designing management training and development for competitive advantage: lessons from the best
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Traditionally, individuals were trained around
current job-based deficiencies and skill needs.
However, a few exemplary organizations, view
a T&D as an continuous process and a primary
source of sustainable competitive advantage.
In these organizations, T&D becomes the
critical means for creating readiness and
flexibility for change across all organizational
levels.
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Readiness and flexibility are achieved largely through
supervisory, management, and executive training.
This study was designed to understand and describe how these
best-in-class organizations design and utilize supervisory and
management T&D to achieve and sustain competitive
advantage.
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Thus the goal of this paper is to collect benchmark
information and derive a model of how the best T&
D organizations structure, implement, and conduct
management-level T&D.
26 of the 62 organizations served as a benchmark.
These make forty two percent of the organization.
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Written information and interviews were taken from
the heads of the departments.
These were specialists, key consultants, executives
and managers.
A best-practices model was developed from the
commonalities of the information collected.
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TRAINING AND DEVELOPMENT
FRAMEWORK
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How do exemplary companies tie T&D to their strategic
business plans?
In these organizations, there is a structured linkage between
the organization's strategic mission and the goals of the T&D
program.
T&D goals and processes are reviewed and updated annually
according to the changing strategic needs of the business.
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At Apple's corporate T&D headquarters - Apple
University - regular forums with executives are
conducted to exchange information about the
strategic direction of the firm and its business
units.
In addition, professionals from Apple University
are permanently assigned to business units and
serve as a continuous information funnel between
these units and the university.
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Apple also uses its worldwide information network to collect
information about changing business requirements, and to
facilitate immediate responsiveness in T&D offerings.
In another corporation, Motorola, the CEO is one of four
"outside" members of the Advisory Board of Directors to
Motorola University . This creates a link between the CEO's
agenda and its implementation through T&D.
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At P &G, members of the executive committee
teach at P&G College whenever they are
physically nearby. For example, over the course
of 1992, the CEO had taught at P&G Collegenine times.
In Corning Glass Corporation, question "What
do we need to do with people to meet thedevelopment needs of the company?" has been
addressed by the Board of Directors annually
since 1979.
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Fifty-eight percent of the organizations interviewed, have
some form of explicit T&D policies.
Objectives are achieving consistent employee access to, and
participation in, T&D, budget allocation, required hours of
participation, or required T&D before or after promotions.
Other rules-oriented policies refer to the annual number of
hours each employee is obliged to spend in T&D.
Some companies, such as ARCO and 3M, specify a minimum
of 40 hours of training per year.
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AT&T Universal Card, requires 80 hours of annual training per
employee, and at Andersen Consulting, Zytec, and the Saturn
division of General Motors, the figure is 100 hours.
Many organizations like P&G establish T&D policies as part of
structured career paths, a prerequisite for consideration for
promotion, or a requirement once the promotion is obtained.
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Benchmark organizations also strive to mold theattitudes and behaviors of their supervisors and
managers through values-oriented T&D statements.
For instance, some of the organizations like Coca
Cola (according to its mission statement 2000),
assert that "every manager is held accountable for
the development of his/her employees.
Managers' own rewards and promotions are made
contingent upon their success as developers of talent.
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Needs are influenced by factors both internal and external to
the organization.
In these benchmark organizations, the establishment of T&D
needs is driven most often by the organization's mission and
strategy, with an average rating of 6.27. Individual
performance factors, environmental trends, and job-based
information appear to be less influential in establishing T&D
needs, at 5.31, 5.08, and 5.04 respectively.
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Several organizations, including 3M, Apple,
Corning, and Motorola, conduct annual conferences
with the organization's most senior executives to
elicit their views of the skills that will be needed to
achieve strategic short-term and long-term goals.
In these companies, however, environmental
demands drive adjustments to the business strategy,
with T&D changes implemented as a result of
decisions to modify the business strategy.
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For example, Xerox benchmarks other exemplary companies
and collects information from their partners and suppliers to
best understand the economic, cultural, and technological
trends affecting their business.
Similarly, Northern Telecom uses customer focus groups to
learn about product and service requirements to identify
employee development needs.
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Transfer refers to the degree of continuity between
learning in the T&D context, and behaviors and results
in the job environment.
The first critical requirement for transfer is an overlapbetween learning in training, and requirements on the
job. The overlap assures that the knowledge, abstract
concepts, attitudes, or behaviors acquired through T&D
match the strategic business needs.
The simplest way to maximize overlap between the job
and training environments is through on-the-job training.
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General Mills indicated that only about 10% of its training
occurs away from the job.
Texas Instruments, uses an HR system in which critical
competencies are derived from job analyses. These critical
competencies serve as the common underlying competency
framework for selection, promotion, and reward decisions,
and for establishing T&D requirements for a given job.
