Corporate University 080110

2010

AHMAD HUMAIZI BIN MAT NOOR, STUDENT ID: 804239

ASRAF BIN ABDUL RAHMAN, STUDENT ID: 805432

MOHD FADZLY BIN MAHYUDDIN, STUDENT ID: 804274

NOOR HIDAYAH BINTI ABD RAHMAN, STUDENT ID: 804976

The Emergence of Corporate University

Table of Contents

1 Introduction 2

2 Definition of University Corporate University 2

3 History of Corporate University 3

4 Concepts of Corporate University 5

5 What constitutes corporate university 6

6 Growth of Corporate University 7

7 Typology of Corporate University 8

8 Key Features of Corporate University 12

9 Business Case for Setting Up Corporate University 13

10 Five important concepts to consider 14

11 Success Factors for a Corporate University 16

12 Goals and Mission of Corporate University 22

13 Planning for Corporate University 24

14 Examples of Corporate University 26

15 Comparison between Traditional Training Department, Corporate University,

and Traditional University

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16 The Future of Corporate Universities 32

17 Conclusion 34

18 Reference 35

EMERGENCE OF CORPORATE UNIVERSITY

1 INTRODUCTION1

In the human resources literature of past years a “new” trend in human resources training and

development is described: the corporate university. This concept is rooted in the USA, where

the label first appeared in 1955 with the foundation of the Disney University (Solomon,

1989), and has been continued in Europe and Asia. According to official statistics in the USA

more than 1,800 corporate universities are now in existence; 40 per cent of the Fortune 500

companies have implemented a corporate university (AACSB, 1999).

In recent years the corporate university has become an increasingly significant aspect of

contemporary corporate training and development in Europe (Walton, 1999). In the US, the

development of corporate universities has been widespread, with their current rate of growth

leading researchers to estimate that they will outnumber traditional universities within the

next decade (Prince & Beaver, 2001). This objective of this paper is to explore the

surrounding the emerging role of the corporate university worldwide.

2 DEFINITION OF UNIVERSITY AND CORPORATE UNIVERSITY

A university is an institution of higher education and research, which grants academic

degrees in a variety of subjects. A university provides both undergraduate education and

postgraduate education. The word university is derived from the Latin universitas

magistrorum et scholarium, roughly meaning "community of teachers and scholars.

A corporate university is an organizational entity dedicated to turning business led learning

into action. It is designed, driven and intricately linked to the company’s business strategy

with the aim of achieving corporate excellence through improved staff performance and a

company-wide culture in which innovation can thrive.

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The handbook of Corporate University Development (Paton et al; 2000) defines corporate

universities as all initiatives which:

Are wholly owned by a parent work organization

Have as their primary focus the provision of learning opportunities for employees of

the parent organization (even though it may also offer learning to suppliers of

customers)

Utilize symbols and language from the educational sector

In other words, a corporate university is any educational entity that is a strategic tool

designed to assist its parent organization in achieving its goals by conducting activities that

foster individual and organizational learning and knowledge.

3 HISTORY OF CORPORATE UNIVERSITIES

General Motors and General Electric and other large manufacturing firms were some of the

forerunners in the workforce education movement. As early at 1914, companies like these

developed internal training functions to provide workers with the skills necessary to perform

routine jobs. These corporation schools continued throughout the mid-point of the twentieth

century with additional movements toward corporate accreditation for training. All kinds of

industries focused on internal training and development.

While the focus on workplace training continued, the world started to change. Technology

advancements, globalization, the shift from an industrial- to a knowledge-based economy,

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and increased competition all influenced the way that we worked. Training had to change,

too.

The first corporate universities were conceived in the mid-1950’s as responses to these

changes and today serve as the underpinnings of the corporate university, or strategic

learning, industry. The movement started slowly and gained momentum around 1980 in the

United States. Increased awareness around the concept of strategic learning emerged as the

forerunners were sharing their stories more opening as the initial competitive advantages

were achieved.

In the late 80’s and the early 90’s, American companies began to recognize that a

commitment to lifelong learning with practices in systems thinking and cross-functionality as

introduced by Senge (1990) and explored by Nolan, Goodstein and Pfeiffer (1993) and

Beckhard and Pritchard (1992) among others, was a way to keep up with technological

advancement and global competition. Becoming a learning organization became the desired

status throughout Corporate America.

