The year was 2000. Steelcase Inc., a global office furniture industry leader, gave a tactical nod to its “knowledge company” commitment with the opening of Steelcase University (SCU), a facility that redefines the traditional “bricks and mortar” learning institution in spaces brimming with interactivity. And though the facility itself comes alive as a learning center, this story is not about the genius apparent in the structure. It’s about what goes on inside.
In the years leading up to the corporate university unveiling, Steelcase Inc. evolved from a top-quality office furniture manufacturer to a research-based corporation providing office environments. Having studied how and where employees use the space around them, Steelcase was in a position to approach markets from a knowledge perspective rather than a commodity perspective. The new focus: teaching how a work environment can actually enhance innovation, communication, work-process learning and decision-making. The company blossomed with its advanced, user-centered research and the incorporation of new technologies.
The opening of a state-of-the-art learning center allowed for the consolidation of Steelcase Inc. learning and development. Previously handled through the company’s different functional areas, trainers and training activities operated with relative autonomy, and in hindsight, at a costly expense-to-impact ratio. Steelcase University quickly offered consistency. The SCU leadership team outlined an ambitious three-year plan for supporting the next phase of the furniture giant’s evolution from a manufacturing company to a knowledge enterprise. Then came the hard-felt blows of 2001. Steelcase’s markets struggled in the recession, and Sept. 11 brought the world to its knees.
Once centralized, the new leadership within Steelcase University could have opted for a “broker of training” track, but there was no future in perpetuating the traditional sales methodologies when the enterprise itself was transforming. And the market upheavals demanded bottom-line thinking. “When margins are slim, you have to have tight cost structures,” said Jeff Barton, manager of sales & foundational learning. “We simply hadn’t been process-oriented with our sales and our learning. We now have a process in place that connects the impact our training has on specific strategies designed to achieve our business results.”
The SCU team knew it would be their job to help lead the organization through upcoming shifts and turns. “We had to demonstrate an ability to help the departments operate at a high level despite drastic cutbacks,” explained Joe Chiaramonte, manager of dealer learning & development. “At the same time, within our own University infrastructure, we were forced to become more efficient. It was like building a wing while you’re trying to fly.”
The first step for Steelcase University was to determine how it could best bring value to an organization reeling from the harsh realities of the economy. Manned by learning pros who had cut their teeth in all corners of the enterprise, SCU had an advantage. “We knew Steelcase—where the company had been and where it wanted to go,” said Faye Richardson, manager of operations learning & development. She added, “Recognizing our unique makeup, we clarified our competitive advantage and the bottom-line value we deliver. The team analyzed how we: 1) work with clients to understand needs; 2) build appropriate business-linked solutions; and 3) implement and measure the business impact of these solutions.”
“This careful process of discovery underscored our value proposition: customer intimacy,” said Richardson. “Our accumulated knowledge could bring insights and efficiencies that couldn’t be found elsewhere. In addition, from our cross-functional vantage point, we were positioned to access a gold mine of internal customer knowledge on an ongoing basis and share it up the ladder. This insider track was a critical piece of Steelcase’s intellectual capital that we shared; we had a responsibility to leverage it for the good of the enterprise.”
The SCU team could deliver outstanding value through better-targeted learning solutions than might be available from the outside. Research into what other companies were doing indicated that turning the function over to external sources didn’t deliver business-specific results. On the flipside, those that chose to stay 100 percent in-house couldn’t keep up with demands.
Charged with ongoing corporate learning and change leadership and fueled by the knowledge that their strong value proposition of customer intimacy would best serve the organization, SCU moved learning forward against tremendous economic odds.
The customers or “audiences” of Steelcase University are the Steelcase functional groups and owners tied to HR, IT, Finance, Sales, Supply Chain, Product Marketing and Manufacturing. SCU made a strategic decision to structure operations around a process that would facilitate critical information exchange. An exclusive group of business-savvy learning experts known as “audience owners” would serve as the liaisons between SCU and its customers. Drawn from Steelcase’s functional areas, these audience owners had an internal understanding of the enterprise thanks to years of training and field experience. The connection process they initiated with customers would be key to how SCU managed intellectual material.
An audience owner was assigned to each internal customer group. The charge: to get to the table at the functional level with the right solution based on careful needs identification. Before this could happen, each had to earn a spot at the table as a member of the decision-making team by exemplifying SCU’s value proposition and becoming an active listening/learning partner who truly understood the client organization.
