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11/1/2010

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This is my eighth and final blog in the eight-blog series that we called “The View is Worth the Climb.” I’ve talked about the problems with corporate training today, the fact that we have this broken investment value equation, and the need to fix that broken equation. I’ve discussed the mandate or imperative for transformation and the fact that we shouldn’t be waiting for someone to tell us to do it, that we should be ahead of that and making the kinds of changes and improving our situation greatly so that we are adding more value. I’ve discussed how “Running Training Like a Business” is an appropriate methodology for organizations to utilize to begin the transformation process, and I’ve laid out why outsourcing is a tool that organizations should seriously consider in their pursuit of transformation.

What I haven’t talked about, something that I believe in my heart is that at the end of the day, it’s not about training, it really is about results. We can be doing the best training in the world, developing the best classes, bringing the best instructors, and having the best content, but if it doesn’t make a difference for the business, then it really is irrelevant.

I often tell people about benchmarking, because benchmarking is a great tool that almost all training organizations use at one time or another. You may look at a benchmarking report and say, “Wow, the average company in my industry spends $800 dollars per employee per year and I’m only spending $400. So, I must be under-spending and I should be going to my management and showing them this benchmarking report and making the case for doubling the budget.” And what I would say is if you’re spending $400 and your benchmarks are spending $800 and you’re getting no value for the $400 you’re investing, you’re probably overspending; you’re overinvesting. On the other hand, if you’re getting $30 back for every dollar you invest, you probably ought to quadruple that investment, not just double it. So when we do benchmarking, we have to make certain that we do it in the context of value creation. And that’s why I say it’s not about training, it’s about results.

So let me just shut this down with one final observation. There’s something Ronald Regan use to say all the time, “This tide raises all ships.” And I think that’s the case for training and what happens when we transform ourselves from a functional orientation to a value creating machine that in fact this tide does raise all ships. For the training organization, it means that the people in that organization are doing work that makes a difference for the company they work for and that they leave at the end of the day saying they’ve made an impact and feeling like they’ve made an impact. I’m not certain that everybody can say that today.

The second thing is for the employees of those companies where we’re doing really terrific training on important business issues. The employees find that their work is more rewarding, it allows them to do things that are important to the company and the business, their skills are being built so that they perform at much higher levels, and they also leave at the end of the day feeling like they’ve made a difference.

And lastly, for the executives who fund all this stuff that we’re talking about, when they look at it, they have confidence (unlike the lack of confidence that many of them have today) that the money they’re putting into developing their people is in fact making a difference for the business and for their people. So, in that regard, “this tide really does raise all ships.”

With that, I welcome your comments. I would appreciate your feedback and maybe another day, there will be another blog.

Thanks.

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9/23/2010

Smoke Screens about Outsourcing

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Let me just call up smoke screens, again, about outsourcing and I’ll tell you why—this is an interesting one that has dual smoke screens. The next one is that “I lose control.” I talked about this earlier but let me be just a little bit more specific.

The argument goes like this. If I outsource parts of training to an outsourcing provider or a third-party provider, I will lose control. And that’s as stated by senior training leaders. I take there’s a real issue with that.

First off, in most training organizations, what we know is that there’s more training going on outside than inside the training organization. That does not sound like control to me. The opportunity is to get one’s arms around the total spend, direct and indirect, and manage the total spend, which we often find is not going on. There’s a hidden spend in training that’s 2-4 times more than the direct spend, and it’s an issue because it’s unmanaged. I have said for many years that training inside an organization is the largest unmanaged spend companies have, particularly big companies. If you think it’s a $1,000 per employee/ year, it’s actually $4,000 per employee/year. So, that’s the real spend, that’s what you ought to be managing, and that’s what nobody’s managing. So, lack of control is an argument. What in fact we know from outsourcing experience, and we can see this across multiple outsourcing providers and multiple outsourcing relationships, is that outsourcers bring formal processes for service level agreements, people accountability, monthly meeting and reports, and rigorous process control and variance management—all the things that companies demand of a third-party provider that they really don’t demand of themselves. So, when you put all those things in place, you have a governing structure that oversees it all and is engaged with it. I would argue that it doesn’t allow you to lose control, but in fact, improves the control you get. So, that’s an argument that, I think, again is a smoke screen.
Let me move to the last one that I’ll talk about. This is an interesting one because it comes from both the buyers, or the internal training organizations, and the providers. And the argument goes something like this: “A company should not outsource the strategic elements of training.” So what do we mean by “strategic elements”? We mean the business linkage process of understanding the needs of the business and having dialogues with the business to determine visual learning solutions. It could make a difference for the business and, in fact, for designing that learning solution, and for all those sorts of things that are business connected and more strategic in orientation. And so, the internal learning organizations argue that that’s their role and you can’t outsource it. The providers, interestingly, at least a bunch of providers, argue the same thing, that they don’t believe those activities are outsourcable nor should they be outsourced And I think they do that for this reason:

