Running Head: CAN THE TIERED SERVICE MODEL SAVE L&D

Can the Tiered Service Model Save L&D:

An argument for change and sustainability

13 May, 2016

James Frame

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Table of Contents

Executive Summary.....................................................................................................................................3

Introduction.................................................................................................................................................5

Background and Trends...............................................................................................................................5

A Tiered Solution........................................................................................................................................9

Recommendations.....................................................................................................................................12

References.................................................................................................................................................14

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Executive Summary

A research study was launched to identify and determine if a tiered service model can be

a viable and sustainable growth model for learning and development (L&D) within large

organizations. This study searched for published examples, models, reviews and trends. The

findings are summarized here.

Goals:

1. Answer the question; can a tiered service model for L&D help reduce overall allocations

across business segments while still providing support options to current and future

business partners.

2. Identify how business partners can/should be segmented and still maintain appropriate

levels of service.

3. Determine potential success measures for a tier model approach.

4. Answer the question: Is a tier model approach for L&D practical and sustainable for large

organizations?

Process:

1. Review existing tier models in either L&D or other corporate service sectors for viability

within L&D.

2. Review literature regarding objective methodology to segregate businesses for a tiered

approach.

3. Search for common definitions.

4. Integrate the results.

5. Provide recommendations.

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Findings:

1. No empirical studies found showing benefits of existing L&D organizations structured in

a tiered model approach.

2. Tiered models are used in other service sectors within a large corporate environment.

3. L&D has significant gaps in meeting the current trends.

4. The tiered model approach does suggest long-term sustainability and application to

address known gaps.

5. The tiered model can be based upon learning maturity.

6. Success measures to address known gaps suggest a long-term focus on performance

outcomes (or impact on business) and learning maturity progression across the

organization.

Recommendations:

1. Large organizations with internal L&D departments can benefit from a tiered service

model.

2. Business unit segmentation within tiers should be based upon, at least in part, evidence of

learning maturity in order to properly address unique learning needs.

3. Further empirical study on success metrics in a large organization that has employed a

tiered service model is needed…specifically addressing impact on the business and

organizational performance.

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Introduction

The field of Learning and Development (L&D) has long been a critical component of

Human Resources. The traditional model for L&D is as a service to the greater internal business

functions and a cost on the bottom line. As a result, to reduce that cost mainly equates to creating

efficiencies. But, in the last several years, professionals in L&D have begun looking at other

models within the organization to include, how to become a source of competitive advantage

(Martinette and Obenchain-Leeson, 2009) by providing a direct tie to organizational performance

in a fast changing world.

Peter Senge (2008) continues to argue that an organizations ability to learn and change

(adapt) – becoming learning organizations – is the best way to competitive advantage. The

reality is in many organizations the current L&D model has not changed significantly neither

does it address specific business outcomes. The traditional L&D functions remain focused on

training events and report their success based upon Kirkpatrick level 1 or 2; a perceptional

assessment of the learning event. This research proposed to identify and determine: 1) if a tiered

service model can be a viable and sustainable growth model for learning and development

(L&D) within large organizations; 2) what are the success measures for a tiered model; and 3)

how should tiers be defined.

Background and Trends

Bob Dylan brought us, Times They Are A Changin (1964). Why does L&D need to

change anyway? Is it broken? Jeanne Meister and Karie Willyerd state that the workplace itself

is changing and if human resources does not adjust they may well be left behind (2010). The

function of HR is shifting. It not only requires the ability to recruit, grow their human resources,

provide ‘meaningful experiences’ (Morgan, 2016) but, also to facilitate access to the necessary

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knowledge at just the right time (CEB, 2015). Since L&D has been a traditional part of human

resources in many large organizations, their model of success has often been relegated to

measurement of past performance on their ability to simply taking training orders and deliver on

those orders. The age of the knowledge worker and the knowledge organization has evolved and

operates now with a new reality; the source for competitive advantage (as Senge has always

eluded to) is much more in the hands of the very human resources L&D seeks supports. Since

change is happening faster than ever before, L&D must adapt.

