No. 870. INSTITUTION - ERIC · performance appraisal procedures. New technologies, including video,...

AUTHORTITLE

INSTITUTIONREPORT NOPUB DATENOTEAVAILABLE FROM

EDRS PRICEDESCRIPTORS

DOCUMENT RESUME

050 226

Lusterman, SeymourTrends in Corporate Education and Training. ReportNo. 870.Conference Board, Inc., New York, N.Y.ISBN-0-8237-0311-88531p.Conference Board, Inc., 845 Third Avenue, New York,NY 10022.Reports - Research/Technical (143)

MF01/PCO2 Plus Postage.*Corporate Education; Demography; *EducationalChange; Educational Needs; Educational Technology;*Educational Trends; *Organizational Change;Postsecondary Education; Program Content; ProgramDevelopment; Social Change; Supervisory Training;Technological Advancement; *Training Methods;*Training Objectives

ABSTRACTEducation and training programs have changed

significantly during the past five years in most large U.S.corporations. Rapid technological change and the adoption by manycompanies of new strategies in response to such factors as heightenedglobal competition and deregulation have imposed new skill andknowledge needs. A larger proportion of employees in all major jobcategories is now involved each year in formal training than fiveyears ago. Growth in participation rates has been highest formanagers and professionals as well as sales and marketing personnel.Despite the fact that diminished earnings have compelled somecompanies to reduce staff, most have increased the number ofprofessionals engaged in training. As corporate leaders committhemselves to reducing or containing education and training costs,more attention is being paid to linking training programs tocompanies' strategic goals. The needs of departments and individualsare increasingly determined by joint trainer-manager explorations andperformance appraisal procedures. New technologies, including video,computer-aided instruction, interactive video, and satellitebroadcasting, are having important effects on training. Corporatedepartments are becoming better equipped to conduct training programsand are beginning to play a more active role in oversight of trainingactivities throughout the company. (MN)

***********************************************************************Reproductions supplied by EDRS are the best that can be made

from the original document.***********************************************************************

Trends in CorporateEducation and Training

U.S DEPARTIMST OF EDUCATIONOn of Educational Research and Improvement

ED TIONAL RESOURCES INFORMATIONCENTER (ERIC)

\Ohis document his been reproduced as

ecowed from the person or organizationoriginating it.

O Minor changes have been made to improvereproduction Quality

Points of view or opinions stated in thiSdOCumoot do not necessarily represent officialOERI position or policy

"PERMISSION TO REPRODUCE THISMATERIAL HAS BEEN GRANTED BY

4,4 Civt )TO THE EDUCATIONAL RESOURCESINFORMATION CENTER (ERIC)."

,... ±rtt 3 1

ABOUT THE CONFERENCE BOARD

The Conference Board is a business information service whose purposeis to assist senior executives and other leaders in arriving at sound de-cisions. Since its founding in 1916, the Board has been creating closepersonal networks of leaders who exchange experience and judgmenton significant issues in management practice, economics and public poli-

cy. The networks are supported by an international program of researchand meetings which The Conference Board staff of more than 350 per-sons carries out from offices in New Yolk, Ottawa and Bt ussels.

More than 3,600 organizations in over 50 nations participate in TheConference Board's work as Associates. The Board is a not-for-profitcorporation and the greatest sha:e of its financial support comes frombusiness concerns, many with worldwide operations. The Board alsohas many Associates among labor unions, colleges and universities,government agencies, libraries and trade and professional associations.

The Conference Board, Inc.845 Third AvenueNew York, New York 10022(212) 759-0900RCA International Tele\237282 and 234465

The Conference Board, Inc.Avenue Louise. 207-Bte 50-1050 Brussels, Belgium(02) 640 62 40Telex: 63635

The Conference Board, Inc.1755 Massachusetts Avenue, N.W.

Suite 312Washington, D.C. 20036(202) 483-0580

The Conference Board of Canada25 McArthur RoadSuite 100Ottawa, Ontario, K1L-6R3(613) 746-1261

Conference Board Repoli No. 870

,c) 1985 THE CONFERENCE BOARD, INC.

ISBN NO.: 0-8237-0311-8

Printed in U.S.A.

Trends in CorporateEducation and Training

by Seymour Lustuman

A Research Report from The Conference Board

4

Contents

Pagb

HIGHLIGHTS v

WHY THIS REPORT vii

1. CHANGES IN NEEDS AND DIRECTIONS 1

More Support at the Top 1

Influence of Technological Changes 2

Meeting New Management Development Needs 2

A Corporate Resource 3

Moving Toward the "IBM Model" 3

Changes at General Electric 3

Implementing New Strategies and Goals 4

A New "Philosophy of Management" 4

Quality Circles 4

Reaction to a Merger 4

2. CHANGES IN PROGRAM SCOPE 6

Participation Rates 6

Corporate Training Staff 6

Staff Professionalism 7

Training Roles of Other Company Personnel 8

Outside Resources 9

University Programs 9

3. CHANGES IN METHODS 11

Assessing Needs and Defining Goals 11

Selection of Participants 12

Evaluation 12

Group Criteria 13

Mutual Reinforcement 13

Changes in Training Technologies 13

TV Networks 14

Learning by Experience 15

4. ORGANIZATIONAL CHANGES 16

New Corporate Programs 16

GTE 16

IBM 17

A Consumer Goods Company 18

ii TRENDS IN CORPORATE EDUCATION AND TRAINING

Enlarged Corporate Programs 13Borg-Warner 18Warner-Lambert 18A Diversified Manufacturing Company 19

Merging Two Training Systems: Allied and Bendix 19Changes in the Corporate Department Role 19Service and Coordination 19Staff Support to Top Management 20Part of the Management Process: Xerox 20Oversight 20

Information System 21The Corporate Perspective: GE 21Seeking the Proper Balance: Bank of America 21

APPENDIX: DEMOGRAPHIC AND SOCIAL FACTORS 22

Tables

1. Changes in Employee Participation 72. Large Increases in Employee Participation, by Industry 73. Changes in Training Staff Size, by Industry 8

6 CONTENTS iii

Highlights

Education and training programs have changed signifi-cantly during the past five years in most large U.S.corporationsin their aims, scope, resource use, or organi-zation, and often in all of these ways. Rapid technologicalchange and the adoption by many companies of newstrategiesin response to heightened global competition,deregulation, and other changes in the businessenvironmenthave imposed new skills and knowledgeneeds. Companies are also trying to achieve greater competi-tive strength by enhancing the quality and productivity oftheir people.

A larger proportion of employees in all major jobcategories are now involved each year in formal training thanwere five years ago. Growth in rates of participation has beenhighest for managersincluding supervisorsand forprofessionals, sales and marketing people.

While diminished payrolls and earnings have compelledsome companies to reduce staff, most report that the num-ber of professionals engaged in training has increased. Moreuse is also being made of line managers and other nonprofes-sionals, as well as of outside training resources.

Growthin employee participation in company-sponsored training, in staff size, and in the use of otherresourceswas particularly prevalent during the past fiveyears among financial institutions.

Corporate leaders are said to be commited to reducing orcontaining education and training costs even as they seekmore from that function. More attention is now being paidto tying training programs to companies' strategic goals. Theneeds of departments and individuals are increasingly de-termined by joint trainer-manager explorations andperformance-appraisal procedures.

About This Report

This report is based on information provided by 218 com-panies. In-depth interviews were conducted with educa-tion, training and development executives in 46 of thesefirms; 184 responded to a questionnaire mailed to Fortune500 industrial and service companies. Thirty-four of thefield interviews were at companies that did not take partin the survey.

New technologiesvideo, computer-aided instruction, in-teractive video, and satellite broadcastingare having im-portant effects on the training function. They are providingsuch benefits as increased instructional effectiveness, train-ing paced to individual needs, and the ability to train in-dividuals, as needed, rather than in groups. They also offergreater opportunity for centralized program developmentand, therefore, control of content.

In striving for improved and cost-effective education,training and development, companies are strengthening andwidening the role of corporate training departmentsandare creating such functions where they did not exist. Cor-porate departments are becoming better equipped to con-duct management-education programs, to carry out topmanagement's communications and indoctrination goalswithin the organization, and to develop programs for skillsneeds shared by operating units. They are also beginning toplay a more active rolenot only in support and coordina-tion but also in oversight of training activities throughoutthe company. Line units are being given more responsibilityfor training needs specific to their operations.

7 HIGHLIGHTS V

Why This Report

Educenk:i in Industry, the first systematic inquiry everundertaken into the scope and character of corporate edu-cation, training and development activities, was publishedby The Conference Board in 1977. In a changed competitiveenvironment, the contribution of company personnel nowlooms larger than ever in the eyes of most corporate leadersas a key to business vitality and growth.

The present study explores the kinds of changes that majorfirms have initiated since 1977with particular emphasis onchange during the past five yearsand the factors that have

8

prompted them. The study suggests approaches and possi-ble models for corporate managers concerned with thesematters.

The Conference Board is grateful to the Student Loan Mar-keting Association for its generous support of this project.We are grateful, too, to the many corporate executives whohave shared their ideas with as.

JAMES T. MILLSPresident

WHY THIS REPORT vii

Chapter 1Changes in Needs and Directions

EDUCATION AND TRAINING programs have changedsignificantly in most large U.S. corporations in their aims,scope, resource use, or organ;zation, and often in all of thesewaysduring the past five years. To begin with, employeeshave had to acquire many new competencies during this halfdecademanagers no less than plant operators, clerks andtechnicians. One reason for this has been the rapid introduc-tion of new technologies. "Technological change;' a Xeroxexecutive says, "is the main force now driving education andtraining in our company. One of our major challenges is keep-ing our people at the leading edger General Electric's train-ing manager comments: "Technologies are changing so fastthat adapting to them is taking a bigger share of the trainingdollar!'

The second major influence on changes in training hasbeen the adoption by many companies of new strategies andgoalsresponses to heightened global competition, deregu-lation, and other changes in the business environment. Theseoften call for attitudinal changes as well as for new skills andknowledge. Thus, a bank executive notes "enormous change"in his company, "from a situation in which the customercameto us to one requiring initiative, innovation and risk taking.We're trying to shift the ways of thinking and acting of anentire organization!' Training in a steel company, one of itsofficials reports, has been put at the service of "an organizedeffort to change the company's leadership style from abureaucratic approach to a more participative and innova-tive approach, with clearly understood goals and objectives,and greater employee involvement and commitment:' Execu-tives at other firms also report a strong new stress on the de-velopment of competenciesentrepreneurial, marketing andothersthat entail a blend of skill and knowledge; that are,in effect, new ways of thinking.

More Support at the Top

The trend among top executives toward increased supportfor training among top executives grows, in large part, outof their awareness of these new needs. But often other fac-

Terminology

According to Webster's Ninth New Collegiate Diction-ary, 1983

to "train" is "to inform by instruction, discipline or drill;to teach so as to make fit, qualified or proficient";

to "educate" is "to provide schooling for; to developmentally and morally by instruction";

to "develop" is "to work out the possibilities of; to pro-mote the growth of to cause to unfold gradually".

As a shorthand convenience, and in the absence of amore suitable term, the word "training" is sometimes usedin this report to embrace all of these activities.

tors are involved as well. In some cases, greater interest intraining is a response to significant growth in company sizeand resources; in others, enhanced respect for the potentialbenefits of education and training based on personal ex-perience. "Like many others in the rising generation of seniormanagers, our new president has been through a variety offormal training experiences himself and appreciates theirvalue;' is the way a consumer goods executive explains strongrecent growth in training staff and programs at his company.