They don’t have the capability to do those strategic things or they’re more transaction oriented in their approach to outsourcing. So, in my past life, the outsourcing relationships that I’ve created included the strategic elements. We performed that really well. My provider performed that really well when I outsourced my training in DuPont years ago. Subsequently, when I led outsourcing processes with a number of other companies, we performed very well and delivered immense value. From the outsourcers’ side, unless you’re responsible for the processes for understanding needs and determining solutions, it’s hard to be held accountable for the value. In the absence of those things, the most that you can hold an outsourcer accountable for is:

Quality processes
Cost reduction
Consistency
Responsiveness
Cycle time

Those sorts of things on the transaction related elements and quality of content that you purchase if you’re purchasing from a third party content provider.

So, those are the five arguments. The last one crosses the barrier between internal and provider organizations. So, when I look at outsourcing today, there’s been a pretty significant change in how we do outsourcing today in the marketplace. The marketplace has evolved from comprehensive outsourcing to outsourcing of specific elements or specific services and the research says that the things that are being outsourced the most are custom content development, training administration primarily in large companies, not in small companies, and some delivery. And, of course, organizations are moving more toward software as a service hosted, learning technology model, where they don’t require resources to support systems and those sorts of things. And sometimes you’ll see organizations outsourcing combinations of those things. And while those are good things to outsource and, in fact, they offer the opportunity to reduce cost, they also limit the ability for the outsourcing provider to make a huge impact on the value side of the equation.

So, as organizations do this work and outsource these kinds of things, they must take the next step, which is to improve their internal processes for:

Linking to the business
Understanding needs
Engaging with customers
Understanding customer expectations
Ensuring that the work they do is relevant and linked to something important and that they understand and can document the value being delivered for the work they do

If we do this well, it will eliminate a lot of objections that we hear from organizations as they think about or talk about outsourcing and it will hopefully move them from the side of “I’m not interested in this” to the side of “I actually should consider it because there’s sufficient experience in the marketplace to say that organizations that do outsourcing, at some level, do get some benefit.”

So, why don’t I stop here and welcome all your comments, inputs, critiques, support, and all the things that go along with these blogs. I look forward to hearing from you. And I have two more blogs to do to end this series on “The View is Worth the Climb.” This last one on outsourcing is one of those things that I say along the road, “This is one of the things that if you do well, makes the view worth the climb.”

Thank you.

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9/6/2010

Backroom to the Boardroom

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Today, I want to talk about moving from the backroom to the boardroom. So, what do I mean by that?

I have this strong drive to help training reposition itself from its functional orientation to a business orientation, which if it does, will allow it to not only be in the same room with business people but also sit at the table (as opposed to looking in through the door or sitting around the outside wall).

How do we get from the backroom? How do we get from not being considered an integral part of the business to one where people look to us much like they do with sales, marketing, manufacturing, finance, or IT and get engaged in business discussions that allow us to bring forth the kinds of insights and capabilities that we know are possible to make a difference for the business.

And I think that, in-fact, is the essence of the challenge.

When we have conversations, do we have conversations with the people who are running the business?

· Do we ask them what their expectations are of us and how we should serve them?

· Do we understand the key capabilities they need in their organization to advance their objectives?

· Do we know where we’re coming up short in our performance?

· Do we know where the priority areas are for us to make a difference?

· Do we talk their language?

· Do we talk in terms of profitability, productivity, customer satisfaction, and customer retention, or do we talk about training programs, competency, e-learning, classroom training, and how many training classes have been taken in their organization?

Those are the things that I think make the difference between looking in through the window and sitting at the table.

And the other thing is…if we ever get invited to the table—much like the other people who are sitting around the table—we have to bring insight that goes beyond training. So:

· We have to understand how the business operates.

· We have to understand the various levers that organizations can pull and be broader than just training people.

· We need to be business people in training, which means that along with expertise in our special area called training, we must have the skills of business people who can look at financial sheets and say, “There’s an issue over here with fixed cost or variable cost, or how we’re doing SG&A or what’s our level of SG&A.” Things like that.

So, I submit that we have to think differently, act differently, talk differently, walk the halls of the business, and stop in and sit down with business people and say, “What’s on your mind today? What challenges do you have? What’s keeping you up at night?” All those things will eventually lead to us to being invited inside the room and given a sit at the table and moving, in-fact, from the backroom to the boardroom. I think it’s critically important.

