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The European Business Review March-April 2013
Contents Global Economy
Global Managemnet
5
A 'Sigh of Relief' at Davos: Confidence and Caution Shared Center Stage Michael Useem
8
Global Recessions: A Survivor’s Manual Irv Rothman
13 Fast-Expanding Markets: Where New Growth Can Be Found! Terence Tse, Mark Esposito & Khaled Soufani 17 DAFZA Offers Highly Developed Infrustructure and Quality Services to European Companies 19 Structuring Your Organization to Meet Global Aspirations Suzanne Heywood & Roni Katz
24 Building Ethical Business Cultures: BRIC by BRIC Alexandre Ardichvili, Douglas Jondle, Jack Wiley, Edgard Cornacchione, Jessica Li & Thomas Thakadipuram 29 Performance Management Systems in Mexico: The Dual Logics of Evaluating Performance Anabella Davila & Marta M. Elvira
Business Ethics 33 Why Should Managers be Socially Responsible? & Sustainablility Antonio Argandoña 39 How Sustainability and Carbon Footprint Reduction is Transforming the DNA of Leadership. Key Trends for 2013 Nikos Avlonas
Business Operation
43 Predictive Analytics: New-generation Strategic Decision Support Tobias Klatt & Klaus Moeller 48 Flexibility to Improve Forecast Accuracy Karin Bursa 52 Demand Chain Management: Enhancing Customer Value Proposition Pankaj M. Madhani
Innovation
57 Unlocking Innovation Through Business Experimentation Stefan Thomke 62 Why Our Decisions Get Derailed and How to Get Back on Track Francesca Gino
Organization
Editors Jane Liu Peres Kagbala David Lean Elenora Elroy Annabel Jacobs Commissioning Editors Laura Macshane Nisha Khimji Natasha Scott Business Development Editors Ian Love Marcus James Mellisa Ford Head of Production Saul Luckman Production Charlotte Godfrey Illustration Suya Zhang Mark Hithersay Head of Finance Lynn Moses Editor in Chief The European Business Review Publishing Oscar Daniel
READERS PLEASE NOTE The views expressed in articles are the authors’ and not necessarily those of The European Business Review. Authors may have consulting or other business relationships with the companies they discuss. The European Business Review 113 Sternhold Avenue London SW2 4PF Tel +44 (0)20 8678 8991 Fax +44 (0)20 7000 1252
65 CEOs, Mind Your Own Business! Why and How Corporate CEOs Need to Pay More Attention to Corporate Functions Andrew Campbell, Sven Kunisch & Günter Müller-Stewens
info@europeanbusinessreview.com www.europeanbusinessreview.com
71 Making Corporate Learning Work Shlomo Ben-Hur & Nik Kinley
Copyright © 2013 EBR Media Ltd. All rights reserved.
“
Companies must be socially responsible not only because it is demanded by society, or because it increases profits, but above all because CSR is part of good management.” Business Ethics, p.33
No part of this publication may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopy, recording, or any information storage and retrieval system, without written permission.
