Part 3 - Learning & Development Series
This is the third post in our series demonstrating why learning and development (L&D) is critical to an organization’s success. We’ve previously set the stage for why L&D needs to elevate its game to support organizational growth and change initiatives and leadership’s “make or break” role in L&D. Today we highlight the workforce … the “arm” of the organization that executes strategy and a key differential for success.
“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. Many companies start out on the wrong end by thinking first about the money, but I've never seen success on a sustainable basis happen without developing people first—especially their leadership capability. You need good leadership to really build a sustainable business. …We’re using the training to drive operational excellence around the world. ”[1] David Novak, CEO of YUM! Brands
The words in that sentiment sound good, right? But can they be true? YES, in this case they most certainly are! For years, David Novak has “walked the talk” as a Fortune 500 leader and achieved significant organizational results to back his statements and philosophical stance. Novak took the helm as CEO in 2001 and for the past 10 years, YUM! Brands has outperformed the S&P 500 and realized consistent double-digit growth.
What’s important about this type of philosophy and the results it can achieve? Well, you’ve already learned that CEO’s of organizations continue to assert that talent is their #1 or #2 concern, particularly as it relates to skill gaps.[2]
According to Accenture’s survey, U.S. executives of large companies confirm the skills gap creates significant organizational challenges:[3]
We realize there are cynics out there who query “So what? Is additional investment in workforce training really necessary? Is it worth the cost? It won’t be that bad if we don’t spend any more!” Or will it?
Accenture’s survey further highlights the consequences of not addressing the skills gap:[4]
So both the skills gap and consequences of not addressing it are more likely than not the reality businesses will face. Combine that with a more likely than not environment of continuous change plus the realization that change can further exacerbate the skills gap with the corresponding negative effects on business performance and operating results. All of these issues increase the probability of potential long-term risks to the organization when a workforce is not readied and enabled to execute business strategy, on demand.
What are organizational leaders to do? Forward-thinking, progressive leaders will need to continually reassess business strategies, operating models, and competencies (i.e., knowledge, skills and behaviors) to address the very nature of work being performed. In response, organizational learning functions need to evolve and be prepared to “build” talent internally through:
In other words, the L&D function must be dynamic, proactive and aligned with the needs of the business. It cannot continue to merely administer and manage legacy programs. The imperative to invest in L&D has become just as, if not more, important as “buying” talent through the recruiting function, especially when capabilities are necessary to navigate through change.
David Novak put his philosophy to build people capability into practice years ago and he personally invested time and effort through active sponsorship and involvement in the leadership program development and delivery. After years of program participant feedback and encouragement, he memorialized the approach in his New York Times best seller, “Taking People with You.” His thoughtful reflection, planning and actions to develop a relevant, readied and enabled workforce to execute strategic goals and objectives has elevated the performance of YUM! Brands and performance has been sustainable for over 10 years. This is easily demonstrated through financial results, reduced turnover, and improved customer satisfaction ratings.
Do you still need more detail to be convinced? Let’s break it down to better understand some of the key issues we’ve observed with Workforce Development.
Inadequate attention is paid to readiness and enablement. Many people feel that they are not equipped to handle current demands placed on them, especially in situations confronted during change. In fact, in many cases they do not think they have the authority and sponsorship to address the skills gap. This directly affects their confidence level and further impacts performance. Unfortunately, this circumstance can be further complicated if personal time and effort has not been invested to develop requisite skills. Therefore, you see people falling even more behind when change occurs creating an even wider skills gap.
Currently, 97% of learning takes place on the job[5]. When significant change occurs in one’s job, the on-the-job training may not be capable of having its essential impact. Why? Because the change likely resulted in job changes requiring new competencies and capabilities along with an understanding of how the competencies and capabilities apply to current, transitioning and future job responsibilities.
Change challenges the routine ways that people work. Our experiences conclude that the nature of organizations and the nature of work itself create challenges.
