corporate learning: investing in the future ... - hec paris

LEARNING FROM THE EXPERTS

CORPORATE LEARNING: INVESTING IN THE FUTURE AND DRIVING SUCCESS

HEC PARIS EXECUTIVE EDUCATION

1, rue de la Libération

78351 JOUY-EN-JOSAS CEDEX – FRANCE

+33 (0)1 39 67 70 00

[email protected]

© All rights reserved HEC Paris Executive Education 2019

06 Adapting skills to rapidly changing environments

14 Measuring the impact of corporate learning strategies

04 Anticipating and closing skill gaps

08 Driving innovation to create value and growth

15 Establishing a company-wide learning culture

10 Adopting an agile mindset and approach

17 Unleashing the power of collective intelligence to make smarter decisions


CONTENTS

12 Attracting the right talent

HEC PARIS EXECUTIVE EDUCATION – CORPORATE LEARNING: INVESTING IN THE FUTURE AND DRIVING SUCCESS - 3

In a rapidly changing and unpredictable world, one of the best ways for organizations to prepare for the challenges of the future is to adopt a company-wide culture of learning. By allowing companies to acquire, share, and apply knowledge, corporate learning enables them to increase their efficiency and competitive advantage and above all to innovate.

For HEC Paris Professor Hervé Coyco, “Corporate learning is an approach that must be embraced by not only the leadership of a company, but also by all of its employees. It’s all about everyone in the company working together and this shifts the emphasis from individual to collective learning.”

Simply put, a continuously learning organization is more innovative and agile. “Innovation isn’t the privilege of R&D or CEOs,” Professor Coyco says. “Innovation is crucial in every layer, and in every part of the company.” Senior executives face the challenge of “establishing a culture of innovation,” and executives must foster innovation by “giving their teams the necessary degree of freedom”. But all employees, no matter their role, must “collaborate beyond the organization’s boundaries and develop new solutions with their peers.”

A period of transition is inevitable when adopting a learning culture. Professor Coyco says: “Some initiatives will fail, and leaders’ attitudes will set the tone. Beyond the outcome itself, their role is to recognize the intent and intrapreneurial spirit driving their employees as they voluntarily get out of their comfort zone and take risks to help the company move forward.”

“To design corporate learning programs, we always focus on the company’s actual challenges,” says Professor Coyco. “First, we expose our participants to the experience of industries they’re not familiar with in order to raise their awareness of different ways of thinking. From these references, we develop frameworks from which they can build their own experience. Finally, we help them reflect about themselves and their roles as leaders.”

To become an effective learning organization that accelerates innovation, bridges skills gaps and attracts the best talents, companies need to develop a learning culture that promotes collaboration, collective intelligence and accepts that failure is an integral part of the learning process.

The tremendous pace of change has far-reaching

consequences for companies. It is becoming increasingly difficult for

leadership teams to predict the future.

Professor Hervé Coyco

INTRODUCTION


The impact of technological disruption, shifting business models and the increasingly dynamic nature of work means that companies are facing significant skills gaps in key areas such as strategy, leadership, digital transformation, change management and innovation. Upgrading and developing their skill set is therefore crucial for employees wishing to keep up with a constantly changing business landscape.

For HEC Paris Professor, Florian Hoos, companies that fail to bridge skills gaps will have to contend with two major issues. Firstly, “if you don’t close skills gaps, there’s no way you can move with major trends, such as automation, digitalization and new ways of organizing the workplace.” Secondly, “companies that don’t upskill their employees will become unattractive to highly qualified professionals in the job market.”

“In the long run, for many companies, managing skill gaps is ultimately a question of survival,” affirms Professor Hoos. While in the short term, companies often focus their training programs on the latest trend, such as “Blockchain” or “agile working methods”, a more in-depth approach is necessary in the long term.

The fundamental challenge, he states, is developing the hard and soft skills that will enable companies to innovate and manage future change effectively.

When companies are reluctant to invest in training, it’s often because they don’t want employees to take their new skills to the competition. Professor Hoos feels companies need to view this from an employee’s perspective: “If I’m not well trained by my company and they don’t invest in me, my motivation will decrease and one day I’ll leave.”

Research shows that companies who invest in their employees and empower them to transform their skills can increase overall performance and productivity. Many companies are therefore taking a more proactive approach to closing skills gaps. AT&T, for example, implemented the 2020 Workforce Initiative to help upskill their staff after notifying 100,000 employees that their jobs would not be relevant in 10 years. “Closing skills gaps goes hand in hand with implementing the right culture,” concludes Professor Hoos.

