The Performance Improvement Blog

Better Business Decisions in 2010

My New Year’s wish is for better decision-making by organization leaders in 2010. In the past decade, we have witnessed a pandemic of bad decisions. If only there was an H1N1-type inoculation to prevent the spread of this management disease.  Leaders of auto companies made decisions that brought that U.S. industry to the brink of disaster and put hundreds of thousands out of work. Leaders of financial services companies made decisions that contributed to the bottom falling out of the housing market and slowed the growth of thousands of small businesses. Government leaders made decisions that failed to provide jobs, education, and health care to millions of low-income families.

Economists and politicians will debate the reasons for the deterioration of our companies and economy for years to come, but underlying all of this theory and posturing is the fact that people in positions of authority have not made very good choices. I think there are at least three factors for this poor decision-making. One is a failure to recognize the effect that stress has on the ability of human beings to make difficult decisions. To this point, Myra White writes:

…executive functions which reside in the prefrontal cortex are critical to higher-level reasoning. They help us direct and maintain our attention, remain focused in the face of distractions, plan future behavior under conditions of uncertainty, anticipate outcomes and use feedback—all cognitive activities that are essential to complex decision-making.

Under stress these functions breakdown making it hard for us to carefully think through complex decisions. We have trouble concentrating, make short-sighted and biased judgments, and have difficulty accurately assessing the potential risks and gains associated with different courses of action.

Leaders should be aware of their own limitations when under stress. They need to reach out for help from others inside and outside of their organizations.

Another factor that contributes to poor executive decisions is a lack of information. Top level managers are often insulated from the experience and advice of mid-level managers and front-line employees. Their organizational systems do not allow for employees closest to customers to communicate information to senior leaders.  And successful leaders delude themselves into believing that they don’t need input and feedback from others. These executive leaders, therefore, are making decisions with an incomplete understanding of their businesses and their markets.

A third factor contributing to poor executive decisions is the drive to be in total control. Rather than letting others make important decisions for which they have expertise, many senior leaders reserve that responsibility for themselves out of fear of losing control. This results in a failure to consider all options and destroys the drive and creativity of managers.

Commenting on this problem, Heather Daigle, in a post on DDI’s blog, Talent Management Intelligence, writes…

It’s instinctive to want to regulate “optimal performance” with processes, procedures and best practices. However, making business objectives crystal clear, setting parameters – not regulations – for performance, and offering up some decision-making control to employees can go a long way to restoring the engagement, well-being and productivity of your talent.

Given these factors, it’s a wonder that companies can be successful at all. Some observers of business   success argue that it might have more to do with luck than with a rigorous decision-making process. The results of the past decade suggest that coin-toss or rock-paper-scissors might have worked just as well. 

Learning Mismanagement

“The waste of organizational resources, and learner time, is tragic,” writes Clark Quinn.  “Seldom has so much been done, for so many, for so little gain.”

Quinn is writing about e-learning, but I think his observation applies to nearly all learning interventions (e.g., training, coaching, mentoring, online instruction). The commonly used estimate is 80% to 90% of participants in these interventions fail to apply what they learn to achieving business goals. In the current economic environment, this is a travesty. Companies today cannot afford to waste resources. Maybe there was a time when learning events (especially off-site events) were considered perks and it didn’t matter how much participants learned. Those days are over.

At least three factors are contributing to this need for greater value from training and development: 1) the economy requires companies to do more with less which means that managers have to reduce costs and increase value; 2) employees need to learn how to be creative and innovative in order to compete globally – if not, they will be put out of business by cheaper, faster, high quality, and countless Asian workers (see Daniel Pink); and 3) many employees, especially younger generations, are motivated by learning and will not join a company nor stay in that company unless they have opportunities to learn and make a difference.

Quinn blames the problem on “bad design and mismanagement.” I would agree that so-called “e-learning” programs are, for the most part, badly designed. But classroom-based training and development programs that I have observed in recent years are very well designed. Instructional designers and facilitators have become very professional and do an excellent job of making these programs responsive to the learning styles of adults. The gurus of instructional design, such as Robert Mager, Elliott Masie, Bob Pike, and Thiagi, have had a profound impact on the field and the quality of instruction over the past twenty years has improved dramatically.  

The waste is more the result of “mismanagement”. That is, organizations do things that prevent the application of learning to achieve business goals. For example, employees are sent to business acumen simulations without knowing how this learning fits into their individual development plan, how they will be expected to apply learning from this program to improved work performance, and what difference it will make for the organization.  This lack of alignment and expectations is played out every day in almost every business in almost every department and for almost every employee. 