The audience owner meets with the top functional executive, sits in on meetings and gets an inside track, mapping the desired results and identifying the gaps and behaviors needed. The audience owner then pulls in program managers and instructional designers to develop or locate learning programs. The result is implemented through a trainer. SCU’s learning management system holds it all together by providing the administrative infrastructure.
Strapped by cutbacks, SCU crafted an outsourcing model that would best support this process. The team knew they couldn’t compromise on the audience owners. And they knew their project managers and instructional designers were valuable knowledge experts on the solution team. The decision: Outsourcing would be used strategically to keep internal resources focused on leadership and functional VPs.
The strategic outsourcing model allows SCU to stay true to its value proposition. Perhaps more important to the overall enterprise, the model protects years of research and the vast intellectual capital that’s at the foundation of Steelcase Inc. “Had we opted to go with 100 percent outsourcing, Steelcase intellectual capital would be exposed, and the organization would have lost an avenue for critical information gathering,” Richardson said.
Perhaps the biggest change is that training has a seat at the table at the onset of the planning process. This makes SCU more effective not only in providing an on-target training solution, but also in identifying situations where training might not be the answer to a problem. “Drawing on both broad and intimate knowledge of Steelcase operations, we can recognize logistical or environmental problems that no amount of training could have fixed at the needs identification stage, before time and resources get allocated to training development,” Chiaramonte explained.
Along with the new structure and processes came useful tools to help ensure SCU delivered on its plans. To identify and prioritize those who would receive focus and attention, an audience matrix was used to plot functional areas in terms of strategic value to Steelcase and receptivity to learning. By centering efforts on departments that landed in the top quadrants, the matrix process helped ensure tight resources were allocated for greatest impact.
To evaluate and measure itself internally, SCU took the Balanced Scorecard approach. Monthly, each direct report’s work is bounced against the Balanced Scorecard in terms of the development of internal people, application of processes, customer results and financials. Such systematic monitoring helps raise the bar internally, keeps SCU true to its value proposition and serves as an indicator of how the team is doing.
Steelcase University launched itself with an aggressive three-year plan and (in spite of curves) stayed on track. It took two years for SCU to take stock and develop the new processes and systems, creating a blended model that would allow it to stay close to internal customers, provide the right learning solutions and remain fiscally responsible. Now, despite all of the downs, efficiencies are up—virtually unheard of when budgets and people are going away. “We have made great progress in changing the fundamentals of how Steelcase University does business,” said Richardson. “Our goal was to create, through learning, a more disciplined approach—integrating goals and styles.”
“A case in point is the sales area,” said Barton. “In the past, they were challenged by interacting with customers in a way that better supported our value proposition. So our goal was to change how we go to market. We developed a disciplined sales methodology, integrating the efforts of other functional groups within Steelcase—specifically in the areas of marketing, product development and communications. Through our processes, we raised the level of customer focus within the sales organization, helping them transition from ‘transactional operators’ to ‘total solutions’ professionals.”
“Our startup came at a time when ‘business as usual’ wouldn’t work,” Richardson concluded. “We stayed true to our value proposition and at the same time asked: What do we need to do to change behaviors in our company? SCU founded an outsourcing model that enables us to serve as a catalyst for enterprise change with two huge deliverables: tailored learning and the ability to gather previously untapped intelligence and share knowledge with Steelcase Inc. leadership. The latter has led to a breakthrough in support as we gain insights into how well we set directions as an organization, how well we execute these internally and how well we leverage our human capital.”
There are many unknowns ahead. The easy, cost-cutting solution for Steelcase senior management would be to broker 100 percent of the organization’s learning function. But any short-term savings are overshadowed by long-term value lost. “You can’t save your way to improvements and growth,” said Richardson. “We live by our value proposition and believe that for Steelcase, the answer is to approach outsourcing not as a cost-reduction strategy, but as a value-generator tied to our business goals.”
Steelcase Inc. CEO/President Jim Hackett agrees. “We will continue the learning quest together,” he said. “Steelcase University is well positioned as a strategic business partner to Steelcase Inc., helping us accelerate change and achieve organizational goals through learning.”
George Wolfe, Ph.D., is dean of global learning & development for Steelcase Inc. and manages all operations of the corporate learning center. Ken Dutkiewicz, CPT, is manager of global learning & development at Steelcase Inc. Glenn Dunn is director of global learning & development at Steelcase Inc. You can reach George, Ken and Glenn at firstname.lastname@example.org.