Is your Organisational Capability aligned to your Business Strategy?

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Changing Landscape requires longer range investment in capabilities

The fundamental changes in the global economy triggered by the sub-prime crisis in the banking sector during that extraordinary month in August 2008, there is clearly going to be a challenge to conventional approaches to leadership development.It is clear that Emerging Markets, and South Africa in particular, is only now experiencing the economic downturn that hit developed markets in the past few years.  For Chief Learning Officers, this has significant implications for how you think about your investment in leadership development, organisational capability and the longer term choices that you make to ensure you retain the ‘know-how’ to support your growth ambitions.

Declining top line growth and market uncertainties will most probably see an increased emphasis on cost and efficiencies and cuts to training budgets, which would require a re-think of conventional approaches to learning and development initiatives (especially given the often extortionate cost of travel/accommodation for off-site programmes, as well as the hidden cost of ‘downtime’ for learning). One can expect that most organisations will default to managing the business through the downturn through a relentless focus on cost cutting and ‘rationalisation’ of their business often with unintended consequences.

The upbeat and ambitious ‘growth strategies’ during previous years of ‘abundance’, become replaced with more sober and cautious ‘stay-in-business’ plans that are biased towards financial key performance indicators. We have been here before. Such organisations, unfortunately, begin to haemorrhage as they tighten belts and disinvest in development strategies. They will begin to loose functional and technical experience, as well as their corporate memory. What is often even more at stake and is less visible, is a loss of an entrepreneurial eye for possibility, the very ethos that most probably positioned the business for success in the past. The crisis in liquidity or capital becomes a crisis in leadership.

Future Trends in Learning & Development Strategies for Client Owned Development Centres

A few organisations, however, will focus on leading through this potentially protracted slowdown during which the landscape itself will be fundamentally altered. Such organisations will re-imagine the original entrepreneurial spirit of their venture, see opportunity in the crisis, and re-position their value proposition to emerge as market leaders in a changed world. The landscape will change, we will not return to an earlier paradise lost, as we are beginning to understand and appreciate how deeply flawed our assumptions have been about ‘double digit growth’. There is an increasing recognition that the economic crisis is merely one of many potential ‘tipping points’ that reflect a global crisis that extends beyond globalisation. Other large scale systems are facing potential collapse, with climate change linked to carbon emissions being a well published concern. In South Africa, our own energy crisis with Eskom’s ‘load shedding’ euphemism demonstrated what happens when supply-demand ratios are pushed to potential collapse of the energy grid.   We have not even begun to appreciate the looming crisis in water, or even the longer term crisis of biodiversity loss.

We can expect that global businesses will look towards emerging markets to counter their declining returns in developed markets. That landscape however, will require new and different approaches to doing business, and indigenous know-how and networks should not be ignored.

This means that ‘cut and pasting’ learning and development solutions that worked in mature markets are unlikely to succeed, as the theory may not prove to be relevant in the practice thereof.

Perhaps more significantly, the ‘return on expectation’ (an alternative ROI measure) will most probably focus on the opportunities for ‘learning in place’ (action learning).  The “70-20-10″ principle pioneered by the Centre for Creative Leadership and their research has shown how 70% of learning (especially leadership) is through workplace learning, 20% from coaching & mentoring, and only 10% from traditional classroom learning.  Of course, as with any principle, there are exceptions and CCL argues that rather use the principle to help shape your own Leadership Strategy…

“Next Generation” capability solutions will need to be owned by Line Managers – Functional Heads as Head-of-Faculty

The emerging future state of the global economy will require a ‘next generation’ notion of leadership to navigate the turbulence of straddling a necessary dual focus on ‘business-as-usual’ and ‘business-Un-usual’.  Given that we cannot predict the future state, I argue that next generation learning principles will be based on a notion of ‘education and training’ being about preparing people to be able to adapt to an as-yet-not-fully-known reality.   As organisations are required to adapt to a changing reality (the business un-usual), they will simultaneously have to deal with their ‘inherited reality’ (the business-as-usual).

This has profound implications for leaders in terms of their practices and how they are able to learn the new capabilities that will be required. This will necessitate a next generation approach to ‘how does learning take place’, and ‘how we develop leaders’. A colleague of mine calls this ‘leadership 3.0’ which I would call ‘next generation learning practices’.

This means that the current focus by Learning and Development (L&D) departments on structured group based ‘programmes’ with fixed curriculums will shift to a more real-time ‘learning-whilst-working’ understanding of how learning takes place. This is part a revival of the ‘learning organisation’ ideas of the 1980s, part a return to the notion of ‘action-learning’, but more importantly a need to recognise how modern information technology solutions integrated with the concept of communities of practice (CoP) could radically redefine learning processes at work.

Where Functional Heads become heads of faculties within your organisation.

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