THESE BEST-IN-CLASS PRACTICES AND TRENDS CAN HELP
ANY ORGANIZATION.
BY KEVIN MARTIN
An unavoidable and growing labor gap is being
created primarily by two distinct forces: (1) the
mass numbers of baby boomers that are now starting
to leave the workforce; and (2) the limited number
of skilled workers entering the workforce.
These two forces are pressing organizations to plan
and prepare for anticipated talent needs. The
situation is being further compounded by two other
factors: globalization and the “Net” generation.
To overcome these mounting external pressures,
organizations are looking internally in order to
achieve and sustain competitive advantage. As a
result, Human Capital Management (HCM) has taken on
heightened strategic importance organizationally,
and enterprise learning and development is taking
center stage.
STRATEGIC IMPORTANCE
HCM has become a boardroom-level topic with
overarching organizational implications and impact.
In fact, according to an Aberdeen benchmark report,
78 percent of the 245 organizations surveyed
worldwide responded that HCM is either a “high” or
“top two” organizational priority. The 2007 study
found that the overwhelming pressure driving all
organizations to focus resources on HCM is “the need
to increase the productivity of the company’s
workforce.” Furthermore, the majority of all
surveyed companies said they plan to impact
productivity by aligning the workforce with business
objectives.
The role and strategic relevance of enterprise
learning and development within HCM became very
clear another 2007 Aberdeen benchmark report. In
this groundbreaking study — which consisted of
survey responses from 687 HR, training and business
line management professionals and executives from
around the world — the top factor driving
organizations to focus on learning and development
was the exact same factor forcing organizations to
pursue human capital management: To align the
workforce with business objectives.
BEST-IN-CLASS
In the latter study, Aberdeen used performance
against three key performance indicators (KPI) to
distinguish the top 20 percent of all organizations
in learning and development (referred to by Aberdeen
as “Best-in-Class”):
1increase
in year-over-year customer satisfaction;
2improvement
in year-over-year employee performance, defined
as percent of goals attained, ratings in
job-specific performance reviews, and output and
performance of the employee;
3decrease
in year-over-year workforce turnover.
>>
Factors that impact Best-in- Class performance:
The ability of Best-in-Class organizations to
differentiate themselves by improving year-over-year
performance against the critical KPI is staggering.
One clear advantage that cannot be understated is
that Best-in-Class organizations nearly twice as
likely as all other organizations to have a learning
and development strategy that is integrated with the
organization’s overall strategic plan. In addition,
Best-in-Class companies are at least 60 percent more
likely than all other organizations to utilize
learning and development strategies or programs to
make human capital a competitive differentiator
(Figure 1).
>>
Organizational communication is critical:
The increasingly strategic view of human capital
makes it vital to ensure communication throughout
the organization. Seventy-four percent of
Best-in-Class organizations promote learning
initiatives and programs to those who can benefit
from participating, as compared to approximately
one-half of all other organizations. Best-in-Class
companies are 46 percent more likely to get HR and
training personnel into the business units. This
collaboration not only uncovers the specific needs
and priorities of the business units but also leads
to proactive recommendations on how learning and
development can help achieve these objectives.
>>
Generational differences require shift in learning
and development focus:
Aberdeen’s research on learning and development
reveals a strong shift in focus that not only
reflects the global realities of the dwindling
supply of talent (in terms of sheer numbers and
skills) and the increasing competition for this
talent, but also the diverse career expectations
shared among a younger generation of workers. Young
talent today understands the value of its skill set
and subsequently expects employers to cater to it.
Additionally, this younger generation grew up with
technology (i.e. Internet and cell phones) that has
become their primary means of not only communicating
with each other, but also meeting others and
socializing.
Best-in-Class organizations are stepping up their
adoption and use of tools that provide a familiar
environment from which the “Net” generation can
communicate and socialize as well as access
learning. Our research also found that 62 percent of
Best-in-Class organizations are committed to
offering a coaching or mentoring program, which are
especially helpful for younger or new employees.
A LOOK AHEAD
The most widely used technologies among
Best-in-Class organizations for learning and
development purposes focus on the use of Web-based
tools for creating efficiencies in the learning and
development process, as well as providing a blend of
classroom and online education. In fact, 60 percent
of Best-in-Class use enrollment and administrative
tools, and 58 percent use course
scheduling/organization tools and virtual classroom
(orWeb conferencing) tools.
