Recently I was asked to comment on the role of learning in a company's strategic alignment. My answer was straightforward. Over the years I've observed that business leaders pay scant attention, if any, to aligning their training and learning efforts with their strategic vision. After all, the return on investment from organizational learning does not have a line in the budget, so it is easily overlooked.
Obviously, any alignment starts with clarifying an organization's vision, mission, values, and goals. As for aligning organizational learning, HR should be involved in this process. Unfortunately, many smaller companies don't have a full time HR person. And, in larger companies, it's not uncommon for the C-suite to skip over HR's role when developing and implementing strategy.
Perhaps it would help to know a bit of HR history. Back in 1996, a woman named Patricia McLagan outlined some key differences between Human Resource Management (HRM) and Human Resource Development (HRD). She noted that HRM's main responsibilities include compensation and benefits, employee assistance, union/labor relations, and information systems. McLagan noted HRD's primary responsibilities as training and development, organizational development, and career development.
McLagan also noted that some HR responsibilities overlap both HRM and HRD, such as selection and staffing, performance management systems, human resource planning, and organizational/job design. In my opinion, one reason leadership teams fail to include learning in their strategic alignment is unintentional ignorance about these two major HR disciplines. Regrettably, even HR people can be unaware of the differences.
The fact that most people do not understand these differences was underscored several years ago when Keith Hammonds, then an executive editor at Fast Company, wrote a seminal article entitled "Why We Hate HR". In the article, Hammonds railed against the HR profession for doing little about organizational development and not participating in strategic leadership.
But as I read Hammonds' diatribe, I noticed that, essentially, he was blaming HRM for not doing HRD's job. Additionally, Hammonds also got caught up in a catch-22: He blamed HR for not having a seat at the executive table. What he failed to point out is that the reason for this is that most C-level execs won't let them sit there.
In my opinion, efforts at strategic alignment will continue to fall short until business owners and C-level executives involve the talents of both HRM and HRD. The business impact of not doing so can be shown with information from the Emerging Workforce Study. That study tells us that among employees who feel their company offers little, no, or poor training, 41 percent plan to leave within a year.
In contrast, however, in companies where training opportunities are viewed as excellent, only 12 percent of employees are considering work elsewhere. That's a 240% greater chance of employees wanting to leave if training is non-existent or viewed as poor!
To consider that impact of this in dollars, let's turn to the Society for Human Resource Management (SHRM). They tell us that the cost of replacing an employee in the United States averages $17,000, and those making over $60,000 per year will cost a company more than $38,000 to replace.
Going back to the data about poor or excellent training, if those people actually leave and we use SHRM's low-end replacement costs of $17,000 per person, the company with poor training loses about $50,000 more than the company with excellent training.
This means many companies could literally double their training budget and end up saving money, and that doesn't even take into account the improved productivity from better-trained employees. But to make its biggest impact in your company's favor, that training needs to be aligned with your strategic goals.
Therefore, I offer the following thoughts and suggestions to help organizations in their strategic alignment:
- HRM people are more ubiquitous and are often ultra-dedicated, but we must stop expecting them to be all-things-HR.
- Chances are your organization has an HRM person but not an HRD person. Bring in an HRD consultant and get their input. (By the way, they won't try to steal the HR person's job. They're HRD specialists: they don't want to do HRM's work.)
- Business owners, senior managers, and executives need to recognize the value of both HRM and HRD, and that both should be involved with strategic alignment. Senior management must willingly invite both HRM and HRD to the strategic planning table.
- Everyone must see the big picture and be enthusiastic team players about incorporating learning to help the organization achieve its goals. With both sides of HR helping with strategic alignment, companies will save a lot of time, energy, and money.
So the next time your leadership team gets together and review your strategic alignment, make sure that you ask yourselves this question: Will you pay attention to the huge ROI that comes from weaving strategic learning into your organization's efforts?