Achieving that goal meant rethinking the corporate philosophy toward employee

development. Corporate managers accepted the need to educate and continuously re-educate

their employees, but actually making organizational change happen seemed to be an uphill

challenge complicated with union needs and demands, pressures to remain competitive

during the transition periods, and desires to turn profits. Terms like re-engineering, re-

inventing, and organizational change dominated Corporate America. The centralized and

controlled employee development programs of the past would not meet those corporate goals.

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The choice to become a learning organization coupled with the need to stay competitive

sparked, at least in part, the corporate university movement.

With the end of the Cold War and the relaxing of global trade barriers, globalization became

a dominant factor in corporate learning. What started as an American practice became a

global phenomenon. Corporate universities emerged in companies around the globe. New

thinking around learning models that aligned with particular industries and particular cultures

likewise followed. The corporate university was no longer a movement; it was a critical

business practice.

Thus, changing industry and technology factors as well as new thinking about workplace

learning catalyzed the corporate university concept and movement. This historical

perspective provides a basis for understanding and conceptualizing the corporate university

as it exists today. In its current state, the corporate university is a process by which

organizations integrate strategic, continuous, and results-oriented learning throughout their

entire workforce chains.

4 THE CONCEPTS OF CORPORATE UNIVERSITY

In most cases, corporate universities are not universities in the strict sense of the word. The

traditional university is an educational institution which grants both undergraduate and

postgraduate degrees in a variety of subjects, as well as conducting original scientific

research. In contrast, a corporate university typically limits scope to providing job-specific,

indeed company-specific, training for the managerial personnel of the parent corporation.

Corporate universities are most commonly found in the United States, a nation which has no

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official legal definition of the term "university". Perhaps the best known corporate university

is the Hamburger University operated by McDonald's Corporation in Chicago.

5 WHAT CONSTITUTES OF A CORPORATE UNIVERSITY

Despite increasing attention being given to the role and development of corporate

universities, the debate as to what constitutes a corporate university remains. A review of the

literature reveals the two broad themes which can be identified.

The first is the functional approach, where the corporate university focuses on day-to-day

training issues. As Meister (1998: 29) notes that corporate universities are essentially the 'in-

house' training facilities that have sprung up because of the frustration of business with the

quality and content of post-secondary education on the one hand, and the need for life-long

learning on the other. They have evolved at many organisations into strategic umbrellas for

educating not only employees, but also secondary customers and suppliers.

The key elements drawn from this approach are the focus on basic skills and the need to

develop consistent and uniform knowledge, skills and ability across an organisation and its

network of customers and suppliers to ensure consistent quality of product and/or service.

The second theme is the strategic approach linked to the long-term development of the

organisation’s human capital. Walton’s (1999: 412) definition emphasises the strategic focus

of knowledge creation and management across the whole organisation when defining

corporate universities. He states: The notion of a corporate university is becoming

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increasingly fashionable as an overarching designation for formal learning and knowledge

creation activities and processes in an organisation.

There are a number of common elements to both constitution, including a focus on formal in-

house training and development and an on-going investment to improve an organisation’s

human capital.

This second approach fits with a key theory in the area of human resource development; that

of human capital theory, which links investment in the organisation’s key asset, employees,

to increased productivity and sustained competitive advantage (Schultz, 1959; Becker, 1964;

Smith,1998). Because such investment can lead to the employee adding value and being

retained by the organisation through incentives such as career progression, increased security

and higher remuneration, the firm's resource base is enhanced. This can be linked to the

resource based view of the firm where an organisation develops these resources in such a way

that they become rare, valuable and difficult to imitate, further developing the organisations

competitive advantage.

6 GROWTH OF CORPORATE UNIVERSITIES

Organizations around the globe continue to adopt the corporate university concept. The

corporate university concept involves a process not necessarily a place by which all levels of

employees (and sometimes customers and suppliers) participate in learning experiences

necessary to improve job performance and enhance business impact. Although the actual

number of corporate universities is difficult to pinpoint, some estimate that more than 2,000

exist in the United States.

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More importantly, the trend continues to grow. It began in North America and has spread to

Europe, Asia, and the rest of the world in a limited manner. Organizations have invested

heavily in this concept, sometimes with a price as high as 5 percent of payroll compensation.

This heavy investment has brought increased concerns and demands for account-ability.

Consequently, a corporate university must show how it impacts the organization. If its value

is questionable and it is not perceived as an important part of the strategic and operational

framework of the organization, it could very well disappear.