I think we have enormous opportunity and potential. Those of us who have been in this space for a long time and have seen it work well know that when training is focused on an issue, when it is relevant, when it is tightly linked to something important to the business, and when it is done well that, in-fact, it can deliver exponential value for the investment being made. I’ve seen it hundreds of times; you’ve seen it hundreds of times. The question is, “Why aren’t we doing it every day? Why aren’t we doing it consistently?”

In my book Running Training like a Business, what we said is that one of the reasons why business executives are sold on learning (and not sold on training) is that they see improved performance, but only sometimes. It is inconsistent and they don’t know when to expect it. They don’t have confidence in us that when they invest in us, they’re going to get something for their investment that exceeds the investment.

So, I think it’s imperative that we start to get a mindset that says, “We want to be an active player with the business, we want to be an active participant and contributor, we want to be viewed as business people, we want to have our organizations behave as if they are part of their own company, and we know that the decisions we make and the work we do are affecting our income and livelihood, not that of some distant company that we work for but never see.”

And I think if we can get aligned to that, then the path to getting there is pretty clear. And, in-fact, if you look back on the blogs that I’ve offered up, you will see some of the ways in which you can advance your organization to where it moves, in-fact, from the backroom to the boardroom.

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8/17/2010

The View is Worth the Climb - Running Training like a Business - Part I

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There must be something in the air (or in the water) these days. The topic of “Running Training like a Business” seems to be getting more and more rampant and there’s more and more interesting stuff being developed. It’s mystifying to me since the book Running Training like a Business (you can pre-order the forthcoming eBook version here) I co-authored has been out for over 10 years. The belief that I and many others have is that when the book was first published, it was probably a bit ahead of its time and actually, now, it’s more relevant than ever. But what’s interesting is I just saw on LinkedIn - a friend of mine and a guy who is an ex-executive from Central Learning, John Higgins, now President of Caspian Learning wrote recently, a few weeks ago, “Exactly when will people start running learning like a business.”

After 10 years in the industry, I’ve seen little, if any, progress. And, I also saw the following week a blog from another friend, talking about running training like a business and the fact that it’s been out for a long time and organizations still haven’t done much about it. The question is, “What is going on here?”

I just returned from a trip to Amsterdam and Paris where I met with six companies and the topic of conversation was “Running Training like a Business” and how they could, in fact, do things differently than they are doing today, such that they could follow many, if not all, concepts of “Running Training like a Business” and deliver more value. So, I thought I would use this blog today to talk about the topic and what it means and, perhaps, even how you can begin to show movement toward the concepts that are discussed in detail in my book.

So, what is “Running Training like a Business?” I think at the end of the day, it’s about transformation. As we say in the book, making this kind of transformation is not for the faint of heart; it is tough work. It requires changing the way we think, the way we act, the way we talk, and the way we interact.

But fundamentally, we talk about the twin tales of effectiveness and efficiency in the context of “Running Training like a Business.” So, what are those things?

Effectiveness is all about creating value, seeing yourself as a business, seeing yourself as an enterprise versus a function, talking the talk of the business, measuring yourself by your customer success (not by all the stuff that we traditionally measure ourselves by, like volumes, classes, courses, events, competencies, and all those sorts of things). Instead, we measure ourselves by results being delivered to our clients in the form of increased revenue, increased earnings, improved productivity, reduced cost, and those sorts of things. So that’s the effectiveness side of running training like a business.
The efficiency side, which is the other half of the twin tales, is all about getting cost to acceptable levels, uncovering and exposing hidden costs and getting them under control, and managing the total cost of training as opposed to just what’s visible. What we know is that in any corporate training budget, what you see represents only a small portion of the direct spend normally in an organization and it’s particularly dramatic in a decentralized organization. But having said that, even in a decentralized organization, the budget represents a small percentage of the total cost because another 2-4 times that number is being spent in indirect costs that have as their makeup things like the cost of time off the job, the cost of poor quality, travel cost, and those sorts of things. The most important is the loss of opportunity cost, which is the fact that people aren’t creating value for the business while they are off the job doing whatever level or amount of training that they’re trying to do.

So, the dilemma we have here is that there’s this huge mandate for training these days. It’s about improving effectiveness, reducing costs, becoming more relevant, and delivering value.

Yet, when we look inside many training organizations, what I have seen (anyhow, I can only speak for myself), is a broken investment value equation, which means that there’s insufficient value being delivered for the investment being made.

And that’s a difficult place to be because you never know what happens when executives have to make decisions about where they invest money. They lay down all their options side by side and they look at those options in terms of investments and value being delivered, and if we’re coming up short on the training side, then we’re likely going to be impacted by a decision. It’s not going to be a positive one; it’s going to be about taking costs out, stop doing some things, or reducing resources.