Innovation
Why Our Decisions Get Derailed and How to Get Back on Track By Francesca Gino
T
he Ducati motorcycle racing team, Ducati Corse, decided to compete in a motorcycle racing circuit, the MotoGP, for the first time in 2003. The team had accumulated years of experience and success in other motorcycle racing circuits, but the MotoGP had different rules and required a different type of motorcycle. Consequently, team members approached their first MotoGP as a season of learning – their goal was not to win, but to gain as much knowledge about the race for future years as possible. The plan of action was clear, and the team tried to set everything up so that implementation would follow smoothly. For instance, the team’s racing bikes were fitted with sensors to capture performance data, and Ducati Corse engineers held debriefings with the riders after each race to gather feedback on the bike’s handling. Unfortunately, however, the team’s outcome bore little resemblance to its initial plan. During the 2003 MotoGP season, the team experienced unexpected success, finishing among the top three in nine races and second overall for the season. Instead of focusing on learning from all the data they were gathering, team members focused on celebrating. The unexpected success also increased the engineers’ confidence in their ability to design high-performing racing bikes. As a result, the team decided to radically redesign its bike for the MotoGP 2004 season, adding more than 60% new components. But the new racing bike did not perform as well as
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expected in the first few races of the 2004 MotoGP season. As the team members themselves recognized, their confidence sidetracked them from their goal. The business press often reports stories of CEOs, managers, and their companies setting out to accomplish specific goals and ending up with very different outcomes. In our own professional lives, similar experiences cause us to question our fundamental ability to make effective decisions that are consistent with our initial plans. In my own study of various organizations, I have observed several circumstances in which decision makers are likely to get sidetracked. Experienced managers may plan carefully for their negotiations but end up with very different deals after being caught up “in the heat of the moment.” Thoughtful executives may introduce new incentive schemes to motivate their employees but discover that the new systems triggered cheating. Similarly, team leaders may plan to spur success by using a participative approach to problem solving but fail due to their difficulty putting themselves in their team members’ shoes. Why do our plans so often go astray? I spent more than ten years working on research projects that address this question, which I discuss in my recent book Sidetracked: Why Our Decisions Get Derailed and How We Can Stick to the Plan (Harvard Business Review Press, 2013). This research led me to a puzzling conclusion about our nature as human beings: our goals and plans are often inconsistent with how we actually behave. Like the managers I observed, all of us want to be consistent – that is, we care about following through on our goals. Yet, even when we spend time developing our plans and are committed to our best intentions, our decisions often veer off course in ways we did not anticipate. Ducati Corse planned to use 2003 as a learning season devoted to gathering the data needed to build high-performing racing bikes in the years to come. In the end, however, the team did not adequately use the information it collected and failed to learn. Whether we are making plans for today, next week, or many years from now, when the actual moment of decision arrives, subtle forces can sidetrack us. Typically, getting sidetracked leads to disappointing outcomes and negative consequences for both ourselves and our organizations. It also leads
Whether we are making plans for today, next week, or many years from now, when the actual moment of decision arrives, subtle forces can sidetrack us.
us to regret the fact that we didn’t follow through on our plans. There are three sets of forces that sidetrack our decisions as we implement our plans: (1) forces from within ourselves, (2) forces from our relationships with others, and (3) forces from the outside world. These forces may operate in isolation or, as is frequently the case, work together. Understanding how these forces operate can be helpful in two main ways. First, it can help us stick to our well-thought-out plans going forward. Second, it can help us understand and decode the often puzzling behavior of our colleagues, friends, and bosses.
Forces from within As it turns out, our own thoughts and feelings can sidetrack us. In a 2006 issue of Inc. magazine focused on entrepreneurial mistakes, Gary Heavin, the founder and former CEO of the U.S. fitness chain Curves International, reflected on his career. Heavin was running his first chain of gyms in Houston, Texas by the time he was 30 but filed for bankruptcy only a few years later. He learned from this first business failure and partnered up with his wife to fund Curves International, a successful Texas-based fitness franchise. When reflecting on his first CEO job, Heavin noted that he used the words “I” and “me” too often and the words “us” and “we” not often enough – that is, he placed too much confidence in himself and too much responsibility on his own shoulders. In the same issue, Gauri Nanda, the creator of the hybrid robot-alarm clock Clocky (which runs away from you when you try to hit the snooze button) describes how she created an entire brand simply to bring Clocky to market because she was unwilling to hand over control of her product. Nanda believed in her goal of developing products that use technological solutions to solve human problems, but she regretted that she hadn’t teamed up with someone with more business experience.
On a wide range of dimensions, from our ability to make good decisions to our success in business, we tend to rate ourselves higher than our colleagues or peers. A large body of research suggests that most of us think too highly of our skills and abilities. On a wide range of dimensions, from our ability to make good decisions to our success in business, we tend to rate ourselves higher than our colleagues or peers. To take a humorous example, a 1997 U.S. News and World Report survey asked 1,000 Americans a simple question: “Who do you think is most likely to get into heaven?” Overall, the respondents believed that then-president Bill Clinton had a 52% chance of getting into heaven, basketball superstar Michael Jordan had a 65% chance, and Mother Teresa had a 79% chance. Yet, interestingly, someone else ranked even higher: the person completing the survey. Respondents rated themselves as having an 87% chance of passing through the pearly gates – and thus as more divine, overall, than Mother Teresa.