The increasing status of human-resources managementprograms, and growing professionalism in the education andtraining activities of many companies has also influencedthe attitudes of top executives. It is clear, too, that the for-tunes of training programs have reflected the competenceof training managers and their ability to "sell" their programsto top and line management.

Management's recognition of a new orientation towardlearning in the work force itself may also be a factor, someobservers suggest. One executive comments: "Members ofthe 'baby boom' generation and managers and professionalswho have come up through the ranks in recent years haveunderstood the need for continuing education in a rapidlychanging world: They expect and demand more training.

Important new needs and growing management support

9CHANGES IN NEEDS AND DIRECTIONS 1

have combined to enhance both the role and status of train-ing in many companies. Some representative characteriza-tions of this change:

"Management has become convinced that educationdriv 1 the business!'

"A stepchild nntil recently, the training function is nowseen as essential to the company's strategic goals!'

"Developing our people is now the heart of our busi-ness strategy."

"Our human resources function was given a new charterthree years agoto contribute to the company's competi-tive edge by recruiting talented people, training them, andnot letting them stagnate!'

"Training departments used to be wiped out by reces-sions, but few were in the recent one:'

Influence of Technological Changes

No group of personnel or type of business is immune fromthe new learning requirements imposed by technologicalchange. Production managers must understand computer-aided manufacturing and continuous-flow techniques; salesand human-resources managers use computerized informa-tion systems. General managers have to grasp the techno-logical competencies needed for jobs within their purview.Senior managers need to understand technological implica-tions and possibilities to plan investment strategies.

For nonmanagerial personnel technological change hasbeen the principaloften the soleforce behind new train-ing needs. High technology has replaced electromechanicalprocesses, and computers have taken the place of earlier in-formation systems. "More and more of our jobs call forknowledge-workers!' an energy company trainer says. Amanufacturing executive observes that "not long ago draftspeople needed only a slide-rule; today they must know com-puteraided design!' Typists have been learning to use wordprocessors, sales clerks to operate computerized cashregisters; and plant workc.-s to operate electronicallycon-trolled equipment.

Lockheed-California trainers are preparing 200 clericalemployees for the company's move into "the automatedoffice!' according to a company executive, by teaching themthe uses of the computer for word processing, spread sheets,and data banks, and have begun classes for another 60machine-shop people in aspects of computerized numeri-cal control.

Accelerating the introduction of new products, technolog-ical change has also affected the work of marketing and al-lied personnel. "Products used to be introduced in a few citiesand move out across the country gradually as we trained morepeople to sell and service them;' Xerox's education and train-ing manager says. "With today's technologies, you launchthem worldwide very quickly to meet the competitivechallenge!'

There are problems, however. Until the recent technologi-

2 TRENDS IN CORPORATE EDUCATION AND TRAINING

cal explosion, engineers and scientists appeared to have hadlittle difficulty in keeping abreast of their fields by readingperiodicals, journals and books and participating in com-pany, university or professional-society programs. Par-ticipants say this is no longer true. For one thing, the"half-life" of an engineerthe length of time for which hisor her training will serve adequatelyhas been sharplyreduced. (Estimating this at five years, one training directorfigures that a twenty-five year old graduate wi1I have to bereeducated eight times in the course of a forty-year career.)

In the face of this greater need, the nation's engineeringschools, an importaht resource which engineers have usedto keep current in the past, are not serving business needsas well as they once did, some executives say. "They are inan economic bindunable to afford either expensive state-of-the-art equipment or salaries that are competitive withthose offered to engineers by private employers:' onecomments.

Meeting New Management Development Needs

If technological developments have had their principaltraining impact on nonmanagerial occupations, most otherchanges have directed attention to the education of managers.Managers are seen as the key to the implementation of newor revised strategies that seek variously to increase competi-tive strength, enhance productivity, raise the quality ofproducts and services, and meet circumstances altered byderegulation and other events!

Even where their companies are not changing strategicdirections, top executives may seek benefits from enlargedmanagement-development efforts. A typical comment: "Wedecided two years ago that better managers are an impor-tant part of the competitive edge!' The need may appeargreatest among firms that have pruned their managerialranks or cut the number of level of management. "Leanerstaffing entails broader spans of control and calls for bettermanagers!' another study participant observes.

Finally, some firms have been anticipating the need fora new generation of managers. Seagram, for example, inau-gurated its first management-development function in 1984,not long after introducing a succession-planning system. Acompany official says this was "partly because the liquor bus-iness has become a lot tougher, but also because a numberof senior managers and some middle ones were nearingretirement:'

Most newly created management development programshave been designed primarily for lower- and middle-levelmanagers; existing programs have tended to expand theirreach upward. The training director of a consumer productsmanufacturing firm says: "Successful older managers who

'Various social and demographic factors were found to have had little or no influenceon corporate training programs during the past five years. See Appendix (See also

Helen Axel, Corporanons and Families: Changing Practices and Perspectives. TheConference Board, Report No.868. 19851

1 0

have been directing the affairs of profitable companies recog-nize fairly readily a need for the education of younger andless-seasoned people. It takes longer for them to accept thatthey may have something useful to learn themselves. Theproblem is less acute in high-tech and service companies thathave had a clear need to train people on a continuing basis.But where the technical aspect is missing, it is hard to bringalong the restthere is no tradition!'

The focus or mir of management education subject mat-ter has also changed recently in many companies. Skills, asdistinct from theory, are said to be receiving more empha-sis. "We are providing services that the company desperatelyneeds, such as a manual for functional managers on how todo a strategic plan!' the director of training and developmentfor a consumer goods firm points out. Others report thatwhile interpersonal relations continue to be a basic subject.the scope of their management development program haswidened. "The emphasis used to be on employee-to-employeerelations; it now also includes employee-to-supplier and "cus-tomer relations!' a manufacturing firm reports.

A Corporate Resource

More and more companies are coming to regard theirmanagers as "a corporate resource,' available for reassign-ment from one division to another and for movement be-tween corporate and operating units. This approach has beena factor in the decision to centralize management develop-ment in some companies. It has had other effects as well.It has made job rotation possible as a significant develop-ment tool, rather than an occasional occurrence. It has alsoaffected the content of formal educational programs. Ahuman-resources executive at a bank, for example, describesa recent change in its entry-level management-training pro-gram: "The program used to be functionally oriented andone-dimensional, with trainees assigned to one of threeladderscommercial banking, investment trust business, oroperationswhere they were expected to remain. A partic-ular trainee learned about credit finance but not about retail-ing, trust investment, or money markets. Now all of thesesubjects are covered for all trainees, who understand that theymay be assigned wherever they are needed!'

The prevalent growth of the management-development ef-fort is reflected in new programs, wider manager participa-tion in existing ones and in the creation and enlargement ofcorporate training departments. It is also manifest in a trendtoward what many refer to as the "IBM model!'

Moving Toward the "IBM Model"

When an IBM employee becomes a supervisor, and uponsubsequent promotion to higher managerial ranks, he or sheis required to go through a course of study deemed appropri-ate to the responsibilities being assumed. The program con-tent at each grade builds on what came before and isaddressed to the responsibilities to be assumed. Various corn-

panies have adopted similar approaches to management de-velopment in recent years, while others aspire to it.

Even where the "IBM model" is not adopted in its entirety,that feature of it that seeks to connect and integrate programstages or parts may be. For example, an internal managementdevelopment program launched by one company in 1981 isbuilt on seven core programs. It seeks to avoid discontinuity,"a major flaw in many management-training programs!' thecompany's director of management-resources developmentsays. "Our programs don't just start and finish, but aredesigned so that participants see how one part fits intoanother. Our outside faculty members work together towardthis end, even to the point of coordinating terminology!'

Changes at General Electric

A GE company executive says that his company "tries tominimize rulesdoesn't want to say a person can't bepromoted unless he or she has taken a course' Several yearsago, however, a decision was made to focus corporate train-ing at certain critical points in the career of a manager. Thissame executive says: "Training and development became anarm of corporate strategy, giving close thought to when thecorporation should inter gene with programs to assure coor-dination, integration and acceleration!'

Participation in a 12-week executive-development programis not formally required of potential general managers, but"is understood to be expected!' General Electric has long hada formal managerial program for college recruits, and offersone for the heads of various functional areas in the businessunitsthe latter identified as "strategic marketing," "stra-tegic finance' and so on. The company has recently instituteda required program of training for new managers. About1,000 participate every year worldwide. It differs from IBM'sprogram, according to GE's management-education chief,in its "strong orientation toward increasing General Elec-tric's competitiveness as well as focusing on traditional 'one-over-one' skills!' He explains: "The training occurs duringthe first 12 months after an individual crosses the thresholdto management. The first phase is based on self-studylocalmanagers administer materials prepared by the corporatemanagement-education operation. After the person is on thejob for six to eight months, he or she attends a six-day pro-gram at GE's Management Development Institute at Croton-vile, New York. Phase three, like the first, is administeredlocally and involves 14 modules of management modeling.

"Why this big new program? Research showed us that first-line managers manage about 50 percent of the professionalworkforce of the company. They do the interviewing and hireabout 90 percent of all new employees. Yet many have beenin the company for less than five years and have had no train-ing in selection, motivation, evaluation, and soon. They holdthe company's proxy in key areasemployee relations, EEO,for example. In the course of its preoccupation with execu-tive education, the company had forgotten about thesemanagers and neglected them for many years!'

I.1CHANGES IN NEEDS AND DIRECTIONS 3

Implementing New Strategies and Goals

The training director of a top multinational says: "Ourlarger corporations are going through a process of sortingout what they want to become and where they want to go,and they are looking for ways to make sure all their peoplecome along with them on the trip!' Several examples illus-trate the increasing use of management education and train-ing programs in the implementation of new strategies.

A New "Philosophy of Management"

In October, 1983, a Management Mission Program wasofficially launched by Combustion Engineering at a meet-ing of the company's 70 most senior executives. This two-day program was designed by the t raining department in con-sultation with senior managers. It reached over 15,000 em-ployees in its first year.

The program's goal was to change the corporate culture.It sought to do this in two ways: First, a senior executive wouldpresent and discuss with participants a new "philosophy ofmanagement'sone that aspires, in the words of the com-pany's Director of Management and Organization Develop-ment, to "more participation, more sharing, more openness,more flexibility, more risk taking, and improved quality!' Se-cond, based on participation, the two-day session would it-self be "a showcase" and exemplar of the changes sought.Films, dealing with issues ranging from methods of super-vision and styles of leadership to ways of building sales andincreasing earnings, would be followed by solicitations ofparticipants' opinions and general discussions.

The meeting of top executives at which the program waslaunched was opened by the CEO, who described his visionof how the company should evolve over the next decade andhis philosophy of management: He sounded thethemes thatwere to be echoed down the line. A second round of meet-ings took in senior managers of the operating companiesabout 500 in all. The several group vice presidents, who hadattended the first meeting, opened these sessions much asthe CEO had the earlier one, endorsing and interpreting hiskey ideas for the operating unit managers.

To bring this program to personnel within the operatingcompanies, 45 of these units' staff memberssome train-ing personnel, some drawn from the ranks of planners, mar-keters and other staff specialistswere specially trained bythe corporate training and development staff. The presidentsof the operating companies represented management at thesesessions.

