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Aligning Corporate Learning With Strategy

Blog: Colin Crofts - Business Process Improvement

Too many corporate learning and development programs focus on the wrong things. A better approach to developing a company’s leadership and talent pipeline involves designing learning programs that link to the organization’s strategic priorities.

Survey after survey of CEOs points to a shortage of leadership and
management talent as a leading concern.1 In an era when the capabilities
of knowledge workers, not technology or capital, is often the key
constraint on growth (particularly in emerging markets), this is hardly
a surprise. The mystery is how ineffectual the response has been. It’s
not that companies aren’t willing to invest in developing their people.
They spend heavily in this area: In 2012, companies in developed
economies spent nearly $400 billion on training.2 And yet, at least
one study concludes that the majority of managers believe that
employee performance wouldn’t suffer if their own company’s learning
function were eliminated altogether!3 As corporate learning professionals,
we find this lack of appreciation dismaying.
The fact is that much of the investment and effort that organizations spend
on learning is focused on the wrong things. For example, companies often
ask us to assess whether the types of learning experiences they provide
their employees are “cutting-edge.” The proliferation of online courses
and just-in-time knowledge available through mobile apps is prompting organizations to rethink traditional approaches to learning, so it’s
understandable that many corporate learning leaders are paying more
attention to innovative modes of instruction. In our view, technology has
the potential to expand and democratize the reach of learning in
organizations. Moreover, research in neuroscience and the science of
learning is revealing more every day about how effective learning
experiences engage the cognitive and emotional centers of our brains.
But breakthrough advances will only be possible when learning is
linked to business goals. In our opinion, the emphasis should be on
strategic alignment of learning rather than on how learning is delivered.
The importance of alignment in learning and development is receiving
increasing attention.4 In 2009, the European Foundation for
Management Development (EFMD), based in Ixelles, Belgium,
established a system for accrediting corporate learning organizations
that included a set of criteria for assessing how well corporate learning
aligns with overall corporate strategy. EFMD’s Corporate Learning
Improvement Process, which one of us helped develop, was the first
effort of its kind to define research-based assessment standards for
evaluating and accrediting corporate universities and learning functions.
One notable finding in the accreditation reviews was the relatively
weak performance on measures of learning alignment and wide
disparities among organizations on this dimension.5 This article builds
on the research in this area to identify underlying causes of poor
learning alignment and best practices of leading companies.
The word learning, which has largely replaced training in the corporate
lexicon, suggests “knowledge for its own sake.” However, to justify
its existence, corporate learning needs to serve the organization’s stated
goals and should be based on what works. We see many corporate
universities turning toward the academic paradigm, choosing to become
gateways to the array of learning resources available from edX,
Coursera, TED, Khan Academy, and social networking sites. Many
companies assign much of the responsibility for deciding what, when,
and how they learn to employees. But in our view, this approach
won’t address the talent conundrum: There’s too much focus on learning
and not enough on meaningful development.
If corporate learning and development is to remain relevant, learning
leaders must shoulder the burden of developing the company’s talent
capabilities and supporting strategic priorities. CEOs and top executives
also have a critical role. Although many corporate initiatives might
benefit from personal attention from the top, developing the company’s
leadership talent must be on the list. The good news is that many top
leaders seem interested in making this happen: In one survey of global 

CEOs, respondents said developing the leadership and talent pipeline
was where they wanted to spend more of their personal time.6 Personal
engagement and leadership on the part of the CEO can make a huge
difference in setting the right tone for the organization.
For their part, some corporate learning executives are also rising to
the challenge. They are beginning to take a more strategic view of their
businesses and a proactive stance on the role of learning and
development in delivering value — matching what we call the corporate
“learning agenda” with the demands of talent development and
business goals. We will describe some of these learning executives’
practices, which can serve as a model for implementing a corporate
learning strategy. (See “About the Research.”)

Mapping the CEO Agenda

When two of us worked as management consultants, we typically began engagements with new clients by developing a profile of what we call
the “CEO agenda.” Culled from analyst reports, corporate websites, and
personal interviews, the CEO agenda allowed us to identify the
mission-critical concerns of the company’s top leadership and tailor
discussions to that agenda. Effective learning leaders take a similar
approach, developing a learning agenda for their organizations that is
reflective of the CEO’s priorities. Mapping the CEO’s agenda is the
first step in aligning learning with strategy. (See “Guiding Questions
for Learning Executives.”)

