IBM, Learning, Outsourcing, Kidwell

Getting Even More Out of Learning Outsourcing

By Jill Kidwell, Vice President and Process Leader, IBM

Jill Kidwell, Vice President and Process Leader in IBM's outsourcing division, provides leadership for talent management outsourcing. Talent Management includes elements of strategic HR and focuses on learning, succession,  performance, recruiting and compensation planning.

Increasingly, companies recognize that people are their most important asset. According to one CEO who responded to IBM’s 2006 Global CEO study, “While we will focus on new markets, so much of our revenue growth is dependent on our people and the relationships they bring. As the business ever commoditizes, people become the anchor.”   Unfortunately, for a host of reasons, companies are facing a talent gap, and filling the gap is harder than ever.  The Wall Street Journal (September 15-16, 2007) states “its no secret that global companies are finding it harder to fill critical jobs these days. They’re struggling to land top recruits in emerging markets, for instance, and haven’t prepared people in their own ranks to step seamlessly into management slots.”  Companies recognize that having a ready supply chain of top talent will help them to garner bigger market share, achieve their growth and innovation agenda, and ultimately beat the competition.  The focus on talent places HR and Learning executives at the table with business leaders; and now that they have that seat, it’s become a hot seat. Expectations are high.  The business wants them to deliver on a strategic talent management agenda, fulfill their commitments and demonstrate their achievements with clear, quantitative measures.      

Against this back drop, outsourcing the learning function requires a comprehensive, thorough approach. Today customers typically seek benefits such as consistent, standard processes to support the global enterprise, more effective learning solutions, reduced costs, variable pricing, and access to enhanced technologies. 

But now that attracting, developing and retaining talent is such a hot issue, companies want to get even more out of learning outsourcing and they increasingly outsource learning in combination with other talent management components.  According to Kennedy Information, “Talent management [outsourcing] is emerging in a big way as clients start focusing on the strategic side of workforce management.”  Kennedy recognizes that learning outsourcing, along with recruiting outsourcing, are two of the more mature components within the talent management suite of services.  Kennedy asserts that growth in talent management outsourcing is being driven in part by the fact that, “companies have created a new position, called the SVP of Talent Management, that cuts across all internal HR silos, bringing together the departments and viewing the organization politically and strategically in order to engage in organization change.” 

So, it’s no longer sufficient to achieve cost savings and gain better control over your learning function, you also need to prepare the organization for the next phase of outsourcing—the outsourcing of strategic HR functions.  With careful planning and armed with a long-term vision for Talent Management, you will be able to gain even more benefit from your learning outsourcing deal and be able to position your learning organization and other talent management functions to fulfill critical roles in the development, deployment and retention of your workforce.  Regardless of whether you initially outsource learning as a stand-alone deal, or it is included as part of a strategic HR Talent Management initiative there are steps you can take to prepare for the future.  Here are a few tips based on our experience in the market.

Start early to launch an initiative to classify roles and assess skills and capabilities.  At a recent IBM Chief Learning Officer Roundtable, attendees recognized that Learning needed to take the lead in helping their companies to define, identify and locate workforce skills on a global basis.  These efforts are critical to helping companies identify and prioritize gaps at a local and global level, linking career development and learning priorities to close those skill gaps and locating individuals and/or partners with the right expertise and making that expertise visible throughout the larger organization.  For many companies at the Roundtable, the initial attempts to define skills were not successful.  Some felt that the initial taxonomy was too detailed; others underestimated the amount of change management needed to engage the organization in this skills classification process.  Completing this activity early will help your company achieve the goal to have a ready supply chain of talent to take on new product introductions, enter new market, or provide leadership across the company.

Align the learning organization.  By aligning we mean that you have enterprise agreement on how learning dollars are allocated and that you have a structure and process to continuously evaluate and re-allocate dollars based on business imperatives.  If you don’t already have a governance process in place, establish a governance framework to guide the outsourcing process.  This framework can be expanded later to govern the retained organization and outsourced services.  You also need to identify how much is being spent on learning, what it is spent on, and what the results are.  This will become your base case and will set the bar for the cost savings you hope to achieve.  It will also give you the data to help determine whether all of learning will be in scope, or whether aspects of it will be retained within the business units. 

Overcome functional silos.  The WSJ article suggests that “to meet the [talent shortage] challenge, companies must rethink how they hire, train and reward their employees, placing those tasks at the heart of their business plans.  In doing so, they have an opportunity to address [disparate] problems with a unified plan, rather than waste time and resources attacking each of the issues individually.”  Start by developing a vision for an integrated talent management function within your company.  Understand the connect points between the core processes that support talent management.  Base the process map on the employee life cycle.  If you are considering a stand-alone learning outsourcing engagement, take the time to map out the intersections between learning and the other critical components such as performance.  This map will help to guide your review of the provider’s statement of work and ensure that it covers all of your requirements.

Remember, it’s not about the technology.  Early stage learning outsourcing deals were all about technology.  Today, technology is assumed.  All providers have platforms that support basic training requirements.  So don’t let technology discussions and selection processes get in the way of your decision making.  Technology platforms no longer differentiate one provider from another.  The market is awash with systems that support, or have plans to support, an integrated talent management solution.  Rather the differentiators are the scope of services, the supporting processes and the people.  And it is here that companies need to proceed with caution.  Learning outsourcing deals are five to ten year commitments.  To get the most out of learning outsourcing, it is critical to select a provider that can support your long-term vision for talent management.  This eliminates select training providers who only support learning initiatives.  And it opens the aperture to include companies who provide services along the entire continuum of talent management and HR outsourcing.

Operate against metrics that matter.  The days are long gone in which HR and Learning were required to simply manage budgets and handle mid-year budget cuts.  Now they are asked to have their fingers on the pulse of the supply chain, implement strategies to close gaps, and demonstrate that those strategies worked by documenting business results that were accomplished as a direct result of their efforts.  As you plan for your outsourcing engagements, develop the metrics that will make the difference between getting the right people with the right skills to the right place at the right time.  Be prepared to work with your learning outsourcing provider to align their service levels with your critical measures.  Their services will become an integrated part of your overall process and need to support your strategic talent management agenda.

Sources: 

“How to Fill the Talent Gap,” WSJ, September 15-16, R4

IBM’s CEO Study, 2007, 765 CEOs participants

Outsourcing the learning function:  Laying the groundwork for a successful transformation,  IBM’s Institute for Business Value 2005

HR Outsourcing Marketplace 2007-2010:  Key Trends, Profiles and Forecasts, Kennedy Information, Inc.

Innovation: Shifting the Strategic Focus of Learning: Lessons from the 2007 Chief Learning Officer Roundtable. IBM’s Institute for Business Value

Visit IBM