Aligning for Success

ALIGNING FOR SUCCESSConnecting Learning to Business PerformanceARE ORGANIZATIONSATD Research: LEARNINGBUSINESS ALIGNED? Connecting Research to Performance The link between learning strategy and business strategy WHITEPAPER MEASURING 61% HIGHLY ALIGNED IN 2011 ALIGNMENT 49% HIGHLY ALIGNED Less than1in 5 High IN 2013 performers measure business impact more 2011 of learning (2013) likely to measure826 LEARNING ANDBUSINESS PROFESSIONALSIMPORTANCE TO 2013 4 31LEARNING ANDLEARNING BUSINESS PROFESSIONALS 93% said alignment was very important to them (2011)TIPS FOR ALIGNING

© 2015 by ASTD DBA Association for Talent Development (ATD).All rights reserved.No part of this publication may be reproduced, distributed, or transmitted in any form or by any means, includingphotocopying, recording, or other electronic or mechanical methods, without the prior written permission of thepublisher, except in the case of brief quotations embodied in critical reviews and certain other noncommercialuses permitted by copyright law. For permission requests, write to ATD Research, 1640 King Street, Alexandria,VA 22314.ORDERING INFORMATIONResearch reports published by ATD can be purchased by visiting ATD’s website at www.td.org/research or bycalling 800.628.2783 or 703.683.8100.ATD Product Code: 791508-WPe-ISBN: 978-1-60728-296-9Publication Date: April 2015ATD EDITORIAL STAFFDirector, ATD Research: Laurie MillerAssociate Editor, ATD Press: Melissa JonesResearch Analyst: Maria HoResearch Specialist: David FrankelCover and Interior Design: Bey BelloProduction Manager: Dara Friel

EXECUTIVE SUMMARYTo win in the marketplace you must first win in the workplace.—Doug Conant, former CEO, Campbell Soup CompanyFor CEOs, putting together a business strategy, which involves defining long-term goals and making decisions on how toreach these goals, is no easy task. Oftentimes, it is a process characterized by continuous evaluation and re-evaluationin the face of complex, unpredictable, and rapidly changing market and industry conditions.If the organization is to successfully act on that strategy and meet its goals, the workforce must possess the necessaryskills to carry out the actions described in the strategy. For this to happen, the organization must have a learningstrategy that is synchronized and closely aligned with the business strategy. In many organizations, developing thelearning strategy is ultimately the responsibility of the head of the learning function, who may hold such titles as chieflearning officer (CLO), chief talent development officer (CTDO), or vice president (VP) of learning and development, or VPof organizational development.Regardless of formal title, how does the head of learning ensure alignment, particularly given the complexity andchange that characterize the business world? In Aligning for Success: Connecting Learning to Business Performance,the Association for Talent Development (ATD) draws upon a wealth of survey data to explore this question. ATD alsoconducted interviews with heads of learning from leading Fortune 500 organizations—including Hilton Worldwide,DaVita HealthCare Partners, and United Parcel Service (UPS)—that have been able to align their business andlearning strategies.Some of the questions ATD seeks to answer include: „„ Are business strategies and learning strategies aligned in organizations? „„ What is the value of alignment to organizations? „„ Given that CEOs are responsible for the business strategy in organizations, how can the learning function build relationships with CEOs? „„ Although the support of senior executives is critical to alignment, how can the learning function work with unit leaders to ensure alignment with their goals? „„ How can the learning function maintain alignment through major organizational changes? „„ What are some strategies for measuring alignment, given the difficulty of doing so and the resource limitations most learning functions face?03 ALIGNING FOR SUCCESS: Connecting Learning to Business Performance 03EXECUTIVE SUMMARY

This Study finds that between half and two-thirds of organizations can be described as having high alignment; these organizations had better market performance than those with less alignment. Certainly, the stakes are high for everyone associated with an organization—CEOs, top learning leaders, the workforce, and shareholders—when it comes to building and maintaining alignment between business strategy and learning strategy. Today more than ever, good business requires good employees—and good employees require the right training. Between half and two-thirds of organizations have high alignment; these organizations performed better than those with less alignment.04 ALIGNING FOR SUCCESS: Connecting Learning to Business Performance

