CORPORATE LEARNING FACILITIES

 

From the desk of Marcia Dresner...

A few years ago, the prevailing view was that e-learning, virtual classrooms, and other technology would obviate the need for companies to spend money on brick-and-mortar facilities. The thought was that there would always be some like GE’s John F. Welch Leadership Center at Crotonville. They were a product of another time, however, and companies developing new learning organizations and leadership development capabilities really didn’t need them.

Today, the situation seems to have changed and the news is full of companies that are building not just corporate training facilities, but grand campuses. Deloitte LLP recently announced that they were going to spend $300 million to build a conference and learning center on a 750,000-square-foot-campus in Westlake, Texas – it will include 800 guest accommodations, dining facilities, a ballroom, business center, recreational facilities, and a fitness center. Conoco-Phillips is building a research and training center in Colorado, and last November the University of Farmers (Farmers Insurance) opened a 120,000-square-foot, 20-classroom educational and development facility in California that cost $17 million to build. 

A Best Practice?

There is no single facility model in use among Learning & Development (L&D) organizations, even amongst those known as best practice organizations. Companies like Caterpillar have an excellent reputation for the quality of their learning and leadership development programs, but do not have or own dedicated training facilities. On the other hand, Hitachi Data Systems (HDS) conducts all of its training in either specially-built training centers or within other HDS facilities. Some L&D groups – the UBS Global Leadership Academy for example – use a hybrid of hotels, conference centers, classroom spaces, and corporate training centers. 

As with many aspects of corporate decision-making, facility trends seem to go in cycles:

• From centralized to decentralized
• From leased to owned
• From utilitarian to extravagant

When technology-based learning started replacing some instructor-led training and travel became an expense that companies were not comfortable with, companies that owned dedicated facilities found that they could open up those facilities for use by other companies and users. It is now possible for other companies to use, for example the American Airlines Center in Dallas, the 2 IBM Learning Centers in New York, or the ING Leadership Centre in Toronto

Reasons to Build

Having a dedicated learning facility with the company name on it conveys a sense that developing people is an important corporate value, a key message for companies to send to all kinds of stakeholders. There is no doubt that there is an intangible sense of receiving special attention when leaders and high potentials are asked to attend training at special places like the Boeing Learning Center’s hillside training facility, or when new sales associates are brought to the Pfizer Learning Center for their orientation and initial training.

There are other, more concrete (pun not intended) reasons why companies build brick-and-mortar facilities. Infosys is growing rapidly, and needs to make sure that its new hires are well-prepared to serve clients with their technical knowledge and their knowledge of what it takes to represent the company in an enterprise services engagement. They also want to be sure that the company has the leaders it needs going forward. The company shows its belief in the importance of its people with one of the largest corporate training centers in the world, the Mysore Global Education Centre facility. The facility boasts India’s largest gym and one of the best cricket fields in the country, balanced by an enviable corporate library and the Infosys Leadership Institute.

The Infosys Hyderabad Facility

The Enterprise Solutions Academy in Hyderabad (see photo above) has a similar view of the importance of learning and is a full service campus. The ESAcademy has 22 full-time faculty in a facility with a residential capacity of 800. There are 10 training rooms with a capacity of 70-200, 11 laboratories that can accommodate 30-100, and 8 conference rooms.

TenarisUniversity recently inaugurated their new campus. This relatively new corporate university made the decision to build a campus at their headquarters in Argentina as part of a deliberate desire to create a single, corporate culture within a company that was formed through multiple mergers and acquisitions. Simply put, the idea was to get people together by bringing employees from all of the places where the company did business. TenarisUniversity campus, which represents an investment of $17 million, consists of a 4,000 square meter building with an auditorium, classrooms, offices, and libraries. It also includes a 4,500 square meter residential hall that can host up to 100 employees who come to Campana, Argentina to take part in TenarisUniversity global events. It will be home to TenarisUniversity's five schools:

• Finance & Administration
• Commercial
• Managerial
• Industrial
• Information Technology

Tenaris CEO Paolo Rocca spoke about Tenaris' tradition of supporting education to create integration at the official inauguration of the campus. “Our commitment to internal training has grown over time, accompanying our expansion worldwide,” he said. “Education has become a strategic factor for global integration, the creation of a common identity, the alignment of internal knowledge and values.

Fabio Tonolini

At a time when many companies were trying to make their corporate universities “lean and wall-less”, Tenaris built a brick and mortar structure. In a CorpU TV interview, Director of TenarisUniversity Fabio Tonolini discusses how, as a worldwide company, they saw great value in bringing they employees together at the company headquarters in Argentina, helping Tenaris create a unified global culture.

But Is It Necessary?

What learning professionals and corporate leaders have to realize, however, is that the building does not lead to the success of a learning program. As important as Crotonville is as both a symbol and a starting place for leadership training at GE, the success of the company’s leadership development effort says as much about the performance culture of the company and the attention that its leaders pay to providing career paths and opportunities to promising talent as to any one place. Even the people at GE talk about how they could provide a “Crotonville experience” to people in other parts of the world.  The word “experience” is key. It’s all about what the program stands for and what happens within and beyond the program.

Even when a company has a signature facility, it’s not the only option the learning organization uses. One international finance organization uses a hybrid model for its learning activities. The leadership training organization is encouraged to use the company’s well-equipped executive center in Switzerland whenever possible. They also use conference facilities and hotels depending on the focus and the size of the gathering, the type of learning taking place, the location of the participants, and other considerations. 

If a company chooses not to build a dedicated L&D facility, it doesn’t have to – nor should it – relegate learning to makeshift classroom or hotel space. “If the environment is bad, then people will generally perceive the training to be bad, regardless of content,” notes Nick Howe, vice president, HDS Academy/Hitachi Data Systems. In addition to the learning centers mentioned above that are available to outside groups, there are additional state-of-the-art executive conference facilities that provide all of the technology and classroom amenities a learning organization would need, along with first-rate food and hotel facilities.

A company that prefers to hold learning in multiple locations due to the need to educate partners or suppliers, in addition to employees, might also choose to build multiple smaller training centers. That’s the model used by Hitachi Data Systems, which has facilities in 30 cities throughout the world. Much of that training is technical in nature, and that same model may not work well for companies that want to create one culture through the shared experiences of its leaders.

Is It Time??

That’s the question we’re hearing from an increasing number of CorpU members. There are so many variables involved in the decision to build a brick-and-mortar facility that there really can’t be a simple yes or no answer.

• Is a building or campus necessary to demonstrate that the company is serious about its vision of learning as a corporate asset, or is the learning organization already considered that way so a “building” isn’t necessary?
• Has the learning organization outgrown the classrooms and training venues it was able to beg, borrow or steal, and proven its value so that a building is the next step?
• Is the development of the next generation of leaders so critical that one place to bring everyone together is a key to the company’s growth strategy?
• Are there special needs that can only be filled in dedicated facilities?

It’s a complex issue with considerable corporate financial and political ramifications. Learning organizations have a lot to think about!

Marcia Dresner, CorpU Senior Research Analyst