The competitive organization requires a learning system that drives business performance by integrating learning into business processes for employees, customers, suppliers and partners. Such a system makes learning a strategic, enterprise-wide solution instead of a departmental solution. In this capacity, all information stores and learning tools combine to extend the capabilities of human capital. Deploying learning in alignment with business objectives gives organizations a competitive advantage in today’s knowledge era.
Formal, instructor-led or classroom training represents only one kind of learning. Learning itself encompasses all the diverse, numerous ways people absorb knowledge, including on-the-job experience, seminars, e-learning and so on. Events such as new product launches, sales forecasts, career moves, succession plans, industry trends and customer requests can trigger learning.
Leveraging One of the Last Competitive Differentiators
This is the information age, the knowledge era—employees, managers and executives are inundated with too much information. Competition today has narrowed players down to an increasingly lean, business-savvy group, and one of the last competitive differentiators is the incredible impact of learning on performance.
Efforts to successfully wield knowledge across the enterprise form a significant trend as organizations seek to maximize their investments in the workforce and tighten bonds with customers, suppliers and partners. “Those companies that do the best job of empowering their workers through education and training are most likely to enjoy the highest levels of economic success,” wrote Steve Lynch in the September issue of Chief Learning Officer magazine (“The CLO’s Role: Balancing the Learning Mix in Outsourced Environments”).
Ideally, learning is customized and personalized, combining various activities and methods. Enterprise-wide blended learning based on role and individual needs is another trend today. Blended learning supports e-learning, webinars, books and education, as well as instructor-led, self-paced, ad-hoc and on-the-job training.
Learning Today: Fragmented, Inefficient, Immeasurable
Despite current trends, even some of the most advanced corporations have not successfully organized and strategically leveraged their vast learning potential in all its forms.
Most companies lack a centralized repository for learning content, records and results, so learning is dispersed throughout multiple divisions. The absence of big-picture visibility means duplication of effort, overspending and inefficiences, ending in uncertainty as to learning’s effectiveness. There is no single view of or accountability for what occurs from a training perspective.
The amount spent on learning is frequently an unknown—further, most organizations do not know the effectiveness of learning efforts they fund. Without the means to measure the impact of learning, many organizations cut training budgets first in lean times. This leaves managers with untrained personnel and no record of skills attained and skills needed.
Does recognizable value result from learning? Many organizations do not know.
Business Objectives and Learning
The purpose of providing learning is to better meet business objectives. Yet most learning strays from those objectives, resulting in extensive effort that does not achieve intended results. Lacking awareness and tools, most organizations typically do not tie learning to business objectives.
The enterprise learning market, however, is moving toward strategic learning—alignment with corporate objectives, insight into the status of constituents, coordination with employees’ career plans and overall competency management.
“LMS vendors have an opportunity to help organizations on both fronts by making the training function more efficient, and employees more productive,” report analysts Michael Brennan and Cushing Anderson in “Corporate eLearning, LMS Vendors” in the IDC Bulletin 2002.
Exploring the Learning Management System
The answer to fragmentation and inefficiencies in organizational learning is an effective learning management system (LMS) applied strategically throughout the enterprise.
The Importance of Integration
Integration solves the problem of scattered learning and indeterminate results. Enterprise-wide integration within a pure-Internet framework enables the LMS to gather learning information and help determine what learning needs to be delivered across the organization. Such integration also makes it possible to analyze the effectiveness of the learning.
Enterprise learning requires information exchange to and from all applications. The integrated LMS draws upon a single repository of data that encompasses HR, sales, marketing, customer relationship management (CRM), supply chain management (SCM), financials and so on. All applications and systems feed information into the LMS—likewise, the LMS updates the other systems, communicating bi-directionally.
For example, after a performance review, Suzie’s manager recommended improvements in negotiation skills, indicating that deficiency in Suzie’s learning plan. The LMS recommended a new Web-based course, “Skill-Building: Sales Negotiation.” Suzie took a pre-course assessment and the LMS entered her score in her profile. Suzie’s post-test demonstrated her increase in knowledge, as well as the general effectiveness of the course. The LMS automatically updated Suzie’s profile, indicated Suzie’s improvement in her department’s records and added a course rating for other learners.
Integration allows the system to anticipate learning needs. As in the previous example, the LMS recommended the appropriate learning in the face of a deficiency in negotiation skills. When there are a number of routes to achieving the learning goal, the LMS recommends those options an employee has indicated as preferred learning methods.
Enterprise portals facilitate easy access to LMSs, giving administrators, instructors, learners, managers and executives a comprehensive, up-to-date view of every aspect of the learning effort.
Management in Real Time
An LMS is a refreshing alternative to static tools, such as Excel spreadsheets. The real-time nature of an industry-leading LMS, combined with seamless integration, embeds learning in business processes and increases productivity via just-in-time access.
Getting the right learning at the right time in the right manner is critical. For example, a new accounting clerk can learn to post invoices on the job using step-by-step on-screen instructions instead of a class or individualized attention.
Not only do LMSs effectively track, manage, deliver and measure learning across constituencies, they are intelligent. Specific workplace occurrences—triggers—prompt the system to recommend the most relevant learning proactively, pushing out information that improves workforce effectiveness in real time.