Employees now understand that they need to work for companies that regularly

update their skill set.

Professor Florian Hoos

Anticipating and closing skill gaps

KEY SKILLS GAPS IN COMPANIESMEETING SHORT AND LONG-TERM SKILLS DEVELOPMENT CHALLENGES

Data Management

Innovation

Leadership

Digital Transformation

Change Management

Strategy

KEY SKILLS GAPS IN COMPANIES


For a company to survive, it has to respond positively to change. The first key step is to clearly identify the existing skills within the organization and determine how they can be adapted to current and future shifts in the business environment.

The consequences of failing to adapt can be irreversible. Professor Hoos cites the example of BlackBerry who did not anticipate the impact of bigger touchscreen displays and user experience based mobile phone applications. This once powerful industry giant rapidly lost its position as market leader.

For Professor Hoos, companies need let go of a “hierarchical” approach and drive decision-making down to the front lines. “I think working across functions, and having the right skills in place to do so, is key to solving the complex problems that many companies will face in the future,” he says. In addition to being adaptable, companies must also be agile at all levels of the organization – that is to say “being prepared for rapid change when it arrives.”

Effective change management plays a critical role in skill adaptation. According to Professor Hoos, “if the top managers don’t change, it is very unlikely that their subordinates will change.” He underlines that “promoting a work culture in which failure is accepted is the starting point for learning and adaptation.” To be truly adaptive, companies need to generate, test and replicate innovative ideas faster, at a lower cost, and with less risk than the competition.

The automotive industry is an excellent illustration of this need to adapt to a changing market. “German car manufacturers have produced high-quality cars for years but with companies like Tesla, Apple and Google entering the market, established firms now need to rethink their business models”. BMW, for example, has invested billions of capital into producing their own electric cars and Volkswagen says it will build 150,000 electric cars by 2020. Ultimately, it is this ability to adapt that will determine which companies survive and thrive.

Equipping your company to manage change is just as important as training

people for every single new industry trend.


Adapting skills to rapidly changing environments

MEETING SHORT AND LONG-TERM SKILLS DEVELOPMENT CHALLENGES

“ The future of work is going to look very different and the only thing that will be constant is change.”



Although often associated with startups, innovation plays a crucial role in the survival of all companies. To innovate effectively, however, the management of established organizations have to embrace the unknown and accept failure as part of the process.

To understand how innovation works in an established firm, it is important to make the distinction between “exploitation” and “exploration,” says HEC Paris Professor, Laurence Lehmann Ortega. Exploitation is what a company uses to run the business and “bring in the money”. Exploration, however, focuses on “learning, driving innovation and imagining the business models of tomorrow.”

For Professor Lehmann Ortega, innovation plays an essential role in enabling companies to reinvent themselves, meet the challenges of the future and ensure their long-term survival. “If companies don’t question their way of doing things, their business model will be disrupted by new competitors and they will disappear,” she affirms.

In order to innovate – or “explore” – organizations must create an environment where failure is accepted, and employees and leaders can challenge the status quo. “Finding the money and right talent isn’t the most difficult,” says Professor Lehmann Ortega, “the real challenge is questioning industry beliefs and getting people to think in a different way.”

Measuring failure is just as important as measuring success. “I think companies should measure the failure rates of their experimentation,” states Professor Lehmann Ortega. “A very high failure rate is a good way to measure how innovative you are. It’s like telling your child they need to walk, but not to get up because they’re going to fall.” To innovate, companies need to know they are going to “fall” – and that may require changing the culture.

BMW’s DriveNow program is one salient example of innovative exploration. The program, which allows customers to rent a BMW by the minute, anticipates a future where car ownership is less widespread. “To prepare for success in future markets,” Professor Lehmann Ortega concludes, “you have to start exploring them today.”

What kind of innovation works best? The kind

that nobody even knows about yet.

Professor Laurence Lehmann Ortega

Driving innovation to create value and growth

THE KEYS STEPS OF INNOVATION ACCELERATING INNOVATION AND EMBRACING AGILITY

Launch

Commercialize

Develop

Ideate

Test

THE KEYS STEPS OF INNOVATION


In our highly competitive and rapidly changing economic environment, developing agility has become a key issue for companies throughout the world. In the words of Bill Gates: “Success today requires the agility and drive to constantly rethink, reinvigorate, react and reinvent.”