Issues raised at the Management Mission Programmeetingsproblems relating to communications, for exam-ple, or to the administration of the performance-appraisalsystemhave generated special study groups and task forces.If the ideas or suggestions arising at sessions of either thebasic program or the task forces have companywide impli-cations, they are passed on to a corporate-level steering com-mittee. This committee, made up of three senior managers,


was appointed at the program's start to monitor progress andto channel and follow up on new ideas.

In short, says Combustion Engineering's manager of train-ing and development: "This program is not only com-municating a change, it is also making training a dynamicpan of the change process!' Moreover, it represents an ap-proach that is applied to other programs, this executive notes."In our finance course, for example, or our advancedmanagement course, company officers talk to participantsabout the strategic directions of their function and then askthem to react. So our meetings are really two-way dialogues,and training becomes a means to several ends. At the sametime individuals are trained, they give benefits back to thecorporation by identifying problems and even coming upwith recommendations as to what can be done!'

Quality Circles

The introduction of quality circles and similar programsto encourage wider employee participation in managementhas also had training consequences! As part of a strategyto increase productivity, Olin Corporation, for example, be-gan to develop "Employee Involvement Teams" several yearsago, giving the training department responsibility for in-structing managers in how to organize and operate them.

Responsibility for coordinating such a program was alsogiven to the training department at the Chicago, Milwau-kee, St. Paul and Pacific Railroad. This unit has producedguides for the leaders and the "facilitators" (assistants to theleaders) of quality circles and of problem-solving teams, andmanuals for the instruction of those assigned to take overthese duties. It has done the same for the labor and manage-ment members of such groups. The training department hasalso developed a participants' manual for "SteeringCommittees" labor and management groups in particularplaces that organize local quality circles, decide how they willoperate, and oversee their functioning.

The director of the Railroad's training department, whoserves as a consultant to the heads of the several steering com-mittees, says about his unit's role: "Management turned tothe training department when the quality circles were started.It seemed to them a logical place. We had done motivationaltraining before and understood the group process, how toinstitute organizational change, and how to do problem solv-ing. The consultants who set up the program taught usspecific quality-circle techniques and gave us other relatedtraining!'

Reaction to a Merger

Allied Corporation's human resources organization wasassigned a key role, following the firm's acquisition of Ben-

'For details on such humanresource programs, see Harriet Gorlin and LawrenceSchein, Innovations in Managing Human Resources, The Conference Board, Report

849, 1984.

12

dix. It begat) with the design and execution of a survey bythe director of that unit, ir'ended to "identify the variouselements that collectively constitute the cultures!' A seniorexecutive-training program was then built around these ele-ments. 11vo aspects of the program are stressed by this ex-ecutive. First: "It did not grow out of a traditional needsanalysis or performance appraisals, but from a recognitionthat the twa parts of the organization had to be integratedand share an understanding of who we are and wherewe aregoing!' Second: "The idea was not to establish hard and fastrules about how to do thingsor to teach marketing, hu-man resources, or other traditional subjects. It was to helpmanagers understand the world around usinternatior

13

trade, the new business environment, Allied's values anc'to help them to start thinking strategically and see the ramifi-cations of their actions. It was also to get them to know eachother better" This senior program became a model and wasadapted for other strata of management.

Prior to their integration, both Allied and Bendix had builttheir management development programs around middleand lower levels of management. "One of the big changeshas been the inclusion of top level directors and senior ex-ecutives;' an Allied executive says. While the initial purposewas to facilitate the merger of the two cultures, an ongoingeffort has been institutionalized in the firm's developmentstaff.

CHANGES IN NEEDS AND DIRECTIONS 5

1

Chapter 2Changes in Program Scope

ALL KEY INDICATORSrates of employee participa-tion in formal training activities, numbers of staff profes-sionals employed, involvement of non-professionals intraining, use of outside resourcespoint to widespreadgrowth in corporate training activity during the past fiveyears!

Participation Rates

The proportion of employees participating each year ineducation, training and development programs increasedmore often than it decreased in all major personnel categories(Table 1). Gains were greatest for supervisors and middlemanagers: More than a 'wird of surveyed companies reportedincreases during the recent period in the participation of thesegroups, while only one in fourteen said participation haddecreased. Not far behind, with about one in four notingincreases, were senior and upper-middle managers, profes-sional and technical employees, and sales and marketing per-sonnel. Least likely to have participated more broadly intraining at the end of the period than at the start were secretar-ial and clerical workers, and operators and craftsmen.

Financial institutions (less readily distinguished now sim-ply as banks, insurance companies, or brokerage firms thanthey were five years ago) report large increases in trainingparticipation among all employee groups (except operatorsand draftsmen) markedly more often than do industrials orother kinds of service firms (Table 2). In each of the groups,however, "large increases" were reported most frequently forsupervisors and middle managers.

Participation growth has been qualitative as well as quan-titative, some of the respondents say. The executive respon-sible for management development at GE comments, forexample, about recent changes in that company's program:"The net effect has been to reduce the number of courses

'Readers have learned to treat cautiously findings of surveys with large non-response

rates. In the present case, however, interviews conducted at firms that did not respond

to the Board's mail questionnaire showed patterns of change very much like thoseof the participants. Similarly, follow-up among a large group of non respondents to


but to make for higher-quality participants and for widercoverage of those who have been identified as targetpopulations!'

Corporate Training Staff

The corporate training staff has grown in about half thesurveyed companies. A like proportion report staff increasesin training functions at divisional or operating-unit levels.Overall, the number of training professionals has increasedat one level and not decreased at the otheror has increasedat bothin nearly two-thirds (64 percent) of these firms. Theproportion of companies reporting increases in corporate-level staff is highest among financial companies and lowestin the top industrials: So, too, is the ratio of increases todecreases (Table 3, p. 8).

Marked reductions in staff are linked to persistently low-ered earningsand broad cuts in personnelthough somefirms have trimmed training departments in less severe cir-cumstances. Staff reductions have not always resulted indiminished training activity staff (see p.11). The 1981-1982recession, moreover, is widely said to have been less damag-ing to the integrity of staff and training programs, even tem-porarily, than earlier ones.

Participants attribute this to an earlier elimination in theirprograms of "nice to know" courses, and to the closer con-nection they have established between training activity andthe operating needs of the company. "Management has be-come satisfied that we only do the essentialthat we're con-tributing to the bottom liner one training director says. Anaerospace executive notes a major change in philosophy inhis company: "In anticipation of future skills needsandwith strong pressure from the linemanagement decided toincrease staff during the recent recession rather than decreaseitto use down time to good purpose!'

a 1977 Board survey on training and development showed that levels of staffing andprogramming in the firms that did not participate initially were only slightly belowthose of the participating group. (Seymour Lusterman, Education in Industry, TheConference Board, Report No. 719. 1977)

14

Table 1: Changes in Employee Participation1(184 Companies)

Employee Category

Changes in the Proportion of Employees WhoParticipate Annually in Company-Sponsored Training

Percent of Companies ReportingIncrease Little or No

ChangeDecrease

TotalLarge Small Small Large

Senior or upper-middle managers 24% 25% 45% 4% l00%aMiddle managers 34 32 27 2 4 100aFirst-line supervisors 40 32 22 3 4 100Professional and technical 23 40 32 2 3 100Sales and marketing 27 31 36 2 4 100Secretarial and clerical 15 28 51 4 2 110Operators and craftsmen ....... .... 8 26 58 3 4 100aOther 6 12 77 4 100a

Turing past five years.

%etas do not add to 100% because of rounding.

Table 2: Large Increases in Employee Participation, by Industry'

Employee Category

Large Increases in the Proportion of EmployeesWho Participate Annually in Company-Sponsored

Training

Percent of Companies ReportingTop

Industrials'(n=44)

OtherIndustrials' Financial Other

(n = 50) (n=44) (n=46)Total

(n=184)

Senior or upper-middle managers 22% 22% 34% 16% 24%Middle managers 29 39 46 21 34First-line supervisors 24 39 61 33 40Professional and technical 12 22 44 11 23Sales and marketing 10 26 52 19 27Secretarial and clerical 10 14 23 13 15Operators and craftsmen 7 6 4 15 9Other 9 12 5 6

Turing past five years.' Respondent's from Fortune 500 industrials are separated here into top 250 and others.

Where deep cuts were made temporarily, short-term finan-cial benefits may have been offset by longer-term costs,several participants suggest. "We cut back staff whenausterity hit the industry in 1982!' the training manager ofan energy company says, "and begat. building it up againa year or so later. You can hold back training from technicaland scientific people for only so long without paying a price.It was a costly maneuver; we lost trained and experiencedtrainers. It is hardand takes timeto replace talent!' Anexecutive at a firm that disbanded its training departmentfive years ago says that his company's tactic, for the present,is "to hire expertise rather than train it!'

Staff Professionalism

As companies have striven for greater efficiency in needsassessment, program development, and course delivery, theirtraining departments have had to become more "profession-alized," come participants say. For example, Hewlett-Packard's Director of Training and Development reports:"Five years ago we had more people who were rotatingthrough the training department to round out their ex-perience. Now we are looking for people who want to special-ize in this areaand we're finding them!' Others make thesame point. An insurance executive says: "Our training func-

15 CHANGES IN PROGRAM SCOPE 7

Table 3: Changes in Training Staff Size, by Industry'Percent of Companies

Number of Staff Members:

TopIndustrials'

(n =44)

OtherIndustrials'

(n=50)Financial(n =44)

Other(n =41)

Total(n =184)

At the Corporate Level 100% 100% 100% 100% 100%

Increased 38% 55% 69% 48% 52%

No Change 38 32 26 43 35

Decreased 24 13 5 11 13

At Divisional or Other Levels 100% 100% 100% 100% 100%

Increased 48 32 73 61 52

No Change 38 51 22 39 37

Decreased 14 17 5 10 11

Overall 100% 100% 100% 100% 100%

Increased at corporate and other levels 19 17 57 36 32

No change at corporate and other levels 21 19 12 29 20

One level increased, other unchanged 34 45 25 23 31

One level decreased, other unchanged 14 8 4 2 8

Decreased at corporate and other levels ..... . 12 11 2 10 9

1During past five years.* Fortune 500 industrials are separated here into top 250 and others.

tion has not changed during the past few years, but the kindof person in it has changed drastically!'

Specialists are being hired with backgrounds in a growingvariety of fields. Hewlett-Packard's department includes per-sonnel with graduate degrees in curriculum design and otherfields of education, as well as in organizational behavior anddevelopment. It also includes a specialist in interactive video-disc programming and several TV professionals with majornetwork experience.

Because much more time, effort and expense are going intoeducational development, IBM's Director of Education says,"instructional designers, and occasionally professionalwriters, have replaced teachers, who used to do these thingswhen they weren't teachingusually not verb well. Audioand video people are also being brought in more and more!'

At least one corporate training director sees line experienceas a desirable background for a headquarters staff job.Another, who herself recently managed training at a majorsubsidiary, plans to fill future corporate staff slots withtrainers from field operations. She says: "The corporatedepartment will be the ultimate job for senior trainers. Wewill have people who know and are able to work effectivelywith others!'