WHITEPAPERAligning for Success: Connecting Learning to Business Performance (hereafter the Study) relies on interviews conductedby ATD Research with top learning executives at Fortune 500 companies in January 2015. In 2011, these individualsand other senior learning leaders were interviewed on the topic of alignment by ATD and the Institute for CorporateProductivity (i4cp). This report draws on those interviews.The Study also analyzes survey data collected from learning and business professionals by ATD and i4cp between 2011and 2013. Some of these data were previously released in other publications, but other data are unique to this report.What Is Alignment?With alignment, there is a strong link between an organization’s learning strategy and its overall business strategy. Alearning strategy includes goals or desired outcomes, and the plans and programs for achieving those goals. Likewise,a business strategy encompasses business goals, which are often long term (typically three to five years). An alignedlearning strategy will ensure that an organization’s workforce has the necessary skills to carry out the actions describedin the business strategy.Andre Martin, CLO at Mars Corporation from 2010 to 2014, explained that alignment is what happens when learning is“relevant to our business leaders. We have to make sure that what we do is intimately tied to business strategy.” With alignment, there is a strong link between an organization’s learning strategy and its overall business strategy.Who Is Responsible for the Learning Strategy?In October 2011, ATD and i4cp surveyed 826 learning and business professionals. Participants were asked who wasresponsible for the development and execution of the learning strategy in their organizations. As Figures 1 and 2 show,a head of learning was responsible for the development or execution of the learning strategy in 40 and 44 percentof organizations, respectively. The next most popular response for the development and execution of the learning05 ALIGNING FOR SUCCESS: Connecting Learning to Business Performance 05WHITEPAPER

strategy was a head of human resources (25 and 17 percent, respectively). It is important to note that in some smallerorganizations there may not be a head of learning, so that responsibility is included among the responsibilities of thehead of human resources.Although their official titles vary, in this Study senior executives in learning or human resources who are accountablefor their organization’s overall learning strategy are referred to collectively as “CLOs.”FIGURE 1: DEVELOPING LEARNING STRATEGY Who is responsible for the development of the learning strategy? 15% 13% 40% Head of learning 7% Head of human resources Manager 25% CEO OtherFIGURE 2: EXECUTING LEARNING STRATEGY Who is responsible for the execution of the learning strategy? 17% 10% 44% Head of learning Head of human resources 12% Manager 17% CEO Other06 ALIGNING FOR SUCCESS: Connecting Learning to Business Performance

Alignment in OrganizationsThe evidence suggests that some degree of alignment exists in almost every organization, and between half and two-thirds of organizations could be characterized as having high alignment.In ATD and i4cp’s October 2011 survey, 826 learning and business professionals were asked to what extent theywould consider their organization’s learning and business goals to be aligned. Just over six in 10 reported that theirorganization’s learning goals and business goals were aligned to a high or very high extent, and another quartercharacterized the level of alignment as moderate. A mere 3 percent said there was absolutely no alignment.In September 2013, ATD and i4cp asked a different group of 431 learning and business professionals the samequestion. In that survey, nearly half the respondents believed that goals were aligned to a high or very high extent. Thispercentage was significantly lower (p < 0.05) than in the earlier survey. However, note that the fraction of respondentscharacterizing their organization’s alignment level as moderate was much larger in this survey. Thus, the difference inthe fraction of individuals who responded that there was little or no alignment is not significant at the p < 0.05 level. Inaddition, the 2013 survey had nearly half the number of respondents as the earlier survey, and also comprised a differentmix of industries, company sizes, and locations.FIGURE 3: ALIGNMENT IN ORGANIZATIONS To what extent do you consider your organization’s learning goals to be aligned with the organization’s business goals? Very high extent 24% High extent 16% 37% 33% Moderate extent 11% 25% 13% 34% Small extent Not at all 3% 3% October 2011 survey (n = 826) September 2013 survey (n = 431)Identifying Statistically Significant DifferencesIn this report, we often note whether the difference between two groups is significant at a level of p < 0.05. Asignificance of p < 0.05 implies a less than 5 percent probability that the difference is a result of chance, and onecan be 95 percent confident the results represent a statistically significant relationship. At a level of p < 0.05, itwould be very likely to observe the same results if the research were repeated.07 ALIGNING FOR SUCCESS: Connecting Learning to Business Performance 07WHITEPAPER