For Professor Lehmann Ortega, a defining trait of agile organizations is their “test, trial and error approach.” Team members are empowered to formulate their own solutions rather relying on their bosses for ready-made answers. This is one of the main differences between agile organizations and command-and-control organizations. “When employees move from a bring-me-the-answer to a solution-finding mindset, they have to be more agile, creative and innovative.”

Successful agile companies know how to develop a culture that is open to change, that empowers people to collaborate in self-organizing teams and that welcomes diverse ideas. As Professor Lehmann Ortega points out, the most agile and innovative and teams “look at the world with different eyes.” By challenging existing industry recipes, they enable organizations to increase competitive advantage, improve performance and generate growth.

An agile mindset and innovation go hand in hand. For Professor Lehmann Ortega “one of the key benefits of agile structures is that people have more ideas.” They understand and embrace the test and learn approach. The more they test, the more they learn, which in turn makes them more agile and innovative.

Michelin offers an excellent example of innovation through agility, says Professor Lehmann Ortega. The tire giant, for example, successfully transformed its sales and operations planning processes by moving towards designing, constructing, testing and validating solutions in intense three-week periods called “sprints.”

Successful companies know that true agility rarely “happens from one day to the next,” concludes Professor Lehmann Ortega. When the approach clicks into place, however, continuous innovation and agility are within reach.

If everyone takes the same approach, you’re always going to find the same

solution.

Professor Laurence Lehmann Ortega

Adopting an agile mindset and approach

ACCELERATING INNOVATION AND EMBRACING AGILITY

“ Business agility is all about the ability of companies to anticipate new opportunities and to respond to them quickly, effectively and economically.”Agility


Talent is scarce, highly valuable and difficult to replace. Apple founder Steve Jobs, a true believer in finding the right people, famously said – “Go after the cream of the cream. A small team of A-plus players can run circles around a giant team of B and C players.”

To attract top talents, a company needs to challenge its employees and help them develop both their skills and their careers, says HEC Paris Professor Matthew Mulford. If talent “simply flows to the highest paid position, the company’s value proposition would be: we’ll pay you more than anyone else,” he states. The real value, however, lies in development opportunities. “Why shouldn’t the chance to grow both personally and professionally be at least as important as the salary and the number of paid holidays?”

When companies invest in people, it is highly visible for both current and future employees. Training on its own, however, is not enough – providing direction is equally important. One potential pitfall, Professor Mulford warns, is training employees then asking them to return to their old jobs.

“Teaching employees new skills is one piece of the puzzle, but they have to be empowered to apply what they’ve learned and evolve.”

Companies need to challenge their current management training practices. Letting employees nominate themselves for training programs, rather than being put forward by a supervisor, is a powerful option. Professor Mulford remembers how at Volkswagen, employees were asked to make a video about why they wanted to participate in an inno-vation program. “This enabled the company to identify ‘non-traditional’ talents and rethink their high-potential list,” he states.

Talents need to have a clear idea of where they can go in the company and how they can get there. Giving them more autonomy in their own career development not only engages them, but also prevent managers from “replicating themselves” when they make training and promotion decisions.

In the end, you have to design key performance indicators and reward

structures that are in line with the company’s mission

and values, and then see what people actually do –

not just what they say.

Professor Matthew Mulford

Attracting the right talent

LEVERAGING CORPORATE LEARNING TO ATTRACT THE BEST TALENT

“ Companies are only as strong as the collective talent of the people who work there – attracting and retaining the best talent now plays a crucial role in their long-term survival.”


Corporate learning represents a significant investment for companies and it is therefore essential that they are able to measure its impact and ROI. There is, however, no one-size-fits-all solution. The key challenges are determining what to measure and how to measure it.

To accurately measure results, Professor Mulford explains, you need to start off with a clear and well-defined goal. If you take the example of more effective leadership, he adds, a clear-cut objective would be - “what are the specific leadership behaviors you want to achieve?”

Clearly defining the objectives and the target outcomes are essential. At HEC Paris, our priority is to ensure that corporate learning has relevant and tangible impact for the company. That is why we co-develop programs with corporate clients to customize the content, impact metrics and KPIs both before and throughout the project. Measuring the impact therefore becomes an integral part of the learning process. That said, companies face challenges when it comes to measuring the intangible payoffs to training. “A lot of the things we care about the most are very hard to measure,” affirms Professor Mulford, “as a result, we have to guard against

focusing on the metrics that are easier to measure. This can lead to warped priorities and unintended consequences.

