A New U

Consolidate learning, improve instructional quality and raise employee engagement.

By Kathryn Tyler Apr 1, 2012

April CoverWhen North Shore-Long Island Jewish Health System in New York City experienced a shortage of surgical technicians, HR professionals developed an innovative solution. "There weren't enough techs" in the marketplace, explains Senior Vice President and Chief Human Resource Officer Joseph Cabral, "so we started our own surgical-tech training program." Thus began the Center for Learning and Innovation, North Shore's corporate university, now serving 42,000 employees across 15 hospitals.

North Shore's leaders did what many others have done—they created a corporate university to meet the organization's strategic learning and development needs.

It is becoming more important for organizations to train and develop the employees they need rather than find them in the marketplace. According to SHRM Workplace Forecast 2011The Top Workplace Trends According to HR Professionals, 57 percent of the responding HR professionals foresee a global shortage of skilled workers having a major strategic impact on their organizations. Thirty-nine percent said it will be difficult or very difficult to find qualified individuals for new jobs in a post-recession workplace that requires different skills. A corporate university represents one way to bridge this skills gap.

However, for a corporate university to become a reality, HR professionals must:

  • Understand how a corporate univer- sity will benefit the organization.
  • Gain executive support.
  • Align learning and development goals with business goals.
  • Determine the logistics of delivery, funding and instruction.

"Make sure you're anchored in your company strategy and have strong sponsorship from the CEO," advises Tammy Patrick, global director of Whirlpool University at Whirlpool Corp., headquartered in Benton Harbor, Mich.

Unlike training programs with fixed start and end dates, a corporate university becomes an ongoing investment and "requires a shift in thinking among an organization's leadership," adds Terry Nulty, executive director for Accenture Talent & Organization and Accenture Academy, a corporate university vendor in New York City.

The Objective

HR professionals need to identify the gaps in employee development that the corporate university is intended to address. Ask why you are creating a corporate university. "There needs to be a specific and clearly articulated reason," says Mark Allen, Ph.D., editor of The Next Generation of Corporate Universities: Innovative Approaches for Developing People and Expanding Organizational Capabilities (Pfeiffer, 2007). Then, create a plan on how to accomplish the goal and how to measure achievement, he adds.

For example, North Shore was grappling with 63 percent turnover in critical-care unit nurses. "That was unmanageable," Cabral says. The remedy? "We created a yearlong critical-care fellowship training program for nurses. Within the first year, turnover decreased to 13 percent."

Moreover, patient care improved. "We looked at best practices and developed a curriculum. We had new nurses go through this training program and then practice what they learned on the floor. If a nurse manager said, 'We don't do it that way here,' one of the instructors would educate the nurse manager on the new standards of care. In turn, we improved nursing practices on those units," Cabral says.

The hospital also saw improvements in other quality indicators, such as communication with caregivers, error rates, employee satisfaction and patient satisfaction. "Every dial moved," Cabral says.

Are Corporate Universities Feasible for Smaller Employers?

It may seem as though corporate universities are solely the realm of large corporations. Can the little guys get in the game? "Absolutely," says Amy Bastuga, vice president of HR at Radio Flyer, a Chicago-based toy manufacturer with 67 employees. The company's corporate university is dubbed "Wagon U," named after Radio Flyer's most well-known product. "It doesn't matter how big the company, we all have customers to serve. We all need to have scalable solutions to address our challenges and opportunities." 

HR professionals at smaller organizations simply need to be more creative about how to use resources. Some ideas include:

Partner with a community college or local university. "Corporate universities don't have to be brick and mortar," says Joseph Cabral, senior vice president and chief human resource officer of North Shore-Long Island Jewish Health System. "Partner with a local community college. Or, with technology and a learning management system, you could easily deploy different types of training."

Join a consortium. "If you collaborate with several companies that each have 10 employees who need to be trained, a classroom of 30 becomes more palatable," says Tammy Patrick, global director of Whirlpool University at Whirlpool Corp.

Focus on informal learning and development. Some types of learning and development are inexpensive. For example, mentoring and coaching cost very little. Mindfully delegating stretch job assignments gets the work done and develops employees. Online message boards and wikis updated by employees can capture your organization's knowledge before senior employees retire.

Offer online instruction. Classroom learning is costly, so save it for the most important or special types of instruction. For compliance topics, especially, consider online courses. 

In 2003, Farmers Insurance Group began the University of Farmers to address deteriorating performance among new agents. "We elected to centralize the development of our new agents," says Annette K. Thompson, senior vice president and chief learning officer of Farmers Insurance Group in Los Angeles. "Because we were working with thousands of independent contractors as our audience, we elected to brand our efforts under a 'university.' "

Allen, also a professor at Pepperdine University's Graziadio School of Business and Management in Malibu, Calif., urges HR leaders to delve deeply into what their organizations seek to gain. He advises considering: "What is the difference between the workforce you have now and the workforce you would like to have? What would it take to get there? You need to clearly define the gap and address it."

