Companies today demand innovative senior leaders who inspire confidence, middle managers who can translate the corporate vision for their functional or geographic area and front-line managers who can get the job done. Directly or indirectly, these challenges rely heavily on education and training, whether provided by internal corporate departments or external partners.
Yet, when we talk about linking strategy to education, some businesspeople roll their eyes. Perhaps they think education should be independent of corporate strategy because they’ve had too many bosses whose idea of strategy was mouthing a flavor-of-the-month.
Or maybe they simply hold an old-fashioned view of education as competency training.
Big Promises, Limited Results
In fact, the stakes are much higher. Changes in the global marketplace are making ever-increasing demands on companies. Ethics scandals have undermined trust in executives and spawned greater scrutiny of corporate governance. Terrorist attacks such as 9/11 have led shareholders and activists to second-guess the geopolitical ramifications of every business decision. China and India are on the rise as a source of consumers, resources and competition. At the same time, as large numbers of senior managers enter or near retirement, the leadership pipeline has been thinned by decades of downsizing.
In such an environment, strategic thinking is just as important for CLOs as it is for CEOs, but no one can actually make sense of a top-down strategy if it means a mariage de force between a highly generic motherhood statement and a highly detailed operating plan. In “Execution: The Discipline of Getting Things Done,” Larry Bossidy and Ram Charan write, “We talk to many leaders who fall victim to the gap between promises they’ve made and results the organization delivers.” But if education can serve strategies that are well-understood throughout the hierarchy, and if it can be combined with fluid execution and even explicitly tied to results, HR can, for once, be a hero.
A sea change in thinking about corporate education is taking place—a shift in how we view it, as well as a shift in how we design and deliver education programs. Instead of regarding education dollars as a tiresome drain on profits—the first expense to be cut back in hard times—smart CEOs increasingly see education as a strategic asset, an asset that enhances the long-term value of the business.
“Give me a lever long enough and a place to stand,” Archimedes boasted, “and I can move the Earth.” Education can be just such a powerful lever for setting the CEO’s agenda in motion.
The traditional and principle focus of corporate education and development has been on individual competencies, and those will always be relevant. This is why business schools and executive education programs are still germane, however much we may decry aspects of their design, performance or cost-effectiveness. Within the workplace, it’s the same story: An employee is formally or informally assessed on his or her strengths, and developmental needs are mapped against a stated or unstated list of competencies required for excellence in functional activities (calculating break-even points, controlling manufacturing quality, interpreting accounting standards), management (analyzing, communicating, negotiating) or leadership (valuing diversity, coaching, demonstrating courage).
The focus of such education is to close gaps in those competencies. This approach is dangerously close to an elementary school and undergraduate degree model of education where a subject-matter expert transmits received wisdom into the waiting and presumably receptive head of a pupil, who recapitulates it and is rewarded with certification. It’s reminiscent of Pete Seeger’s protest song: “And they all get put in boxes, little boxes just the same.”
That’s not what adult business professionals need—not once you get past a basic set of core abilities and shared language, a cultural understanding of “how we do things around here,” important as those are. Rather than viewing education from the vantage point of an individual, education can be focused on the organization and on closing gaps in organizational capabilities. Both of these approaches are appropriate, even critical. Arguably, the latter provides the most tangible link to the corporate strategy, and gives Archimedes solid ground on which to stand.
The Burning Question
Organizational capabilities define the company’s or division’s ability and willingness to execute its strategic activities with people working in tandem toward common goals—its ability to address its business challenges. (Don’t worry. If it were easy, the competition would have already done it.) Common examples of organizational capabilities might include integrating acquired companies, leveraging internal knowledge, marketing globally or partnering with suppliers. These are not things an individual or even a group of individuals is good at—they are what an organization is (or could be) good at.
It is not enough to have highly competent, talented people. In fact, talented people who can’t execute tend to get frustrated and leave or become susceptible to recruitment from without. Any outfit that can’t manage to retain the best people won’t get far on the backs of the laggards. So a good place to start, not just for purposes of employee retention, but to determine organizational effectiveness—or to predict a business’s ability to survive—is to carefully assess any gaps between the current situation and the current business objectives.
Even a sound strategy may specify how an organization will reach its destination while leaving open the question of whether or not that strategy can be successfully executed. To phrase the most burning question in its most general form: What are the organizational capabilities needed to implement the strategy and attain the business objectives?
What Was the Question Again?
For example, if the strategy of a manufacturing firm were to outsource large components of its final product, then to be successful in that strategy, the organization would need to be capable of effectively partnering with its component providers. If the organization were accustomed to treating such providers as vendors rather than partners, their strategy and long-term survival would probably be at risk. So here, the question would be: Is this organization capable of partnering with a key supplier?
