The results of a recent survey by consultancy Booz & Company show executives voicing significant concerns about their companies’ abilities in executing strategy. In many instances, CLOs directly touch on areas in which executives are seen as lacking confidence, and have an opportunity here to improve their organizations’ strategic effectiveness.
The survey drew response from 2,350 executives — including more than 600 in the C-suite — from companies of various sizes and operating in a range of industries around the globe. Among its findings were 83 percent of respondents reporting that their company’s growth strategy leads to waste.
Paul Leinwand, a partner at Booz & Company, said this speaks to the difficulty of executing a growth strategy, where learning and development plays a key role. “There’s no question learning [and] development are going to be a critical component in a successful strategy,” Leinwand said. “And companies struggle right now because they don’t always have people with the right skills in the right places to accomplish the company’s objective and strategy.”
According the Leinwand, the mistake companies make in developing workforces for growth is focusing on new business only. “Too often, growth is considered to be an avenue only for some sort of a new venture,” he said. “Companies need to double down on what their core business is, what their core capabilities lead them to, and that would involve all kinds of training and capabilities that need to be built in those areas.”
Neal Goodman, president of learning and development consultancy Global Dynamics Inc., highlighted the importance of knowledge transfer in avoiding waste when administering learning for strategic growth. “There’s a general collective amnesia in organizations, whereby the lack of information and knowledge shared results in significant loss of profitability,” Goodman said. “Much of this has to do with the siloing of organizations and the discouragement of sharing information. This is where learning organizations can really make a difference, because to the degree that knowledge is shared across the organization, where it’s not only encouraged but rewarded, we find that organizations are far more successful.”
Avoiding the waste associated with a lack of knowledge transfer becomes particularly challenging when a company is spread all over the globe. “It’s not unusual that what one part of an organization may be learning, let’s say from its operations in India or China, is not shared by other units within the same organization and so it’s reinventing the wheel every time,” he said. “Learning organizations can play a significant role in improving this because [they] can create a mechanism whereby learnings that take place in the organization are accumulated, shared, retained and disseminated. It makes them strategically more important because they become the central nervous system of the organization in sharing the knowledge that’s gained.”
Sixty-seven percent of respondents to Booz & Company’s survey reported that their company’s capabilities do not fully support their strategy. “The chief learning officer should play a huge role in making sure that when we think about building capabilities, we’re being very careful about exactly what type of capabilities the company needs to build, because we can’t build all capabilities for all things,” Leinwand said.
The key here is to ensure strategy, capabilities and the learning agenda are defined and aligned. “We have a problem because capabilities aren’t well defined, sometimes we aren’t focused on capabilities, and then we have a secondary problem, which is often the learning agenda is distinct from what the capabilities are at the company’s strategy level,” Leinwand said.
Another problem is companies trying to tackle too many capabilities at once. “One of the problems with capabilities is that there can be a list of 30 capabilities a company needs to build, and then you could have a list of 30 different skills we want to empower and that becomes an impossible task,” Leinwand said. “The question is: What are the skills that we’re trying to develop that line up with the capabilities that we’re trying to build for the company’s strategy?”
Fifty-five percent of survey respondents said allocating resources in a way that supports their company’s strategy is a significant challenge, particularly when pursuing a wide set of growth initiatives. As CLOs know, resource allocation, specifically budgets, is a large factor in driving and managing learning.
“A big piece of budgeting and resource allocation has to be, first of all, what is the people investment that we’re going to make in total and then, within that, what are the right skills that we have to invest in building within our people?” Leinwand said. “There’s no question that resource allocation decisions have to be made in concert with what the strategy is rather than separate from it.”
Daniel Margolis is managing editor of Chief Learning Officer magazine. He can be reached at email@example.com.Filed under: Strategy