Following extensive internal and external conversations on the
changing nature of Shell’s context and leadership needs, a project team
reporting to the CEO and head of HR identified four leadership attributes
they saw as critical for future leaders, essentially replacing the leadership
model that had been in place for more than a decade. This meant
changing Shell’s approach to developing leaders, placing “in-role”
development through on-the-job experiences at the heart of a new
leadership development system.
Consider the example of Paddy Coyne,
vice president of enterprise learning, leadership development, and global
talent at Royal Dutch Shell plc. After starting his career at Shell as a
project engineer, Coyne then spent 14 years with the management
consulting firm McKinsey & Company Inc. before returning to Shell in
2007. When Shell’s previous CEO Peter Voser was appointed CEO in
2009, the company announced plans to concentrate on global business
lines that would enable it to be “the world’s most competitive and
innovative energy company.”7 Coyne saw an opportunity to rethink
the way the company developed its leaders in accordance with Voser’s
The guiding principle (commonly expressed as “Shell leaders personally
develop the best people”8) emphasized line manager responsibility for
cultivating desired behaviors. This required learning and HR
professionals to adopt new ways of working and to revamp the leadership development portfolio to focus on key leadership transition points. To
ensure that learning continued to support the needs of the business,
Coyne formed advisory panels of business leaders to guide the
development of new programs.
Although Shell’s effort is still ongoing, it’s an example of corporate learning that links professional development directly to business goals.9 Starting with the CEO agenda helps cut through the noise of multiple initiatives vying for attention to reveal the few, critical, “must-win battles” that the CEO is committed to achieve.

How does this approach differ from the starting point of most learning and development programs? Typically, the first step in a new learning
initiative is a training needs assessment, which uses surveys and
in-depth interviews with business leaders to understand the skills gaps
and “pain points” they want training to address. For example, a global
consumer goods company we’ve worked with conducted such an
assessment for a new leadership development program aimed at midlevel
leaders across a number of its operating divisions. The company engaged
a team of instructional design consultants to survey dozens of managers,
asking them to rank the top development needs of leaders in multiple
categories. The collected and tabulated responses demonstrated a desire
for additional training in areas including coaching for performance,
inspirational leadership, and communications. The course that emerged
was a diverse smorgasbord of skills training. Although all of the skills
selected were valuable, as a group they did not reflect anything specific
about the organization or its strategy. Indeed, the conclusions of these
types of training needs assessments tend to be similar across
organizations. Given that midlevel managers at many large corporations
face some of the same challenges, this is not surprising. What is missing
from the picture, however, is a connection to the unique circumstances
of the business and the priorities critical to its success.
No matter how talented the instructors or how dedicated the learners,
these kinds of learning interventions based on needs assessments are
unlikely to move the needle on the business priorities that matter most. Furthermore, by outsourcing the process, the company’s learning leaders
missed an opportunity to get “close to the business” in a meaningful way.
In some cases, consultants who also provide instructional design and
training delivery to the same clients may have vested interests in the
outcomes of a needs assessment and can skew the analysis. As discussed
above, a better approach is to start from the business agenda to ensure
that training supports the capabilities required by the company’s strategy.
Mapping the CEO agenda as a starting point for the learning strategy is
powerful because it provides focus for training activities that allow
learning leaders to link development initiatives to specific business goals.
Yet this approach remains more the exception than the rule. One reason
for this may be that declared business priorities (for example, “growth”)
are sometimes ambiguous. Learning leaders need to unpack the CEO
agenda to identify the key drivers — for example, “doubling sales of
new products in emerging markets” — to which learning resources
can be directed. Companies that are able to align the mission, focus,
processes, and capabilities of their learning assets with tangible business
goals truly have a corporate learning strategy.
In many companies, the governance structures for learning and
development can dilute the immediacy of the contact with the rest
of the business. One study found that less than a third of companies
have chief learning officers reporting directly to the CEO or company board.10 More often, learning reports to the head of HR or other
functional leaders. This is no reason, however, for learning executives
to be disconnected from the strategic agenda. Rather, they need to be
proactive in discussing and working with this agenda. Interactions
between learning functions and executives in other parts of the business
are too often squandered in administrative debates over allocation of
training costs and learning hours delivered. Chief learning officers need
to take a more strategic approach, and the company’s senior executives
must ensure that capability-building efforts are directed at the things that
matter most to the company.
Mapping the CEO agenda and its implications for corporate learning is
thus the first step in constructing the company’s learning agenda. The
next is to operationalize the learning agenda through the portfolio of
learning and development activities.