Back to Class

A decade ago, thousands of companies hopped on the e-learning bandwagon, touting the advantages of online instruction: flexibility, consistency and—primarily—cost-efficiency. Now, the pendulum is swinging the other way. Corporate universities are returning in droves to traditional classroom instruction, says Mark Allen, Ph.D., a professor at Pepperdine University. "I don't see any completely virtual corporate university conferences anymore," he notes. "It is about how we can use technology to enhance, rather than replace, classroom learning."

Some corporate university trends are:

More classroom instruction and brick-and-mortar infrastructure investment. In October 2011, Deloitte LLP opened a 700,000-square-foot corporate university in Westlake, Texas. The sleek facility boasts 35 classrooms, 36 breakout rooms and 800 guest rooms, as well as resort-like amenities such as a ballroom and fitness center. "We wanted a place to build new skills and also develop culture. That's hard to do via e-learning," says Bill Pelster, managing principal of talent development. Before building Deloitte University, the firm surveyed employees about professional development. "To our surprise, Millennials overwhelmingly said they wanted a physical facility," he says.

Still, why build a $300 million facility in the midst of a recession? "The board voted to go ahead," Pelster says. "Investing in our people was the right thing to do, regardless of what the economy was doing."

More informal online learning. Flexible architecture is critical to being able to technically support wikis, blogs, discussion forums, sharing articles and other such developments, says Terry Nulty, executive director for Accenture Talent & Organization and Accenture Academy. "For example, a learner could look up a term on the company's wiki for a quick overview and, if interested, immediately take or schedule a formal course about it," she explains.

Christopher R. Hardy, Ph.D., director of the Global Learning and Technology Center at Defense Acquisition University, a corporate university serving 147,000 military and civilian employees of the U.S. Department of Defense, adds that "Informal learning is more important to the job than any course you can take. You forget a course quickly, unless there are a lot of applications. We've gone to different simulations and case studies."

Using online learning judiciously, rather than indiscriminately for cost savings. "If you try to cut back and offer everything online, you lose some employees," says Joseph Cabral, senior vice president and chief human resource officer of North Shore-Long Island Jewish Health System.

"We went online—not to save money but to reach the people we can't reach in a classroom and to be more efficient with how we prepare them for the high-dollar classroom experience," Hardy says.

Nulty explains: "Our clients typically use classroom-based learning for topics that are unique to their organization and need to be taught in the classroom to be effective. They tend to use online learning for topics that are universal in need and audience and require ongoing maintenance to keep skills current."

According to the International Learning and Talent Development Comparison Survey 2011 by the Society for Human Resource Management and the Chartered Institute of Personnel and Development in London:

  • Fifty percent of U.S. respondents' organizations use e-learning for compliance training, such as health and safety, vs. 22 percent for onboarding and 9 percent for mentoring.
  • Webinars are the most popular online instructional method, with 54 percent of responding companies using them, followed by online virtual learning management systems, used by 31 percent of respondents.
  • Sixty-seven percent of U.S. respondents said e-learning is not a substitute for face-to-face or classroom learning, and 90 percent said e-learning was more effective when combined with other types of learning.

Pelster concludes, "Live, in-person, quality learning still has a place in corporate America. Old and young crave the human interactions that come from seeing people in person. It introduces employees to other leaders in the firm, and they make connections they would not make otherwise."

— Kathryn Tyler

Development Strategy

Once corporate leaders have determined the driver for the corporate university, then HR professionals can begin to address how to meet those needs in terms of delivery methods, instructors and funding.

When most people hear the word "university," they think "classroom" instruction. But corporate universities encompass far more. They include online courses—synchronous (live) and asynchronous (recorded)—plus coaching, mentoring, simulations, case studies, stretch job assignments, job aids, and other informal learning tools like wikis.

At North Shore, Cabral says, "We have recently added simulations. New doctors practice on highly sophisticated Annies [mannequins] before they see patients."

At Sprint University, the offspring of Overland Park, Kan.-based Sprint Nextel Corp., flowcharts used by customer service agents to troubleshoot diagnostic problems play a prominent role. "Tools you develop with a team of 20 people can get used a hundred million times a year. It's a huge efficiency," says Dave Fogleman, vice president of Sprint University.

HR professionals must decide on the delivery methods that best meet their organization's objectives. Often, programs are a mixture of many types of instruction and informal learning. For instance, Whirlpool University developed in two parts: the physical component and the online one. The physical component takes place at Brandywine Creek, a 52,500-square-foot training facility 15 miles north of headquarters, completed in 1993. In 2008, Chief Executive Officer Jeff Fettig decided to expand the corporate university's online presence to serve all of Whirlpool's 19,000 salaried employees. Prior to that, the online program had served 6,000 employees.

Patrick recalls that at the time, 95 percent of the university's courses were held in the classroom, "which is a very expensive model. We decided to invest in a new learning management system and custom online learning courses, as well as some off-the-shelf content."

