The Single Most Important Choice for Organizational Leaders

Of the plethora of challenges that an organization faces each day there is one single question that is by far the most important of any question. The answer to this question determines every decision an organizational leader makes as well as determines the future success or failure of the organization or its leaders. The question is straight forward; what do we value?

The values of an organization are important because they represent the core set of beliefs that guide organizational leadership in developing programs, managing talent, and growing leaders. Whereas a mission provides the roadmap, values provide the underlying ethical behaviors that drive the mission. It is an imperative; therefore, that an organization embraces a shared belief system that permeates through the entire enterprise. Values are constants for an organization and do not typically change but serve as a foundation for how decisions are made and business challenges are met.

Several years I had an opportunity to talk to a CEO of a large health care organization about a particular core value of the company; treat every employee with dignity and respect. He shared with me that sometimes this value cost the organization by way of a small percentage of employees remaining on the payroll longer than may be acceptable in other companies. He strongly believed, however, that people should be afforded every opportunity to become productive employees and that the benefit far outweighed the cost of these few employees. He valued humanity in the workplace and in return he garnered loyalty and respect from employees. In contrast a large health care organization I worked with could not name their company's values. The company flounders in conflicting policies and procedures, disharmony between senior executives, as well as an ill-defined culture. I believe at the heart of this company's struggle is a lack of clearly defined values.

Blanchard and O’Connor (1997) In Managing By Values assert a company that truly manages by values, has only one boss-the companies’ values. If values were a box on a company organizational chart they would reside at the top of the chart. Organizational and individual goals, therefore, should be aligned with the values of the organization.

So how does a company actually manage by values? Collaboration by core leadership to name and define the organization’s values is the first step. The next step is publicizing the values in all communications and holding the mission and values as a litmus test for all projects, programs, initiatives and talent management activities.

As the organization determines its priorities, identifies projects, writes policies and procedures the question becomes is this project, process, policy or procedure representative of our values? Which value is supported and how is the value supported? In the selection, assessment and succession planning processes, the question is does this employee or potential employee's values align with the values of the company?

Are Training Departments Obsolete?

The days of the Training and Development Department as a necessary operational expenditure are long gone. Training Departments are continually finding themselves in a position where they must justify their existence. Feeble attempts at ROI have left many of us questioning the value of the work we do and more and more senior executives are doing the same. The question remains, “How were we making training decisions?” The most obvious way is reactively. A new system or a new procedure is introduced and we scramble to provide training in a ridiculously short period of time to often-resistant participants. Proactively we offer a basic core group of training courses on management and customer service because everyone needs that, right? Occasionally we even conduct a needs assessment; an often faulty instrument which assesses everything but the important things with all but the right people. But how do we determine what we need to assess? How do we know what is important?

“What is important?” A senior executive in an organization would answer, “The bottom line”. Why haven’t we as educators fully explored the impact of training on the bottom line particularly management training? My colleagues have responded to that question by claiming that these so-called “soft skills” cannot be quantified. If we believe this then we must then accept the fact that management training has failed to impact business results. In fact our metrics indicate that we never intended to impact business results. We’ve measured our success by use of three metrics:

1. Course evaluation- response to the course from the participants typically based on how much they like the instructor.

2. Basic validation of training content-verbal or written feedback affirming the competency was learned.

3. Application of what is learned-assessment of whether newly acquired skills are being applied in the workplace.

These metrics do not address the impact of training to the bottom line of our companies. We must approach management education with the intention to improve business results. The goal of the training intervention should be measurable changes in organizational performance.

A few years ago began to explore how training in my own organization could improve business results. What is costing my organization loss of revenue? Are these costs universal? And most importantly, can training not only address these areas but also impact them significantly? As an OD and training professional for the past 20 years the answer to that last question either would validate or besmirch an entire career. Did I dare venture down this path? I felt that training is critical to the success of an organization, perhapsI just had to approach training in a new way using the same metrics that senior executives use.

I started by asking myself, what is costing my organization revenue? The first was obvious, employee turnover. Could training impact turnover? I had to think first about why employees really leave. Most of the time I found employees don’t leave the organization, they leave their direct management. The question then becomes, “How well does our management team hire, train, support, reward and ultimately retain staff?” How can I assess, provide the training intervention, and then measure? I knew that there are two direct sources for assessment that didn’t even require I develop a needs assessment. One source is the employee exit interview and the other is our company employee satisfaction survey. In many organizations the exit interview is so confidential I’m not sure anyone sees it. If we aren’t going to use the exit interview as an opportunity to learn and change, why do it? I wanted to know why employees were leaving and most importantly I wanted to know the percentage of turnover for a particular manager. With this information I could target my training directly. The employee survey could provide me with similar information. I could also make predictions from the survey about future turnover. I could measure turnover pre and post training.

What other area was my company at risk for losing revenue? The most obvious way we lose revenue is customer dissatisfaction. Of course, we offer customer service classes but are these classes addressing why customers leave? I knew I had to see the data from our customer complaints. I knew this data would not only tell me why customers were leaving but which personnel member they last interacted with that caused the complaint. The data would reveal to me process issues as well as employee performance issues. Training can address those issues. We can target specific process areas or performance issues and specifically design training address the need. We could measure the number and type of complaint pre and post the training intervention.

One other area we could be losing money is risk. What have we suffered loses due to litigation? This data would help determine the priority of training design and delivery effort. Once again, I could measure risk pre and post training intervention.

I began to realize we have been doing everything backwards! We develop training and then try to justify it. Why not use the organizational metrics we already have in place as our need assessment and deliver training for the organization’s bottom line as opposed to cookie cutter, feel good training? I realize that what is important to my organization is universal. The same approach can be used in every organization by looking at where revenue is lost and those areas are universal employee turnover, customer dissatisfaction, and risk. Then design training that addresses the specific reason for that revenue loss.

Designing training to the bottom line, however, can only be successful in an organization in which accountability is systemic. In other words, post training intervention, a positive change in the metric must be realized and established compliance measures be enforced. The entire training effort must be an integrated part of the company’s performance management system. This requires buy-in from the senior management team.

The following is the criteria in determining a training program:

· All training must positively impact the company bottom line

· Use of organizational metrics (turnover reports, customer satisfaction surveys, risk factors) all direct the training effort

· Evaluation of the training intervention must be based on organizational metrics as opposed to training department metrics

· Accountability must be organizationally systemic

· Compliance measures must be integrated into current performance management

· Senior management must buy-in to the process

We must look at ROI, not as a foe but as a guide to direct our priorities and focus what really

matters in an organization. Whatever your organization has selected to measure is important to your organization.

Study these measures and determine how a training or educational intervention might impact the bottom line of

your own organization. There must be a continual process of analysis of data from organizational metrics,

determining the appropriate training intervention, conducting the training or educational intervention, measuring

the effectiveness of the intervention, redesigning the intervention if appropriate and then beginning the cycle again.

As training professionals know what is important, how it is measured, and most importantly how you can leverage your training to address the organizational priorities. Linking the training effort to the bottom line is not just one way to approach training, it’s the only way.