The words “I” and “we” pervade our decision-making because of the positive views we hold of our competence and abilities. Though certainly helpful in many contexts, from our health to our persistence in the face of failure, overly positive beliefs in our abilities can hinder sound decision-making. For instance, if entrepreneurs think their ideas are better than those of their competitors, they may take unwarranted risks. If CEOs believe they have better information than everyone else in the executive suite, they may invest in the wrong markets or make disadvantageous acquisitions. And if team leaders are too confident in their own knowledge, they may be reluctant to listen to the opinions of team members, even when they would lead to better outcomes for all.
Forces from our relationships with others As you may recall, Tom Hanks won back-to-back Academy Awards for Best Actor in 1993 (for Philadelphia) and in 1994 (for Forrest Gump). Several movie critics later noted that although Hanks’ performance was excellent in these films, it was at least as impressive in some of his subsequent movies, including Apollo 13, Saving Private Ryan, and Castaway. Yet Hanks’ fellow actors did not give him enough votes to even be nominated for an Oscar in any of these movies. Though there are a number of likely explanations for this fact, one cited by movie critics is the possibility that Tom Hanks’ peers, for jealous reasons, did not want him to win a third Oscar. In fact, if Hanks were to win other awards, at least some of his peers would come up short when comparing their Academy Award performance to that of Hanks.1 This anecdote illustrates the common tendency to evaluate ourselves on various dimensions by looking at others. We can often answer the questions that most nag us about ourselves – ranging from “Am I a good leader?” to “Do I make good decisions?” to “Am I a trustworthy person?” – by comparing our attitudes and actions with those of other people, such as peers or colleagues. When we compare ourselves unfavorably to someone else, we are likely to experience distress, jealousy or envy. These emotions can lower our self-esteem and lead us to somewhat dysfunctional behaviors. For instance, in a recent study, University of Michigan professor Stephen Garcia asked 55 employees at a Midwestern University to imagine that they were working for a company and had either high pay or high decision-making power. The employees were then asked to imagine they had to make recommendations about a new recruit – namely, whether to offer the new recruit high pay or high decision-making power. The participants advised offering the new recruit the opposite of whatever they had (high pay if they themselves had high decision-making power, and vice versa). The results suggest that people who have high standing on a particular dimension (such as pay) protect their view of themselves on the social hierarchy by making recommendations that prevent others from competing in the same social comparison context.
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As Hank’s story and this research results show, we like to know where we stand relative to others on a variety of dimensions. But we often fail to appreciate the pervasiveness of these social comparison processes, which influence our choices and can send our plans off course.
Forces from the outside world In 2010, a heated public conflict broke out between FIJI Water, a U.S. supplier of premium bottled water, and the government of Fiji, led by its prime minister and military dictator, Frank Bainimarama. At that time, the Fijian government was struggling financially because of various natural disasters and government corruption. To increase its coffers, the government decided to raise its tax on companies that extracted water above a certain level. As it turns out, FIJI Water was the only water bottler on the island large enough to be affected by the new tax. The tax increase was dramatic: from one third of a Fijian cent to 15 cents per liter. It was expected to net the government $11.7 million annually. Based on the high prices FIJI Water charged its customers, Bainimarama’s government assumed that the company was highly successful and that the tax increase would be easy for it to swallow. In reality, FIJI Water was a small player in the bottled water industry. In response to the tax increase, the company shut down its bottling plant, laid off its 400 employees, and cancelled its contracts. Calling the new tax increase discriminatory and the Fijian government unstable, FIJI Water representatives publicly threatened to pull out of Fiji completely. In the end, given that the company had built its name and reputation on bottling clean, pure water from Fiji, it decided not to leave the islands. Though FIJI Water ultimately agreed to pay the tax increase, the government’s inaccurate view of the company’s financial situation soured the relationship between the two parties. All of us are predisposed to make biased attributions of others’ behavior, as Bainimarama and his government did. In particular, we tend to discount the impact of situational factors on others and their actions. This tendency may sidetrack us as we make decisions across a variety of contexts, including HR decisions. For instance, managers may be more likely to promote a salesperson who is performing well in a region with high product demand rather than another salesperson who is performing at lower levels in a more difficult region. Similarly, a senior IT leader may have more confidence in a new software engineer who efficiently writes code in an easy-to-learn programming language rather than one who is less efficient in a more complex language.