Pulling apart the factors of causality is also a critical part of measuring success. “Say you have someone who did a specific piece of training and two of their direct reports were promoted,” Professor Mulford states. “This could have been a direct result of the training program, but can you say they would not have been promoted if their boss had not gone to the training?

“You have to systematically compare performance longitudinally – between those who received training and those who did not – and through time, which would mean comparing performance before and after training.” Professor Mulford stresses the importance of measuring ROI over time. “I would say that if you’re really interested in measuring the impact, you have to track people over the long-term. This will allow for continuously reinforcing the learning that happens in that training program,” he concludes.

To maximize the impact of corporate learning, everyone

involved needs to reflect, act and be fully committed to achieving the objectives. Once you can clearly define the objectives, the design of

the training program and the accompanying metrics can

be created to meet those ends. Starting with the objectives

and working back is a key step in maximizing the impact of

corporate learning.

Professor Matthew Mulford

Measuring the impact of corporate learning strategies

LEVERAGING CORPORATE LEARNING TO ATTRACT THE BEST TALENT


For HEC Professor, Patrick Delamaire “A learning organization is one where people can step back, analyze and learn together from past experiences and the external environment in order to adapt and prepare for the future. It is an organization that prefers to decide its own destiny instead of having it imposed by others.” He adds that learning organizations are less intimidated by change, and have less “fear and limiting beliefs” stopping them from experimenting.

To maximize their chances of success and ensure employee buy-in, organizations need to accompany their teams, develop trust, enable them to visualize the future benefits and allocate the necessary time. Creating a company culture accepting that failure is part of the process and that reinforces the collective ownership of projects is also crucial.

Professor Delamaire recalls how his work in Silicon Valley helped him identify another key trait of learning organizations. “I figured out the real power of diversity,” he says. The best ideas and solutions come from culturally and professionally diverse teams. The challenge for managers, however, is to “accept, leverage and optimize these individual differences” and resist the temptation “to impose their own views on others.”

Companies that want to become learning-oriented can make certain key changes, according to Professor Delamaire. “Managers must accept the idea of giving more freedom in creating the conditions to experiment, by focusing more on what has been learned than the results,” he states. During his time at Apple Professor Delamaire discovered the importance of “collectively deciding on a framework to objectively measure the results of an experiment.”

It is up to all managers to cultivate communication and help employees to identify their own role in a company’s resistance to change, Professor Delamaire affirms. He also stresses the importance of celebrating learning and changing both attitudes and mindsets. It is not only about “rewarding the ones who discovered something great. When we create a kind of collective process, it’s essential to encourage everybody, reward everyone who contributed and give credit to everybody in the team.”

If a corporate learning strategy does not have

the buy-in of employees, the change process will be stuck or extremely limited.

Professor Patrick Delamaire

Establishing a company-wide learning culture

DEVELOPING A LEARNING CULTURE AND COLLECTIVE INTELLIGENCE

Collaboration

Trust

Problem-solving

Creativity

Common goals

Diversity

Experimentation

THE TREE OF COLLECTIVE INTELLIGENCE


A company’s greatest resource is its people and capitalizing on their collective intelligence is one of the best ways for organizations to prepare for the challenges of the future. Central to the concept is the idea that cooperation, collaboration and collective effort, lead to better decision-making and results. “Collective intelligence is important because it secures the life duration of the system,” states Professor Delamaire.

Collective intelligence that promotes individual well-being can also play an important role in engaging employees. Encouraging shared knowledge tends to have a positive effect on employee motivation, which in turn promotes higher levels of engagement and performance. For Professor Delamaire, “collective intelligence between cross-functional team members can create a synergy between the different levels of an organization, including top management. We can also observe this synergy in executive training programs with hundreds of managers.”

As technology advances, new technologies such as artificial intelligence (AI) have the potential to revolutionize the way teams manage and share collective intelligence. However, Professor

Delamaire stresses that AI should be seen only as

a tool. The extent to which AI can foster collective

intelligence, he says, is the extent to which people

can “manage collective emotions and thinking

processes.” He draws an analogy between AI and

a piano, which can “create beautiful music, as long

as the musicians know how to play it.”

To implement collective intelligence effectively,

trust is crucial: trust in the future, in others and in

ourselves. Some managers are not comfortable with

that at the beginning, Professor Delamaire affirms.

