Get a group of CLOs together and ask them for a list of the topics they are most interested in, and the relationship between enterprise learning and organizational culture change is likely to be near the top. What’s behind this interest in driving culture change through learning? Many CLOs strongly believe they can help with these kinds of large-scale issues. But making the case to their bosses depends on marshalling compelling evidence from other companies that have successfully used learning and communications to change the culture of an organization.
In looking at the potential impact of enterprise learning on culture change, two types of initiatives are most prominent. The first seeks to create capabilities in the culture that were not previously present, but which have been deemed vital to the growth of the business. This can involve cultural change programs within a single organization, or programs to create a unified culture from two merging organizations. The second type of initiative seeks to change a dominant personality trait within the culture that is impeding overall performance or even putting a company at risk.
Creating New Capabilities in the Culture
Consider GE Money (formerly GE Consumer Finance), which has rapidly become a force in consumer finance with global strategies and aggressive growth plans. Ginny Ertl, global head of training and development for GE Money, is the executive charged with ensuring that the company’s global workforce is equipped with the capabilities and skills they need.
One of the challenges GE Money faced was creating a global culture with consistent and common selling capabilities. As Ertl notes, “The GE culture has traditionally been very strong in finance and engineering, but less strong in sales and marketing. We needed to create a culture that valued excellence in sales and marketing and that could actually execute the right kinds of selling behaviors.”
In other words, companies with strong cultures cannot simply put a layer of training onto the culture, because it won’t be absorbed. Instead, they must reach down into the culture, find the skills, attitudes and behaviors that are already working successfully, and then spread those throughout the rest of the organization.
So Ertl and her team identified the top sellers throughout each of GE Money’s geographic regions and across business lines and brought them together with instructional designers in a series of workshops. Together they identified the top sellers’ best practices, expert stories and lessons learned, key ways they understood and dealt with customers, and other differentiating behaviors.
The results of these design workshops were striking, according to Ertl. More than half of the successful behaviors identified were common across geographies, sales forces and lines of business. Based on this initial work, the team was able to create a common sales model that could be replicated across sales forces. This work was important to ensure that cultural change could take place with the least resistance possible.
The blended training delivery model GE Money used included instructor-led training, workshops and performance simulation. The latter aspect has been especially important because simulation-based training is far more effective at changing sales behaviors than other forms of learning. GE Money’s Sales Practice Tool lets agents practice customer care and sales through simulated interactions with customers. Feedback from the tool offers them guidance on how to improve performance in a risk-free environment.
Preliminary business results from this new simulation training tool, based on initial rollouts, have been impressive: a 20 percent increase in cross-selling and a 13 percent increase in overall customer-call quality. New training for branch employees – emphasizing role playing to develop effective sales behaviors – also has delivered impressive results from the pilots, with a 13 percent increase in cross-selling across the branches, resulting in significant revenue uplift.
A Corporate University Approach to Culture Change
Spanish Bank Caixa Galicia faced challenges that in some ways echoed those of GE Money. Caixa Galicia has undergone rapid business growth and geographic expansion in recent years through mergers and acquisitions, and its business has diversified accordingly. In that environment, the importance of developing the right sales behaviors in the workforce had grown increasingly vital. Caixa Galicia executives framed the business challenge as one of cultural change: How could the bank create the kind of workforce culture to sustain its competitive advantage, strengthen its relationship with the marketplace and attract and retain the best talent?
The answer was to create the Instituto Tecnologico y Empresarial Caixa Galicia (ITE) as a critical means of driving culture change for the bank as a whole. ITE was conceived and designed as an innovative mix between a business school and a corporate university. It is charged with all internal training for the bank, but it also offers open external programs such as graduate degrees.
ITE has been charged with helping transform its current employee base from “product sellers” into “trained financial advisers.” Moreover, the business sponsors of the new sales training explicitly asked that the designers minimize the time that learners need to be away from their jobs to complete coursework. To maximize the impact on sales performance, and to meet the sponsors’ need to minimize work disruption, the designers created a blended sales training program that includes:
This approach has improved sales for the bank, while also minimizing the time employees must be away from their jobs.
Changing ‘The Way We Do Things Around Here’
One of the more well-known definitions of corporate culture is “the way things are done around here.” Strong cultures often have an almost palpable “feel” to them – a force that guides workers toward the attitudes and behaviors that the organization values the most. But what happens when the way things are done begins putting a company at risk?