Training Roles of Other Company Personnel

Training resources have been augmented in most compa-nies through the greater use of line managers and other non-specialists. Seven out of ten cf the participating firms saythat the time devoted by such personnel to instruction andto program planning and development has increased during


the past two years; only a handful report reductions. Wideruse of nonspecialists is reported by nearly four-fifths of thecompanies that have also added to their professional train-ing staffs. Three in five of the firms that made no changein the size of their training and development staffsandnearly half of those that reduced themalso reported greateruse of nonspecialists.

Line managers and specialists in areas other than train-ing are more often working with design experts in course de-velopment, bringing to the process their greater knowledgeof both the subjects and skills to be taught and of the situa-tional context. An insurance executive, describing the de-velopment of a multifaceted program for managers, says:

"We pulled together a group of functional officers and askedthem what skills were needed by middle-and upper-levelmanagers in each of their areas. The training department hasbecome the gluea development coordinator and broker.In the past we would have brought a program in from out-side that didn't quite fit, or spent a lot of time on a trainingneeds analysis!'

Specialists in more than one area may collaborate incourse-development efforts. At J. C. Penney, for example,technical personnel from the training, merchandising andvideo departments joined to develop an interactive video pro-gram designed to train buyers in automated inventorymanagement.

Line managers who teach are more likely to have been spe-cially trained for that activity today than in the past. Theextent to which this happens, though, depends on the sizeof the company's training department, the competencies tobe imparted, and various cost-benefit considerations, as well

16

Changes in Use of Outside Resources'(184 Companies)

Percent of Companies Reporting Change

In Use of Instructorsand Consultants

For In-House Programs

In Use of Universitiesand Organizations

°haring Outside Programs

Large increase 17°/o 9%Small increase 36 31Little or no change or trend 34 47Small decrease 8 9Large decrease 5 4

Total 100% 100%

'During past five years.

as on management's attitudes. % large retailing enterprisereports that it has recently adopted "a new strategy of using

.e people rather than trainers as much as possible" to helpvalidate and emphasize to participants the importance of thetraining, and so that course content may be adapted to localconditions. Programs developed for this firm by outside con-sultants are initially conducted by these specialists but arethen turned over to the company's professional trainers. Thenthey aregiven over to nonprofessionals who have been trainedby the training department.

Many training executives would prefer that courses betaught by skilled staff instructors, rather than by linemanagers or specialists in other areas. They believe that, atleast up to a certain level of complexity, it is easier for goodteachers to learn course content than the other way around.They also recognize the limits to this approach, however.Thus, the training director of 4 high-technology companysays: "Staff people concentrate on the generic typeprogramsmanagement training, training for quality cir-cles, basic math, basic and advanced blueprint reading,crane-operator training. As the subject matter gets more eso-teric, others are trained to teach it. We introduced a 'train-the-trainer' course two and a half years ago, and nobody canconduct training now without going through it. Operatingmanagers resisted at first, arguing that there were companyspecialists todo it. But this hostility has evaporated and mostof them now like the idea as they see its benefits!'

Outside Resources

The use of outside instructors and other consultants toaugment company employees in the design and conduct ofin-house programs has also increased during the past fiveyears at more than half the firms surveyedfour times thenumber stating that it had decreased. (See box above.) Growthwas greatest among companies that also increased the sizeof their in-house training staffs: Nearly two-thirds of such

firms say that their use of outside resources has also expandedduring the recent period. Growth was only slightly moremodest among firms reporting no change in numbers of stafftrainers, three-fifths of which note increased employmentof outside contractors and one in four firms that cut train-ing staff are availing themselves of outside resources to agreater degree than five years ago.

Private outside contractors are normally employed as amore cost-effective alternative to internal staffing for sometraining activities, and to procure kinds of expertise not avail-able in the companyor at accessible institutions. An aero-space executive says: "We have good colleges in the area, butwe also have needs that go beyond what they offer. So we'rebringing their strengths into the company, contracting withindividual professors and offering special programs of ourown!'

Contractors also offer the fruits of wider experience andmore diverse interests than mo &t training departments canhave. Thus, an oil company recently decided to shift froma staff-prepared and conducted management-developmentprogram to the use of outside consultantsin order, thefirm's director of education and development says, "to getfresh ideas from the outside, and greater flexibility and adapt-ability to change. We had become a production operation,grinding out programs, not staffed to provide thenecessaryresearch and development!'

University Programs

Increased use is being made, for similar reasons, of pro-grams conducted on the outside by universities and trainingorganizations! New arrangements are also being worked out

'Bricker Executive Education Service, Woodside, California, a privite organiza-tion that tracks such matters,estimates that the nu mber of participants .n general andfunctional management programs conducted by universities increased from 10,000in 1981 to 12,500 in 1984.

17CHANGES IN PROGRAM SCOPE 9

with colleges and universities, as companies seek ways ofmeeting emerging needs and better serving existing onesparticularly in management education and engineering andscientific studies.

Some of these involve special relationships between in-dividual firms and institutions. Xerox, for example, has de-veloped a program with Rochester Institute of Technology"to enable its engineers to grow with the changing technolo-gies:' a company official says. Mechanical engineers are givenleaves of absence to study computer engineering at RIT.

Hewlett-Packard, on the other hand, brings a universityprogram to its people. In 1982, it set up a micro-wave con-nection between one efts facilities and Chico State College,an institutior it considered to have an outstanding programin computer sciences, bringing live instruction to plant en-gineers. More recently it has begun to transmit these coursesto other locations via its satellite television network (page 14).

Groups of companies have also joined in collaborationwith one or more institutions. A group of eight northeasternfirms recently created a five-week summer program forupper-middle managers with Boston's Babson College. A to-tal of 35 participants from these firms devote three weeksof study to operations, finance and marketing, and two moreweeks to the development and implementation of strategy.Management-development executives at the member firmsworked together and with the school on the design of theprogram: They meet several times a year to review candidateselection and issues of program content and quality. The headof training for one of the companies sees values in the pro-gram beyond those deriving from the courses. He notes thatparticipants establish relationships with peers, both withintheir companies and in other firms, who may become use-ful to them in the future and from whom they learn aboutoperations other than their own and enlarge their businessknowledge.

Another new arrangement, this between a group of univer-sities and a group of large companies, had its earliest begin-nings well over a decade ago. At that time, 16 institutionsjoined in the creation of an Association for Media-BasedContinuing Education for Engineers (AMBCEE), an !ntity


A "First" in Business-Education-GovernmentCooperation

Lockheed-California Company's machinists have beenlearning the techniques of computerized numerical con-trol (CNC) through hands-on instruction at a large trailerthat is parked outside the pant. The trailer was purchasedand equipped with a CNC mill, six CNC lathes, and tablesand chairs, by Los Angeles Valley College with moneyprovided by the California Employment Training Panel, abody set up in 1982 to administer retraining funds drawnfrom an employer-paid unemployment tax. The zurricu-lum was designed by Lockheed-California's trainingdepartment, members of which also comprise the faculty.The trailer is also being used by other firms in the area.

A Lockheed-California executive says: "This is a first.By working with the community college we develop aresource where equipment that is too expensive for onecompany can move from place to place and get continualuse. At the same time it upgrades the college's equipment!'

Lockheed has also helped Los Angeles Valley Collegelaunch a course in computeraided design, contributingabout $200,000 worth of software. Various firms in the areahave been sending employees to it.

These programs are products of an effort mounted bya group of Los Angeles area employees and unionsto de-velop a more productive relationship with the nine-institution Los Angeles College community system. "It'sbeen a long -time interest of ours," a Lockheed-Californiaexecutive says, "but it's just taken off and begun to growin the last two or three years."

designed to promote and coordinate the sale of videotapeengineering courses to industry. A major evolution of thiseffort was the recent formation of an institution called theNational Technological University, through which par-ticipants in the program may receive degrees. Leading firmsare supporting this venture and are represented on NTU'sadvisory board. It is expected that live broadcasts will sup-plement videotaped material before too long.

18

Chapter 3Changes in Methods

MOST OF THE EXECUTIVES surveyed believe thattraining resources in their companies are being used moreeffectively today than they were five years ago. The principalreason, they say, is that programs are being matched moreclosely to company aims and interestst`needs-driven;' "tiedto the bottom ling' "client - oriented;' are terms used. A var-iety of new instructional technologies are also contributingto more efficient and cost-effective training. Training pro-grams are said to be serving company needs more effectivelyas a result of such factors even in many companies that havereduced their training staffs.

"It's a whole new approachfrom presenting courses tocontributing to the organization;' one training directorsays.Another comments: "We've moved strongly to practical,work-unit-based, training interventions; to short workshopstied to actual practice; to skill building rather than informa-tion giving!' Still another contrasts his firm's recently adoptedapproach to training "as an arm of corporate strategy" withearlier practice: "Education in the past was an incoherentcottage industry in our company. The people that ran it hada constituency that covered their expenses by sending stu-dents. Courses proliferated, were redundant and over-segmented. The training department was an internal salesagency, measured by how many courses it could sell!'

Among the many firms reporting a major reorientationtoward "needs-driven" education and training within the pastfew years are companies like IBM, GE, and Xeroxall ofwhich have long been regarded as leaders and exemplars inthe field.

IBM's Director of Education says: "Education is hard tomanage, but a systems approach is evolving in our company.We're trying to be more precise in our planning anddeliveryto identify the knowledge and skills that are neededfor every major job in every major area of the business, andto direct education to that definition, rather than simply toprovide courses. The justification for courses in the past wasthat people wanted them. Now the skills needed by market-ing representatives, field engineers, and others are carefullyand methodically identified. Courses are still offered, butno longer on a 'nice-to-know' basis!'

Pressures toward this end have come not only from topplanners and budgeters, but from the line constituencies oftraining departments as well. One training director says:"Managers have become more sophisticated and demand-ing about what training should do for them. Theyare impa-tient with long training programs. They want to learn a skilland get back to work. There is pressure on them for produc-tivity. They have to be convinced that training will pay off."

Assessing Needs and Defining Goals

Needs-driven training, participants suggest, entails a num-ber of closely linked steps assessing individual and groupneeds, defining training objectives, selecting participants,designing courses and instructional methods, providing forfeedback and evaluation. "Most companies do some of thesethings well, but few do them all well;' a food company ex-ecutive says. Several recently appointed training directorscommented on the "poor connection" they found betweencompany needs, as determined in performance appraisalprocedures, and the training programs then in place.

Three out of five of the companies participating in thisstudy report that significant change has occurred during thepast five years in their methods of assessing training needs.These changes appear to take three forms.

First, job-description and performance-appraisalprocesses are being used more widely, and with greatersophistication, to ascertain the training needs of key person-nel. Typically included are individuals judged to hold spe-cial promise for advancement to future leadership, and thoselikely to succeed present managerial incumbents. "Individualcontributors", specialists in a variety of professional and tech-nical areas, may also be brought into these processes.

Second, training executives in many companies are work-ing more closely with managers to help them: (I) to inter-pret the training implications not only of performanceappraisals, but of new technologies and operating systems;and (2) to judge the role of training in improving unit per-formance. In the process, training goals are being spelled outwith greater specificity.

19 CHANGES IN METHODS 11

An oil company's training department, for example, re-quires that prospective trainees and their superiors agree be-forehand on the skills improvements to be gained from acourse of study. Trainees and supervisors complete a ques-tionnaire developed by the training department for the pur-pose, and meet together afterwards to compare theirrespective assessments. A "preliminary action plan" is re-vised during the training program and in a post-trainingevaluation process. In other companies, program designersbuild courses around "teaching points" items of knowledgeand skill to be imparted.