Staying on Track Making plans is often easy, but sticking to them turns out to be quite difficult. When developing and implementing our plans, we need to carefully consider the forces that are likely to impede our decisions or the decisions of those we are trying to influence: forces from within, forces from our relationships,
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and forces from the outside world. This is often difficult to do, as we tend to subscribe to this view from Shakespeare (as expressed by Prince Hamlet): “What a piece of work is a man! How noble in Reason! how infinite in faculties! in form and moving how express and admirable! In action how like an Angel! in apprehension how like a god! the beauty of the world!” When we think about the amazing abilities of the human mind or reflect on the technological and scientific discoveries of the past century, it’s easy to enthusiastically agree with Hamlet’s perspective on human nature. Yet the evidence that I’ve described contradicts this perspective, as it documents the many ways in which our decisions are easily and predictably sidetracked. This evidence, in addition to numerous recent events, from bank failures to political scandals to ecological disasters, point us to the conclusion that, as human beings, we are neither “infinite in faculties” nor “noble in reason.”
By raising your awareness, you can keep your self-views in check and recognize when they may be taking you off track. In Sidetracked, I present a set of principles one can use to stay on track. For instance, the principle “raise your awareness” can help us modulate our overly positive views of our own competence and skills. By raising your awareness, you can keep your self-views in check and recognize when they may be taking you off track. To avoid the derailment that may result from comparing ourselves to others, you can “check your reference points” – that is, you can uncover the true motives behind your decisions, identify whether they are driven by social comparisons, and readjust accordingly. And to address our tendency to discount how situational factors impact others’ actions as we evaluate them, we can use the principle “consider the source.” Questioning your sources of information should lead you to reach more rational decisions. If Hamlet were to revisit his words today, he might conclude that, like computer software, the human mind also has bugs. By staying attuned to these mistakes and actively using the principles I discuss in Sidetracked to fix them, we can make good decisions and stay on track.
About the Author Francesca Gino is an associate professor of Business Administration at Harvard Business School and the author of “Sidetracked: Why Our Decisions Get Derailed, and How We Can Stick to the Plan” (Harvard Business Review Press, 2013).
Reference
1. Elizabeth Weitzman, “Movies and Actors Who Were Robbed of Oscar Gold,” New York Daily News, February 21, 2008, http://www.nydailynews.com/entertainment/movies/2008/02/22/2008-02-22_movies_ and_actors_who_were_robbed_of_osc.html.
Making Corporate Learning Work By Shlomo Ben-Hur & Nik Kinley Corporate Learning functions are under pressure to deliver like never before. Yet studies have repeatedly shown that business leaders’ satisfaction with the work of their learning functions has remained as low as 20% for the past decade. For an industry worth over $200 billion per year globally, that is a bad return on investment. In this article the authors lay out five critical changes to the way corporate learning is approached, that businesses need do to put things right and make corporate learning work.
L
ast year, a survey found that more than half of managers believe that employee performance would not change if their company’s learning function were eliminated.1 Some people exclaim a slight derisive laugh on reading this: it seems to play into their stereotypes about corporate learning. So they smile. Right up to the moment they remember how much learning costs. Then they stop smiling, because it often costs a lot. Globally, figures suggest over $200 billion is spent on corporate learning each year and it seems that the general feeling is that over $100 billion of that may well be wasted. Alarmingly, this wastage figure may well be on the conservative side. Because over the past ten years survey after survey has repeatedly shown that the proportion of business leaders who are satisfied with their learning function’s performance is around 20 percent.2 The stark reality is that by and large corporate learning is just not working as it should, and has not been for some time. And that is a lot of wasted money. In this article, we explain what needs to change: what businesses need to do to turn things around and finally make learning work. This not a new issue, but it is one that cannot be ignored any longer. Fuelled by downturn-driven budgetary pressures and apprehension about the efficacy of learning interventions, demand for evidence of the impact and value of learning is growing fast.3 So a lack of progress in improving the impact of learning is suddenly meeting both heightened and hardened expectations. If corporate learning is to retain what remains of its credibility, something needs to change and it needs to change fast. Of course, for anything to change, there needs to be some recognition that there is a problem. This may sound obvious, but we fear that not everyone is convinced of the need for change. For example, whenever learning leaders have been
asked by surveys over the past few years what their biggest challenge is, they have persistently reported that their number one issue is demonstrating the value of their work.4 There is no doubt that demonstrating the value of corporate learning is a challenge. But we are surprised that it comes out as the number one concern. Our fear is that this finding reveals an assumption that lurks in the background of corporate learning – the idea that there is nothing wrong with what is being done at present, that value is already being added, and that the poor satisfaction ratings are somehow not a fair
Globally, figures suggest over $200 billion is spent on corporate learning each year and it seems that the general feeling is that over $100 billion of that may well be wasted. Alarmingly, this wastage figure may well be on the conservative side.