It often requires introspection at all levels of the

organization and “accepting the idea that everyone

in the company contributes to both maintaining the

balance of the system and maintaining problems.”

Not all employees will find this easy: “In my classes,

some managers aren’t always aware of this pitfall,

and often, the system is stuck because of them.”

By empowering employees to become more creative

and agile, collective intelligence ultimately enables companies to overcome uncertainty and motivate everyone to work together towards a common goal.

To implement collective intelligence effectively, trust in the future, in

others and in ourselves is crucial. Some managers aren’t comfortable with that at the beginning.

Professor Patrick Delamaire

Unleashing the power of collective intelligence to make smarter decisions

THE TREE OF COLLECTIVE INTELLIGENCEDEVELOPING A LEARNING CULTURE AND COLLECTIVE INTELLIGENCE


Companies need to move away from the “business as usual,” mentality and rethink every facet of their business model. When implemented effectively, corporate learning strategies can help them achieve this goal.

A key issue for the leaders of organizations is being able to deliver short-term results, while at the same time investing and preparing for the challenges of an increasingly ambiguous, volatile and unpredictable economic environment.

“The real challenge for companies is anticipating market trends as opposed to simply reacting to them,” states Professor Coyco. “With the rapid pace of change, companies that anticipate these shifts in the business landscape will increase their chances of success, while those that remain in reactive mode will get left behind.”

“Companies that prioritize corporate learning have the ability to mobilize the collective intelligence of the organization, and regularly challenge and revisit their strategy,” affirms Professor Coyco. “They establish an environment in which employees ensure they’re always

developing their own skills, rather than waiting for

the company to propose a new training program.”

To optimize their chances of successfully

integrating corporate learning into their business

model, many companies are now working in

partnership with universities and business schools

in order to draw on their research, knowledge

and expertise. As Professor Coyco points out:

“For business schools, it’s a way of remaining

firmly anchored in the reality of the business

world and to adapt to the specific challenges

of each organization. Effective corporate learning is about much more than just “copying and pasting solutions.”

Becoming a learning organization means

rethinking current methods and rigid hierarchical

structures. It requires engaging employees at

all levels and giving them the freedom to test

ideas. “Learning helps create this common understanding that innovation and agility are job number one for everybody,” Professor Coyco concludes.

Becoming an effective learning organization

enables companies to adopt innovative solutions to the challenges they face.

Professor Hervé Coyco

CONCLUSION

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Hervé Coyco

Hervé Coyco is an Adjunct Professor at HEC Paris where he frequently serves as a Program Director in custom programs for large multinational corporations. Before joining HEC Paris, Hervé spent over 30 years at Michelin where he held senior positions such as President of the Passenger Car Tire Division and President of Michelin Asia-Pacific Operations.

Florian Hoos

Florian Hoos is an Affiliate Professor of Accounting and Management Control at HEC Paris. His teaching and research focuses primarily on social entrepreneurship, accounting and control, responsible leadership, change management, ethical decision-making and impact assessment. Florian has also created online courses on entrepreneurship and change-making.

Laurence Lehmann Ortega

Laurence Lehmann Ortega is an Affiliate Professor of Strategy and Business Policy at HEC Paris. Her research focuses on strategic innovation, especially in existing firms operating in mature and low-tech industries. Laurence is also the co-author of “Odyssey 3.14 Reinvent your business model”, an original approach that combines innovation and strategy.

Matthew Mulford

Matthew is an Adjunct Professor at HEC Paris and a Senior Lecturer at LSE. His areas of expertise include negotiation analysis, effective business decision-making and leadership. He has designed and/or taught customized executive programs for HEC Paris and various institutions around the world across a variety of industries and in more than 20 countries.

Patrick Delamaire

Patrick is an Adjunct Professor and the Academic Director of several HEC Paris programs in Europe and Asia. He is a certified executive coach and co-developed the HEC Paris Global Executive Coaching Program. His fields of expertise include leadership, coaching, change, and communication. Previously Patrick worked as a senior manager in companies such as Apple and VELUX.


CONTRIBUTORS

HEC PARIS EXECUTIVE EDUCATION

1, rue de la Libération

78351 JOUY-EN-JOSAS CEDEX – FRANCE

+33 (0)1 39 67 70 00

[email protected]

FOR FURTHER INFORMATION:

Ann Gilmore - +33 (0) 1 39 67 75 26 - [email protected]

https://www.hec.edu/en/executive-education/custom-programs-your-teams


corporate learning: investing in the future ... - hec paris

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