This is opposed to what I believe is a really important element to the work we do, which is, when times get tough, you would think that companies would invest more in training, not less, because there’s demonstrable evidence that companies that invest heavily in training get really sizably improved productivity from their employees. So, you would think when times are tough, your organization needs improved productivity to get out of the difficult times. The organization would invest more in improving skills and capabilities; instead, the opposite happens.

And it’s all a result, in my mind, of the fact that we have not delivered sufficient value for the investment being made.

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8/2/2010

The View is Worth the Climb - Transformation: Part 2 / Looking at Costs

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So, let’s begin with what transformation is and what kinds of transformation might be required. Let’s start with costs. In many organizations, when someone says, “How much are you spending on training?” most people look at the corporate training budget and say that that’s the amount. And it doesn’t take long as a result of a couple of questions like:

Is sales training included?
Are you decentralized?
Do you have a training organization in other parts of the company?
Do the businesses do some of their own training?
Is any of that captured in a budget?
Do you have stewardship over it?
Can you, in fact, pull it all together at the request of a CFO, for example?

And I suspect that most organizations will struggle with that.

The second part of cost is the other costs associated with training. Think of a triangle, and think of the very top of the triangle, the narrowest part being the direct cost of training—which is what is visible out of pocket, what you use to pay for staff, outside resources, and infrastructure.

The next segment, or the next element, of cost is the cost of employees while they are doing training. So, if they are taking five days off the job to attend a training course, there is a cost of five days of their salary. If they are using e-learning, there is a cost of one hour of their salary over the course of the year. The big question is, are we adding that up, and do we know what it is?

The fourth element of cost is the cost of poor quality. So, if the training is not effective, is no good or isn’t delivered well by the instructor, doesn’t stick to or doesn’t have good learning design, or doesn’t have good learning objectives or doesn’t test for them, that’s a cost buried under the category of quality, which also needs to be added to the total cost of training.

And, for the last element and the largest, picture the bottom of the triangle—the widest part, which is the lost opportunity cost. The lost opportunity cost has to do with the cost when you pull people off the job—they are not doing the work you hired them to do. The simplest way to think about this is a salesperson. If you pull a salesperson off the job for five days of training, that means he or she is not selling for five days, which means he or she is not generating revenue, which means you have lost an opportunity to create revenue. That’s a big deal, and it’s the widest part of the triangle. So I would suggest that when you think about the cost of training you think about all of these things—all of these make up the total cost.

Let’s say, for example, you are highly dependent on instructor-led training, which means that you’re pulling people off the job, putting them in the classroom or asking them to travel. When you take actions to transform training, say, if you can convert some level of classroom training to e-learning or virtual instruction, it either means employees don’t travel or it means the training is shorter. It means that they are not taken off the job for as long as they would if it were an instructor-led course. And if you only count the cost of the training directly, you miss a huge opportunity to take credit for value created on the cost side of the investment value equation by taking the action you’ve taken.

So, that’s cost. Now, let’s talk about value.

Value is the so what of training. If it’s not delivering some sort of value, then it’s irrelevant and we are irreverent. So, we have to make certain that we have the right processes in place to uncover needs that are business-driven needs in a way that allows us to bring forth solutions that make a difference for the business.

There is some interesting research, by Bersin and trainingindustry.com, that speaks of the fact that organizations are going to move away from curriculum-based large catalogs of courses to more project-based stuff. I have been a believer in this for a number of years. For more than ten years, I have been talking about the fact that there are three types of training that go on in organizations:

One is curriculum based, which is driven by competencies and the like and is delivered through some sort of catalog or core curriculum or those sorts of things.
The second is corporate initiatives, which get driven by some sort of corporate edict around things like customer responsiveness or customer satisfaction or customer diversity or the like.
The third type of training—and I think not many organizations really do and or really do well the third type—is what I call business-issue-driven training. This is the idea of having someone who is dialoguing with the businesses:

Understand what their business needs are.
Understand what their challenges are
Understand what they are trying to accomplish in the next twelve to twenty-four months.
Understand what the people component of what they are trying to do is.
Determine whether training can make a difference or can be a lever in enabling that business challenge or result that the business leaders are looking for.

This process normally results in some sort of project-based solutions, which, for lack of a better term, we will call learning systems. These may be made up of multiple components of training or learning programs, probably highly customized or at least tailored, that are put together in a way that the whole becomes greater than the sum of the parts.

So, if you can’t answer the question, “what value are you delivering?” then that’s a battle cry for transformation. If you can’t answer the question, “what am I spending?” then that’s a battle cry for transformation. If when you look at your organization then you say, “(as an example); we are decentralized, and every organization, every business has its own training organization and we don’t know how much we are spending in total, but I suspect if we went out and asked each training organization what it is spending, we could probably find that out.”

