Dec, 2019; Director Institute Feature by Mat Jacobson, Contributor
A number of the world’s largest employers have created strategic alliances with universities in an attempt to address one of the highest priorities facing corporations; “how to attract, retain and develop key talent?” Virgin Unite has spearheaded the 100% Human at Work initiative, which has “brought together an extraordinary network of over 150 organizations around the world who have helped us to shape and identify the elements that define a 100% Human Organisation”. The B Team, a global non-profit initiative co- founded by Sir Richard Branson and Jochen Zeitz, with its superb lineup of business leaders, from the CEO’s of Salesforce, Allianz Group, Mastercard, the UN Foundation, PepsiCo and many others, share a central mission – the creation of “business models and environments where all employees can thrive today—and in the workforce of the future.”
THE CHALLENGES: With all the best intentions, even with many of the world’s business leaders on board, most corporate development plans fail to achieve their objectives. Tuition reimbursement plans are often regarded as merely a perk to employees, rarely designed to solve complex corporate initiatives.
Recognised vs non-recognised credentials: Corporate educational training is polarized. On one hand there are short, skills-based, non-award courses often in the form of internal training, or via external sites such as Udemy, Coursera and other aggregator platforms. The short course advantages include low cost, and targeted specific skills. However, these courses rarely increase staff retention or build corporate loyalty. Further, because they are not formally recognised, they don’t lead to meaningful career development.
At the opposite end, are formal university qualifications. These have the advantage of building long term retention, employee morale and loyalty, as degrees can run over years. The disadvantages are that university degrees are more expensive, and disconnected from the immediate skills needed to solve current challenge. Short course providers offer various band- aid solutions, that can seem like a trivial acknowledgement such as “badges” and “certificates”. Consider a manager evaluating a promotional prospect who has a badge in Effective Communication? What does the manager make of this? On the other hand, the same manager may have very strong pre-conceived ideas about the quality and reputation imbued in an MBA qualification, even if they find it difficult to distinguish between an academic MBA and the ability to tackle complex business challenges.
The corporate impact of poorly executed strategies? Significant! According to SHRM (Society for Human Resource Management) the cost to replace a salaried employee is equivalent to six months’ salary - and that is just the out of pocket costs. Then there is the impact of lost productivity and possibly worst of all, the corporate knowledge and intellectual property that is lost to the organisation. According to CIO Magazine, the true cost of turnover could be, “as much as 2.5 times an employee’s salary depending on the role”.
Re-thinking the future of workforce development: Is it possible to offer a recognised bachelors or MBA degree, ensuring retention of key talent, while remaining affordable? Is it possible to deliver university accredited degrees, meeting all the compliance requirements for formal accreditation, while also being agile and customised to solving individual corporate needs? By developing a new model of collaboration between ed-tech and traditional universities, we believe the answer to these questions, is Yes!
Five Steps to Developing the World's Leading Employee Retention and Development Strategy
1. Applied and Customized University Degrees: The first step is to define the strategic objectives and long-term skill sets the organization seeks. to develop in its staff. Perhaps it’s developing an entrepreneurial, problem solving culture, or striving to integrate all business lines for better customer service. Ducere Global Business School (Ducere) https://www.ducere.edu.au with its university partners across the globe, tailors university degrees to the strategic needs of its customers.
Case Study: In an MBA program delivered to management at 20th Century Fox, the subject, Organizational Behavior, required research on industry best practice, analytics and recommendations, tailored to the strategic issue facing the client, “Culture change during a major merger”. In this case the merger was with Disney Corporation. Managers work towards their MBA, while, simultaneously solving critical business challenges.
2. Affordability: The cost of university tuition ranges considerably between universities, and across different jurisdictions. Online degrees overcome geographic boundaries, provide access to quality education at affordable prices and enables flexible work and study arrangements that meet the needs of the student and the organization. If structured correctly, pricing structures can fit within a corporation’s tuition reimbursement plan while enriching the organizational culture and employee benefit at the same time. Initially this may be a challenge, as typically a tuition plan (averaging around $5,000 per annum for most major companies) is only a fraction of university fees, therefore making the corporate support more a gesture of goodwill, than a viable solution to attracting, retaining and developing key talent within our organizations. Ducere has developed pricing models based on scale and efficiency, coupled with scholarships to allow for a scalable take up of degrees, at an affordable price. In some cases, Ducere has been able to deliver university MBA’s for total tuition fees as low as US $7,000 per student.
3. Retention Policy: By directly linking tuition support to a minimum retention period, key employees stay longer, become more productive and increase morale through their accelerated impact on the corporate bottom line. Corporate Education Retention Policies are not generic, as they need to be streamlined around a number of factors including overall financial commitment, position of the employee, expectations for ROI and a reasonable lock-in period. Often, a two-year commitment is required post graduation.
4. Development of a customized learning plan: In Step 1 we looked at the need to define the overall corporate strategy. A successful strategy requires customized personal learning plans, which are negotiated with each employee and their manager. The plan should stipulate the program of study, specific skills development, and the organization objectives to be achieved.
Case Study: KPMG senior staff, in undertaking the MBA subject, “Entrepreneurship and Innovation”, were tasked to determine how the professional services firm should engage with the start–up eco-system considering structured approaches based on survey data, current trends and industry benchmarks.
Ducere / KPMG entrepreneurship & innovation project recap presentation.
5. Analyse ROI: Creating a corporate Workforce Development Plan that becomes a long-term viable proposition, requires a rigorous analysis of the ROI.
An average $2.40 return for every dollar invested is a strong outcome; however, the true return could be much higher when programs are customized to meet company’s needs. ROI can be measured through attracting the best talent, retaining the best talent longer, reducing turnover costs, minimizing downtime through turnover, and training costs of new hires and increasing productivity.
Case Study: As part of an MBA program with PwC, under the MBA subject Digital Operations, managers were asked to Investigate tangible opportunities for Artificial Intelligence (AI) in the professional services sector and make recommendations on how professional services firms could capitalize on this emerging technology.
Conclusion: A successful Workforce Development Plan creates an environment that is a win/win for the employee and the corporation. It is natural for employees to seek world- class, university qualifications that provide opportunities for meaningful career growth. Equally, employers are committed to building an organisational reputation where retaining quality talent, promoting their Workforce Development Plan goes hand in hand with the advancement of their strategic organisational goals. An effective company-university partnership meets both of these objectives, the results can be transformative.
About the author: Mathew Jacobson is the Founder and CEO of Australian online education provider Ducere Global Business School. Mathew, CEO Magazine's 2018 Education Executive of the Year, is disrupting the higher education landscape, creating some of the industry’s most innovative educational platforms and projects. Mat is a regular media contributor on topics of business, innovation and entrepreneurship and has hosted spoken at numerous academic and business events, including at Apple’s Emerging Leaders Program and the Harvard for 21st Century Academic Forum Conference. Connect with Matt via LinkedIn: www.linkedin.com/in/mathewjacobson/