J. C. Penney's manager of training and developmentdescribes the program-planning process of that company:"Our five regional training managers meet with key store per-sonnel during the summer to determine what additions, de-letions and revisions to make to their training programs. Atthe same time, headquarters staff learns about the plans ofdepartments that have an impact on storesmerchandising,advertising, systems catalog, and so onand integrate theminto training plans. Then there is a "summit" meeting, and,finally, budget adjustments. While this process has been go-ing on for quite a while, it has been done well only for aboutfive yearsthe result of experience and better administra-tion. Our people were skeptical at first not sure it wouldbe useful. Now the program is established and ongoing, andduring the year people think about what else is needed andwhat should be changed!'

J. C. Penney's experience also exemplifies the closer liai-son reported by a number of firms between training managersand top company planners and strategists. The J. C. Penneytraining executive says: "Training in the past focused largelyon lower-level skills and on management theory. Today it sup-ports company strategies. During the past few years, for ex-ample, the big emphasis has been on sales and customerservice. Through video tapes, workshops, meeting scripts andcommunications pieces the training department has gone allout to support that direction. We are now called upon bymanagement as directions are formulated. We are in closetouch with the beginnings of policy formation:'

Some participants say that managers in their firms are be-coming more skilled at assessing training needs, but moststress that their judgements cannot be accepted uncritically."Department heads rarely understand what kind of train-ing is needed!' one says: "They often ask for a course whena better approach is possible!' The director of training at apharmaceutical company adds: "Many of our managers havelittle sophistication about possible causes of problems anddeficiencies. For example, people may not meet deadlinesfor a variety of reasons: Their personal organization tech-niques may be bad; they may not know how to assign priori-ties, or to keep the things and information they need available.Their problem may be that they're not staying current withtheir field don't know how to gather information or don'tspend enough tine reading. They may have a problemdelegating responsibility. Or the problem may be a kind of


block caused by poor ability to organize a reportor anxi-ety over an oral presentation. They may be `pleasers'; getstuck on taking risks; be indecisive. You have to know thereason before you can bring about a change."

A third factor in the improvement companies report intheir needs-assessment process is that training personnel indifferent parts of the company are exchanging informationand judgements to an increasing extent, usually under theauspices of the corporate department. (This is discussed morefully on page 19.)

Selection of Participants

As education and training programs become tied moreclosely to individual and group needs, the methods of select-ing participantsand criteria for participation oftenchange as well. About half of the companies studied reportthat change has occurred in this respect during the past fiveyears.

By and large, two kinds of changes are reported. First, insome firms participation is no longer by self-selection. "Peo-ple just used to sign up for courses and attend: Now theymust be nominated by their department heads!' an insuranceexecutive reports. "With training tied to the goals of the cor-poration rather than to a list of course offerings, participa-tion has become more selective and mandatory!' anotherexecutive says.

Second, training for whole categories of employees is re-quired in more companies. This is reflected principally inthe IBM model in which training precedes or follows pro-motion to new levels of management(page 3). But it appearsin other forms as well. Thus, one participant reports thathis company "is beginning to move away from bringing in-dividuals in for training and toward the training of entire or-ganizational units:' New internal systems, made possible bythe computer and other technological innovations, and suchchanges as the introduction of quality circles, have also ledto mandated group training.

Evaluation

Somewhat over two-fifths of the companies taking partin this study report significant change during the past fiveyears in the ways in which they evaluate training effective-ness. Most appear to be trying to measure behavioral changeagainst predetermined performance goals. Few training ex-ecutives any longer honor the idea that programs can bejudged solely by how well trainees learn course material. "It'seasy to find out what people have learned, but more difficultto determine its value to the company',' one says. For someskills, success in attaining training goals is readilymeasurableeven observableoften at the training centerwhere actual work processes are repres, rated or simulated."Supervisors who send their people to you will let you knowvery quickly if they're not being trained properly;' one train-ing manager says.

20

Management-development programsand others withcomplex aims and distant payoffspresent the more formid-able evaluation difficulties. Some training-program evalua-tions rely on the testimony of those who have taken part incourses. Typically, participants are asked to criticize and makesuggestions about programs they have attended immediatelyupon completion. Three to six months later they maybe askedto report on how their job performance has changed as aresult of the program. Increasingly, their immediate superiorsare also being asked to judge the effects of programs on sub-sequent job behavior.

More often, too, the appraisals of participants and theirsuperiors are in terms of a variety of criteria. "A few yearsago, managers rated improvement on a one-to-five scale, withoptional comments. Now they rate specific items of perfor-mance;' a tobacco company executive says. One human-resources-development executive says about a management-training program: "If 72 percent of their superiors reportmarked improvement in people they've sent to be trained,you can assume the program is workingthat in the other28 percent either the organization or the person is blocking.If the reverse ratio is found, the program is at fault!'

It has become practice in many companies to specify ex-pected results before training activities are undertaken. TheDirector of Human Resources Development at the Chicago,Milwaukee, St. Paul and Pacific Railroad, for example, says:"Laying and repairing track involves the use of hazardousequipment. When the department responsible for this workrequested a program to train new employees, we asked whatthey expected from the program and a 50-percent accident-reduction goal was set. Using a control group, we were ableto demonstrate a saving from the program of $225,000 pergang!'

This executive says, too, that the training in many skillsareas simulates working conditions so closely that its effec-tiveness can be validated before the participant returns tothe job. He says: "This makes it possible to pinpoint blame.If employees have demonstrated that they have acquired cer-tain skills in the course of training and then fail to performsatisfactorily when they get to the job, disciplinary actionis indicated unless some explanation other than lack of ef-fort can be found!'

Group Criteria

New human-resources strategies have generated their ownassessment techniques in surveyed companies. Thus, pro-grams to train supervisors, shop stewards, and others in theorganization and operation of quality circles are often evalu-ated by group- rather than individual-performancecriteriaproductivity, absenteeism or grievance rates, for ex-ample. In a few companies, the effectiveness of efforts tomove managers toward more participative styles of leader-ship are judged by the findings of employee attitude surveys.

Group or collective performance criteria are being applied

to other than team programs. One firm. for example, is u-sessing a self-instructional course in sales forecastingon thebasis of improvement in the aggregated forecasts of its fieldsales staff.

Mutual Reinforcement

The closer relationship between training specialists andline and staff managers that has been evolving through theirjoint endeavors in many companiesin assessing needs,specifying training goals, and appraising resultshas hadsignificant side benefits, some participants observe. First,managers gain new training-related skills, as well as insightsinto other sources of productivity problems. Second, theyget more feedback from training sessions than in the pastare told more by trainers about opinions, attitudes, ideas andconcerns expressed by members of their units during the give-and-take of program events.

Third, to the extent that the trainees' managers have con-tributed to the formulation of such goals, their subsequentrole as evaluators closes a loop and deepens their involve-ment in the system. The result, one human resources execu-tive says, is not only better course design but enhancedunderstanding, trust and support from managers and agreater readiness on their part to spend time with traininggroups. Another says: "They have come to understand" thatthe department is not trying to jam something down theirthroats!' Still another training director says that as word ofhis department's success "in producing measurable gains indesired behaviors" made its way through the reaches of hiscompany during the past five years, training activities bur-geoned and staff doubled in size.

Changes in Training Technologies

If changing technologies have been a major source of newtraining needs, they have also been transforming trainingmethods. Three out of five participants report significantchange in training methods and the use of technology intraining during the past five years. "Thanks to television andcomputer-aided instruction, the big thrust now is frominstructor-intensive training to self-administered training!'one training executive says. Reinforcing as well the trendtoward experience-based learning, these new media are saidto have "dethroned the classroom!'

The use of television has grown rapidly in recent years,not only for demonstration and exposition, but as a meansof appraising and correcting performance in training situa-tions. Skills trainers at a supermarket, for example, use livevideo to demonstrate to trainees mistakes they have madein filling grocery bags; management development people atan oil company use it to criticize role-playing exercises, suchas enactments of disciplinary encounters. "Live videotapeplayback has become a powerful tool!' a training directorsays.

With the growing prevalence of computers in company


offices, computer-assisted instruction can be "imbedded"employees can be instructed in the use of new systems atthe very terminals they will be using in their work. But theuse of the computer in training has been limited. It is nowbeginning to take off, many training executives believe, im-pelled by a still newer technology that marries computer-aided instruction with moving pictures. "Computer-assistedinstruction has been only half the picture: Interactive videodisks have made a viable teacher of the computer',' one ex-ecutive says. Others note that while magnifying the com-puter's instructional effectiveness, interactive video has alsotaken the boredom out of it.

Thirteen hundred J. C. Penney buyers will go through an18-module, 36-hour, interactive video program that will pre-pare them to make better buying decisions, using an auto-mated inventory-management. First-time supervisors at Olinalternate computer work on such subjects as budgeting anddisciplining, with discussions in small groups. Computer-imbedded instruction teaches billing systems to new Xeroxemployees.

Much more sophisticated training uses of the computerare also being made. Management exercises based on com-puterized simulations have been offered by universities andprivate firms for some time. At least one company, Hewlett -Packard, has built a model around its own special circum-stances. Four years in development, this simulation exercisehas recently become the core of a week-long functionalmanagement seminar. Participants are grouped into com-peting teams, each composed of a general manager and staff.Team members are assigned functions other than the onesthey normally perform. "Thus, a personnel specialist mighttake on marketing responsibilities: Based on engineering,marketing, financial and other information, he or she willdecide on a new product development and product introduc-tions, levels of support for products on the market, and mar-keting strategies:' the executive responsible for the programsays. Plans are reviewed quarterly in this simulation exercise,as economic and competitive conditions change.

Video and computer instruction, which is often designedspecifically for company applications, also offers many otherpotential benefits, respondents say. Content can be con-trolled, and uniformity or consistency with other programsassured. Geographic distances can be spanned quickly, andtravel costs avoided. Personnel can be trained singly, as needarises, without the high cost of one-on-one instructionortheinefficiency of waiting until groups are gathered. Traineescan pace the instruction to their own capabilities, and canrepeat or go back to material at any time. Programs can read-ily be modified and updated.

Olin, which introduced its first "interactive instructionalsystem" five years ago in its Chemicals Division so that cus-tomer service personnel could adapt to the requirements ofa new order entry system, has found another value in the newtechnology. A company executive says: "We can pick up ata central point in the system and track how far each person


Learning at Home

Con Edison offers management employees 36-monthinterest-free loans of $500 to $8,000 toward the purchaseof computer equipment and supplies for use at home. TheCompany also has arranged for 20 percent discounts witha computer retailer. Instituted by the company's chairman,the program is intended to "help promote computer profi-ciency throughout Con Edison's professional and manage-ment groups."

Other companies, for the same reason, have providedpersonal computers to executives for home or office, firstgiving seminars on their use.

has progressed and how much time it took to get therehelping us to appraise individuals and discover ways of im-proving programs:'

TV Networks

TV networking is another new method that is coming intogrowing useand aspired to even more often. It is an im-portant technology at Hewlett-Packard. That firm's cor-porate training department comprises 80 people. It includesthree training groups: One is responsible for basic manage-ment development and employee education and another forexecutive development, The third is chartered to explore theuse of computer technology in company training. The lar-gest group in the department, however, numbering about 30people, is a corporate television network. Through this group,Hewlett-Packard has been transmitting via satellite to 67receiving stations at company facilities in the United Statesand Canada for the past few years. With provision for over-seas transmission as well, this facility is used exclusively forthe training of Hewlett-Packard employees. It has becomea major form of the support by the corporate unit providedto personnel at over 50 manufacturing divisions supportin "educational technology and expertise on how peoplelearn:' in the department manager's words.