For example, when Bill has a customer on the telephone and needs an immediate answer, typing in a few keywords quickly brings up the appropriate document, such as a whitepaper, product profile or glossary. Such intelligence makes the difference between receiving an immediate answer and waiting for an e-mail chain to eventually bring resolution to an issue.
Enterprise-wide strategic learning applies not just to employees, but to customers, suppliers and partners as well.
A manufacturing company about to unveil a new product gave its partners basic product information and outlined their roles in production. The sales force still needed to be well-versed in product specifications, features and benefits, and the customer base required information with the appropriate marketing spin. Suppliers along the distribution channel needed to understand the features and benefits.
Given a top-performing LMS, the company in the above example could restructure and re-use information to develop learning for each constituency, leveraging the LMS for information distribution. Using an LMS ensures better, more timely constituent learning, and in this case would result in a more successful product launch.
Seeing a Return on Learning Management
Driving business performance is one benefit of enterprise learning. Gaining a large competitive market share is another. All organizations can benefit from an enterprise-wide LMS, particularly service companies needing to train people quickly and respond to urgent customer needs. LMSs are critical for companies dealing regularly with changing compliance and regulatory issues—constituents must stay up-to-date to avoid fines and corrective action.
Integrated LMSs save time otherwise spent seeking information, make information development more cost-effective, provide analytics to aid in future spending decisions and more. Such automated, streamlined learning translates into ROI from reduced learning costs.
Because an LMS manages webcasts, online seminars and e-learning as opposed to instructor-led training, organizations can save untold amounts by instructing the workforce at the office. In the past, travel and hotel costs, instructor charges, course fees and employee downtime made instructor-led training a hefty financial burden.
“In 2001, Reynolds and Reynolds associates and customers completed 66 more learning experiences than in 2000, and training costs were reduced by $1.1 million,” according to the September 2002 issue of Chief Learning Officer magazine (“Training Drives Business Success for Reynolds and Reynolds”). The organization saves by combining training modules into a single webcast series, consolidating diverse audiences, leveraging information to serve several functions and using other similar tactics.
Soft ROI and Business Benefits
The positive impact and the value of learning extends beyond figures on a balance sheet. Many business benefits arise from soft ROI, which Gartner calls “value on investment” (VOI).
Significant VOI emerges in corporate cultures where constituent learning advances the quality of human capital and enterprise-wide collaboration. Customer satisfaction, communication across constituencies and emerging workforce competencies all add to VOI.
Thinking Locally, Learning Globally
Managing constituents worldwide both increases the need for learning and makes learning effectiveness an imperative. Learning that must be relevant based on currency, language and context requires a state-of-the-art system.
An international financial services company—one of the top 10 largest banks in the world—had been aggressive about providing technology-based learning across its HR organization. The company built its own systems to manage certain aspects of learning. However, after discovering the availability of an industry-leading LMS solution that could integrate with existing HR systems, this organization chose to implement enterprise learning.
Globally deployed enterprise learning boosts competitive advantage. Pushing learning out to local and remote constituents increases incremental revenue and market share in other countries.
The ideal LMS integrates learning across critical business processes to improve productivity and reduce costs, while simultaneously measuring learning effectiveness. More than just information management, an enterprise-class LMS is a comprehensive system tying learning to business objectives and providing a built-in means of evaluation. Extending learning beyond the enterprise makes the workforce more efficient and yields both monetary returns and soft ROI.
Organizations need insight into learning needs, centralization of all learning and the ability to analyze learning effectiveness. By leveraging enterprise learning to enhance its investment in human capital, the astute organization harnesses a key asset and gains the competitive edge in the knowledge era.
Jason Averbook is responsible for development and delivery of marketing and positioning for PeopleSoft’s entire Human Capital Management (HCM) division. Prior to joining PeopleSoft, he was director of organizational readiness at Ceridian Corp. Jason has served on boards for both the IHRIM and SHRM organizations. He has also contributed his expertise to the American Society for Training & Development (ASTD). For more information, e-mail Jason at firstname.lastname@example.org.
The Most Effective Path to Competitive Advantage
The first step toward gaining competitive advantage from an LMS is going beyond features and functions to understand what exactly the LMS should accomplish. Many organizations do not know how learning fits into their business processes, how scattered their learning is or what their solution must look like to achieve business goals.
The second step is selecting an industry-leading solution with enterprise-wide integration. This choice makes the difference between success and implementing a new solution three years down the road.
There are many LMS packages available, but not all provide integration. Niche players offer a wide selection, but all lack delivered enterprise-wide integration and the accompanying core knowledge of collaborative applications. Organizations using niche products must manually build integration into their back-office systems, a painstaking process jeopardizing the leveraging of HR data. In addition, niche players only address employees, ruling out other constituencies. A number of companies with niche solutions have been forced to revisit their LMSs.
The investment in implementing a niche solution that even approaches the functionality of an industry-leading enterprise system is astonishing.
For optimal results, organizations should choose a top-performing enterprise LMS with built-in integration that allows for enterprise-wide communication. These solutions are based on pure-Internet technology, so constituents can access what they need anytime, from any location. Vendor expertise, interface usability and depth of analytics are additional selection criteria. The ideal vendor is committed to the enterprise learning market.