How the Learning Function Views AlignmentThe data show a strong association between alignment and market performance. Learning practitioners also understandthe value of alignment and their role as its champion. In the October 2011 survey, more than 90 percent of learningprofessionals felt alignment was of critical or high importance. However, it is important to remember that only about 60percent of learning professionals participating in that survey characterized their organizations as having high alignment(Figure 4).Some insights emerge when looking at the responses 93%those learning professionals provided when they wereasked about the importance of alignment to business of learning professionals said alignmentleaders. Only about two-thirds believed that alignment was very important to them.was of crucial or high importance to business leaders.FIGURE 4: IMPORTANCE OF ALIGNMENT How important is it to you as a practitioner that your organization’s learning goals are aligned with the organization’s business goals, and how important is it to business leaders? Critical 61% 28% Highly important 32% 38%Moderately important 5% 21%Somewhat important 2% Not at all 11% 0.10% 2% Learning professionals Business leaders08 ALIGNING FOR SUCCESS: Connecting Learning to Business Performance

CONCLUSIONIn an organization, CLOs have the challenging task of ensuring that the learning strategy is aligned with theorganization’s business strategy. This Study described the benefits of alignment, and provided insights on howCLOs can ensure and measure alignment. Some key findings and recommendations emerging from this report are: „„ Between half and two-thirds of organizations could be characterized as having high alignment between business goals and learning goals. These organizations have better market performance compared with organizations with lower levels of alignment. „„ Learning leaders understand the importance of alignment, with more than 90 percent of learning leaders believing that it is extremely important. Top learning leaders point out that alignment is critically important during major organizational changes, such as mergers and CEO changes.09 ALIGNING FOR SUCCESS: Connecting Learning to Business Performance 09CONCLUSION

ACKNOWLEDGMENTS ATD and i4cp gratefully acknowledge the contributions of time and professional insights from the following: „„ Kimo Kippen, chief learning officer, Hilton Worldwide „„ Steve Priest, chief wisdom officer, DaVita HealthCare Partners „„ Anne Schwartz, vice president of global leadership development, United Parcel Service10 ALIGNING FOR SUCCESS: Connecting Learning to Business Performance

REFERENCESASTD/i4cp. 2011. Suite Synchronicity: Exploring the Relationship and Alignment Between the CLO and the ExecutiveTeam. Alexandria, VA: ASTD Press.ASTD/i4cp. 2012. Developing Results: Aligning Learning’s Goals and Outcomes With Business Performance Measures.Alexandria, VA: ASTD Press.ASTD/i4cp. 2013. The Value of Learning: Gauging the Business Impact of Organizational Learning Programs. Alexandria,VA: ASTD Press.ASTD/i4cp. 2014. Change Agents: The Role of Organizational Learning in Change Management. Alexandria, VA:ASTD Press.Bingham, T., and P. Galagan. 2011. “M’m m’m Good: Learning and Performance at Campbell Soup Company.”T+D, March 13. www.td.org/Publications/Magazines/TD/TD-Archive/2011/03/MM-MM-Good-Learning-and-Performance-at-Campbell-Soup-Company.Favaro, K., P. Karlsson, and G. Neilson. 2014. “The Lives and Times of the CEO.” Strategy+Business, May 30.www.strategy-business.com/article/00254?pg=all#ceo_turnover.11 ALIGNING FOR SUCCESS: Connecting Learning to Business Performance 11REFERENCES