HP's television network is used principally to provide train-ing in new products for sales, service and other support per-sonnel, although it has been used for engineering educationas well. The information to be conveyed is determined by theresponsible product division; the manner of presentation bythe training department. "One of our staff producers is as-signed to each project:' the company's training directorreports. "He or she is responsible for working with the divi-sion in putting the story and course together in a way thatwill be effective on TV. The using division is charged on acost basis!'

The TV unit continues to make video tapes for companyusers, in addition to live transmission. In addition to provid-ing educational technology services o f t hese kinds to the field,members of corporate staff offer consulting and support oneducational matters to these entities.

22

Hewlett-Packard's manager of corporate training and de-velopment regards the initiation of livebroadcasts via satel-lite several years ago as a major advance in trainingmethodology for his company: "It has several important ad-vantages over video tape. First, you can't procrastinate aboutusing it: When a broadcast is scheduled live, the people areusually there to watch it. Second, all of our live broadcastshave audio feedbackinteraction. A phone-line system al-lows people at any of the sites to call in questions, and in-cludes a screening and control arrangement wherebyoperators appraise the value and timing of each question.Third, and quite unexpectedly, the live presentations are bet-ter than the taped ones. For some reason, people are moti-vated to prepare better and to rehearse more often. Finally,we can tape live broadcasts at headquarters for distribution,and they can be taped locally for the use of people who missedthe telecastincluding new employeesor for a refresher,say, the day before an important sales presentation!'

Training-program managers have long been makingrecommendations and decisions about modes of instructionappropriate to given conditions. Some structure the processwith checklists, grids and guidelines, and train other com-pany trainers to deal with the issue. Factoring the new tech-nology into this process is proving to be particularly vexingfor many, although interest is strong. "Systems, hardware,course materialthe field is enormous and complex;' onehuman-resources-development VP says. "There's nothing

you can't do with computer-based training, especially in con-junction with video. But there is a costin equipment andneeded personnel!'

Other training executives speak of this predicament in stillstronger terms. One says: "Training has suddenly becomeso capital intensive, that it has put us in the hot seat. We mustchoose between alternate modes and models of equipmentand risk recommending investments that prove to beunwisein equipment and systems that quickly becomeobsoleteor we must recommend against all of them:'

Learning by Experience

Training and development executives are likely to affirmquickly their belief that formal instruction accounts for onlya small portion of learningmany place it at 10 or 20 per-cent and that on-the-job experience accounts for the rest.The most important challer 4e, they say, is to plan and nour-ish learning through job rotation, task force and committeeassignments, and similar "experiences in unchartered or alienwaters!'

However, it is a challenge that has been made more difficultin many companies by the recent trend toward leaner staff-ing. "If you suggest pulling one person out and sending himto another location for three months, there is a fear that thehouse of cards will fall down", one training executive says."We've done it only in a few cases!'


Chapter 4Organizational Changes

WHILE EXPANDING PROGRAMS and seeking to im-prove the quality and effectiveness of their training efforts,most of the companies surveyed have also made significantorganizational changes in the past five years. As shownearlier, more than half have increased the size of their train-ing staffs at the corporate and at lower organizationallevelsin somecases radically upgrading the function. Eigh-teen have created corporate training functions for the firsttime. Several also report that previously independent train-ing units at corporate headquartersengaged, for example,in sales, marketing, EDP, clerical or management traininghave been consolidated. "We no longer have educationalpockets all over the place:' the training director of a finan-cial company comments.

Changes have also been made in the roles and activitiesof corporate departments. Potentially, such units performthree distinct functions:

They provide training for certain employee groupsmiddle and senior managers, for example, or headquartersfacility personnel.

They provide service to trainers and training units at lowerlevels of the company.

They provide information and counsel to top managementso that it may better plan, organize and control training ac-tivities companywide. Many companies report that their cor-porate training departments have undertaken one or moreof these roles for the first time in recent years, that they havestrengthened earlier efforts with regard to them, or that theyhave significantly changed the way staff time is allocatedamong them.

The discussion that follows focuses first on the structuralchangesthe introduction of new corporate programs andthe enlargement of existing ones, and then on changes in theactivities of corporate staff personnel.

New Corporate Programs

Most of the companies that have created new corporatetraining and development functions only within the past five


years are somewhat below the top rank of Fortune 500 firms.Notable among the exceptions are IBM, GTE, and Beatrice.The key aim of the move at IBM was better coordination ofnumerous education and training centers; at Beatrice, it wasthe initiation of a management development program, withcoordination a secondary factor. Both considerationsloomed large at GTE.

GTE

Put together in 1958 as a conglomerate combining GeneralTelephone, Sylvania, and a number of lesser components,GTE made a major strategic turn under a new CEO in 1976.More integrated, it would become part of the emergingtelecommunications industry. Such a change, this executivebelieved, would require that managers understand the newdirection, adhere to common standards, become fused intoa single corporate culture, and operate at the highest possi-ble level of competence.

A Vice President for Education and Training was addedto GTE's staff in 1979, the first person at that firm to havecorporate-level responsibility for such a function. A spaciousand well-appointed enclave of residential, instructional andoffice facilitiesGTE's Management DevelopmentCenterwas also constructed to underscore the importancemanagement attached to the new function, to symbolize thechanged character of the company, and to provide par-ticipants with a learning environment free from distractionand irritants.

The education and training program is conducted by a58-member staff, comprised principally of professionals butincluding personnel who are involved solely in facilities andadministrative matters. The professional members aregrouped into three segments. One is responsible for execu-tive and advanced management education, for programsgeared to the top 7,500 of GTE's 40,000 managers. A secondsegment has created and administered educational programsin functional skills programs in finance, marketing and cor-porate communications, elements of which are gradually be-

24

ing turned over to operating units for administration. Thethird unit is concerned with evaluation, coordination andresearch.

Programs for middle-and lower-level managers, as well asall professional, technical and sales training, are responsi-bilities of GTE's operating units. These units are organizedinto three groups. The largest embraces all telephone opera-tions. An Education and Training Department was createdfor the telephone group in 1982. It consists of a curriculumdesign unit, a "National Engineering Training Center:' amanagement training sectionand, reflecting GTE's newcompetitive environment, a "National Sales TrainingCenter:'The components of GTE's manufacturing-oriented groupare so widely diversified that the educational and trainingprofessionals on group staff travel extensively to bring pro-grams to the operating units and to serve them in a consult-ing capacity.

The Vice President in charge of the corporate Educationand Training Department sets corporate-wide policy, andthrough the staff, coordinates, supports and audits the ac-tivities of operating units. An Education and Training Na-tional Advisory Council meets four times a year. The Councilis the key medium for the exchange of information and ex-perience among GTE's training professionals. It is made upof the corporate Vice President for Education and Training,the directors of his three training units, and the top trainingexecutive for each of GTE's operating groups.

A quarterly training-data report is submitted by all oper-ating units to the Education and Training Department atgroup and corporate headquarters. These reports provideastatistical picture of the time spent by training units in pro-gram design and delivery, of the numbers of participants inprograms and the hours spent, and of costs.

These data support group and corporate planning activi-ties and are used in appraising the performance of particu-lar training operations. However, these operations arecomprehensively audited by operating reviewteams, consist-ing of two members of the corporate education and trainingstaff and representatives of the operating units not underreview. The review team, following a formal protocol, andhaving reviewed certain materials sent to it earlier by the oper-ating unit, appraises the program, development and deliv-ery system, as well as curriculum, staffing and managementand administrive procedures. It devotes a week to theprocess, initiated by a meeting with the unit's staff to dis-cuss what will be done, and visits classrooms. The review cul-minates in an oral report to the head of the unit. No morethan a month later, a formal report goes to the head of thetraining unit, the human-resources person to whom he orshe reports, and the corporate Vice President for Educationand Training. The head of the training unit is required torespond to the recommendations of the report with a state-ment of what will be done. This plan then goes to the headof the operating review team and becomes part of the basisfor the next annual review.

Advice and assistance is provided to operating units as needarises. The corporate unit also provides support to the oper-ating units in the form of a two-week program for trainers.Given twice a year, it teaches participants how to performneeds and task analyses, how to determine course contenton the basis of the information these studies yield, and howto teach effectively.

IBM

Education, always an important function at IBM, was in-itially centralized and became more and more decentralizedas the company expanded and diversified over the years. Re-cently, however, a recentralization process has occurredwithin IBM's divisions, and a corporate education functionwas created for the first time since the firm's very early years.Fifteen divisional or functional units, each headed by a direc-tor of education, are responsible for specific areas of educa-tion. These include management development, marketingfor large customers, marketing for other customers, service,product education, manufacturing, industry education, andworld trade. Each divisional center is responsible for thede-velopment and conduct of its own programs.

The corporate Director of Education, assisted by a staffof four professionals, describes his unit's roleas "not to con-duct education, but to work with the 15 groups, developingguidelines, helping with strategies, and trying to improveplanning, course development, and delivery.' He has no au-diting role at present, but anticipates that "as agreementsare reached on how to do certain things, the various unitswill want to know how well they are meeting agreed-uponstandards!' The corporate director has no formal authorityfor effecting change: Divisional Directors of Educationreport to their respective division heads.

A key charge of the corporate department is to foster "asystems approach" to training and development, which, atpresent is said to be "by no means completely evolved or com-pany wide!' Other reasons for the creation of this newfunction:

To improve communications among the 15 educationareas, create a network that will minimize duplication of ef-fort in program development and methodological research,and constitute a medium through which the benefits ofex-perience can be passed on.

To coordinate delivery systemsan activity, IBM'sDirector of Education says, that "becomes necessary as edu-cation moves from the classroom lnd into the age of satel-lite transmissions and computers that talk to each other '

To develop an evaluation function: This is just gettingunder way as heads of divisional units meet periodicallywiththe corporate staff to develop guidelines.

To answer questions about IBM education from "theoutside world" companies, government agencies, andothers.

25ORGANIZATIONAL. CHANGES 17

The recent creation of divisional and functional trainingcenters has been another move to "optimize the benefits ofboth centralization and decentralization:' the Director ofEducation says. He illustrates with this example: "Customerengineers in the service unit are given 16 days of training.Eight of these are conducted in the branch offices, of whichthere are approximately 150. They involve computer-basedself study. However, eight days must be spent in the class-room in one of the two education centers of the servicedivisionone in Chicago and one in Atlanta. Units at thesetwo centers develop the materials for the computer-based selfstudy that takes place at the branches. This reduces theamount of travel time and expense and the 'teed for instruc-tors, while students are able to proceed at their own rate anduse the same material as others for much of their work!'

A Consumer Goods Company

Whatever the values of decentralization may be for super-visory, professional and technical training, considerationsof both cost and consistency of content usually dictate thatprograms for managers be consolidated under corporate leveldirection and control. Thus, the initiation of a managementeducation and training program has been the occasion in anumber of companies for the creation of a corporate educa-tionand training function. Once launched, even if this is notalways anticipated at the time, these new units have tendedto assume coordination and support roles as well.

