Case Study: How to Use Learning & Development to “Take People with You?”

Introduction and Background:

You will remember that we introduced this case study in our recent post on the “Make or Break” Role of Leadership in Learning & Development (L&D). It involves a small business unit that has gone through significant transformation and continuous change. The business unit (BU) is part of a large global business and is within one of the four primary divisions. Like many business units in larger companies, the BU must constantly adapt itself not only to its direct marketplace impacts but also the dynamics of externally and internally driven changes across the enterprise as a whole.  This case study looks at a 10-year period during which the BU went through 4 significant business transformations.  Additionally, there were numerous changes across the enterprise that also impacted and created an environment of continuous change for the BU.

This week we will work through the case study and explore how L&D supports development of a readied and enabled workforce ensuring robust business agility responsive to continuous change and transformational events in this BU. Afterward, we hope you will agree that L&D must now be seen as a business imperative, a partner, and strategic investment in the vital business assets … the people!

To refresh your memory, the details about each transformational event are provided below:

The first transformation for the BU took place in the late 90s. It involved the separation of the BU into two distinct business units, each aligned with different divisions. The objective of splitting the BU into two parts was to improve operations across both parts of the former BU and provide better enterprise alignment through the divisions.  As you might guess, it involved the development of new business strategies and changes to the operating models and organization structures in order for each business unit to be aligned with their respective new divisions. Unfortunately, about a year after the separation, one of the business units dissolved. 


The second transformation happened about 4 years later when the surviving BU was combined with multiple adjacent businesses from the division into a single group. The primary objective of the combination was to gain greater market synergy and leverage the customer base from the combination of the adjacent businesses.  The revenue base increased four fold and involved the rollout of a new combined go-to-market and customer strategy. The second transformation likewise brought changes to the core strategy, some changes to the operating model, and significant changes to the organizational structure of the BU. 


The third transformation followed a year and half later. It involved a series of strategic acquisitions to expand the overall revenue base of the business. In addition, it involved a combination of businesses from the division making the total group of businesses much larger.  The new group was intended to gain further market synergies and grow and leverage the customer accounts. The strategic acquisitions expanded the revenue base and critical talent resources. It entailed acquisitions of very similar businesses, but with slightly different business strategies, quite different operating models, and different organizational structures.

The fourth transformation occurred another year later and was driven by a reorganization following major regulatory changes in the industry. The enterprise had an imperative to redirect and reposition the large group of businesses following the regulatory changes. Several of the businesses were split apart, and some of the businesses were exited as the enterprise adjusted and repositioned to the regulatory changes. This transformation required implementation of a new core strategy, more changes to the operating model and more organization structure changes.  It further required changes to staffing due to the elimination of certain lines of the business.  The original BU was split off into its own stand alone BU.

Generally, all of the transformational events and related changes would be described as significant.

The leadership, in all cases, utilized the “change enablers and levers” from the enterprise’s talent management programs.  To the extent possible, leadership included aligned performance goals, rewards & recognition and learning programs. In all four situations, extensive strategic communications were integral to each rollout and the leadership team was active and involved in the efforts.

How was L&D a key factor in the two successful efforts of the first and fourth transformations?  

1. Learning programs were developed to address basic technical and nontechnical competencies (i.e., knowledge, skills and behaviors) and capabilities of the people. The business was committed to trying to help individuals expand and improve their own basic competencies and capabilities.
   
   
2. Further, the learning addressed the application of those competencies and capabilities in the new environment or strategy through the programs and communications. The effort attempted to move the needle on the organization’s knowledge in a way that was aligned with the strategy of the change and the new environment. 
   
   
3. Other change enabling initiatives were utilized in all four events, such as communication, performance management goals, rewards and recognition, etc. However, in the two transformations that were very successful, investment in focused and well-planned learning was significantly ramped up and the communication strategy was blended into the learning efforts concentrating on both the development of competencies and capabilities as well as their application in the new environment.
   
   
4. Participation was high in the different learning approaches, virtual and instructor led. The learning utilized case studies, role-play, and active participation to simulate the new strategy. Individual and group learning plans, with specifically articulated accountabilities, followed the learning events to enable continued transformation and growth.
   
   
5. At every learning event, virtual or otherwise, the overall feedback was very positive and appreciative.  Participants provided excellent feedback on the topics covered and learning facilitator effectiveness because of their preparedness and modeling of the behaviors encouraged to help embrace change. 
   
   
6. Learners also benefited from extensive leadership involvement and participation in the learning events and communications. This not only demonstrated leadership sponsorship and advocacy, but it also provided a visible way to see leadership role modeling desired transformational changes (i.e., “walking the talk”).
   
   

Observations

Of interesting note, in the second and third transformational events that did not go as well as expected, the significant investment was in the “rollout” through communications, not in L&D.  Further, in the second transformational event, learning focused only on the application of competencies and capabilities specific to the new environment. It did not focus on the development of individual core competencies and capabilities necessary to perform successfully in the new environment. 

Is there a lesson to be learned here? If L&D had focused on both relevant development of individual’s core competencies and capabilities (i.e., not just reuse of legacy training programs) and their application in the new environment, would that have made a difference in the successful outcomes of the transformational events?  The results confirm there were differences in the outcomes.

With the first and fourth transformations, the operating results significantly exceeded the high expectations of the business as well as individual employee reactions, as collected in surveys.  The level of employee engagement increased dramatically both times when you would reasonably anticipate a dip.  The positive results from both transformations, as described by management, were “off the charts.”

The second and third transformations did not meet the high expectations on improvement of earnings and growth. Further, individual employee reactions were not as positive.  The level of employee engagement remained flat or lost ground compared to the prior year’s survey results.

Through these experiences, leadership became convinced that:

• Significant and well-planned investment in learning was critical to enable the change for individuals and organizations
• L&D was required to be a strategic priority of the transformational events
• Leadership commitment to being active and participatory in both communications and L&D efforts was essential to success
• However, it could not merely be a communication effort to enable change; it needed to be built on “moving the dial” to realize individual development through focused learning clearly aligned with business strategy
  
  

This case study has provided three vital lessons related to your workforce:

1. L&D needs to focus on both the development of relevant core competencies and capabilities and how the same apply to job responsibilities (i.e., “What do I need to do my job?”) in order for both the individual and organization to be successful
   
   
2. People will respond favorably and appreciatively to L&D efforts as an investment in them and their careers (i.e., “What’s in it for me?”) when the interest and importance of personal improvement is reflected in organizational messaging, actions and behaviors
   
   
3. When learning is a strategic priority and leadership is involved and committed, individual and organizational performance can be impacted

o   The return on the investments (measured by financial performance in the business unit in less than a year) can exceed expectations and the results can be sustained

o   Furthermore, employee engagement (measured through employee surveys) can increase dramatically

Just like we learned from David Novak’s experience at YUM! Brands:

“It starts with what we've defined as our core formula for success—building people capability. When you get the people capability right, you satisfy more customers and make more money.”[1]

Novak took the helm as CEO in 2001 and YUM! Brands has outperformed the S&P 500 and achieved double-digit growth for over 10 years.

By focusing on workforce development that is aligned to individual and organizational needs and interests, do you then touch the “minds and hearts” of your people unleashing the emotional power and resilience for them to work through changes faster and more effectively? We genuinely believe the answer to that question is a resounding YES!

[1] David Novak, ASTD interview on “Taking People with You,” April 9, 2012