ABOUT THE AUTHORS AND CONTRIBUTORS The Association for Talent Development (ATD), formerly known as ASTD, is the world’s largest association dedicated to those who develop talent in organizations. These professionals take the knowledge, skills, and abilities of others and help them achieve their full potential. ATD’s members come from more than 120 countries and work in public and private organizations in every industry sector. For more information, visit www.td.org. Laurie Miller is the director of ATD research services. In that capacity, she serves as ATD’s senior research program strategist and designer. She provides oversight and direction for all of ATD’s internal and external, industry-specific, and market research services. Contact information: 703.838.5846 or [email protected]. Maria Ho is the research analyst for ATD and served as the author for this report. Contact information: 703.683.9586 or [email protected]. David Frankel is the research specialist for ATD and served as an editor for this report. Contact information: 703.683.9593 or [email protected]. Melissa Jones is an associate editor for ATD Press and served as an editor for this report. She edits and manages the production process for ATD research reports. Contact information: 703.838.5852 or [email protected]. Bey Bello is a designer for ATD and served as the designer for this report. Contact information: 703.683.8148 or [email protected] ALIGNING FOR SUCCESS: Connecting Learning to Business Performance

The Institute for Corporate Productivity (i4cp) improves corporatePeers. Research. Tools. Data. productivity through a combination of research, community, tools, and technology, focused on the management of human capital.With more than 100 leading organizations as members, including many of the best known companies in the world, i4cpdraws upon one of the industry’s largest and most experienced research teams and executives in-residence to producemore than 10,000 pages of rapid, reliable, and respected research annually, surrounding all facets of the management ofpeople in organizations. Additionally, i4cp identifies and analyzes the upcoming major issues and future trends that areexpected to influence workforce productivity and provides member clients with tools and technology to executeleading-edge strategies and “next practices” on these issues and trends. For more information, visit www.i4cp.com.Carol Morrison is a senior research analyst with a decade’s tenure at i4cp. She researchesand writes reports, whitepapers, playbooks, analyses, and articles on many topics relatedto human capital, business performance, and organizational learning. She has authored orcontributed extensively to research reports and other projects published by the Associationfor Talent Development, the American Management Association, and HR People & Strategy.Feature articles by Carol can be found in Talent Management, Chief Learning Officer, HRExecutive, and other leading print and online media. Contact Carol at [email protected] Lykins is i4cp’s managing editor and director of research services. She has workedin the field of human capital research since 2002, beginning with Human Resource Institute,and has published numerous articles and whitepapers on topics ranging from corporatevolunteerism to employee health and wellness and talent management. She is a contributingauthor to The ASTD Leadership Handbook (2010) and her work has been featured in the NewYork Times and the Wall Street Journal. Lorrie is an adjunct professor in the adult educationprogram at Eckerd College in St. Petersburg, Florida. She can be reached at 727.345.2226 [email protected] Dixon is i4cp’s survey manager/data analyst. He manages the survey process forall of i4cp’s research surveys from design and creation through to post survey exploratoryanalysis and reporting. Andrew can be reached at 727.345.2226 or [email protected] ALIGNING FOR SUCCESS: Connecting Learning to Business Performance 13ABOUT THE AUTHORS AND CONTRIBUTORS

APPENDIX: SURVEY OVERVIEWS Aligning for Success: Connecting Learning to Business Performance relies on interviews conducted by ATD Research with top learning executives at Fortune 500 companies in January 2015. These individuals were previously interviewed on the topic of alignment in 2011. The Study also analyzes survey data collected from learning and business professionals by the Association for Talent Development between 2011 and 2013. Some of these data were previously released in other publications, but other data are unique to this Study. Target Survey Populations In October 2011, ATD and the Institute for Corporate Productivity (i4cp) surveyed 826 learning and business professionals. In September 2013, ATD and the Institute for Corporate Productivity (i4cp) surveyed a different group of 431 learning and business professionals. Survey Instruments In both surveys, multiple questions used the customary 1-5 Likert-type scale, with a 1 rating generally indicating a “not at all” response and a 5 rating indicating a response of “to a very high extent.” The October 2011 survey was composed of a total of 29 questions, including those geared toward the demographics of respondents. The September 2013 survey was composed of a total of 32 questions, including those geared toward the demographics of respondents. Procedure In both surveys, a link to an online survey was emailed to the target population. ATD Research conducted telephone interviews with top learning leaders in January 2015. ATD and i4cp also conducted telephone interviews with top learning leaders in 2011, and draws upon these interviews in this report.14 ALIGNING FOR SUCCESS: Connecting Learning to Business Performance