Now, let’s come back to the total cost of training. Would it be able to answer the question on the total cost of training? Unlikely!

Second, if no one is managing the whole and only managing the pieces, then I would submit that you are suboptimizing the investment for a number of reasons:

There are likely duplications and redundancies in what’s going on.
There are probably common needs being met by different solutions, which creates inconsistencies.
If you are using outside providers for one thing, if not for internal resources, to develop this training, it’s underleveraged. So, if you have the same needs across five businesses and you are using five different training organizations or groups of people to develop the training for those five organizations, that is underleveraged.

So, if these three questions— don’t have good answers:

How am I organized?
Am I creating value?
Are my costs under control or at acceptable levels?

...then there is your recipe for transformation. If you can get your arms around these things, I think all else will follow and you can figure out how to do the right mix of fixed to variable costs, the loads of deliveries, e-learning classrooms, virtual instructors, and the like.

You can determine what vendors to use, how much to spend with them, and how to select them, etc. You can follow that with the kinds of technologies that you need to support your efforts and be able to measure whether the technologies you have are doing that effectively.

So, let me end at that. I will come back on the next blog and talk about running training like a business and how it can support a transformation of the type we are talking about. Thanks.

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7/20/2010

The View is Worth the Climb - Transformation: Part 1 / What it is

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Good morning. It’s a cloudy Tuesday morning in Chicago. I’m on my drive to Evanston, IL, to my office. The traffic is horrible. There is construction everywhere.

So, I’m on my drive, and though it’s going to be a lengthy drive, I would, in fact, be developing my next blog. I’m actually going to position the next three blogs. Let me title them:

Transformation
Running Training like a Business
Outsourcing

I’m going to discuss why transformation of training and learning organizations is important, how running training like a business and how its concepts can be enablers for transformation, and, lastly, how outsourcing can be one of the tools or levers that you can use as part of the transformation process to get you where you want to get to.

Why transformation is important

So, let’s start with transformation and why transformation is important. In my experience, there are a set of questions that learning leaders and chief financial officers (CFOs), chief executive officers (CEOs), chief operation officers (COOs), and executives in charge have difficulty in answering. What are those questions?

How much are we spending? I’m going to talk in detail about this. It’s abnormal for anyone to be able to answer the question, how much are we spending on training? because it goes on everywhere and, normally, organizations don’t have their arms around it.
What are you getting for it? That’s the most important question. Regardless of what you’re spending, if you’re getting nothing for it, then you are overspending. And quite frankly, if you are getting tons for it, if you know you are getting a lot of value, then perhaps you are underspending and you ought to invest more.
Are you organizing the right way to deliver the kinds of values that are possible?
Do you have the right mix of fixed and variable resources?
Are you heavy on fixed resources, which gives you limited flexibility and scalability and also lots of fixed cost, or are you using outside resources both to variable(ize) your cost and to provide you access to, maybe, capabilities you don’t have or can’t build on your own?
Do you have the right mix of modalities and deliveries?
Are you pulling people off the job a lot to do this stuff, or are you utilizing the technologies that are available to you these days to minimize time off the job?
Are you using vendors in the right ways, and are you leveraging both vendors and resources to deliver what you’re trying to deliver?
Are you delivering a competitive advantage from the investment being made to your company?

These are the questions I find unanswered in many organizations, and I would challenge all of you who are in learning leadership positions to look at these questions and ask, “Do I have answers for them or not?”

I would say the key ones are spend, value, competitive advantage, and structured appropriately for value creation. If you don’t have a good handle on these, then it’s time for transformation. The business imperative that, I believe, is in front of most training leaders has three components to it:

1. Create more value for the investment being made.

2. Get your cost to acceptance levels.

3. Become more relevant to the business.

Of course, one and three are closely linked. Becoming more relevant means getting connected, being intimate with the business, and understanding its needs. And number one is taking those needs, figuring out if learning can be an enabler to move the lever on some business issue or challenge or need, and then delivering it in a way that makes a difference.

So, with that, I’m going to next talk about cost and how to ensure that you’re looking at cost in the right way and getting it under control and to acceptable levels.

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6/29/2010

The View is Worth the Climb – Part 3: Value Creation

To download and listen to a podcast of this blog, click here.

OK, let’s start this blog with a couple of thoughts on my part here. First, I never thought I’d ever do a blog. I had in mind that a blog is this thing where people write short, quick sentences and thoughts and get lots of responses and go back and forth, and back and forth. Our head of marketing, Kimberley Kelly, informed me that for our purposes, it’s not that. It’s really about putting forth some ideas that might stimulate some conversation, and the ideas have to be complete enough so that people understand and read and then respond if they care to.

So, I then said: Well, jeez, I don’t have time do that. That’s going to take a lot of effort.