After a 30-year history of growth, achieved in part throughthe acquisition of small family-owned businesses, in the early1980's one company determined to realize its potential mar-keting power in consumer goods by divesting itself of sub-sidiaries in other lines of business and consolidating itsdistributor organization and advertising agencies. This firmalso launched the first management education program inits history so that executives might understand the company'snew goals and be better able to implement them. It did soin two steps. First, to develop desired skills and perspectivesin a management tsar it thought to be oriented too exclu-sively toward production problems, top management ar-ranged with a local university for a course in marketingmanagement. A week-long program, it was taken by the 430highest level managers in the company during 1983 and 1984.

"The rate of growth in our industry has been slowingdown;' a company executive says. "Survivors will have to besmart. Competition has forced us to start thinking strategi-cally, and strategic thinking requires competent managers!'

The second step was the employment of a corporate Direc-tor of Raining and Development. His responsibility, this ex-ecutive says, is to "assure a stream of competentmanagersheads of groups, divisions and business units,and of managers reporting directly to them!'

'Raining operations have long been presept at a numberof the firm's operating units, though at none of its groupsor divisions. The corporate director sees a role for himselfin "sending content messages" to these units and organiz-


ing a collaborative effort "to define respective audiences, tomake sure learning is appropriate to each audience, and tosee that programs at different levels are congruent and meshin content!'

Enlarged Corporate Programs

Existing management-development programs have ex-panded in many surveyed companies during recent years,often with significant changes in the organizational arrange-ments under which they are conducted.

Borg-Warner

Borg-Warner established an Employee DevelopmentCenter in the mid-1970's to conduct programs for supervi-sors and middle managers. Over the last few years, supervi-sory training was moved from the Center to the company'ssix operating units. More recently, a Director of Educationand Training was appointed to undertake important new cor-porate functions. One of these was the development of anin-house educational program for the firm's top 250 execu-tives. Second, the new function was to provide training andeducational opportunities for high-potential managersthroughout the company. Third, supportive materials, direc-tion and consultation were to be provided to other companyunits, some of them with long-standing training programs."We will pilot some programs for our groups", the Directorof Education and Training says. "If the programs meet theneeds of the units, they will take or customize them!' Thecorporate unit is also to be a "clearinghouse" for ideas, ex-periences and exchange of information. Fourth, specialcourses, seminars or workshopssuch as one conducted forengineers and manufacturing operations managers on the"just-in-time" conceptare developed as needed. The newunit, in addition, has taken over responsibility for existingprograms for middle-level managers.

Warner-Lambert

A new corporate Director of Organization and Career De-velopment, who had been responsible for human resourcesdevelopment at two of the company's divisions, has beencharged since 1984 with integrating that activity atWarner-Lambert.

Training and development is now only one part of thedepartment's work, she says. It includes responsibility forcorporate-level personnel-1,200 executives, managers, su-pervisors, independent contributors, and support staff. Theunit will also maintain a consulting relationship with fieldtrainers, creating a training network and providing train-the-trainer services in such gl.bjects as how to do needs analysisand develop programs.

The second function of the department, its director says,is planning. "It maintains all documentation and recordsrelating to succession plans for senior managers, as well as

26

for high-potential individuals, for women, and for minori-ties. It does human-resources research, maintaining andanalyzing data on turnover and intracompany transfers. Itmonitors compliance with company standards and expec-tations for performance appraisal. In short, it's a responsi-bility that requires a lot of computer work and a lot ofliaison!'

A Diversified Manufacturing Company

A major expansion of management-education occurredin 1931 at a diversified manufacturing firm when a trainingmanager was replaced by a Director of Human ResourcesDevelopment, and a company "university" was conceived.Designed mainly for middle-level managers, this venture isbuilt around a curriculum of seven core programs, in suchsubjects as problem solving and decision making, commu-nications, financial analysis, and use of the computer. Anoutside faculty is employed, affording the company both ex-pertise and, at present levels of scheduling, economy. Thefirm's Director of Human Resources and Development says:"We send our faculty people around the world, with the resultthat they get to know the company better than most otheremployees!' Registration and other administrative matters,as well as monitoring and evaluation, are all taken care ofby the corporate unit, but operations are charged for theirparticipation.

Efforts are made to bring together managers of differentbusiness twits at these company courses. The same execu-tive says: "We are a highly diversified and decentralized com-pany, and one of my responsibilities is to get people fromdifferent parts of the company to know and trust each otherso that our various operations will work better together. Ourprogram does a lot to accomplish this!'

Merging Two Training Systems: Allied and Bendix

The rate of U.S. business mergers and acquisitions maynot be increasing in recent years, but much larger firms tendto be involved, and the mergers pose issues of policy and prac-tice, as well as of organization. As in the case of Allied Cor-poration and i3endix, each partner is likely to have its owntraining department. Skills-training departments at Bendix,for example, were profit centers and charged using units fortheir services; Allied offered programs on a "space-allocationbasis!' Bendi policy was to rely' iainly on outside contractstaff, while company employees .-onducted most of Allied'sskills training.

Following the merger, such issues were dealt with throughmeetings of functional specialists of the two companies. AnAllied executive explains: "The senior training people met,outlined to each other what they did and how they operated,and tried to work out an agreement as to what should be donein the future. Their conclusions, which called for corporate-level integration and a single set of programs, were submit-ted to and approved by a corporate-merger task force'

27

Changes in the Corporate Department Role

Although the scope of the corporate training department'sresponsibility for program development and delivery variesgreatly from one company to another, certain trends are sug-gested by this study. One is toward a greater role for that unitin designing courses for use or adaptation by field unitsatendency stimulated by the growing use of video and vari-ous self-instructional technologies. Several participants saythat they have recently extended program design services toforeign operations for the first time. A second trend is towarda wider corporate-department reach in its management-development activities: Inclusion in its plans and programsof more strata of managers from more distant parts of theorganization. Finally, operating units are often being givenmore responsibility than in the past for serving those train-ing needs that pertain only to their operations and personnel.

Responsibility for the training of first-line supervisors hasmoved up in some `firms and down in others. Decisions inthis grey area reflect a number of considerations. Five yearsago, for example, a manufacturing firm transferred respon-sibility for the training of first-line supervisors from its di-visions to Corpora' e Training, even as the company wasbecoming increasingly decentralized. The purpose, says itsDirector, was to establish companywide standards and bringconsistency to managerial practice, "starting at the bottomof the pipeline!'

In an energy company, however, responsibility for super-visory training has recently moved from the corporate train-ing department to line units for reasons of economy."Whether people came tc central locations or trainers wentto them, corporate-conducted training was expensive andtime consuming;' the training director notes.

The training director of a financial company reports thatto achieve program consistency the firm shifted several yearsago from complete decentralization to centralized develop-ment and decentralized delivery. He says: "We're eliminat-ing the condition in which supervisors are expected to actin entirely different ways as they move from one part of thecompany to another, but have retained the credibility of ourprograms through the use of line presenters who introduceline-specific material'.' As still another training executive says:"The optimal centralization-decentralization arrangementfrom a cost and benefit standpoint is situation specific'

Service and Coordination

Services by corporate departments other than program de-sign have been increasing, many participants report. One isinformation and adviceabout training resources that maybe available to them, the use of new technologies, and a var-iety of other matters. "Each of our plants and profit centershas its own training unit, but the prime functional expertiseresides in the corporate organization;' a consumer goods ex-ecutive says. Some participants also report that corporatestaff has become more active in, or has initiated, "train- the-

ORGANIZATIONAL CHANGES 19

trainer" programsinstructing field personnel in how to as-sess training needs, and to develop and teach courses.

Corporate-department service to operating units and otherstaff is clearly growing in other ways as well. More and moreoften, these units are playing a coord;nating and clearing-house role. One training director comments: "The downsideof decentralization is parochialism; sharing information isone wey of countering this!' Periodic meetings of corporatetraining staff and training personnel from field units are acommon coordinative medium. Participants often comprisecouncils and meet quarterly or at other set intervals. Sucharrangements have been inaugurated only in very recent yearsat a number of firms.

Olin Corporation decided several years ago that the cor-porate training department should give up a modest programdesign activity and devote itself to overseeing and coordinat-ing the programs of eight operating groups. The Director ofHuman Resources Development, who receives detailedquarterly reports from these units, meets with their seniorpeople three or four times a year. The first meeting is to reviewand appraise their respective plans, and the others to exa-mine programs and consider how participants may help eachother to deal with difficulties. This focus on coordination,he says, "has led to more cross-utilization of people and,therefore, a fuller use of our resources:'

Described by one as "typical professional exchanges!' par-ticipants use such meetings to share information, ideas andexperiences. More and more often too, as a training directorsays, they provide an opportunity "to introduce the field peo-ple to certain corporate themes'.'

Meetings of training councils have also been used to clar-ify for managers the scope of corp Drate-sponsored programsas these have become mandatory in more companies, so asto avoid content duplication at lower levels. Their meetingshave brought about a greater sharing of resources among par-ticipants, some surveyed executives report. One corporatetraining director says, for example, that he has become anexchange broker for personnel since inaugurating a council.Another reports that a field operation recently offered totrain certain personnel of another unit: "This is a new kindof pulling together, and it is part of the culture we're tryingto develop!'

Headquarters training units are also devoting more effortto interpreting company strategies for operating units andhelping them to respond appropriat in their programming."Improving white-collar productiv,:, a top managementpriority rnd has become the focus of our efforts in workingwith the field!' a financial company's training director says,for example.

Staff Support to Top Management

In helping to communicate and indoctrinate the organi-zation with new goals and strategies, as discussed earlier, cor-porate staff has often found itself playing a new support role


for top management. Some headquarters departments havealso begun to m(.nitor and oversee training activities com-panywide,or to do so more systematically; to gather andconvey intelligence about programs and costs to toppolicymakers; and to make judgements about programeffectiveness.

Part of the Management Process: Xerox

The new integration of education and training withmanagement processes, reported by a number of firms, isexemplified at Xerox. "Like many other U.S. companies!' itsManager of Education and Training reports, "Xerox beganin 1980 and 1981 to redefine its strategies to meet thechallenges of worldwide competition. The company's chiefexecutive initiated a training program for the firm's top 25executives from its worldwide operating groups. The programwas designed to communicate the company's strategies andobjectives, and to examine how these strategies can be im-plemented. The faculity was made up of the presidents ofthe major divisions and the top corporate executives:'

The head of Xerox's education and training departmentillustrates the process as follows: "The president of ourReprographics business unit in Webster, New York, woulddescribe his unit's strategies and match them to the corporatestrategy. In programs at lower levels managers also considerhow to direct their human and financial resources to carryout tactics necessary to help implement the strategies. Herethe trainer acts as a catalyst, helping participants see howtheir activities fit the corporate strategy and how the vari-ous group strategies fit together. It is a new role for training,which 1_3 more to do with the management process thanwith traditional education. It also helps to create a common,integrated, vision within the company. And it creates newopportunities and risks for training people who have to ac-quire a new level of knowledge about the fundamental ob-jectives and strategies of the business!'

Oversight

In more and more companies, corporate units are also set-ting education and training policy, and monitoring programsthroughout the firm. Those companies that have movedtoward greater oversight of field training activities haveusually done so cautiously, mindful of their own principlesof local autonomy and the prerogatives of profit-centermanagement. Combustion Engineering's Director ofManagement and Organization Development says: "We arein the process of coming up with a policy that will set stan-dards. With that, we will be doing ongoing monitoringmuch like the corporate compensation department, benefits,and other functions. We have a responsibility to go out andassess the quality of what's being donenot in a punitiveway, but to try to get everyone up to the highest professionallevels they can attain!'