Aligning Learning and Development Resources

After mapping the CEO agenda, it’s important to take an inventory of existing learning and development resources: Companies need to do this on a regular
basis to ensure that the activities in place reflect the company’s learning
strategy. In our experience, however, conducting such a “learning
inventory” is often overlooked.
A few years ago, one of us reviewed the global learning programs for
a large, decentralized multinational and was alarmed to find that the
majority of spending on learning activities could not be properly
accounted for due to lax budgeting procedures among dozens of
scattered learning teams working with hundreds of external vendors.
Although this situation was extreme (it amounted to tens of millions of
dollars), it is not atypical of some large organizations. Just getting a
handle on the learning portfolio already deployed can be a challenge.
In addition to doing an inventory of the current training portfolio, the
assessment should include a review of the company’s development
infrastructure. For example, when Shell decided to transform its approach
to leadership development, it had a fairly traditional talent management
process in which line managers largely outsourced responsibility for
talent development to HR professionals. The new process amounted to
a paradigm shift, involving an integrated approach to in-role development,
key talent processes, and learning programs. These efforts were designed
to help accelerate the development of employees through carefully
orchestrated on-the-job learning experiences while making business
leaders responsible for building the strength of talent pipelines. The
move therefore required a complete rethinking of the development
ecosystem, including promotion and succession planning processes and
the supporting role played by HR and learning professionals.
Companies should, however, be cautious about making wholesale changes
to learning portfolios and organizational structures. Occasionally, such
changes are warranted in light of shifts in the company’s mission or business context. Yet radical changes in training curricula can cause major disruptions. Although Shell chose to retire its entire learning portfolio, in part to signal
a clear break with the past, this entailed a six-month pause in the delivery of leadership training worldwide as the company reset the focus and emphasis
of learning programs. General Electric Co., by contrast, took a more gradual approach. In 2010, GE began to phase in substantial changes to the direction
and content of its executive leadership programs for its most senior leaders,
while also maintaining many of the deeply rooted structures and features it
had used over the years.11
Time and again, we’ve seen new chief learning officers dump existing
programs for reasons of turf or temperament rather than strategy. That’s
a mistake. As long as the company’s strategy does not change, the link
between the corporate learning agenda and the CEO agenda should be
relatively stable over time. Reorganizations tend to occur all too frequently
in corporate learning departments, but they should be limited to situations
where they are warranted — for example, when the learning agenda is
misaligned with corporate strategy or the strategy changes.
Some corporate learning organizations adopt explicit mission statements
linked to business objectives as a way of embedding the priorities of the
CEO agenda into their guiding principles. As the company’s strategy
evolves, the learning mission needs to do so as well. Capgemini, a global
provider of IT services and consulting headquartered in Paris, founded its
corporate university during a period of rapid growth through mergers and acquisitions. The corporate university launched with a mission of being
the “heart, home, and hub” of the group — the place where leaders from
diverse, decentralized businesses physically came together, developed
personal bonds, and built a connection to the company. In 1998, the
company purchased a property near its Paris headquarters to serve as
the physical location and symbol of the university. In keeping with its
mission of cultural integration, the majority of university learning
programs were delivered on the campus through 2007.
However, as Capgemini moved into a new phase of growth, the role of
its corporate university changed accordingly. Between 2007 and 2012,
the university became the driver of global content, ensuring that common methodologies and ways of working were rolled out in a consistent way
the disparate business units. It also organized worldwide learning events
centered on business priorities with global implications. To reflect the
new reality, the university’s mission statement was revised to reflect its
new role. By 2012, the emphasis shifted to virtual and local delivery of
programs; less than 3% of university learning took place at the central
Responding to customers’ demands for more integrated IT solutions,
Capgemini shifted its strategy once more. In 2013, it reframed the mission
of the university to ensure that learning initiatives supported the CEO’s
push to break down silos and build linkages between business units. In
a sense, this represented a return to the founding mission of the university
as a “hub” for exchange and relationship building. Accordingly, the
central campus again took on a more prominent role as a learning forum
and meeting place for company executives.