She said: How about that drive you do to the office every day and every evening; it’s about an hour, hour-and-a-half drive? In fact, why don’t we just call this series of blogs “the drive,” and you can do it. You can do a blog while you are driving to and from work.”

And I finally said OK. I relented. And that’s what I’m doing. I’m on my way to the office this morning, and I thought I would just talk about value creation. That’s the topic of today’s blog.

So, what do I mean by value creation? What I mean is that learning and training organizations need to deliver quantifiable value for the investments being made in them.

And what do quantifiable values look like? Well, they can look like, traditionally, things such as smile sheets that get high ratings or even level 2 high ratings. I would suggest that it really ought to be about the business and we ought to have a series of measures. There is a business metric that determines values we create. So, what are those measures?

These measures are things like:

· Productivity improvement

· Sales

· Earnings

· Productivity

· Employee productivity

· Customer satisfaction

· Customer retention

· Employee satisfaction

· Employee retention

· Employee growth

The thing about value creation is that it has to be in the eyes of the customer. So, let’s just spend a moment talking about who the customers of training are, because then we can figure out how we can understand what’s important to them and how to measure the work that we do to ensure it is delivering value and meeting their needs and requirements.

I would submit that there are three customers of training:

· The employees who receive the training, who build the skills and capabilities required to do whatever it is they have to do to deliver to support their business that they are in, or function

· The leaders—managers, line supervisors, and managers of those employees—who have the task of ensuring that their employees have the skills and capabilities to do the work that’s required and that they are meeting their objectives collectively and individually

· The group that provides all the funding—the senior executives

And my point of all this is that all three customer groups have a set of needs; those needs we need to understand and deliver against.

The employee’s need may be pretty simple: “I need a set of skills to do this job I have to do, or I have a need that has to do with employability.” And we can deliver training and learning against those needs and, in fact, measure it.

The first-line or second-line supervisors may have a set of needs that say, “My employees need to work as a team. I need to get more productivity out of my team, and I need to meet my objectives for the year, and therefore my employees need to have the skills and capabilities to do the work that ensures that I meet my objectives.”

And then the third group, the executives who provide the funding for the work that we do all through the organization . . . its needs may be totally different. This group may be concerned with things like employer of choice, employee retention, customer retention, customer satisfaction, and achievement of strategic objectives.

All these things are measurable. But the reason we don’t measure them, I believe, in many cases, is because we don’t understand and don’t take the time to understand the needs at this level. We pretty specifically look at a training need and say:

What are you trying accomplish?
What do you need?
What’s the skill set that you need?

Then we measure the skill set gotten by some form or fashion, and then we move on. And I would submit that there is a larger view of this that we ought to be dealing with and we ought to be building a set of measurements around.

So, value creation, then, is the delivery of those results that move the needle on business value or value and need as defined by the three customer bases. And things like productivity and sales revenue, employee satisfaction and employee retention, and meeting of objectives and holding of cost and productivity are critically important. So, how do we do this?

1. Business Linkage

Well, I believe that within the value chain of training, there are a set of processes that I would call value creation processes, which are things like:

Understanding the needs of the business—what I call business linkage
Understanding the challenges the business is facing
Understanding what the people and issues are that are associated with those challenges
Determining whether training can make a difference
Enabling the business by developing skills and capabilities that don’t exist today and then doing it.

So, the value creation process, business linkage, first and foremost, begins there; if that doesn’t happen, nothing else matters in my mind.

2. Design and develop a solution

The second one might be actually designing and developing a solution—probably identifying the solution or the solution options that meet the requirements as understood in the business linkage process—and making certain that:

We are bringing options to our customers
The options are, in fact, targeted at the needs specifically identified in the business linkage process
The customers then have the ability to make choices based on the level of value or cost or both, the level of effort, timing, etc.

3. Measurement

The third part of value creation is, I believe, measurement, only because it’s critically important early on in the transformation of a training organization.

Transformation may be a too strong a word, but let’s go with it for now. In the transformation of a training organization, measurement is important because we have to earn the right to do the work that we do. Earn the right means we have to consistently deliver value, we have to consistently be responsive, we have to manage our cost, etc. And so, what my belief is that as we continue to measure and continue to demonstrate value and quantify it and the like, we ultimately build confidence in our customers that when they invest they get substantial value in return. At that point, and that point differs by organization, I’m certain, we can technically stop the measurement process, stop investing resources to do all this measurement stuff, because our customers are confident that when they invest they get value.

So let me stop here and end with the statement I often make to organizations: It’s not about training; it’s about results.

So, we need to change our mind-set to get away from training being the end, when, in fact, it is one of the means, and one of the means to delivering real value and delivering real business results.

