous learning in all aspects of the business — including identifying processes with errors and flaws.

Learning Culture means Honestly Identifying Errors

Once an organization considers learning part of the business strategy, they look at “execution” differently.  They rigorously measure performance, constantly looking for errors and variances, and reward and incent managers and employees to fix errors.  They empower line workers to fix things immediately, and they provide a wide variety of formal and informal learning solutions at all levels. 

Our research identifies the top 50 elements of a strong learning culture, and you find that every one of these elements is “good business.”  If you are an HR or L&D leader, you can promote and spearhead this philosophy through your programs and organization and approach.  If you are a line manager or leader, you can think about how “learnign and execution” are both different sides of the same coin, not necessarily in conflict with each other.

More to come on this critically important topic…

 

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New Disciplines of the Modern Training Organization

Posted on June 2, 2008. Filed under: Content Development, Learning 2.0, Learning Programs, Talent Management | Tags: , , , , , , , , , |

This month we are launching The High Impact Learning Organization®, a research study which has been more than three years in development.  During this time we have interviewed hundreds of corporate HR and training leaders and reviewed in-depth trends of more than 780 global organizations. 

Listen Audio Overview of this research:  click here.

As I have been discussing this research with our research members, I realize that one of the most profound changes that is taking place in corporate learning and development is the need for a new set of disciplines, a new set of skills and competencies.  The traditional “instructional design, development, and delivery” skills, while still important, are fading into the background.

New Skills and Disciplines

  • Facilitating learning, not Delivering learning.  In today’s networked organizations, informal or collaborative learning is now critical.  Rather than creating a learning program and delivering it to an audience, today’s high-impact learning organizations create learning opportunities – by creating communities of practice, social networking experiences, and subject-matter expert-led experiences.  NetworkAppliance, Cisco, Dell, Pfizer, IBM, and many of our other research members have transformed their learning organizations by providing tools and opportunities for experts to teach and share information. Such tools and systems include blogs, wikis, video studios, rapid e-learning tools, RSS feeds, and even “twitter” and other social networking tools. 
  • Information Architecture, not just Web Design.  In today’s corporate learning environment, it is not enough to build “compelling courseware” or an “easy to use LMS.”   We have too much information available to our employees and customers:  product documentation, job aids, online courses, how-to guides, videos, and more.  The critical skills needed are the ability to create an online experience which is relevant and usable for the employee at their time of need — and this requires a focus on information architecture, not just “ease of use.”  (For more information on “information architecture” please read our research.)
  • A Learning Architecture, not just Blended Learning.  The concepts of blended learning, which I first wrote about in 2003 and 2004, have not gone away.  In fact they are more important than ever.  But now you have so many choices of media, collaborative tools, simulations, and other forms of content that you must ration and simplify your choices.  The answer is what we call a “corporate learning architecture,” which describes the tools, approaches, and processes you will support in your organization.  It gives program managers and learning executives a recipe of what to do when.  Again, we discuss this in detail in our research.
  • Competency-Based, Role-Based, and Function-Based Learning, not just Learning Paths.  In today’s “content-rich” organizations, our job is now to create “relevance and context” not just “content.”  This means that when we create a learning program and some online experience to supplement it, we must consider how the learner will locate, use, and apply the content.  If the program is a career or leadership development program, it must be competency based.  If it is a performance-driven learning program, it may need to be role-based (e.g. defined and customized for a certain job role) or function based (e.g. defined and customized for certain job functions which may cross roles).  Each of these models requires a slightly different way of thinking about and developing content.

    A perfect example is sales training for a new product rollout.  Do you want to develop skills in product usage and demonstration?  Do you want to develop skills in sales objection handling?  Or do you want to build solution-selling skills?  Each possible training strategy will required content in different forms for different uses – and in most major product rollouts you need all elements!  Read our Learning Leaders® report on how Symantec solved this problem in their massive new security product rollout.
  • Integration with Talent Management, not just Driving Organizational Competencies.  Finally, one more “new discipline” which we must all address is the need to work closely with our talent management brethren.  In today’s talent-constrained organizations, the L&D organization must understand the needs for new career development programs and portals, integrated performance and development planning processes, competency-based assessment and recruiting, and onboarding.  These processes are not new to L&D professionals, but they take a different level of rigor and approach to the traditional “performance-driven” training programs.  They are more complex, take longer to implement, and require a deeper level of organizational commitment and change.

The Traditional Skills and Disciplines

 Many things in organizational learning have not changed.  You must still understand the principles of performance consulting, needs analysis, instructional design, and assessment.  Learning organizations must still partner closely with line managers and business executives to understand the skills needed to meet urgent new business priorities.  And they must continue to hold themselves accountable for measuring the adoption, alignment, efficiency, and impact of the L&D investment.

