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Building a Learning Infrastructure

Thursday, January 03, 2008 - by Christopher Glynn

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Jim Owens, chairman and CEO of Caterpillar Inc., noted in a recent interview: "We've basically doubled the size of the company in three-and-a-half years. That's unprecedented for a Fortune 75 company."

With the increase in size comes the challenge of ensuring that our people, regardless of where they are located, have the resources they need to learn and grow.

Reaching a global audience of more than 100,000 learners in 40 different countries requires a robust learning infrastructure that comprises three major elements: governance, a learning technology infrastructure, and an alignment process.

Governance

Caterpillar's governance structure ensures strategic connection with enterprise and division goals through a Board of Governors, the Engagement and Learning Council, advisory boards, and lead learning managers in each division.

The Board of Governors provides direction and policies for the corporate learning function. The Engagement and Learning Council provides input and direction for the corporate learning function and monitors results. The college advisory boards offer input and direction at the higher education level, and the lead learning managers provide input and direction at the business unit level.

Each group serves a specific function in making Caterpillar a continual learning organization. With this network of people committed to continual learning in place, we succeed in aligning learning with enterprise goals. Caterpillar University also plays a strong role in fulfilling the organization's business objectives.

Since its origin in January 2001, Cat U has been the global product manager for learning. In this role, the university works across the enterprise to ensure Caterpillar's annual $100 million learning investment is linked to company strategy. As global product manager for learning, Cat U is responsible for

the enterprise learning strategy
the enterprise learning budget
the development of new learning and the redesign or retirement of existing learning
the policies, processes, and standards for learning the enterprise metrics and measurements.

The university also works with various business process owners to develop and deploy learning that arises out of a specific business need. This is typically where many enterprise-required learning needs and initiatives are derived.

The guiding force

Established in 2002, the Caterpillar University Board of Governors sets policies and oversees the alignment of the corporation's learning needs with the enterprise business strategy. This board meets quarterly to discuss enterprise- wide learning initiatives, such as leadership, safety, quality, performance management and the Caterpillar Production System.

The board is responsible for reviewing and approving an enterprise-wide learning budget. These members establish standards, budgets, and strategic direction for Caterpillar University and corporate learning within the enterprise.

Each year, managers from Cat U present new corporate learning initiatives to the board for approval. These initiatives are identified based on input from all of Caterpillar's divisions. The board then identifies and prioritizes current and future learning needs based on the recommendations of the Caterpillar University management.

One of the most crucial roles of the board is to link learning to the key enterprise business strategies. This alignment ensures success through continual learning. The board questions, discusses, and directs Cat U to

the overarching goals of the enterprise.

The Engagement and Learning Council is responsible for nominating, prioritizing, approving, and monitoring the initiatives necessary to advance learning to greater targeted efficiency and effectiveness levels. The target levels are established through an external, industry-wide benchmarking study. The council represents the interests of the enterprise as well as individual divisions, and sets policy and makes recommendations to a global forum of HR managers and the Board of Governors.

It also is responsible for influencing targeted business unit change agents, such as vice presidents and operations managers, to embrace the learning initiatives needed to achieve Caterpillar's long-term vision. The Engagement and Learning Council consists of HR managers and learning managers.

Several Cat U colleges also have advisory boards. These boards comprise business unit managers and subject matter experts who are recommended by the division vice presidents. This process ensures global representation on the boards. This geographic and subject matter mix is valuable to the boards because it ensures that the learning needs of major functional areas are expressed and met. Additionally, this structure lays the foundation for worldwide involvement, ties learning to business goals, and uses the expertise of Caterpillar employees in all areas of the corporation.

Advisory boards guide the strategic learning initiatives of the colleges. Each advisory board follows a specific charter designed to help members focus their efforts and productivity. These charters also assist in setting expectations for the members who play a vital role in helping to define, structure, and prioritize the learning activities of each college and ultimately the enterprise.

The advisory boards provide the college deans with advice on issues ranging from pricing to implementation. Another function of advisory boards is to support the evaluation of the effectiveness of current learning activities. With varying perspectives offered by advisory board members, the colleges gain valuable insight from the voice of the customer.

The structure and function of advisory boards provides for critical and open dialogue. This discussion uncovers what will and will not work in the different business units when deploying learning initiatives. Additionally, these meetings engage board members in action learning because they learn from one another, are educated in learning terminologies and methodologies, and share best practices and lessons learned.

A vital element in defining strategic learning for the enterprise is the partnership Cat U shares with the lead learning managers for each division. Lead learning managers are the central point of contact for all learning within a division. Among other responsibilities, the lead learning managers work to define learning for their division in coordination with their division and enterprise business goals. Working closely with their vice president and senior leadership, they strive to ensure that the right learning is deployed efficiently and effectively. Many hours of intense work are required to determine the type of learning needed for their specific business units through the division learning plan process.

Each lead learning manager has a dual solid line reporting structure to Cat U. This structure helps to leverage the creative tension between the division and enterprise points of view.

Learning technology infrastructure

Cat U is the global business process owner for learning related systems and processes. By driving Caterpillar and its supply chain to one universal virtual collaboration tool, synchronous online learning platform, learning management system (LMS), and knowledge network, investments in these systems and processes are made once to avoid duplication of effort and resources.

Caterpillar's LMS is a worldwide platform. A new release was implemented earlier in 2007 and serves the employee population as well as the dealer network. A learner-centric user interface allows individual learners to experience the LMS in a customized fashion. It dynamically constructs the learner's individual learning plan (ILP) on his desktop.