Routine Work: Most of the workforce prefers routine work. They can do great amounts of it and do it very well. That’s why it is called routine. In addition, systems and processes have been put in place to “organize” work into predictable, controllable, efficient routines – business as usual. A big part of the organization is normally dedicated to high performance in the routine work category.
Non-routine Work: Our experiences also show that far fewer people feel innately comfortable with non-routine work. This type of work requires expertise in the routine, but also demands a high degree of critical thinking, problem solving, risk analysis, and comfort with uncertainty and ambiguity. Over time, these skills have eroded in organizations and when individuals demonstrate competencies for non-routine work, they become the “go to” people in the organization. What is the risk of having too few that are capable? These “go to” people become overloaded and can ultimately bottleneck change initiatives compromising the business agility required to manage the change process optimally. Similarly, bottlenecks and compromises result from individuals in change leadership roles who are not competent in non-routine work.
Change challenges routine work and forces non-routine methods to implement the change process. Otherwise, it wouldn’t fall into the change category. Change causes disturbance, reverting people back to Maslow’s basic need for security. Routine work is often that secure place. People put their heads down and get on with the predictability of their “secure” routine work – where things don’t go wrong and if they do, “I know I can handle it,” is the typical response. When change happens, uncertainty and ambiguity are highly prevalent, and non-routine work is often uncharted, scary and risky – not a place most employees (or people, in general) want to be during these challenging, changing times.
Managing change is about having the capacity to change. An organization’s ability and enablement is tied to the cumulative capability and competencies of its resources. L&D unlocks individual capacity because learning helps increase personal comfort and resilience by creating capability and competency to track with the change. L&D that is focused on both developing competencies and capabilities and the application of the same in the new environment or strategy, creates the increased capacity to deal with change.
Knowledge creates confidence. That confidence helps people realize that change is an opportunity for them. With knowledge, people can view opportunities proactively by being positive, organized, focused, and flexible. They create a sense of self-assurance, have a vision and purpose, manage their feelings about ambiguity, and are proactive. They are more resilient and have capacity to deal with change because of their optimism and confidence.
The positive outlook of employees improves performance. The transparency and investment in employees through L&D creates realization of their value during the change process (i.e., knowing “What do I need to do my job?” and “What’s in it for me?”) When individuals grow personally, they feel more positive about their outlook. Nearly 63% of employees (two in three employees) say learning new skills or receiving special training is most important to advance their career, compared to those who say receiving a college or graduate degree is most important (45%).[6]
What can be done to address these workforce issues related to skills gaps, readiness and enablement? Findings from Accenture’s survey indicate organizations should find the balance to:[7]
When an organization prioritizes learning and focuses on developing and improving the basic competencies and capabilities of the workforce and the application of the same in the new environment or strategy, you “take people with you” as David Novak demonstrated. When you add the message of vision and purpose, people more quickly learn how to adapt and become capable to work through the challenges that occur.
For another “real life story” showing results-focused impact on Workforce Development, we’ve provided additional insights in our latest learning and development case study. After reading our articles and the case study, will you be able to decide, "How will you “take people with you” and realize both individual and organizational benefits that are proven to impact performance?"
[1] David Novak, ASTD interview on “Taking People with You,” April 9, 2012
[2] PricewaterhouseCoopers, 17th Annual Global CEO Survey, 2014
[3] Accenture, 2013 Skills and Employment Trends Survey: Perspectives on Training
[4] Accenture 2013 Skills and Employment Trends Survey: Perspectives on Training
[5] Clark N. Quinn, “Revolutionize Learning & Development,” 2014
[6] Glassdoor 2014 Q2 Employee Survey, Employee Sentiment Around Investment in Education
[7] Accenture 2013 Skills and Employment Trends Survey: Perspectives on Training
This blog was co-authored by Joanne Flynn, Jim Bosserman and Debbie Gower.
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