But while these disciplines remain, our research clearly shows that the “high-impact” organizations are focusing more and more on developing the new skills above.  Read more about the Top 18 High-Impact Best-Practices of High-Impact Learning Organizations in our research.

As always, I welcome your comments.  

(To get a copy of The High Impact Learning Organization® research report, click here.)

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The Role of a Learning Culture in 2008

Posted on January 30, 2008. Filed under: Content Development, Enterprise Learning, Learning 2.0, Learning Programs | Tags: , , , , , , |

We recently completed a major research program which studies the elements of corporate learning which deliver the highest levels of business impact. Our findings were fascinating, providing valuable guidance for anyone in the corporate learning industry.

First, there are two types of solutions provided by corporate learning organizations. The first type, which we call “performance-driven” learning solutions, drive near-term competitive advantage. These programs help the organization with timely, urgent problems.

There are many performance-driven learning solutions in organizations; Consider a major blended learning program to assist sales and service people understand a product rollout, a coaching program to help managers understand how to deal with a business downturn or shift in employee demographics, or an e-learning program to help employees understand how to use a new IT system. These programs drive immediate and measurable impact – and their success is driven by your ability to:

  1. Clearly diagnose the problem (performance consulting)
  2. Understand the nature of the audience (needs analysis)
  3. Build interesting and engaging content (content development)
  4. Deploy and manage the program effectively (program management)
  5. Implement new technology where needed (e-learning)
  6. Measure results and find areas of improvement (measurement).

These six operational skills are critical to success in performance-driven learning, and most L&D professionals (and CLOs) realize that they must continuously work to improve and update their processes and skills in these areas. (Our research found that performance consulting, in fact, is the “highest-value” of these six, by the way.)

But there is also a second, completely different type of solution provided by corporate learning organizations. This value focuses on “long-term” competitive advantage, enabling the company to grow, adapt to change, attract and retain great people, innovate, focus, and meet customer demands. These long term strengths are not developed through “performance-driven” learning, rather they are developed through this second set of strategies, which we call “talent-driven learning” solutions.

Talent-driven learning solutions also take many forms: a multi-tier leadership development program (where almost 25% of corporate L&D dollars go) is the archetypal example of a talent-driven program. A complete sales curriculum (such as Cisco or IBM’s end-to-end sales training program, which takes place over years) is such a program. A corporate wide quality and process improvement program (such as GE’s Six-Sigma, Caterpillar’s new manufacturing process program, and Rockwell Collins process improvement program) is a talent-driven solution.

These programs, as we named them, build talent. They go far beyond the development of skills – they focus on deep-rooted competencies, behaviors, and culture. They must be integrated with career development models and performance management in order to succeed. And they take years to build and mature, demanding a long-term investment.

These talent-driven learning programs provide more intangible benefits (employee flexibility and satisfaction, engagement, innovation, retention), but far greater impact over the long term. In fact, our research found that in 2008 learning organizations are focusing very heavily in this area, driven largely by the tremendous shifts taking place in the demographics of the workforce. The development of talent-driven learning solutions causes stress: you need large capital investments, you must centralize more of your L&D resources, and you must partner far more closely with HR and talent management teams.

Interestingly, as we analyzed the data for our upcoming High Impact Learning Organization research, we found that among more than 40 different dimensions we studied, the single factor which best predicts the business impact of a learning organization is the “learning culture.”

What is a “learning culture?”

Simply explained, we define an organization’s “learning culture” as its ability and willingness to embrace individual and organizational learning as a strategic part of its business strategy. In other words, does your organization focus primarily on “results?” Or does it also embrace the strategy that the organization itself is an organism of people who must continuously develop, grow, and adapt to meet changing market conditions?

There are many ways to measure of the learning culture, and we have come up with a scorecard to help you assess your culture. For example, does your organization have a formal employee development process coupled with the performance management process? Are there formal coaching programs available for managers and leaders to help them learn how to listen and develop employee performance?

At an organizational level, does your organization embrace the idea that many new products and services will fail, and that we will “learn” from these experiences, rather than just punish the underperformers? Are there processes in place for employees to feed back suggestions and improvements? Is the organization porous and always listening to customers for new ideas and changes in the market?

At the highest level, does the organization have a history and experience with change and adaptation as markets change? Can the organization “re-learn” its business when suddenly it faces a major shift which forces it to change the nature of its products, services, and value proposition? Many high technology organizations, for example, are “one-product companies.” They fail to evolve beyond their first successful product. (Remember Informix and Ingres in the database market? People’s Express in the Airline Industry?) Others grow and prosper into powerhouses.

Your Role

The bottom line is this: a learning culture is built through a symphony of business processes – driven by the executives all the way down the organization. Your role as an L&D professional is to constantly be vigilant about the learning culture, ask questions to help others see its value, and take on the role as cheerleader to continuously improve the learning culture in each and every program. We know that an investment in this area will always pay off.

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