7 TYPOLOGY OF CORPORATE UNIVERSITY

Attempts have been made to categorise the corporate university in order to understand their

role and focus. Walton (1999) has categorised corporate universities by placing them in an

evolutionary or generational context, linking the development of corporate universities to the

changing work environment.

This generational structure, describes a ‘First-Generation’ corporate university as

characterised by formal, narrow training, specific to the organisation, uniform products, and a

standardised approach to work organisation.

‘Second-Generation’ corporate universities, Walton argues, emerged as a response to the

increasing competition and market volatility in the late 1970s and early 1980s, as

organisations sought ways to increase organisational flexibility and responsiveness. The

subsequent 'delayering' of hierarchies enabled decision making to be pushed down the

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organisation, thus empowering employees to become responsible for the work, broadening

the approach to training and development.

Finally, Walton (1999) describes the development of ‘Third-Generation’ corporate

universities, which are a reflection of technology advancements and the move to a virtual

mode of communicating training.

Whilst Walton's typology is useful in linking the development of corporate universities to the

changing environment, for analysis purposes, this evolutionary framework is one dimensional

and too static in its assumption of uniformity in type and development. The dynamic

environment within which many organisations operate requires a variety of responses to

training, development and knowledge management across different organisational levels.

Shifting responses and strategies are required by a corporate university to remain effective

and relevant, as a wide range of learning experiences for both employees and management

are developed. This is essential if the corporate university is to be a central part of human

resource development strategies.

In this context, Taylor and Patton (2002) have developed a typology which provides a more

dynamic approach to understanding corporate universities. Taylor and Paton (2002) have

framed the development of corporate universities along two dimensions: learning continuum

and spatial organisation. The spatial organisation axis defines the 4 location of the corporate

university as a physical entity, like a traditional university campus, or a 'virtual' campus',

delivering training and learning to the workplace online. The second axis or continuum of

learning ranges from a narrow training focus (for example firm specific and vocational

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training), through to broader developmental programs (for example professional development

and research). These latter organisations will seek a longer-term approach to managing and

investing in their human resources, using for example, management development centres and

traditional universities, as the focus of such development and exchange. The two dimensions

offered by Taylor and Paton provide a clear insight into the role and function of the corporate

university, and thus allow for a clearer interpretation of the corporate university focus.

Taylor and Paton (2002) combined these two dimensions in a model, to develop a (quadrant)

typology of corporate universities. Both Type and 1 and 2 corporate universities could be

described as taking a functional approach. The emphasis is on cost effective training delivery,

and the ability to incorporate training into work schedules at appropriate times with minimal

disruption. In other words, it is subordinate to the organisation of work.

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Taylor and Paton describe the Type 3 style of corporate university as 'The 'Chateau

Experience'. This is in effect, the traditional management college, where face-to-face courses

are run. Often in partnership with accredited universities this approach provides an

opportunity for more in-depth development of staff, detached from the everyday work

environment for time periods of days, up to weeks at a time. Often associated with

management courses, they are linked to long-term developmental skills. The final type - Type

4 - is described as the 'Polymorphous University'.

The name reflects the dynamic environment within which many organisations operate, and

thus, the shifting responses and strategies required by this type of corporate university to

remain effective and relevant. This approach attempts to include a wide range of learning

experiences for both employees and management, and is the most strategic of all the

approaches, as it actively seeks to engage all levels of the organisation. To achieve this, in-

house training is blended with the building of alliances with centres of higher education to

provide professional and independent input.

Taylor and Paton's approach provides a dynamic framework in which organisation can move,

change and develop their position in the matrix to reflect a transformation in the focus of their

corporate university. More significantly, it allows for testing and analysis of corporate

universities to determine their focus as either functional or strategic.

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8 KEY FEATURES OF CORPORATE UNIVERSITY

Since the early 80’s quite a number of blue chips companies have set up their own corporate

universities in the US and more and more European large companies have followed this trend

with the setting up of various kinds of "corporate training centers", "corporate learning

centers", "corporate universities or campuses". The main purpose of these in house facilities

is to provide the managers with the adequate and specific professional training , but also to

improve internal communications and networking, to build the corporate identity and culture,

to explain and to justify the corporate strategy, etc.

This movement appeared as a response to a real need for big companies with a large number

of managers and executives scattered in various geographical areas and with different cultural

backgrounds, who must act along the same corporate values, professional know how and

aligned leadership.

