Tap Local Resources to Keep Down Cost of Staff Development

TEC Worldwide is an international organization of more than 7,000 business owners, company presidents and CEOs. TEC members meet in small peer groups to share their business experiences and help one another solve problems in a round-table session. The following questions and answers are summaries of recent TEC meetings in Southern California.

Question: I’d like to turn my company into a “learning organization,” but I don’t have much of a budget for expensive seminars or motivational speakers. How can I make ongoing learning a part of our culture without breaking the bank?

Answer: Organizational learning doesn’t have to cost a fortune. By tapping into your own internal resources and those available in your community, you can easily develop inexpensive programs that will launch your company on a path toward ongoing learning and development.

Start by introducing a weekly brown bag seminar series in which employees bring their own lunch and you provide a speaker on topics such as team building, communication, customer service and so on.

Once a month, bring in a speaker to cover a topic that affects your employees’ personal lives, such as managing family finances, stress reduction or parenting skills. Your local chamber of commerce probably will have a list of speakers (or organizations willing to provide speakers) who will make short presentations for free or for a nominal fee. Your human resources person also should be able to line up contacts through local government and civic agencies.

Consider asking your professional service providers, vendors and customers to put on brief programs for your employees. And don’t overlook your own management team and employees--many of them will have specialized expertise they can share with the staff at large. Simply look around your company and community; you will find no shortage of topics and people willing to talk about them.

Like everything else, organizational learning starts at the top. Make a personal commitment to ongoing learning by joining a support group for CEOs or enrolling in an ongoing program of education for top executives.

Take the time to personally educate your employees. Once a month (more often, if possible) make yourself the speaker at the brown bag seminars. Educate employees about where you see your industry going over the next three years and how the company will need to react to upcoming changes.

Give people your big-picture perspective of the industry so they can understand the business beyond their immediate jobs. Talk about the need for change and teach people to anticipate it instead of reacting to it.

Introduce employees to basic financial principles such as cash flow, gross margins and working capital expenses.

Teach people how to read a profit-and-loss sheet. Explain how your business makes money and how each job affects the firm’s ability to make money. Above all, make sure everyone understands that “profit” is not a dirty word.

One thing you can’t do is force learning on people who don’t want it.

So make attendance at the luncheon seminars voluntary, not mandatory. Make learning fun, interesting and useful--both personally and professionally. Model the behavior and reward those who take advantage of the learning opportunities you offer. When people see the value for themselves, they will participate.

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Q: My small company (50 employees) recently was approached by a much larger firm about the possibility of forming a strategic alliance. It seems like a great opportunity, but at times I feel like Jonah staring down the whale’s throat. What should I watch out for going into a situation like this?

A: Strategic alliances offer many benefits, such as cost reductions, streamlined supply chains, access to new markets and increased productivity, but they also carry substantial risk. For that reason, they should be approached with the same amount of due diligence as if you were buying (or being acquired by) another company. However, focus on the strategic implications of the proposed alliance first and the financial issues second.

Ask the potential partner questions such as: What is your strategic direction? What are your long-term corporate goals? What is currently missing in your business process that we can provide? What do you expect my company to bring to this alliance? What kind of partnership do you envision and for how long? How would you measure results in this alliance?

Ask yourselves: What do we expect to achieve with this alliance? How will it affect our strategic objectives? How will the partnership affect us internally? How will it affect our key stakeholders (customers, suppliers, investors, etc.)? Will it require us to give up too much proprietary information? What do we expect from the partner and what do we think they expect from us?

With the potential partner, ask questions such as: How will sharing our technologies, processes or resources create enough value so that the market will put a premium on it? Will this partnership enable us to leverage each other’s strengths while minimizing our weaknesses? Who in each company will “champion” the alliance? Does that person have the authority and resources to make the partnership work?

How will this partnership enable each of us to achieve our strategic goals? In short, ask plenty of questions, listen closely and communicate honestly and openly with the potential partner. Keep in mind that short-term, tactical goals do not provide sufficient reason for pursuing a strategic partnership. If it turns out that the partnership can’t create long-term, sustainable strategic value for each company, you’re better off shaking hands and going your separate ways.

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If there is a business issue you would like addressed in this column, contact TEC at (800) 274-2367, Ext. 3177. To learn more about TEC, visit https://www.teconline.com.