Those workers, that in 1986 were capable of knowing 75% of what they needed to know

to do their jobs are now barely able to keep 10% in their head (Meister & Willyerd, 2010). The

evolution of knowledge change is now estimated, in some industries, to double every 2 years, or

less (Meister & Willyerd, 2010). So, workers are being asked to become more efficient in the

performance of their jobs, with less ability to know everything they need to know, and yet

contribute in more ways to bottom line. Therefore, organizations and people, in order to remain

competitive, have to become increasingly interdependent with each other and technology in ways

that once seemed like structure and convenience, but are now a necessity.

Not only are workers asked to do more with less as organizations pursue this marketplace

competition, but the workplace in general has changed. For the first time in history,

organizations also have 5 generation groups that striate across one of the largest and most diverse

learning backgrounds ever seen (Meister & Willyerd, 2010). This generational segmentation is

more than accommodating population groups from 18 to over 70 years of age, but adapting to the

vast differences in how each individual learns, accesses, and retains knowledge in order to

perform their daily tasks. For example, those in their 70’s grew up with no access to computers,

while someone in their 20’s doesn’t even know what it’s like to not have access to a computer.

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To address these often complex and unique learning needs, maintain efficiency and provide

sustainable growth, L&D is forced to look for alternatives from the traditionally models of

support where one-size-fits-all: It is simply too expensive and un-scalable to approach learning

with this the same model.

The requirements for knowledge, the amount of change in knowledge, the speed of

change and the diversity of an evolving workplace are all concerns enough on their own, but

where knowledge is shared and obtained is changing too. Since these rapid changes workers

have been forced to adapt their learning quicker than L&D. Some trends indicate that 79% of

learning today comes from outside traditional L&D (CEB, 2015). Jeanne Meister speaks of

“social learning” (Loc. 2563, 2010) as the next evolution of how and where these knowledge

workers are accessing, retrieving and even adding to this body of knowledge. And, in a recent

study from CEB, it was learned that 68% of employees are getting their information to perform

on their job from co-workers (social learning) which is supporting an upward trend of 17%

growth in just 2 years (2015).

The methods of how this evolving learning occurs are also changing. Terms like self-

direct learning and on-demand learning (think YouTube) are taking front stage as primary

methods of how knowledge is obtained (Brandon, 2016). In addition, Saks & Hacuun argue that

adaptive learning through social contextualization is the new norm, where they report 70% of

knowledge required is learned informally (2008). Together with informal learning on the rise and

57% of employees expecting learning to be just-in-time (CEB, 2015) the more traditional how of

a formal learning event approach (whether online or in the classroom) may, or should be, on the

way out. A recent study conducted by the Corporate Executive Board (CEB) found that

employees indicate they only apply ½ of what they learn from a formal learning event; therefore,

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only 21% even expect their learning (what they need to know and when they need to know it) to

occur in a formal setting (2015). So, to recap, 21% don’t expect their learning to occur in a

formal event (the traditional approach for L&D), and when they do attend a formal event they

apply only ½ of what they learn. Perhaps these are the reasons why 79% of workers seek their

knowledge outside of L&D (mentioned above). This should be a warning shot over the bow of

L&D – what you’ve been doing, it’s just not working!

The knowledge worker is also a mobile worker (Meister & Willyerd, 2010). Mobile

devices mean the methods of distribution and location have to be addressed, including where

learning is available (in the cloud or on my mobile device). Many workers have already

addressed work life balance through integration rather than separation (Morgan, 2016). L&D

specifically must become more integrated in their approach in order to increasingly impact

competitive advantage in the marketplace (Appleby & Mavin, 2000). Jacob Morgan (2016)

released his assessment of coming trends in HR for 2016 and beyond and number 1 overall is the

employee “experience” (p. 2). It is the integration of all environments that impact the employee

performance and L&D has an opportunity to take front seat and make a difference.