28

Information System

Oversight requires information, which is gained by cor-porate training departments in various ways. A still smallnumber of firms have begun to require standardized reportsfrom operating units. The corporate training director of oneof them reports that such requirements may generate or-ganizational stress even when carefully prepared. "A year was

devoted to convincing the heads of the various business seg-ments that, even though they were responsible for what theytaught and how they did it, they had enough in common tojustify the effort we were asking them to make. Through aformal training document, field units reported each quarteron the training programs they had conducted, their length,the internal and external resources they had used, the traveland other costs that had been associated with them, and simi-

lar information. Formal training was defined as a programof at least eight hours. A standard unit of training was thenumber of hours of formal training divided by eight.

"We recognized that important qualitative differences be-tween programs remained, but felt that at least we hada com-mon denominator that gave us an order of magnitude. Forthe first time we could systematically track our training ac-tivity companywide.

"The corporate training and development department didnot intervene directly in the training activities of lower-levelunits, but was responsible for formulating and policing ad-herence to policy on such matters as methods of selectingparticipants in training programs, and program charges.While the new reporting system was focused on finding outhow much was being spent in the field for what, some ap-praisals were also madesome gross judgments as towhether segments seemed to be serving their training anddevelopment needs properly!"

The program was abandoned in 1985, two years after itwas begun. "It got to be too painful for the field!' the cor-porate training director reports. "Managers were surprisedto learn how much time and money was going into training:some thought it was too much. Disagreements festered overthe accuracy and validity of the figures!'

The Corporate Perspective: GE

Still another way in which corporate units may serve topmanagement is described by GE's manager of managementdevelopment operations: "From a corporate point of view,the role of strategic business units is to differentiate amongpeople so that they become best at whatever the business ofthe group isaircraft engines, lighting, plastics, and so on.They do this through selection, training and developmentthat is specific to their particular marketplace, to the tech-nologies involved, to the supplier networks they use, and evento their locations. Their job is to excel at building a culture

within the corporate culturean aircraft engine culture, forexample. But as long as there is a corporate entity, anotherpiece of work has to be donethe integration of trainingand development within a strategic frame. The corporate roleis to bring people from throughout the organization togetherat appropriate moments, and at different stages, to ensurethat what is done is more than the sum of the parts. The fo-cus is on interchanges, interdependencies, synergy. EEO com-pliance, for example, is a corporate wide issue and has to betalked about. So are the company's principles on resourceallocation, the strategic issues in technological development,and so on!'

Finally, this executive notes, the benefits provided by closerlinks with field operations go in more than one direction.In developing the executive programs, members of his staffwork with the training managers of operating units to getmaterial for case studies, simulation exercises, and videotapesinvolving them in the development of corporatematerials.

Seeking the Proper Balance: Bank of America

Central control can bring economies at too high a cost,as even highly sophisticated managements have discovered.Bank of America, for example, learned by hard experiencethat a central control system for nonmanagerial training, in-stituted in 1982 to eliminate unnecessary trainingand achievesavings by coordinating the use of outside vendors, "prettymuch brought training to its knees in the field;' in the wordsof the bank's Director of Employee Development. Both theprograms it developed ana its responses to those proposedlocally showed that the corporate department was too farfrom the field to understand its needs and to serve them ap-propriately and promptly, this executive says. A recent reor-ganization has moved responsibility for programdevelopment, and for some delivery, to the bank's four majordivisions, each of which has had a considerable augmenta-tion of staff through transfers from the corporatedepartment.

The corporate unit is "completely out of the business ofdelivering programs!' but has not abandoned other centralfunctions: First, it sets policies and standards for trainingthroughout the company, also advising operating units onissues of technology-based training. Second, aided by com-puterized files, it coordinates the use of outsmle vendors andmonitors company experience with them. Third, the cor-porate department serves as an auxiliary program-designservice, helping particularly in sales, marketing and credittraining, but in other areas too, as needed by divisional units.Finally, it is instituting a computerized reporting system thatwill keep track of programs, costs and numbers of par-ticipants throughout the company.

29 ORGANIZATIONAL CHANGES 21

AppendixDemographic and SocialFactors

Some questions posed in The Conference Board'ssurveyand explored further in the in-depth interviewsbore on the issues of whether, and in what ways, certain so-cial and demographic conditions may have influenced cor-porate education and training activities during recent years.A summary of these findings follows:

Age Groups: As reported by the 184 companies taking partin the Board's survey, employees in all age groups were morebroadly involved at the end of the period than at the begin-ning, though the increases are said to have been small in themajority of cases. The gain in the proportion of employeeswho participate each year in company-sponsored trainingand development is reported to be considerably greater inthe 25-to-55-year age category than in either the older oryounger ones, and is lowest for those 55 and over. The smallerincrease for young employees is said to reflect lower ratesof recruitment during the period by many companies andavoidance of training costs where possible. "We had a dryperiod when we were doing little hiring and went for peoplewith experience when we did!' one executive comments, forexample. The continuing trend toward early retirement helpsto explain the relatively small increase in training for olderemployees.

A counterpart to the early retirement trend is the reduc-tion, already under way, in the numbers of yearly entrantsinto the work forcedue to the sharply lower birthrates ofthe 1960's and a slowing in the growth rate of female partici-pation in the work force. This will present no problem to ex-ecutives at several of the companies surveyed because it iscoinciding with "stabilization" of the firm's growth. Othersdo see it as affecting the availability of qualified personnelin certain categoriesengineering, scientific, technicaland calling for stronger measures to attract and retain em-ployees. But, they say, this will not significantly affect train-ing and development.

Women and minorities: Femtle participation in trainingand development activities is reported to have increased con-


siderably more than male participationnonwhite muchmore than white. These differences, respondents say, are bas-ically a reflection of greater representation of women andminorities in the employee population. Respondents fromseveral companies commented that special programs forwomen and minorities that were introduced during the 1970'shave been discontinued. One training director has resistedefforts by his company's EEO office to introduce special pro-grams for blacks and hispanics on the principleshared bymany of his counterparts in other firmsthat affirmativeaction in employment is sufficient to assure desired out-comes. But special efforts to promote the representation ofwomen and minorities in training programs may still bemadesometimes by the training director. "If I find thatthey are not in a training session, I reach out for them!' onesays.

A food company's program to identify and develop high-potential people includes a separate pool of women, mostin their early thirties. But "it is learning through experiencerather than education that drives their development!' a com-pany executive says. The first training program ever conduct-ed by a liquor firm was launched as part of the settlementof a law suit charging discrimination against women.

Education costs and student debt: High and rising tuitioncosts are a barrier to post-secondary education for manyyoung people, while others, completing their schooling withsubstantial loan obligations, constitute what has been termed"an indentured generation!' Training and development peo-ple do not see noticeable effects on their activities from thesecircumstances, though they are aware of pressures for changein personnel policies.

Some companies do see a trend toward increased partici-pation in tuition-aid programs as a result. One reports thatmore employees than in the pastparticularly women andminoritiesare now pursuing degrees. The conclusionsdrawn from this phenomenon range between two extremes."We're looking harder at what we pay for, tightening up loop-holes, not being as open handed;' a bank executive reports.

30

Another respondent, however, noting that the "matura-tion"of his company is reducing opportunity for promotion,says that management may liberalize the firm's tuition-aidprograms "as one way of keeping employees satisfied!' (Thegrowing practice among many young people of working fora period of time between completing undergraduate workand beginning full time graduate studies in order to gain theexperience that many graduate schools value and to earnneeded money is described as a "serious factor in our tur-nover experience" by one respondent.)

Employees r resently use tuition-aid programs to improvetheir job competencies, to prepare them for broader or differ-ent work responsibilities, and, sometimes, to pursue interestsonly tangentiallyif at allrelated to their work. The num-ber taking part in these programs is smallestimated to beabout 4 percent of those eligible in any year. Since employeesuse tuition aid to pursue subjects and skills that are eithernot taught in company training programs or for which theyare not eligible, even a sizable increase in rates of participa-tion will not affect training and development activities, it issaid.

The connection between the company's training programand the loan obligations contracted by employees for prioreducation costs has even less bearing on the training and de-velopment activity than the opportunity available for usingtuition-aid programs to pay for education, respondents say."Deals may have to be made to bring needed specialists intothe company at times", one comments. "Cash bonuses orother financial incentives may be offered. It's possible thatpeople with loan obligations will be hired in this waythoughmore likely that experienced specialists will. But such ar-rangements have no implications for our training activities.There's nothing the training department can do to avert theneed for them and nothing special for it to do once they'remade!'

Some companies have initiated, or stepped up, contribu-tions to student loan and scholarship funds. But ConferenceBoard studies show that these have not grown appreciablyin total, even as educational grants of all kinds have beentaking an increasing share of the corporate contributionsdollar.

Work readiness of youth: Poor language and math skillsamong many young people cowing into the work force con-tinue to give a degree of trouble to many corporate employ-ers. "The people who are getting out of high school can't

spell, write or type any better than they used to:' an insur-ance executive comments. Some survey participants com-ment in the same vein as a bank executive who says:"Unqualified people are not hired. The issue is not drivingtraining and development nearly as much as it is the selec-tion process!' A human-resources executive reports that a gasand electric utility in a large city has experienced, a "ten-foldincrease over the years in the number of people who haveto be screened and tested to fill a job!' The saving grace, hesays, is that his company has been doing little hiring of late.

Many firms provide instruction in basic math and com-munications, and several require particularly unqualified em-ployees to attend remedial courses in grammer or "Englishfundamentals" before they are permitted to take a basiccourse designed to correct writing deficiencies. But, by andlarge, such programs have beedin place for many years, andthere is no indication that the problem is felt to have changedsignificantly in severity. On the positive side, several respon-dents commented that younger workers are much more atease with computers than older ones and know a good dealmore about electronics.

Displaced Workers: More than a quarter of the respon-dents to the Board's questionnaire indicated that their firmsare "involved in efforts or programs to retrain displacedworkersthat is, employees whose jobs have been eliminat-ed!' In most cases, follow-up interviews showed that theretraining to date has been to qualify employees for otherjobs in the company. It has often been possible, respondentssay, to reassign many without such preparation. One human-resources-development vice president says: "The truth is thatno thought is being given in our company to job obsoles-cence and how workers will be retrained. It is an issue thatneeds to be incorporated into our strategic plans!' (An offi-cial at a large aerospace firm, which introduced a newmanufacturing-control system based on computerizedscheduling modules in order to qualify for a major subcon-tracting job, suggests that the training program connectedwith this effort averted displacement of over 1,000 em-ployees.)

A number of companies participating in this study haveprovided counseling and outplacement services to displacedworkers. Only one, however, reports any in-house retrainingto qualify displaced workers for employment outside thefirm, and that on a very modest scaleseveral secretariestaught the use of a word processor.

31 DEMOGRAPHIC AND SOCIAL FACTORS 23

No. 870. INSTITUTION - ERIC · performance appraisal procedures. New technologies, including video,...

Documents

Transcript of No. 870. INSTITUTION - ERIC · performance appraisal procedures. New technologies, including video,...