Chief Learning Officer- September 2008

Mission Accomplished? Measuring Success of Corporate Universities BY SUSAN M. TODD Measurement science at corporate universities still is evolving. But as corporate executives increasingly turn to universities as strategic partners, university leaders must ensure that what and how they measure progresses beyond narrow measures to sophisticated talent development metrics. earning organizations have to measure what they do, and the measures have to be meaningful to corporate leaders. In the Corporate University Xchange (CorpU) eighth annual benchmarking study, 58 percent of learning organizations reported they are under increasing pressure to demonstrate the value of learning and development (L&D). Yet, the same study showed corporate leaders do not really believe or buy into the measurements that are presented to them (see Figure 1). There must be a better way. Corporate universities, like their HR parents, have been lacking a “decision science” to adequately deﬁne and describe the value of their work and the payback on the company’s investment in learning. John Boudreau, research director of the University of Southern California’s Marshall School of Business, is shining the light on the need for a new way to measure and report what HR, which often includes learning, does. He uses accounting as an analogy. The profession was equipped to tally balance sheets and income statements, but fell short in providing tools to evaluate ﬁnancial investments. This shortcoming yielded a decision science called “ﬁnance,” a ﬁeld with new sets of tools and frameworks to calculate decision concepts such as return on investment (ROI) and economic value added (EVA). Similarly, the sales function was not equipped to analyze customer needs in a way that could lead to strategies on product packaging, pricing and promotion. Hence, the marketing function took shape. Similarly, L learning must spawn new practices that can improve the meaning and the context of its value to the business. Corporate universities have struggled with measurement because the frameworks still are evolving. Leaders believe measurement has to proceed according to a corporate university maturity model (see Figure 2). The maturity curve describes an evolution that proceeds from consolidation to alignment to validation, and ﬁnally, optimization. Consolidation Rio Tinto, one of the world’s largest mining companies, grew through a series of planned acquisitions. It initially chose not to interfere with the successful operation of its newly acquired mine sites, electing to let training teams operate in a highly decentralized mode. Eventually, senior leaders called for a thorough evaluation of HR and learning and found the costs were out of line with benchmarks. The training teams couldn’t begin to think about demonstrating the value of their work until they had a clear view of how much money was being spent by the 37 unique training teams at all mine sites. It was impossible to measure efﬁciency improvements before providing a cost basis for current operations. Building a consolidated view of the total investment meant analyzing 37 training budgets, all vendor contracts, full and part-time staff salaries and other costs. The problem was complicated further because all the business units were using different tracking systems, and many costs were buried in budget line 38 Chief Learning Ofﬁcer • September 2008 • www.clomedia.com http://www.clomedia.com

Table of Contents Feed for the Digital Edition of Chief Learning Officer- September 2008

Chief Learning Officer Editor’s Letter Contents Connections Imperatives Selling Up, Selling Down Strategies Take Five Lifestyle Learning: Improve the Bottom Line With Behavioral Education Tracom’s Social Style Model CLO Profile IOL: Determining the Impact of Learning Communicating With the Boss About Impact Mission Accomplished? Measuring Success of Corporate Universities Borrowing Measurement Practices From Investors Value Creation With Human Capital Investment Business Impact Analysis at Chrysler Learning or Performance Enhancement: Which Is It? Best Practices in Global Project Management Training Case Study Business Intelligence Advertisers’ Index Editorial Resources In Conclusion

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