Gaining Buy-In for the Learning Agenda

As with the CEO agenda, the learning agenda should articulate the essential strategic initiatives for corporate learning. However, choices about what to
keep, eliminate, or add to bring learning activities in line with business
priorities should not be made in isolation. To enact change, it’s important
to get input and buy-in from both the learning organization and leaders in
the rest of the business — all the way to the CEO level. Creating the right supporting structures and interfaces with the business units, HR, and other
related functions is critical.
When Eivind Slaaen, senior vice president of human resources at Hilti AG
wanted to take the company’s approach to leadership development in a new direction, he recognized the need to engage line managers. Slaaen’s vision
for learning at Hilti, a Liechtenstein-based producer of high-end power
tools for the construction industry, emphasized development of new
managers through on-the-job experiences supported by a multiyear process
of formal learning interventions. “We’ve stopped treating learning as
stand-alone and see this more as a journey,” says Slaaen. “Rather than
thinking you can teach people what they’re supposed to know in a couple
weeks of training, we’re pulling the line [management] in as a partner
— so you need to convince others to be a part of that journey.”
It’s difficult to overstate the significance of CEO involvement in driving
support for corporate learning programs — particularly leadership
development and senior management training. (GE’s CEO has famously participated directly in every executive leadership program for more than
30 years — with one exception, when then-CEO Jack Welch underwent
heart bypass surgery).
12 Having exposure to the priorities of top
management is key to establishing the credibility and relevance of
learning initiatives. In the case of Shell, the CEO actively sponsored
the new approach to leadership development and was instrumental in communicating its importance and meaning through personal storytelling
that reinforced the link between leadership behaviors and business results.

At Unilever, CEO Paul Polman has made leaderhip development a key
pillar of his long-term vision. He charged the vice president of global
learning and capability development with designing a senior leadership development program that was more external-looking and focused on
long-term performance. Executives received invitations to the program
from Polman himself, who personally participates in the program. The
company signaled its commitment to executive development with the
construction of a new learning center in Singapore, the first major
expansion of its corporate learning infrastructure in nearly 60 years.13
Although the personal involvement of the CEO in learning initiatives
can have a decisive impact, a broader effort of stakeholder management
is typically required to promote and gain buy-in for the learning agenda.
Learning leaders shou
 organization revealed that funding models based
on participant fees charged to bu
ld map out a concerted “campaign” to
inform and gather input from key influencers and decision makers in
other parts of the business. For example, our work with one
ning. In this
case, getting the backing of the CFO was critical to developing more
effective financing structures for learning initiatives. A disciplined effort
of s
siness units was a hindrance to developing a strategic approach to
corporate leartakeholder engagement and outreach gives learning
executives an opportunity to deepen their understanding of strategic
priorities and demonstrate the business value of learning interventions.
Another vehicle for advancing the learning agenda and ensuring that it
remains responsive to the needs of the business is creating governance
mechanisms such as learning advisory boards. Shell created advisory
panels composed of executives representing all of its businesses to help
set priorities, advise on the development of new curriculum, and provide
periodic reviews of the impact of the programs. Capgemini University
invited leaders from the various business units to help steer the curriculum
in their areas and designated senior members of the learning team to act
as liaisons between the business and the university. These governance
structures help ensure that local learning activities remain aligned with
the global learning agenda while also helping corporate learning leaders
adapt to the changing needs of different parts of the business.

Activating the Learning Agenda

Once the learning agenda is in place, it needs to be activated through
programmatic activities and changes to the learning portfolio. As with any
change of this nature, corporate leaders should be prepared to face stiff
resistance from entrenched forces that want to maintain the status quo.
An inclusive approach to stakeholder engagement in early stages of the
process will lessen opposition and facilitate implementation.
Nevertheless, there can be difficult choices. In many organizations we’ve
worked with, there are good programs that are well regarded and popular
with participants but not aligned with the revised learning agenda.
Programs and learning initiatives that do not advance the ball toward
business goals should be eliminated or brought into line with business
needs. Sometimes this requires bringing in different learning personnel
with the relevant expertise and instructional design skills to meet the new objectives. The company’s learning agenda should be the “North Star” for
all corporate learning and development — the set of orienting principles
against which program design choices are tested.
Activating the learning agenda also requires that the goals of the corporate
learning strategy be applied at the functional, regional, and business-unit
levels. Just as business units need to align priorities and investment with
the top-level strategy, learning leaders need to ensure that training and
learning interventions are tailored to the specific needs of the business
they serve and are aligned with the company’s global learning agenda.

A Key Strategic Question

The approach we have presented is a practical way of addressing the key
strategic question for corporate learning: “Are we doing enough of the
right things to develop the capabilities our people need to deliver the
outcomes that matter most to the business?” Companies that answer this
question in the affirmative can activate a powerful lever of competitive
The close interconnection of development activities with business priorities
is the hallmark of an effective corporate learning strategy. It requires much
more than just getting senior leaders to turn up at leadership training
events. Rather, it means viewing the corporate learning agenda as an
essential extension of the CEO agenda as it applies to the company’s
human capital.

SOURCE: MITSloan Management Review

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