Is the enterprise training department still relevant?

What does the future hold for enterprise training departments, especially in this era of Web 2.0? This is the intriguing question posed by Collaborative Enterprise in its ECOLLAB. According to the blog site,   ECOLLAB “…is a cross-cultural idea laboratory to exchange perspectives with experts and practitioners on Social Learning and Networked Enterprise concepts to develop more resilient organizations.” The authors chose “training departments” as the lab’s first topic.

In response to ECOLLAB, Clark Quinn writes:

It can no longer be just about courses.  It’s got to include performance support, and informal learning. It’s got to be about culture, and learning together skills, and facilitating productive information interchange and productive interactions. We have technologies now to empower user-generated content, collaboration and more, but the associated skills are being assumed, which is a mistake.  The ability to use these tools will continually need updating and support.

Tom Haskins writes that training departments in collaborative enterprises must choose between:

·         living fearfully in the past and living optimistically in the future

·         neglecting technological advances or fully utilizing them

·         rejecting the younger generations or embracing them wholeheartedly

·         facing the future with self-absorbed resignation or creating a future by caring for common interests with many others

Harold Jarche writes this about the future of the enterprise training department:

The main objective of the new training department is to enable knowledge to flow in the organization. The primary function of learning professionals within this new work model is connecting and communicating, based on three core processes:

1. Facilitating collaborative work and learning amongst workers, especially as peers.

2. Sensing patterns and helping to develop emergent work and learning practices.

3. Working with management to fund and develop appropriate tools and processes for workers.

The only certainty about the future from here on out is that it won’t resemble the past. For example, instructional designers no longer have time to develop formal courses. Survival requires people who can navigate a rapidly-changing maze at high speed. They need to find their own curriculum, figure out an appropriate way to learn it, and get on with it. It’s cliché to say that people have to learn how to learn. Management needs to support self-learning, not direct it.

While I agree with these commentators, I think the training (and development) function in organizations should be designed around its ultimate purpose which is to help the organization achieve its strategic goals. As the great architect Louis Sullivan said, “Form ever follows function.” Given this sage advice, the question becomes, “What is the best structure for facilitating learning that will result in achieving business goals?” The point then is not whether a centralized or distributed department delivers training programs, or internal consultants facilitate self-directed learning, or even that technologists teach employees how to use Web 2.0 tools for learning.  These all are worthy activities.  The main point is that employees are learning and applying that learning to achieve strategic goals. That necessitates what we call the “5As Framework”: 1) aligning learning interventions (training, coaching, online support, etc.) with goals; 2) anticipating learning and success; 3) forming a learning alliance of learner with supervisor/boss; 4) applying learning to achieving business goals; and 5) being accountable for business results. Whatever structure (centralized enterprise training department, distributed training, collaborative networks, etc.) supports these elements, then that’s what’s needed.

Age of Creativity and Empathy

According to Daniel Pink, author of A Whole New Mind: Why Right-Brainers Will Rule the Future, we have moved from the “information age” at the end of the last century to the “conceptual age” at the beginning of the 21rst century. At the PopTech 2007 meeting, he argued that there has been a shift from an emphasis on left-brain thinking to an emphasis on right-brain thinking. Of course, he is on the side of right…brain, that is. He would say that he is left-brain, but given his penchant for pecha-kucha, you could’ve fooled me.

Pink says that this is the age of creators and empathizers; that these are the kinds of workers our economy needs. Western companies are competing with Asian workforces that can do any routine work more cheaply. This means that Western workers have to compete on the basis of creativity and innovation. I heard Pink, along with John Hine, Senior Director of Organization Development and Learning for ConAgra Foods, and Catherine Rezak, co-founder of Paradigm Learning, talk about these ideas as part of a Training Magazine webinar last week.  

John Hine described how ConAgra is applying these ideas to their leadership development programs. He   said that they make the training playful, use simulations of business situations, and make the experiences meaningful for learners by mapping the connections of what they are learning to the “big picture”. This approach taps into the right-brain thinking of employees.

While I find this right-brain perspective on the workforce to be fascinating and appealing, it is also scary. What does this mean for people who are not predominately right-brain thinkers? Will they be unable to compete for jobs because they don’t think this way, can’t think this way, or, because of economic circumstances, cannot learn to think this way? What happens to them? And what happens to the jobs that require an emphasis on left-brain thinking? Will we have a preponderance of people who are creative and innovative but nobody to implement projects that produce high quality work on-time and within budget? Is there no place in the West for workers who want to manufacture goods? 

