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Putting the PIECES! Together: Calculating Value Add

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Putting the PIECES! Together is a philosophical approach to better manage the complexity of business, which focuses on Partnering, Increasing Flexibility, Expanding Your Sphere of Influence, Calculating Value Add, Enhancing Reputation, Sustaining Results, and ! (taking care of the people). It is beneficial in any organization, but is imperative within Learning and Development and HR. This is the fifth blog of the series, discussing the need to Calculate your Value-Add within and beyond your organization.

At no time has it been more important for an organization to prove its value – to calculate its value-add–than in the highly competitive, volatile, uncertain, complex and ambiguous (VUCA) world today. It is imperative that we maximize our resources, time and money on those actions that will have the greatest return. For a Learning and Development organization, there is an added burden however: to show we are not the ‘touchy-feely’ HR of yore, but a results-focused business partner that delivers concrete impact to the company’s bottom-line. This necessitates comprehensive metrics that are:

· Bottom-line’ focused: Most of L&D’s services are directed primarily toward the company as a whole, so its measures should be quantitative and directly link to business metrics and objectives. At FedEx Express, the three driving business goals focus on:

o People – with an L&D measurement directly related to the objective of Employee Satisfaction

o Service - with the company Service Quality Index, a weighted measure of our ability to meet the commitments to our customer, as the primary metric for L&D

o Profit - recognizing the greatest impact L&D can have on overall profit is improving effectiveness and efficiency, the best L&D metric aligned in this area is operational productivity

· ‘utside-In’ Metrics: As implied in the above, any measures established should be customer-centric. Many, if not most, L&D organizations measure their programs on five different levels, ranging from ‘I liked the course’ (level 1) to ‘Return on Investment’ (level 5.) This measurement process has its shortcomings. This approach:

o Limits the number of quantified results to those few programs with a calculable ROI

o Uses L&D, not business, criteria as the measure of value

o Focuses on individual programs, neglecting to consider the impact other factors such as technology improvements or changes in the operating environment can have on an outcome

· Multi-tiered: The concept of multi-tiering is two-fold; first, it includes reporting that is:

o ‘Drill-down’, provides the ability to determine causes of performance rather than just symptoms; it introduces the quality concept of the ‘5 whys.’ For example, it allows FedEx to track a productivity issue to courier time between deliveries, to the station sort, to the loading of the vehicles, and finally to the speed of the sort belt. This identifies a specific action plan to be put in place.

o ‘Broad-band’, leading to solutions in various areas supported within your own organization, for your customers, and in the community. Each of these areas influences the others so their progress must be monitored.

· Managed: Not only should these be reviewed regularly to address issues as or before they arise, it is important to monitor the services themselves, their quality and their cost. For example, a periodic check with those to whom we provide services as well as our own staff, can be something as simple as a two question survey that asks:

o How important is this service?

o How well is the service provided?

This can identify awareness and perception gaps that can be addressed.

The mark of a great leader, organization or company is the value they add – how much better they make the lives of others. By continually calculating your value-add, you will establish a better rapport with your internal and external teams, generate greater support for programs, be able to go ‘toe-to-toe’ with other departments to get your fair share of the budget allocation, better prioritize your efforts, have meaningful status/progress reports, and earn the title of ‘great leader and great organization.’


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