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6/21/2010

The View is Worth the Climb – Part 2

To download and listen to a podcast of this blog, click here.

So, I’m back to talking about “The view is worth the climb.” I’m going to subtitle this particular blog “Listen Naively.”

Let me start with a story. A number of years ago, I was talking with a newly appointed head of training of a fairly sizeable insurance company. This person was new on the job, and I contacted him early on to say, “Look, I know you are new in this job. Perhaps there are ways that I could be helpful to you in the context of helping you get your arms around what’s going on, figure out how to organize for success, and figure out what you should be doing and not doing and how the company that I’m part of could bring value to you.”

This person said, “Thanks very much, but I don’t need any help. I know how to do this stuff.”

So, I went away. However, I continued to contact this learning leader over the course of the next year and a half, about once every two months.

A year and a half later, on a Thursday afternoon, I got a call from this learning leader.

Learning leader: I need help.

Me: Great, let’s talk about it. Let’s get together.

Learning leader: No, I really need help, and I really need help now. I’m getting intense pressure from the businesses to take cost out to become more relevant to create more value, and I thought I knew how to do this, but I don’t think I do, so I need to talk with you about this.

Me: OK, fine, how about I come see you next week sometime?

Learning leader: No, how about I come see you tomorrow morning?

And so, he flew from a large city in the Midwest to a large city on the East Coast the next morning. We talked and put together a strategy for him to get his arms around what was going on and put forth some ideas and recommendations and some action plans with an associated business case. He was thrilled. He went back and was excited about the opportunity to take control of his situation.

On Tuesday, he called me again, and when I answered the phone, he said, “Hi, it’s me. It’s too late.” I said, “What do you mean it’s too late?” He said, “They shut me down. I guess I wasn’t listening well enough to understand that this was a serious issue and that I should have reacted and done something sooner.”

So, my point about listening naively, which is the subtitle of this blog, is that we, as learning and HR leaders, need to be listening to our customers. We need to be listening every day, and we need to be listening naively. What I mean by naively is being open minded about it, not having any preconceived notions, and not being defensive but listening to what they are saying when they are expressing dissatisfaction—when they are talking about the fact that:

They get an allocation, whether they use your services or not
They are not terrible happy with the training you delivered to their organization
They are not satisfied with the cost of the training that you are suggesting to them

These are all signs that in the business world, when customers say such things, providers or suppliers listen to them and, in fact, take some sort of action.

I think we have had a history of just writing this stuff off in our area of training and development and saying, “Oh well, you’re always going to hear that from the business folks, for they don’t appreciate what we do, and they always think it’s too expensive. They just have to trust us that its good stuff, it’s good training, and they will get some value from it.”

My point is it’s critically important to listen, it’s critically important to ask, and it’s critically important to understand what your customers expect of you. Quiz and quantify the terms. If you haven’t asked your customers what they expect of you, you should. When I say customers, now I’m talking about senior executives who are paying the tab, ultimately, for the work that you do and the organization you have and all the training that you develop or buy and deliver.

So, ask them what they expect, document what they expect, and look across the executives. And I suspect you will find they have common expectations. And if that’s so, then you should be able to put them into what I call an expectations map, a customer expectations map, which you use as a measurement system for how you are doing.

And then, go back and check with them periodically and say, “Look, you said some time ago that you had some expectations, and you rated me a 4 on a scale of 1 to 7. Tell me where we are now. Are we improving? Are we not improving? And if we aren’t improving, to what degree are we not improving?”

These are critically important questions. They are things you need to do as you run this activity called training and development. Remember, you are spending a lot of money. You are entrusted with making certain that that money is being spent on things that make a difference for the business. If you’re not doing that, then in my mind, you are underperforming and you are becoming irrelevant and you might find yourself in the same shoes as that senior training person I described earlier in my story.

Look, I’m giving you this advice because I have seen it work, and I know that it works. I have seen learning leaders do this quite effectively. And at the end of the day, they find themselves in a position where their customers are confident that when they invest in them, they are getting something back for that investment that is on a par with other investments that they make.

Stay tuned for the next blog.

Posted at 5:11 PM by System Account | Permalink | Email this Post | Comments (0)

6/10/2010

The View is Worth the Climb - Part 1

To download and listen to a podcast of this blog, click here.

My name is Ed Trolley, and I’m Vice President of Managed Training Services at NIIT. Welcome to my first blog. Actually, this is going to be a series of blogs. The theme of them is “The View is Worth the Climb.” What do I mean by that? What view? What climb? Let me describe that through a couple of stories.

Over the last three weeks, I have had two discussions with senior learning leaders of a pretty sizeable company. They described to me how their company was structured. They were responsible for a very small corporate group, and their company was highly decentralized and therefore had a number of training groups across the company in the businesses and even in some of the functions.