Employee Engagement and Organizational Learning

Organizations need to learn how to increase employee engagement. I don’t mean that HR needs to do a survey or that Corporate Communications needs to start a campaign that promotes positive attitudes or that departments need to have more social events. Those might be nice to do but those activities do not result in organizational learning. By “learning” I mean when the organization as a whole knows how to engage employees and does this continually as part of its culture.

David Zinger offers guidelines for what organizations need to learn. He describes what they should and should not do to create a culture of engagement. For example, one of his “… top 11 ways to ensure employee disengagement” is “never let an employee ask a survey question.” Actually, the opposite is true.   That is, always involve employees in asking survey questions. First of all, they know what is important to ask, and, secondly, the more they are involved the more likely it is that they will use the findings from the survey to support and implement efforts to enhance engagement. A caveat to this guideline is that there is an art and science to asking good survey questions and conducting a valid and reliable survey, so you always want a survey expert involved.

In Zinger’s “13 Powerful Guidelines for Employee Engagement Programs,” he writes that the way to develop engagement is to:

Spread engagement around. Make everyone responsible for their own engagement and accountable to everyone else in the organization. We don’t need people checking up on us, we need people checking in with us to talk about our fluctuating levels of engagement. Avoid putting engagement in the hands of just HR or Internal Communications. This is a line issue, this is everyone’s issue. Don’t forget, CEO’s and Presidents are employees too.

Zinger is making the point that engagement is everyone’s responsibility. Managers are responsible for learning how to do things that promote engagement and employees are responsible for discovering ways to increase their own engagement. When this happens, everyone is learning how to learn about engagement. The organization does not learn if engagement programs are owned by part of the organization without involving all of the other parts. The company-wide conversation about engagement is the way to learn.

Job Seekers Make Career Development Opportunities a Priority

Job seekers put a high priority on career development opportunities when looking for employment. Career development is more important to a large percentage of job seekers than compensation and benefits, work culture, and work/life balance. At the end of last year, 1,363 U.S., Canadian, and Latin American Linkedin members responded to a survey posted by Right Management that asked them, "What is most important when considering a new employer?" By far, the most important reason of five options given was “career development prospects.” The ranking by percentage of respondents selecting each item is:

1.      Career development prospects (40%)

2.      Work/life balance (21%)

3.      Innovative company culture (15%)

4.      Competitive compensation and benefits (12%)

5.      Good rapport with manager (8%)

George Herrmann, Executive Vice President of Americas at Right Management, talks about the implications of this ranking for managers:

Managers who take the time to learn what's important to their team members are in the ideal position to help bring employee and organizational goals together. Better alignment will result in greater contribution and career satisfaction, leading to improved employee engagement – all of which ultimately impacts the bottom line.

I agree with Herrmann about alignment of employee and organizational goals and the critical role of managers in making this happen. Even though “rapport with manager” is ranked relatively low as a criterion for employer selection, we know from other research that it ranks very high in terms of employee engagement and clarity of performance goals. Employees depend on their managers for learning and advancement opportunities. When that doesn’t happen, they feel stymied in their progress. This is more evidence of the importance of implementing the 5As Framework about which I have written previously.

Of course, the caveat to all of this is that it is a year since Right Management  conducted the survey of Linkedin members and employment opportunities for most of those respondents are probably much worse now than they were then. The most important reason for selecting an employer today is probably: has a job opening.

Managers are the Gatekeepers to Employee Learning

 The most important thing managers can do to ensure high performance in their companies is eliminate the organizational barriers to learning. Sean Murray and I wrote about this issue in an article that appears in the International Society for Performance Improvement (ISPI) December newsletter. The article is adapted from our new e-book, Getting More From Your Investment in Training: The 5As Framework. In the article we say:

...managers are the gatekeepers to learning. If they truly want their investment in performance improvement to pay off, they need to pay attention to each of the 5As: 1) aligning learning  interventions with strategic business goals; 2) anticipating and setting the expectations that the learning intervention will have an impact on the success of the organization; 3) forming a learning alliance between learner and manager that supports learning and application of that learning; 4) providing opportunities for learners to apply what they learned in meaningful ways; and 5) being accountable for learning and its impact on the organization.

Only then will organizations maximize the value of their learning interventions (e.g., training, coaching, mentoring, simulations, etc.). Managers who truly want high performance from their team members can’t afford to relinquish responsibility for learning to HR or the Training Department. Trainers won’t be successful, no matter how good the training programs, unless managers create a culture that supports learning and performance improvement. Being mindful of the 5As is a good place to start.