People might not like the answer, but it’s an analysis that must be undertaken open-eyed and with a certain ruthlessness.
Enter the CLO as the white knight, ready to take on a fire-breathing dragon. Shifting the focus of training and education to organizational capabilities does not neglect the individual. Rather, it is all about developing individual competencies within the broader framework of enabling the organization to address its business challenges. Yes, the questions that drive the design and development of such education are different from the ones we used to ask, but the object of the education is still the workforce.
Getting to Maybe
The focus of education can fall along a continuum. (See Figure 1.) Education focused anywhere along the continuum has impact and value. However, the impact and the value go up as the focus moves to the right. Individual competencies remain pertinent at every stage, but as you move to the right, there is the added benefit of supporting or driving the execution of the organization’s business strategies.
A Seat at the Welcome Table
Focusing education and training dollars on attaining the organization’s business goals can certainly earn the CLO the right to a seat at the strategy table. When a CEO observes that the firm’s new strategy is not happening and no one can figure out what to do to make it happen, the CLO is in a position to raise his or her hand and offer both a long lever and a place to stand—education focused on building the very organizational capabilities that will enable execution of the strategy and attainment of business objectives. Obviously, such a stand raises the stakes considerably, but it also makes learning a strategic tool vital to the success of the firm.
Some argue that focusing development on the firm’s current strategic objectives is a short-term position, while developing the fundamental competencies of employees is designed for the long term. If so, the strategy is terribly shortsighted to begin with, and in that case, the politically sensitive CLO needs to navigate a course between Scylla and Charybdis, bisecting short-term and long-term demands. Again, one could point out that individual competencies are still developed when the focus is on organizational capabilities. The trick is to integrate the developmental needs of individuals with the organization’s need to solve its business challenges.
Instead of playing catch-up, education can be proactive. Instead of an organization being perceived by its own employees as clawing its way toward a minimal standard, it can start from the assumption that success is possible given the richness of employee abilities. Instead of thinking about individual deficiencies, it can begin by thinking about opportunities for the business.
Quality Is Economy
Education that focuses on solving business challenges requires a high degree of customization and a sense of scale not common when the focus is merely on individual remediation. Building organizational capabilities that enable execution of specific strategies is not likely achieved via off-the-shelf programs—neither the company’s own (because the process requires that someone have the freedom to point out when the emperor has no clothes), nor an outside provider’s pre-packaged offerings (because every business is unique). Rather, the education needs to be designed and developed specifically for the current situation, so design and development costs will be higher.
Large scale and broad geographic reach also is typically called for. When the goal is nothing less than changing the capability and execution of the firm as a whole, or even a major division, global organizations may need to send thousands of people to programs staged at locations around the world. Similarly, smaller firms will need to allocate larger-than-usual education commitments.
The Importance of Being Earnest
Education has traditionally been about imparting knowledge and developing new skills. However, education also is about changing people’s attitudes and expectations, and motivating them to new behaviors. Developing organizational capabilities often requires changing people’s mental models and altering their long-standing beliefs. That is not easy and usually entails non-traditional approaches. That is, you can’t persuade people to use new behaviors back on the job or to buy into a new strategy by lecturing from a podium. Almost always, radical combinations of classroom and experiential learning are called for.
One technique that has proved successful is the Metaphoric Experience. Like other experiential learning approaches, participants take part in an activity or situation and then reflect on what happened, generating their own insights rather than having them interpreted and conveyed by an instructor. But in this case, they are not role-playing or practicing a day-to-day job behavior. Instead, they become willing actors in an event that serves as a powerful metaphor for their job. Because it is an unfamiliar situation, participants can’t easily draw on their existing and entrenched mindsets. At the same time, they are not as afraid to fail, since it is obvious that they (as well as their peers, superiors and subordinates) are out of their element. Critical thinking is sharpened, disbelief temporarily suspended, and an element of (often quite serious) play prevails. During subsequent debriefing, participants see that the event is analogous to their work, and that the new behaviors that made them successful during this out-of-job experience could be equally successful back in the real world.
Big Promises, Big Results
Development can be thought of as closing gaps between current reality and a desired destination. A gap can exist within a person (an individual competency) or a company (an organizational capability). Historically, the focus of education initiatives has been individual competency and the creation of a pool of talented people. Increasingly, as the complexities of global business thicken the density of known problems and create new ones with higher stakes, the focus needs to be on organizational capability and solving real business challenges.
The trick is to do both: develop individuals within the broader context of addressing such business challenges. Carefully customized programs are one proven approach to the radical concept of using education as a means for executing strategy.
Leah D. Houde, Ph.D., is a managing director at Duke Corporate Education, and has worked in the design, administration and delivery of educational experiences, as well as coordinated the development of a leadership feedback instrument. She can be reached at firstname.lastname@example.org.
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