The missing link in strategic plans


Have you noticed how management gurus and business experts often contradict each other? Marketing expert Seth Godin advises companies to focus on being best in the world at one thing and quit everything else. Yet business experts Jack Stack and Bo Burlingham tell us that companies need to protect themselves against the surprises of the market and that diversification is the best way to do that.

Pot-stirring consultant Max McKeown says bad behavior among leaders is good. He points to Apple's Steve Jobs, who has a reputation for temper tantrums. But in their book True Leaders, Bette Price and George Ritcheske say effective listening and relationship building are imperative to a leader's success.

Disagreements abound on many levels. But when it comes to ongoing learning to support strategic goals, everyone seems to agree it is necessary.

Perhaps the most compelling reason for a strategically-aligned training program comes from Arie De Geus, who says "An organization's ability to learn faster than its competitors may be its only sustainable advantage."

After 30 years at Dutch Royal Shell, where he headed their Strategic Planning Group, De Geus wrote The Living Company: Growth, Learning, and Longevity in Businesses.

Unfortunately, strategically-aligned training is missing from most companies. Worse yet, it's practically a business maxim to say that training is the first thing to go when budget cuts have to be made.

With strategic training so closely correlating to a company's enduring success, you'd think decision-makers would be all over it like white on rice. Instead, a disconnect appears to exist between the knowing and the doing.

Training is the first to go when budget cuts have to be made

We can't say executives lack motivation to ensure these training programs are in place. Every consultant out there will tell you such training helps a company meet its goals faster. And, since decision-makers already know that, they already have motivation.

The problem appears to be elsewhere. Some form of resistance or obstacles are in the way. For organizations to move faster toward their goals, these obstacles need to be removed.

It appears one major obstacle exists merely in how most executives view HR, as revealed in a recent survey of 555 executives in 68 countries. The survey was funded by the Corporate Leadership Council, which consists of senior executives who are committed to involve HR more thoroughly within organizations.

Their research found that only 25 percent of CEO's view HR's performance favorably, and only 16 percent think HR has any strategic importance.

Those numbers are appalling! Somehow our decision-makers must learn that the field of Human Resources has grown exponentially into quite a social science and offers huge benefits to strategic thinking and planning.

Further evidence for the low priority placed on organizational learning is the fact that direct expenditure for training as a percentage of payroll has remained quite flat in recent years.

The American Society for Training and Development's (ASTD) State of the Industry Report for 2007 states that "the consolidated average expenditure as a percentage of payroll has only moved from 2.31 percent in 2003 to 2.33 percent in 2006."

To put that in perspective, imagine a football field with the ball sitting two yards and one foot away from the end zone. That little bit of turf represents the average training budget as a percentage of payroll in 2003. Yet when measured again three years the ball has moved forward less than ¾ of an inch!

Clearly, the average company is not investing any more to create exceptional training programs. If I may be so bold, I will recite the definition of insanity: Doing the same thing over and over but expecting different results.

Where is the ball for companies providing exceptional training programs? Bump the ball up to one inch shy of the three yard line: 2.97 percent of payroll, according to ASTD. In other words, it doesn't take but a mere 2/3 of one percentage point to go from average to being exceptional.

Following the advice of virtually every business guru not an insurmountable task. Considering that exceptional training programs make it much easier for companies to achieve their strategic goals, it would seem that key decision-makers need to re-evaluate what they're doing to reach those goals.

The bottom line is we've already been told that training should be part of the equation, but a connection needs to be made between the knowing and the doing.

The first question for getting there might be "What's getting in the way of having a comprehensive training program?" A second question is probably "How do we get past that obstacle?" And a third question may well be "If we're trying to achieve our strategic goals, why don't we do something about that now?"

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About The Author

Dan Bobinski
Dan Bobinski

Dan Bobinski is a training specialist, author, and an accomplished keynote speaker. He's been providing management and leadership training to Fortune 500 companies as well as smaller, regional concerns for more than 20 years.