Each ILP consists of four sections: enterprise required learning, business unit required learning, job-role specific learning, and discretionary learning. Effective use of the four elements enables employees to tailor their learning plans around current jobs and possible future ones. Using the ILP makes the most of the learner's time and significantly reduces learning administration effort, thus maximizing the resources of the learner and the learning community.

One of the biggest challenges facing any organization, let alone a large global one with a tightly integrated dealer network, is how to enable informal learning across the extended enterprise that includes employees, dealers, suppliers, and customers. The university enables informal elearning across the enterprise through our internally developed, knowledge management system, the Caterpillar Knowledge Network.

Caterpillar and dealer employees, suppliers, and customers make use of the more than 4,000 communities of practice to exchange information, share files, ask questions, and contact subject matter experts around the world. The knowledge network provides a deep mine of searchable data, giving users access to information created in in every area of the organization. Community access is based on affiliation, such as full-time employee or dealer employee, specific location, or by name. As a result, communities cut across the organization and can include members who are dealers, company employees, customers, and suppliers.

In one rather dramatic example, when a tornado destroyed a supplier's factory, the knowledge network helped to coordinate production from temporary facilities and coordinate resources during the reconstruction of the facility. This not only kept assembly lines at Caterpillar running, it put the supplier's employees back to work sooner. The knowledge network played a central role in disaster recovery.

The network also is a powerful tool for making connections between people. Users no longer have to rely on a personal network built through years of experience and various job assignments; instead, they rely on a keyword search in the knowledge network. This allows a wheel loader engineer in China, for instance, to locate a transmission software expert in Europe.

And communication is not limited to internal Caterpillar employees. An employee working in a mine in Africa can obtain help from a maintenance mechanic in Australia. In addition, the network enables internal groups to engage in extended benchmarking with external organizations through the use of a "general public" affiliation.

Synchronous online learning allows the virtual delivery of learning across the globe. In this setting, a live instructor interacts with dispersed learners who are attending virtually. This technology conserves time and money by allowing information to be distributed quickly and by reducing travel costs. Meetings conducted using virtual collaboration have had a similar travel reduction impact. Through October 2007, more than 2,100 classes were conducted using synchronous online learning, and more than 300,000 meetings were conducted using virtual collaboration.

Caterpillar's learning technology infrastructure enables our employees to quickly build both competence and confidence. In addition, the technology infrastructure is an important contributor to sustainability through dramatically reduced travel and other carbon footprint elements.

Alignment process

Caterpillar's alignment process ensures that we are meeting the needs of the customer and the business and that the learning is strategically appropriate and tied to the business objectives. By aligning learning needs and strategies at the division and enterprise levels, Caterpillar is able to improve enterprise performance by providing the right skills and knowledge through learning. This increases engagement, and increases discretionary effort, which leads to better performance. This all leads to a bottom-line benefit because with better enterprise performance comes better enterprise profitability. Aligning learning to business strategies begins with understanding the results the business must achieve and the role that human performance plays in achieving those results. Analysis and alignment are based on input from several areas of the enterprise.

Voice of the business - One-on-one interviews with members of the Board of Governors and executive office using a structured questionnaire that provides information about the overall direction of the business, its key needs, and internal and external drivers. In addition, global process owners are interviewed to identify their goals and the ways in which learning can help achieve those goals. The results of these interviews and questionnaires are communicated to the division lead learning managers.

Voice of the customer - The division learning plan (DLP) process is the primary avenue for communicating with the customer. Each lead learning manager is responsible for developing and implementing a DLP. Using the enterprise voice of the business results, lead learning managers meet with their respective vice presidents and department heads to discuss division goals and initiatives, to identify strategic learning needs, and to determine department operational learning needs. Information gathered from managers, supervisors, and employees identifies additional operational learning needs. The learning needs are then summarized, prioritized, and submitted to Caterpillar University as part of the division learning plans. In essence, the DLP is a division's business plan for learning.

The business plan for learning at the enterprise level is the enterprise learning plan. Based on the voice of the business input and input from division learning plans, the ELP describes the strategic outlook for learning and is not simply a year-by-year planning exercise.

Learning investment

A strong learning infrastructure lays a firm foundation for deriving value from learning. Learning, if it is the right learning, helps our employees to do more and to do it better. But learning alone may not be sufficient. Learning prepares the mind and hands, but does not necessarily engage the heart. Through learning and development an employee acquires the knowledge and skills needed to answer a customer's question, make a decision, or design new product.

Engagement is the extent to which employees commit, rationally or emotionally, to the organization, how hard they work as a result of this commitment, and how long they intend to stay. Engagement adds the heart to well-prepared minds and hands.

Using data from our annual employee opinion survey, we have taken a look at the relationship between learning and engagement. Results to date show a strong correlation. Those organizations with a high engagement index also tend to have a high learning and development index.

The organizations with high learning and development indexes are strongly encouraged to share their practices with others. Annual learning and development index best practice awards highlight the divisions whose index scores are the highest based on employee survey responses. Cat U works with the winning divisions to identify learning and development best practices and case studies that are quickly shared across the corporation using the knowledge network.

The investments we make in learning, in engagement, and in the learning infrastructure help prepare our people for the future by increasing their speed to competence and their confidence.

When we invest in our people, we are investing in an appreciating asset and creating a durable competitive advantage.