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reflection of what is being achieved. It is as if the issues are skin-deep, challenges of presentation and political positioning more than the substance of how learning works. We could not disagree more. We are certain that the learning profession can, and often does, add value. We have seen and been involved in pieces of work that have made a genuine difference to organisations. Yet we also believe that the poor standing of corporate learning is not just
priorities stand out – five critical things that businesses absolutely must do to put things right and make learning work.
Focus on behaviour change, not learning The first priority is a big, hairy, fundamental one and focuses on the overarching question of ‘What is corporate learning?’ This may sound dull and theoretical, but it has massive practical implications.
Corporate learning should be primarily interested in outputs, how the things we learn are used, and how they can be of value to individuals and organisations. about presentation, that it runs deeper than that. Top to toe, something is wrong and it is going to take more than a change in how learning is presented and positioned to put things right. With satisfaction levels hovering around 20 per cent, merely doubling or trebling them will not be sufficient. We need to quadruple them, improve them by a staggering 400 per cent, before we can start saying that corporate learning is in a good place. Moreover, not only do businesses need to improve how they do learning, but whatever they do needs to be different from and better than what has been tried up to now. Because the apparent lack of progress in improving the standing of corporate learning comes despite significant amounts of effort and activity. In fact, the past ten years have witnessed big changes in the practice of corporate learning and the journals are full of case studies of genuinely fascinating, innovative and apparently excellent practice. It is not that things have not been happening or changing, but that the changes have either not been the right ones or have not been enough. So what has gone wrong and what do businesses need to start doing? We have spent the past few years exploring this very issue and in our upcoming book The Business of Corporate Learning: Insights from Practice, we describe in detail what the major challenges and opportunities are. From all our research though, five key
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For the most part, at present people tend to talk and think about corporate learning in the same terms as they talk about traditional, academic learning. It is assumed to be about the accumulation of knowledge or the acquisition of skills. Something is given or passed on to the learner and the focus is on what is given and the process of how it is passed on. Yet viewing learning this way misses the point that it is not skills or knowledge per se that provides value to organisations, but how they are applied. To use a stereotype: academic learning is primarily focused on inputs, what is taught and what is learned; but corporate learning should be primarily interested in outputs, how the things we learn are used, and how they can be of value to individuals and organisations. This does not mean that there is no place for traditional academic learning in organisations, especially when it comes to technical training. And we are aware that in some European countries companies have a legal obligation to provide training and continuing education for their employees and that this may sometimes resemble education in the traditional academic sense. But there needs to be a fundamental shift to recognise that, in the majority of organisations, much of corporate learning is not about traditional learning, but about changing people’s behaviour in ways that produce value for the business. And
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in this respect, the very word ‘learning’ misrepresents what organisations are trying to achieve. The practical importance of this is that behaviour change is at present surprisingly absent from discussions of best practice in corporate learning. And perhaps this accounts for why many learning leaders apparently do not as we do - count developing and delivering effective corporate learning solutions as their number one challenge: because helping people acquire new knowledge and skills is, we would argue, a far simpler task than changing people’s behaviour in ways that improve their performance. The rising application of behavioural reinforcement techniques such as gameification give cause for hope, as does the increasing influence of disciplines that are more overtly focused on changing behaviour, such as behavioural economics. So there is some change afoot, but it is too little and too slow. Once and for all, corporate learning needs to shake off the shackles of its past and recognise that it is fundamentally different from academic learning, and thereby free itself to face up to the real challenge before it.