That was the situation banking powerhouse Citigroup faced. Following several years in which the company had difficulty, in the words of one financial analyst, “balancing growth and ethics,” Citigroup is now in the second year of a program to dramatically transform its organization to more of a principle-centered culture. And enterprise learning is playing, and continues to play, a key role in that transformation.
Citigroup’s growth through acquisition in recent years had led to an extremely aggressive culture, one more geared toward financial rigor than the so-called “softer skills” of HR, learning and culture. Indeed, Sandy Weill, the financial genius who was the architect of Citigroup’s growth, was known for his focus on quarterly results.
Over time, this short-term, “win at all costs” attitude had come at a price. Some questionable deals and behaviors in the United States, the United Kingdom and Japan caused Citigroup to run afoul of regulators and lawmakers. Business performance was suffering as a result, and a Merrill Lynch analyst ultimately responded to these troubles by downgrading Citigroup’s stock, saying, “recent events indicate to us that making the changes needed at the operating-unit level to balance growth and ethics will continue to be a hard, slow process.”
Under the leadership of Chuck Prince, who succeeded Weill as CEO, Citigroup put in place and then executed a sweeping series of cultural, learning and HR changes toward a goal which, to some, seemed unreachable only a few short years ago: “To be the most respected global financial services company in the world.”
The program began with a simple, three-part statement of what Citigroup called its “shared responsibilities”:
On global telecasts, and through personal visits to almost three-dozen countries where he spoke with almost 100,000 employees, Prince made the point: Citigroup is serious about rejuvenating the moral heart of the company, and we will accept nothing less.
In March 2005, Prince and his team also released more specifics on how they would make the reinvention happen. It was what they called their “Five Point Plan”:
The results have been extremely telling. Citigroup recently enjoyed record net income in the first quarter of the fiscal year. Although many factors account for those kinds of business results, successfully leveraging learning and communications to drive cultural change must be given a great deal of credit for the turnaround.
The marketplace also has responded to Citigroup’s focused efforts at cultural change. In the recent words of one industry analyst, “Mr. Prince has cleared the company of its distracting problems. It can now execute because the firm has the freedom to focus on growth. It will not be spending time on legal issues, personnel issues, divestiture issues or even the task of developing the program for the future. It will be focused on growth.”
Learning to Change
A number of common elements can be identified in these successful efforts to leverage enterprise learning to drive culture change. Here are several we believe to be most important:
1. Include a cultural study in any enterprise learning strategy. That is, in planning for major initiatives in skills training, assess the current state of your culture with regard to those skills. Is “the way things are done around here” likely to divert the power of that training, or even subvert it?
2. Reach into the culture. As GE Money found, the chances are good that the behaviors you want already exist in pockets of your organization and simply need to be identified, raised up and re-distributed. By reaching into the culture, and not just placing a veneer of training over it, you have a better chance of spreading change throughout the organization.
3. Make sure that “fresh air” gets into your organization. Houses get musty when they are locked up tight, and so does a corporate culture. Caixa Galicia’s corporate university strategy, which provides internal training as well as access to external learning opportunities, helps ensure a steady supply of new thinking.
4. Leverage key “influencers.” Cultures appear to have lives of their own, but in fact close analysis can identify both policies and people who have a strong influence on the way things get done. For major change programs, Citigroup’s strategy of using its CEO to blanket its global company with strong messages is essential. In addition, however, companies should identify the most respected people in each office and geographic region – regardless of their job title or level – who can help shape attitudes and model the right behaviors.
5. At a tactical level, ensure the development and delivery of learning is reflective of the culture. For example, if you have a culture that places a high degree of value on speed of execution, does your learning organization develop and deploy learning initiatives within days or weeks, as opposed to months?
In the end, good culture diagnosticians and transformational change leaders know how to do two things: They know when to trust their instincts, and they also know how to get focused on achievable goals. That is, in many cases a general feeling of uneasiness about your culture can be a warning signal worth listening to. But then the most successful managers of change go beyond talking about the problem. They work to find the most obvious causes of malaise or poor performance, put programs and metrics in place, and then go at it, leveraging their enterprise learning structures to help make it happen.
John G. Higgins is the vice president for strategy and innovation at Accenture Learning. Craig Mindrum is a visiting research fellow for Accenture Learning. They can be reached at firstname.lastname@example.org.