The corporate university plays the role of a powerful "unifying" tool for the managers. Its

main functions are the internal communication, the dissemination of the corporate culture and

of the professional knowledge. It also has a very important "integration" function for the

young or recently recruited managers (as well as in case of another company acquisition) for

the alignment of the type of management and leadership.

We must notice that corporate universities are also a HRD tools which may allow, besides

their classical professional training role, to identify the "high potential" managers as well as

to improve the internal mobility of the managers. The corporate university appears more and

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more as a powerful and efficient instrument to facilitate the necessary managerial and

organisational changes resulting from the global corporate strategy implementation.

9 BUSINESS CASE FOR SETTING UP CORPORATE UNIVERSITY

A Corporate University is a portal within a company through which all education takes place.

Corporate universities link an organization’s strategies to the learning goals of its audiences.

It functions as the umbrella for a company’s total education requirements – for employees

and the entire business chain, including customers and suppliers.

How is a Corporate University different from a traditional company training department? By

nature of the way each operates. Training departments tend to deliver training in a

fragmented, decentralized way – and it is usually reactionary. Training departments usually

offer a wide array of open enrollment courses, but with different departments participating

sporadically based on their own ‘perceived’ needs. The Corporate University philosophy is

very different from this, pulling together all learning in an organization by managing

education as a business initiative. It has clear goals and long-term strategic plans. It is

proactive. Most important: a corporate university’s activities are linked to business goals. The

"best practice" of creating a Corporate University can shape the culture of a company by

fostering leadership, creative thinking, and problem solving. Corporate universities are

designed to provide employees with practical business knowledge, managerial competence,

and task-oriented education – all aimed at making an organization more competitive.

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10 FIVE IMPORTANT CONCEPTS TO CONSIDER

The most successful employers realize the need to invest corporate resources in maintaining

the skills of their employees. Establishing a Corporate University is one of the best ways to

manage employee development as a needed business function. Steps to Success: Five ideas

for starting a Corporate University at YOUR organization

a. Work with management to create a long-term educational vision.

The process of starting a Corporate University is a collaborative one. Gather together all

levels of management at your organization and create a shared vision of the future. What sort

of company do you want to be? Will your core business change? What about your employee

base? Communicate your vision to the entire organization and keep on communicating it. Let

employees know about future plans for the Corporate University and get them excited about

it.

b. Link the proposed training strategy with corporate business goals.

Use the vision to draft outlines of the needed employee skills and share with corporate

leaders. Stress the need to align skills with corporate goals and objectives. Traditionally the

relationship between training and specific business goals has been weak. Companies invest

thousands of dollars in training programs without any idea of how the training will improve

their bottom line or achieve business goals. Aligning your company’s business initiatives

with an annual training plan is essential in creating a successful Corporate University

program.

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c. Decide on your delivery method.

Technology has enabled training to be delivered in a number of different ways, from video-

based and multimedia CD-ROM courses to teleconferencing and distance learning.

Sometimes traditional classroom-based training is the best and most cost effective method –

sometimes not. Investigate all of your options, and think about the requirements of your

employee-base. Also consider where training will be conducted. For example, at employee

workstations, in a company classroom, offsite, etc.

d. Partner with training vendors and traditional colleges for maximum results.

Partnering with outside sources of education is a great way to get the most out your training

dollars to create dynamic training programs. Calling on assistance from local community

colleges, universities, and outside training organizations can open the door to innovative

educational solutions. For example, a large Call Center and their local Community College

teamed up to create an associate’s degree program in customer service – benefiting the

company and the college. To potentially save money, choose specific ‘key’ learning

institutions to partner with to deliver your long-range training. If you partner with just a few

training vendors they will get to know your organizations needs better and most likely will

provide you extra services if you treat them as a strategic partner. Consider including them in

your annual training planning process.

e. Prepare a funding strategy and budget.

Because funding a Corporate University can be very costly upon startup, some companies

expect that the Corporate University will become self-funded or even generate income. How?

By setting up training programs like a traditional university and charging tuition to their

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internal business clients, as in the ‘fee-for-services’ strategy. Another way to create a self-

funded Corporate University is to copyright and market your in-company training programs

to your outside customers and suppliers. Your local consultant can assist you with this type of

planning. Of course, a well thought-out preliminary budget will determine what funding

initiatives your organization needs to pursue. And if your training programs meet the

company’s business goals, the Corporate University will pay for itself many times over in

increased profits and employee morale and well being.