Focus on functional alignment The second priority focus is on how corporate learning teams are set up to deliver. Much of the thinking about corporate learning during the past decade has been about how it needs to be strategically aligned with a company’s business objectives. And this is undoubtedly important and critical to the success of corporate learning. But in order to translate such strategic alignment into operational results, learning functions also need to focus on how their internal systems, processes and people are functionally aligned both with their objectives and with one another. In other words, are the structure of the function, the mindset and capabilities of the people within it, and the design of learning systems, products and services all aligned with and capable of fulfilling the purpose of learning in the business?
This may sound blatantly obvious, and it is. But in our experience it is also too often assumed or overlooked and not explicitly considered. For example, a key question every learning function needs to be able to answer is, ‘How do we create value for the organisation?’ Of course, ultimately, all learning functions are in the same business, that of helping organisations to make money through performance support and improvement. But there is, as the old adage goes, more than one way to skin a cat. And how you envisage the role of corporate learning in creating value in the organisation can have significant implications for how it should be structured and organised. For example, if a learning function needs to deliver hundreds of technical training programmes, then their operational model will need to be like that of a manufacturing or retail business. The function is likely to resemble a training factory that will focus on ensuring quality at volume, making efficiencies and delivering economies of scale. Conversely, if it is mainly focused on organisational development and the facilitation of change, then it will need to be operating more like an internal consulting unit. And if neither is the case and its focus is on the delivery of executive development, then its operating model will probably have a lot of similarities with that of a business school. These are fundamental questions and our concern is that in too many businesses, the scramble to align learning with business strategy has led to the internal, functional alignment of the various elements that constitute learning functions being overlooked. This has to change.
Step in and out of the business The third priority is to optimise the relationship between learning teams and their customers in the business.
The late psychologist Bruno Bettleheim once allegedly said that the challenge in changing another’s behaviour is not so much being able to step inside the client’s head, to understand their motivations and thinking, as being able to step out again in order to think objectively about what needs to happen. In our view, this is exactly the issue now facing corporate learning. With all the focus on aligning with business needs, demonstrating value to the business, and developing organisational capabilities, there is the risk that learning functions can step in too far and lose their ability to be objective about what needs to happen. And if they are to achieve and retain credibility, they need to be able to contribute an objective viewpoint. Part of the challenge here is a legacy issue, common to many of the HR and learning functions we have seen: namely, self-consciousness about how they are viewed and a strong desire to be seen in a positive light. There is nothing unusual about wanting to be perceived positively, of course, but it becomes a potentially negative issue when it is a key driver rather than merely a consideration, since it can constrain the ability to act. The recent research showing that learning leaders’ primary concern is demonstrating their worth to the business may well reflect current budgetary constraints and learning’s generally poor standing in business leaders’ eyes, but it may also reflect some of this self-consciousness. Whatever the underlying issues, if learning functions are to add value they have to find a way to balance the need to be an integral part of the business with an equally strong ability to step outside it and take an objective view. They must apply, without bias, their expertise in learning science and behaviour change to the task at hand.
If learning functions are to add value they have to find a way to balance the need to be an integral part of the business with an equally strong ability to step outside it and take an objective view.
Apply market forces Corporate learning is effectively a market with competing products and services, and if we want quality, efficacy and efficiency to prevail, we need to apply market forces. By this we mean that businesses need to be able to compare products and know what works and what doesn’t, so that they can make informed judgements about what they want to do, what they can do and what they need to do. And to do this, they need to focus on our fourth priority – getting evaluation right.
It is in very few stakeholders’ interests to find out – or, even worse, admit – that a learning programme has not been successful. And herein lies a problem because corporate learning has spent much of the past forty years acknowledging this issue and discussing how best to address it, but without actually making any great headway. Faulty and incomplete models, limited resources and lack of expertise have all been cited as culprits. And there is little doubt that each of these has played its part. Yet after forty years of inertia, we cannot help but wonder if there is a lack of will in play, too – a general lack of desire to evaluate. After all, almost everyone has something to lose from rigorous evaluation, and it is in very few stakeholders’ interests to find out – or, even worse, admit – that a learning programme has not been successful. And we cannot believe that this dynamic has not affected learning functions’ eagerness to properly evaluate the impact of their work. Of course, it is not only learning functions that are at fault here: one can hardly blame their reluctance, occurring as it does in the current context of failure not being tolerated or at least not forgotten. So any improvement in current evaluation practice is unlikely to happen until businesses understand that learning is a complex and difficult
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Any improvement in current evaluation practice is unlikely to happen until businesses understand that learning is a complex and difficult systemic task that usually does not work perfectly at first attempt, and needs to be evaluated and honed over a period of time. systemic task that usually does not work perfectly at first attempt, and needs to be evaluated and honed over a period of time. This message may not be easy to hear in many business environments, but it must be heard, because without proper evaluation we cannot apply market forces, and without this we cannot make informed decisions. And without that, corporate learning risks descending into mediocrity (or indeed, depending upon your viewpoint, remaining there).