MORE FROM ATD RESEARCHInstructional Design Now: A New Age of Learning and BeyondINSTRUCTIONAL DESIGN NOW Instructional Design Now: A New Age of Learning and Beyond, a collaboration of the Association for Talent Development (ATD) and the Institute for Corporate Productivity (i4cp), explores aA New Age of Learning and Beyond learning landscape rich in emerging opportunities, populated by professionals eager to create and unleash content that drives employee development and organizational performance. But ATD RESEARCH REPORT NEEDS ASSESSMENT and i4cp found that instructional designers don’t rate their profession’s overall efforts as highlyATD Research: as they might. For more information, visit www.td.org/idreport.Connecting Research to Performance BEYOND LEARNING CREATELEARNING AND TECHNOLOGY COLLABORATIONMOOCs: Expanding the Scope of Organizational LearningMOOCs MOOCs: Expanding the Scope of Organizational Learning is an ATD and the Institute for Corporate Productivity (i4cp) research report designed to explore the current—and anticipated—Expanding the Scope of Organizational Learning use of MOOCs in the business world. ATD and i4cp’s survey of learning professionals found that 22 percent are currently using MOOCs in learning and development efforts. For more information, RESEARCH REPORT SURVEYED PROFESSIONALS USING MOOCs visit www.td.org/MOOCs.ATD Research:Connecting Research to Performance 22% MASSIVE OPEN MOOCs IN LEARNING ONLINE COURSEDeveloping Sales Managers: Activating Sales Performance Through LearningDEVELOPING SALES MANAGERS Developing Sales Managers: Activating Sales Performance Through Learning investigates whether sales managers are sufficiently equipped to handle their responsibilities, which includeActivating Sales Performance Through Learning managing and developing sales representatives and meeting unit productivity goals. It also looks at the lack of availability of training programs directed specifically at incoming sales managers, RESEARCH REPORT RECRUITING LEADERSHIP and the content of new sales manager training programs in the organizations where it does exist.ATD Research: For more information, visit www.td.org/salesmanagers.Connecting Research to Performance SALES $ TALENT DEVELOPMENT TRAINING MANAGEMENTSponsored by:The Coaching Approach: A Key Tool for Successful ManagersTHE COACHINGAPPROACH The Coaching Approach: A Key Tool for Successful Managers is a report by ATD Research, in collaboration with the ATD Forum. It aims to examine the use of coaching as a managerialA Key Tool for Successful Managers tool and provides insights on how learning leaders can more effectively develop and sustain successful coaching programs. For more information, visit www.td.org/coachingreport. RESEARCH REPORT LEADERSHIP PROCESSATD Research:Connecting Research to Performance COACHING SCORE Manager CEI listens to employee Manager asks employee questions Manager gives employee feedbackFEEDBACK AND EVALUATION COMMUNICATION MANAGEMENTIn collaboration with: Note: All ATD research reports can be purchased by visiting www.td.org/Store. 15MORE FROM ATD RESEARCH15 ALIGNING FOR SUCCESS: Connecting Learning to Business Performance

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ABOUT ATD RESEARCHWhat We Do „„ ATD Research tracks trends, informs decisions, and connects research to performance for workplace learning and performance practitioners and theorists. „„ Our research reports offer an empirical foundation for today’s data-driven decision makers. „„ We conduct both quantitative and qualitative analysis about workplace learning, talent management and development, and all issues pertaining to training and performance. „„ ATD Research cares about your success, and our specialized research devoted to workplace learning and performance proves it.2015 ATD Research Topics „„ Trends in Training „„ Leaders as Teachers „„ State of the Industry, 2015 „„ Learners of the Future „„ Alignment „„ Culture of Learning „„ Instructional Design „„ Mobile LearningContact InformationResearch reports published by ATD can be purchased by visiting our website at www.td.org/Store, or by calling800.628.2783 or 703.683.8100.If you’d like to sponsor or partner with ATD Research, contact ATD Research directly at [email protected] call either number listed above.17 ALIGNING FOR SUCCESS: Connecting Learning to Business Performance 17ABOUT ATD RESEARCH