The planned technology adoption by Best-in-Class
organizations, however, illustrates a strategy that
relies heavily on prescriptive learning based on
identified skills gaps against defined competencies
and follows a cycle similar to the following: (1)
Define competency frameworks (for positions and
levels); (2) Assess against those frameworks to
identify and assess gaps; (3) Prescribe a learning
path or developmental plan to close or eliminate the
gap, and encourage knowledge sharing and workforce
collaboration; (4) Track progress against learning
plans and/or career development plans via an LMS
and/or employee performance management solution; (5)
Leverage analytics and succession planning to
identify future needs and map against current
workforce readiness to pinpoint recruiting and
development efforts.
Figure 2 illustrates how several learning and
development tools will experience adoption growth
upward of 168 percent among Best-in-Class companies
within the next six to 18 months.
RECOMMENDATIONS
For organizations to prove and improve the business
impact of learning and development:
>>
Integrate learning and development strategy with
overall organizational strategy.
HR and training personnel should meet with the heads
of individual business units to better understand
the organizational “pain points” and critical
business drivers, so they can subsequently correlate
how learning and development can help overcome these
hurdles. This will also help all of these executives
to identify the stakeholders who can benefit from
learning and development.
>>
Focus first on measuring and improving “soft”
metrics; and then move to quantifiable “hard”
metrics.
Organizations previously unable to improve
performance, or that have yet to measure performance
of learning and development, should focus first on
Donald Kirkpatrick’s Level 1 (reaction) and Level II
(learning). Once your company has a process in place
to measure and adjust against soft metrics, it
should then focus on more quantitative metrics.
>>
Identify and eliminate skill gaps.The
ability of companies to identify and eliminate
potential labor (and skill) gaps, as well as the
practice of providing detailed career development
paths will not only provide competitive advantage in
both pre- and post-hire “talent” initiatives, but
also will prove to be a competitive necessity.
>>
Offer structured learning programs to more internal
stakeholders.
Work with individual business unit managers to
understand and identify the stakeholders who can
benefit from learning and development. Though not
everyone requires the same level of investment or
number of learning programs, most everyone seeks to
make a difference at their job.
>>
Promote the successes and ROI that result from
learning and development initiatives.
Our research found that while 74 percent of
Best-in-Class organizations promote learning
initiatives to those who should participate, only 49
percent promote the successes and ROI of learning
and development to relevant stakeholders. The key is
to understand the impact of learning and development
and to communicate the ROI using terms/metrics that
are specific and relevant to the audience.
>>
Integrate learning into pre-hire (recruiting) and
post-hire (on boarding or succession planning)
practices.
A successful strategy can be to showcase learning as
a means to attract top talent. A public-facing
organizational learning and development program may
be why a top candidate chooses your company or
selects another one in its place. Once organizations
define the competencies required for success in a
given position, a focused learning and development
program can be the key to permit a prospective
candidate to acquire the knowledge and skills
required to ascend to that position.
>>
Expand learning initiatives to external
stakeholders.
Organizations that do not offer structured learning
to external stakeholders — a group whose mindshare
is not dedicated to your company — are making a
competitive mistake. Look to create a portal that
provides relevant and timely education and/or
information to your customers. Also, utilize
Webinars to conduct semi-frequent, hardhitting
“lunch-and-learns” for your indirect sales
organization. In many instances, if these groups are
not paying attention to you, they are paying
attention to your competitors. Seek to capture their
mindshare and become the go-to source for their
success.
>>
Encourage workforce collaboration and knowledge
sharing.
Organizations should leverage the expertise within
their organizations, as well as connect more easily
and conveniently with their stakeholders.
Organizations should begin to utilize social
networking tools and other informal learning tools
to communicate practices that can build-upon
internal and external subject matter expertise, as
well as promote a feeling of cohesion and
camaraderie among colleagues that are geographically
dispersed and/or may never communicate in-person. In
addition, organizations should provide access to
content via multiple methods (from iPods to iPhones,
etc.) to engage and appeal to the technology savvy.
Kevin Martin directs Aberdeen Group’s Human Capital
Management (HCM) research practice with an eye on
technology enabled strategy execution at two levels:
workforce management (focused on workforce planning
and administration, goal-setting and alignment,
analytics and performance as a whole) and talent
management (focused on employee acquisition,
performance, learning and development, and
succession planning). He holds a M.B.A. from Boston
University and a B.S. in Business Administration
from the University of Dayton. Reach him at
kevin.martin@aberdeen.com.
To download research from Aberdeen Group’s HCM
practice visit theWebsite http://www.aberdeen.com/channel/hr.asp.