In 2009, 13,000 Whirlpool employees took a new series of 10 online courses called the Foundations of Whirlpool. They responded positively in their comments. Many employees said they liked the fact that Whirlpool was increasing opportunities for employees during a recession. Global employees said they liked feeling closer to executives in the C-suite, who are featured in many of the 30-minute courses, Patrick says.

In 2010, HR professionals re-evaluated the most popular courses to create a more blended learning experience. For instance, "we had a three-day managerial course that taught the basics of supervision. It was like a fire hose coming at them," Patrick says. To improve new-manager effectiveness, HR leaders revamped the course into a 12-month program that alternates between synchronous and asynchronous online instruction and classroom instruction. "Then managers meet with their cohort group and faculty for discussion and role-playing," Patrick says. It costs the same as the three-day course.

‘What is the difference between the workforce you have now and the workforce you would like to have?’

The results? The program was cited as a primary factor in increasing Whirlpool's annual engagement survey's managerial effectiveness index by two points, Patrick says. Now, Whirlpool University offers approximately 40 percent of its content online and 60 percent in classrooms.

Payment Plan

Corporate universities are funded in two ways: as a line item in the annual budget or on a per-use basis by department, known as pay-as-you-go.

Which is better? That depends. "Pay-as-you-go works well in helping corporate universities offer what people want and need, but it doesn't address larger-scale developmental efforts," Allen says. "Also, pay-as-you-go doesn't work well in corporate universities that rely on a lot of virtual instruction. Nearly all of the cost is during development; the variable cost of additional users is negligible."

Whirlpool University has multiple funding streams. "The CEO and each member of the executive committee becomes a sponsor of the programs. Their role is to review and approve content, as well as fund the course," Patrick explains. "The technology to support Whirlpool University is funded through an allocation to our regions based on employee count," she adds. Open enrollment courses charge tuition paid for by the learner's department.

To offset the costs, some companies provide training to other organizations. For instance, North Shore's Center for Learning and Innovation offers CPR and first-responder training to fire and police departments. Sprint University sells training content to its vendors.

‘If training and development is an enabler of organizational performance, it’s all the more important during tough economic times.’

Some executives question the logic of paying to educate employees who might jump ship. "I used to cite studies that show companies that invest in learning and development have much lower turnover rates than those who don't," Allen says. Now, he answers, "What if you don't educate them and they stay?"

While the recession has impacted many corporate university budgets, most have not been gutted. "If training and development is an enabler of organizational performance, it's all the more important during tough economic times. Some corporate university budgets have been cut, but only to the extent that budgets across the board have been cut," Allen says.

"As budget expenses have tightened across the organization, learning has not been impacted more than any other business," Thompson says. "In fact, we just built a second 50,000-square-foot campus in Grand Rapids, Michigan." This investment can be attributed to the value that the University of Farmers brings, she explains.

Some organizations have even maintained budgets. "Our workforce is our competitive advantage," Cabral says.

Choosing Faculty

In cases where HR professionals determine that direct instruction is the best method for learning and development, they will be faced with choices regarding instructors. Should instructors be internal, external or both? If internal, should they be trainers, executives or subject matter experts? If external, should they be consultants or university professors?

Whirlpool University employs a variety of instructors, including faculty from top business schools, senior executives and internal experts.

At the University of Farmers, facilitators vary across learning units. "Often the facilitators are individuals who came out of the business they support, such as an ex-agent or claims representative. These individuals know the business and have credibility," Thompson explains.

Allen advocates having senior executives as instructors because employees taking the classes get some exposure to them.

So, what happens if an executive turns out to be a subpar teacher? At North Shore, Cabral taps executives to be faculty, but on occasion an executive is asked to step down. "Every facilitator is evaluated by the students. We have told some of our leaders—in a nice way—they can't teach again," Cabral says. "The integrity of the program is critical."

Liz Dries, a consultant for Deloitte Consulting in Washington, D.C., attended a four-day course last fall for all newly promoted consultants at the just opened Deloitte University. She appreciated senior leaders' participation. Dries liked the face-to-face networking and socializing elements of the course.

Doing Your Homework

To begin creating a corporate university, Thompson advises visiting companies that have them and attending industry conferences sponsored by the American Society for Training & Development, Corporate University Xchange, and Chief Learning Officer.

Christopher R. Hardy, Ph.D., is director of the Fort Belvoir, Va.-based Global Learning and Technology Center at Defense Acquisition University, a corporate university serving 147,000 military and civilian employees of the U.S. Department of Defense. He recommends entering corporate university best-practice award competitions to get feedback on your program. Win or lose, "you've learned what processes you should be using and who does that best," he says.

However, Allen warns against replicating too closely what other employers have done, which may be "the ideal solution for their organization [but] not the ideal for your organization."

Finally, "Be aware that having a corporate university is not just about buying a building or calling yourself a 'university,' " Thompson says.

In the end, what truly differentiates the corporate university "is whether or not you demonstrate outcomes to the business," Cabral says.

The author is a freelance writer and former HR generalist and trainer in Wixom, Mich.

Discuss The New U:

  • How does a corporate university deliver results for your business?
  • How are your learning initiatives aligned with business goals?

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