Share accountability for learning Research into corporate learning has persistently thrown up a critical, but often unrecognised finding: namely, that contextual factors such as the workplace environment are actually more important in ensuring the application of learning than the quality of the learning event. This is pretty staggering when you think about it. Many businesses would say that they fully understand and appreciate this fact. But we are unconvinced. In a recent survey, 71 percent of respondents stated that their organisation expects managerial support as part of the learning process. However, when asked what managers are expected to actually do, 63 percent stated that they are only required to formally endorse the programme, and only 23 percent reported that managers have to physically do something, such as hold preand post-training discussions. Saying ‘I support you’ while doing nothing to back it up is not support, and businesses need to start accepting and understanding this.
71 percent of respondents stated that their organisation expects managerial support as part of the learning process. Our fifth and final priority, then, is that the responsibility for ensuring that learning happens, behaviour changes and that performance is indeed improved needs to be shared amongst all the parties involved. If they want learning to work, businesses must not and simply cannot assume or implicitly reinforce the idea that corporate learning is only about learning teams ‘doing something’ to employees. We believe that these five priorities are at the heart of what corporate learning needs to do to make learning work. And when we present these ideas to learning leaders, generally speaking, they do not disagree. The jump from learning to behaviour change is bigger for some than for others, but as yet there have been no gasps of disbelief or outraged cries of denial. Indeed, what seems to concern them most is not the ideas themselves, but how to implement them. On the last
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March-April 2013
two points, in particular, we have heard the occasional sharp intake of breath or long sigh, at the thought of strong impact evaluation or creating greater visibility around the business’s role in the learning process. But businesses and learning leaders do need to act and act soon. Indeed, the change is needed now more than ever because the development and deployment of learning solutions has become more challenging by the year. Organisations are increasingly expecting more for their learning money: moving to more cost-effective solutions, demanding faster design and delivery cycles and more accessible content. All of which places pressure on learning solutions by creating greater need for compromise in their development and deployment. So we have a crisis, and a big one at that. But it is not all doom and gloom. Indeed, we have great hope, because as skill shortages and decreasing opportunities to achieve competitive advantage drive businesses to look internally, learning leaders have the attention of their organisations like never before. They may be under greater pressure to deliver, but they also have the stage and the opportunity to put things right.
About the Authors Shlomo Ben-Hur is an organizational psychologist and professor of leadership and organizational behaviour at the IMD business school in Switzerland. He has more than 20 years of corporate experience in senior executive positions including vice president of leadership development and learning for the BP Group, and chief learning officer for DaimlerChrysler Services. His new book The Business of Corporate Learning: Insights from Practice, will be published in March 2013. Nik Kinley is a London-based independent consultant who has specialized in the fields of behaviour change and talent measurement for over twenty years. In that time he has worked with CEOs, life-sentence prisoners, government officials, and children. His prior roles include global head of assessment for the BP Group, and head of learning for Barclays GRBF. His new book Talent Intelligence, written with Shlomo Ben-Hur, will be published in June 2013.
References
1. Corporate Leadership Council. (2012). Driving the Business Impact of L&D Staff. London: The Corporate Executive Board Company. 2. Accenture. (2004). The Rise of the High-Performance Learning Organization. Results from the Accenture 2004 Survey of Learning Executives. London: Accenture. 3. Giangreco, A., Carugati, A., & Sebastiano, A. (2010). Are We Doing the Right Thing? Food for Thought on Training Evaluation and Its Context. Personnel Review, 39(2), 162-177. 4. Accenture. (2004). The Rise of the High-Performance Learning Organization. Results from the Accenture 2004 Survey of Learning Executives. London: Accenture.
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