Terms like ecosystems now relate specifically to an organizations life-blood, not simply a

term used to describe nature. A learning ecosystem; a knowledge ecosystem; a human

ecosystem; and an analytics ecosystem are increasingly a requirement, and must be

interdependent to maintain performance and, to achieve new levels of competitive advantage in

the world of business. The knowledge worker now wants access to those ecosystems when it

works for them, defined mostly by performance expectations. Remember, many organizations

today exist in multiple time zones and finding mutually agreed upon times to hold a learning

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event is itself a nightmare. Combined with what we have learned already the age of the learning

event is inefficient as well as ineffective.

Finally, L&D measures of success also need to shift and leadership is quite aware; 96%

of CLOs believe L&D should measure impact on business, but fewer than 8% are actually doing

it (CLO, 2009). The historical classroom reports indicating some level of general pleasure or

happiness with the content, instructor, and feelings that “I will apply this back on the job” is not

good enough. The business unit needs a partner and the organization needs better alignment with

organizational measures; not just a service provider. How does L&D contribute to the bottom

line? What is the impact to the business performance? With access to data like never before,

L&D must get closer to IT (Morgan, 2016). The organization is asking, soon they will be

demanding: move from descriptive analytics to prescriptive analytics and share with the business

leading indicators and solutions to support business outcomes!

A Tiered Solution

Models for service providers within large organizations have shown to be nearly as

diverse as the functions themselves; accounting, human resources, supply chain, etc. Current

L&D functional models still seem to support a one-size-fits-all approach across all supported

business sectors. This study found no studies or examples where L&D was structured in a tier

solution but, there are a few examples in other service sectors. For example, in supply chain, one

study introduced a tiered model to solve for similar business problems; one-size-fits-all was

found unsustainable nor able to deliver efficiencies across supported businesses (Wright, 2006).

This tier model focused on a high-medium-low business segmentation which has some

applicability with L&D. A couple key critical findings were; impact on productivity; and make

sure promises are managed at all tier levels (Wright, 2006).

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It’s not just the approach to service, but also the respective focus that a tiered approach

can deliver. For example, studies have shown that an increased engagement in a training (event)

doesn’t not necessarily increase productivity (CEB, 2015). The previous logic came from

education circles where increases in participation (or engagement) has been shown to improve

scores in the class. CEB’s study indicates the engagement=higher test scores model in education

does not extrapolate to engagement=higher productivity on the job in the workplace. If L&D has

a responsibility to the business objectives and the larger corporate performance, then it must

address productivity and impact on business, not engagement in an event.

In that same empirical study, CEB learned that, in many organizations, associates were

spending 39% of their time in learning (2015). Perhaps this is a byproduct of remaining focused

on developing learning events to address performance problems without consideration of just-in-

time and/or social learning changes. Their supporting research indicated that a tipping point in

time spent in learning to productivity should really be about 28% (CEB, 2015). This would

indicate there is a waste of nearly 11%, which could equate to nearly $135M lost in productivity

for a 25,000+ organization (CEB, 2015). If learning participation/engagement doesn’t improve

performance and workers are spending too much time in learning, one can see where L&D must

really re-think what really is their impact on the business.

In another study by CEB (2014), it was discovered that less than 10% of organizations

have, what could be termed, a ‘productive learning culture’. This study indicated a potential

cause is the lack of understanding in levels of learning maturity. Perhaps, like the introduction of

a new piece of technology, say an iPad: Some will pick it up and know how to effectively use it

right away; Some may simply treat it like a paper weight – the perfect size to hold down their

printed papers; While others won’t know where to begin to effectively use this new piece of

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technology and perhaps use it as a glorified typewriter. This study indicates a need, not only to

understand a workforce’s varying levels of learning maturity, but also address those levels in

very different ways. Following the analogy of the iPad deployment, it would be extremely

inefficient and ineffective to have everyone go through the same level of training.

The tiered solution takes all the research and the identified gaps and provides a new

structure to support the changes identified. Underlying this tiered model should be a knowledge

ecosystem the entire organization can tap into. Access and training on use of this ecosystem

becomes foundational at all tier levels.