At Northern Telecom, continued promotion requires active
participation in training activities.
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Xerox implements T&D sequentially across the organization,
from the top down. With the exception of the chief executive
and the most junior person in the organization, everyone
receives the T&D twice, once as trainee and once as trainer to
his/her direct reports or peers. In Xerox, this is called "LUTI" -
Learn, Use, Train, and Inspect.
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How do exemplary organizations determine
the content of T&D?
Benchmark organizations derive the content of T&D from
their strategic objectives, culture and values, and their
present and predicted competency and skill needs.The most commonly addressed T&D area is leadership
training. An example is Coca-Cola's 10-week management
development program for persons in line to become general
managers. The program includes traditional leadership
training, as well as internally designed simulations that are"mirror images of business in Coca-Cola," and an action
learning program in which four member teams are given
cross-functional and cross-cultural project assignments and
sent to locations outside their native countries.
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GE also employs an action learning approach in its four-week
training program for mid- to senior-level executives. Teams of
executives are given actual business problems identified by thecompany's top officials, such as Chief Executive Jack Welch.
After a month, teams make presentations to Welch and other
senior managers. With the help of consultants and business
school professors, the student executives go around the world
learning to function effectively in teams, finding theinformation they need, and making decisions with little time
and information.
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HOW DO EXEMPLARY ORGANIZATIONS CHOOSE THE
BEST T&D METHOD?
Choice of T&D delivery methods depends on theorganizational culture and values, T&D objectives and
content, the profiles of trainees and trainers, financial
and technological resource availability, time, location,
and political constraints.
Sixty-nine percent of T&D is designed and deliveredin-house, compared to 31% purchased from outside
vendors.
A second T&D methods involves attempts to increase
the efficiency and cost-effectiveness of off-the-job
T&D.
Simulations and off-hour learning like at Boeing is
used for this purpose.
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GE, for example, opens its doors to its customers and suppliers to
participate in its unique "Work Out" training programs as a means of
elevating the quality of the goods or services supplied and reducing
their costs.
Second is using technologies like at IBM during the 1980s,
technology was used to deliver no more than five percent of the
company's T&D. By 1990 that figure stood at 30%, and by the end
of the decade it is expected to rise to 60% of all T&D delivered.
Apple's "electronic campus" draws on the computer manufacturer'sglobally networked information system to facilitate T&D
information exchange.
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HOW DO EXEMPLARY ORGANIZATIONS CHOOSE
THE BEST T&D METHOD?
Federal Express relies on an interactive video network
to deliver training to 45,000 employees and delivers
college courses and degree programs via personal
computers. They even have a leadership seriesbroadcast on an internal television network, FXTV.
Mentoring is used at Corning.
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Kirkpatrick's (1976) survey of 100 companies indicated that while
over 75% of the firms measured participant reactions, fewer than
50% measured knowledge changes or skills learned, and still fewer
measured changes in behaviors (20%) or results (15%).
An Industry Group study (1995) reported that 43% of the firms
measured business results attributable to training and 60% evaluated
behavior on the job relevant to training.
Xerox uses multiple methods, including observations of traineesonce they return to their regular positions, interviews with trainees'
managers, and examination of trainees' post-T&D performance
appraisals, to ascertain whether T&D has impacted job behaviors .
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Johnson & Johnson incorporates 360 degree appraisal (for example,evaluations by the employee's superior, direct reports, peers,
customers, and self-ratings) into their T&D evaluation portfolio.
The evaluation phase of T&D is an area in which even the bestorganizations practice only a minimum level of assessments.
One reason for this is that T&D in exemplary organizations is part of
the organization's mission and values and is not subject to the rules of
cost-benefit evaluation.
T&D represents a belief in the value of continuous learning, that over
time a highly skilled and informed workforce will be more focused on the
organization's strategic goals and values, and more capable, productive,
and creative in ways that might not be immediately measurable.
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One recent study found that training budgets are effected most duringbusiness downturns.
That is not the case, in benchmark organizations.
Ninety-two percent of interviewees indicated that T&D is central to
the organization's goals - so important that only 15% expressed
willingness to cut T&D during tough times.
Budget priorities are tied directly to the strategic mission.
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CONCLUSION
The framework presented in this paper includes structural features,
policies, and practices that together add up to a climate of continuous
learning.
An effective T&D system is a result of the confluence of elements of theT&D framework, and the extent to which they are embedded in the
organization's structures, policies, and practices.
T & D is important because no organization can have the foresight to
predict the precise talents it will need 10, or even five years from now.
How can organizations respond to and overcome the risks associated with
market uncertainty? By developing an internal discipline that creates
readiness for several alternative strategic directions.
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