So I asked them how much they thought they were spending. They said they did not know. I asked them if they knew there were any issues with what was going on in the company. Was there duplication, redundancy, and the like? Each person said, to a different degree, “Oh, yeah, we know we have lots of redundancies and duplications. We actually have four to ten learning management systems across the company, and that’s just the way it is because that’s our culture.”

So, I suggested that perhaps they, in the role that they have, should take a look at it a little differently and perhaps step up and build the business case for change, knowing full well that their company is spending more money than it ought to be, likely creating inconsistent learning solutions against similar needs, which it should not be doing, and investing resources and time in things multiple times that could be done one way, one time. Their response to that was, “Sounds great; however, there is no real burning platform for us to do that.”

I submit that the view is worth the climb.

If you created the burning platform, this would be a bold move on your part or on the part of the learning leader or the human resources (HR) leader, but someone should create the burning platform.

If you are trying to create shareholder value and a healthier company, be more profitable, and drive productivity, and if your view is only within the walls of directly what you are responsible for, when you, in fact, know there are opportunities in your area of expertise that you don’t have direct responsibility for but could influence, then I submit and contend that you have a responsibility as a shareholder, as an employer, and as a leader, to step up and say, “Look, I think we ought to look at this and do it differently, because we can, in fact. If, in fact, we think about transforming this activity, we can, in fact, create more shareholder value. We can take significant cost out; we can, in fact, improve consistency and value from the investment being made.”

So, that’s going to be the theme for the next seven or eight blogs. I’m going to talk about a number of things about why and how we got to this point where training is one of the largest unmanaged spends in corporations, particularly large corporations.

There is a need to have a value creation process in the value chain of training. Outsourcing is one of those things that gets a bad rap or a mixed rap and, in fact, ought to be looked at as an option for doing some or all of the things you are trying to do or should be trying to do. The organization structure is critically important. Things like highly decentralized structures that don’t come together at any point, I believe, are inefficient or ineffective. And there ought to be some level of stewardship so that we ensure that:

We don’t have duplication of resources, duplication of effort, and inconsistent delivery against very important topics.
Technology is being effectively leveraged.
Lower-value-added activities for the corporation are being appropriately leveraged.

Knowing how much you are spending and what you are getting for it are the keys to the investment value equation, as I call it, and it’s been my belief for some time that the investment value equation in many corporations is broken. What I mean by broken is that there isn’t sufficient value being delivered for the investment being made in training and development.

So, with that, I’m going to close this first blog. I welcome your comments, and I welcome your thoughts and insights. Stay tuned. We’ll be talking about this stuff in a lot more detail in the coming blogs. Thank you.

Posted at 4:09 PM by System Account | Permalink | Email this Post | Comments (0)

6/9/2010

Welcome Post

Welcome to my Summer Series, The View is Worth the Climb*. I’m glad you’re along for the journey ahead.

Since its summer, I thought I used the metaphor of hiking to illustrate the journey to Transforming Training to deliver business impact. It can be much like climbing to a mountain peak – exhausting yet at the same time exhilarating. On the trail up you’ll scrape your knees, fend off animals, lose some gear, and risk your life (or career) all to cause uncomfortable - yet positive - change in your organization.

In anticipation of summer traveling season, you’ll have your choice of reading the blog online or downloading and listening to a podcast recorded version.

In this eight week executive digital blog summer series, The View is Worth the Climb, I plan to share practical example from decades of my personal experience. I’ll be your mentor on the trail to the Summit. While I never thought I start a blog- and honestly can’t believe I got talked into it - the more a thought what I believe is the new business imperative and why value creation is key to the training function, I found that I had something to say that could help you. I really wanted to share my experience to perhaps lend some help to challenges we in learning and talent development still unfortunately face.

Along the journey you’ll learn step by step how to transform training to impact business through some topics we’ll explore:

Why you must climb the mountain
What the view looks like from the top
What the new business imperative is and how you’re in control of it
How outsourcing can be used as lever to help accelerate transformation
How to fix the investment value equation
How running training like a business can be an accelerator to transformation
Why transformation of training and learning is more than simply ‘important’
Why value creation in key the training function

Pack your iphone, ipod, ipad or other MP3 device, sit back and listen or relax and read, as Ed mentors through the journey.

Please write to me, post a comment, or ask a question. I really do want to hear from you. If you like what you hear or read, I encourage to share the posting or podcast with a colleague.

Have a great Summer,

PS - And thanks for taking me with you on vacation.

*The views expressed in this blog are those of Edward A. Trolley and not necessarily those of NIIT.

Posted at 5:32 PM by System Account | Permalink | Email this Post | Comments (1)

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