In the 2015 study done by CEB it was learned that inefficiencies are most often a result

of disproportionate support. The tier model approach for L&D could solve for that by aligning

resources appropriate to the level of learning maturity. Bersin provided a great study on learning

maturity and an example of level definitions with 4 varying levels derived from over 18 months

of research and 400 organizations (see Table 1) (2012).

Table 1

Level 1: Incidental Training On-the-job Training; some supportLevel 2: Training Excellence The Corporate UniversityLevel 3: Performance Improvement Continuous learning; alignment to role; performance driven;

career paths.Level 4: Organizational Capability Organizational & Individual capabilities for success; Coaching;

Knowledge Sharing; Delivered locally, but available globally

Those levels can be used to outline a level of support needed with the additional benefit of

outlining a success measurement to the board of directors: How much has the needle moved on

learning maturity at our corporation? In another study, CEB, took a look at Standard Bank where

5 stages of maturity were identified (see Table 2) (2014).

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Table 2

Stage 1 Stage 2 Stage 3 Stage 4 Stage 5

Supplemental Targeted Strategic Systemic Optimized

Ad-hoc learning Highly Managed Aligned with Business

Performance Support

Learner owned

To differentiate between tiers an objective analysis of the various learning maturities

across the business segments should be performed. These two models of learning maturity

provide a framework from which L&D can draw from to objectively define the various levels of

maturity and thus, identify the tier levels and begins to define specific levels of service. In

addition, redefine success measures to specifically tie to both, movement on a maturity index, as

well as ability to meet business objectives - no matter what tier.

Recommendations

This research began from the perspective that, if one desires to achieve new horizons one

cannot continue to do what is currently being done. Einstein is often quoted as having said that

the definition of insanity is continuing to do the same thing over and over again and expect

different results. L&D can’t continue to approach learning from the same approach – it's just

insane. As evidenced by the changing landscape of both the worker and the organization,

learning itself, and the subsequent knowledge share, must adapt and change or L&D may find

they have become extinct in the process.

However, L&D can choose to make a positive come back with the awareness laid out in

this research. It is recommended that L&D take a tiered approach to supporting their business

segments and define those segments by an objective analysis of the variances in learning

maturity. The measure of success for L&D must then shift to alignment with impacts on business

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performance as well as progressive movement along levels of maturity. One direct impact to the

businesses being supported by L&D is an acute awareness of the distinct differences in approach

to a learning need based upon learning maturity. But also, the business must also recognize that

L&D is a true partner on their journey to competitive advantage and performance in the

marketplace.

Research indicates that there are 2 immediate advantages to adopting a tier model

approach for L&D: 1) Immediate (bottom line) saving by strategically targeting a reduction of

“learning hours” spent (from 39% to 28%) by associates (taking back some of the estimated

$135M in lost productivity) and; 2) Increased impact on business results by strategically

targeting business objectives and directing learning at the level of learning maturity. Enhanced

performance and efficiency within L&D is really a 3rd advantage as L&D becomes better aligned

to both their partner’s objectives as well as clear understanding of their level of learning

maturity. In the end, the organization as a whole can expect to retain current competitive

advantage and begin to chart a course to expanding their competitive advantage as the

organization increases their overall learning maturity. One size doesn’t fit all and years ago I

think Burger King got it right; “Have it Your Way!”

It seems just yesterday I went to the doctor because I was sick and needed to get better;

today I go to the doctor to learn how I can keep from being sick in the future. L&D has an

opportunity to shift from doing what they have always done to becoming what they need to be.

There is a choice; there is a challenge; there are gaps; but, there are solutions. It has been said,

“The prudent see danger and take refuge, but the simple keep going and pay the penalty”

(Proverbs 22:3).

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References

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CLOMedia.com,46-48.

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https://www.CLOmedia.com

Corporate Executive Board (CEB). (2014). Standard Bank's Learning Maturity Framework.

Retrieved from: https://www.cebglobal.com.

Corporate Executive Board (CEB). (2015). Building a Productive Learning Culture: More

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they-are-changin/

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