11 SUCCESS FACTORS FOR A CORPORATE UNIVERSITY

a. Clarify Role and Strategy

Corporate universities are created for different purposes. Some are developed to bring fresh

life to the old training and development department. Others are designed to bring change and

embrace a variety of new strategies and initiatives. Still others are meant to sustain a

successful and effective culture. Disney University, one of the oldest corporate universities,

was created to sustain a culture created by Walt Disney.

Whatever the reason, the specific role of the corporate university needs to be clarified so the

organization recognizes its purpose, mission, vision, values and strategic focus. More

importantly, the strategic plan must clearly connect and link to organizational strategy.

Sometimes there is confusion as to the products and services provided by a corporate

university when compared to other learning units. When there are unclear expectations, roles

and objectives, the corporate university is perceived as just another channel for training and

not a strategic player in the organization game.

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b. Always Have a Champion

As with any major change process or highly visible entity, the corporate university should

have a visible, high-level champion. The champion is an executive or top administrator who

is willing to support the corporate university in achieving its mission. This support includes

providing input into the strategy, communicating the strategy and, when necessary, bringing

less supportive members of the upper echelon into the field. Without this true champion who

can influence genuine support from other managers and executives, long-term sustainability

is difficult. During the development and growth of Motorola University in the 1980s and

1990s, the champion was the Motorola CEO, Robert Galvin. Since Galvin’s departure,

Motorola University has all but disappeared and is now outsourced.

c. Establish Proper Governance

This issue is more difficult to address if the corporate university has been in existence for

some time.In the early stages of development, corporate university leadership must decide on

reporting relationships and the operating board. Should it report to HR, the COO, a marketing

executive, the CFO or the CEO? Because traditional training and development is perceived as

part of HR, the corporate university often reports directly to the human resources function.

However, it may be more appropriate for the corporate university to report to a higher-level

executive to provide more visibility. The second issue involves the direction or overall

governance through a board of advisors, trustees or directors. While a board can sometimes

be created to demonstrate perceived support, it is more important to have a board that can

actually provide input.

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d. Align With Business Needs

The programs, solutions and services of the corporate university must be aligned with the

business. This alignment is developed during the initial analysis leading to the

implementation of the learning solution. The analysis ensures that a business need can be met

with the solution. Appropriate performance analyses develop the connection between the

business need and the learning solution. If this alignment is not made, it is difficult to connect

the corporate university to business value and ultimately show the success of the university.

e. Address Performance Improvement

Closely related to the alignment issue is the process of addressing non-training/non-learning

solutions. When a request for a learning solution is made, how the corporate university

addresses the issue is extremely important, though it often creates a variety of problems. For

example, corporate universities are often perceived as learning providers, offering a specific

type of solution for a need.

In reality, the need may be better addressed with a non-learning solution. In most cases, the

corporate university does not have a charter to offer a mix of solutions. Some corporate

universities attempt to utilize a results-based approach, exploring the non-training issues, and

then hand off potential solutions to other providers

f. Pursue a Variety of Learning-Transfer Strategies

One of the disappointments for learning organizations is the limited transfer of learning to the

job. This problem often stems from dysfunctional processes in work environments that inhibit

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transfer of learning into workplace performance. Creating a variety of practices to enhance

the transfer of learning can help overcome this challenge.

The process usually begins with analysis of the work environment as new learning initiatives

are undertaken. This analysis can translate into design issues, delivery processes and even

appropriate communications to the participants in learning solutions. A variety of

stakeholders must understand their role and take necessary action to support the transfer of

learning. Saturn Corp.’s corporate university involves up to 11 stakeholder groups to

determine if the learning-transfer process is successful.

g. Develop Partnerships With Key Executives

The corporate university exists at the pleasure of the management team. While corporate

universities may have initial support from top executives, a critical group of managers are

those in the middle— those who allocate resources, provide funding, allow individuals to

participate in programs and generally support the corporate university concept. Too often,

corporate university staff members shun operating managers—particularly those at middle to

upper levels. They prefer to operate in their isolated roles, developing programs to meet

specific learning needs. The challenge, therefore, is to develop positive relationships so that

they can work effectively to help resolve issues and business problems confronting this key

group, even when managers do not want to partner.

h. Manage the Corporate University as a Business

The corporate university has an operating budget just as other functions in the organization.

Fiscal management is just as important as delivering a variety of world-class programs. Top

executives seek accountability and responsibility from every department head, not just those

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in sales and operation. Operating within the budget, delivering programs efficiently,

managing vendor relationships productively and ensuring that the function provides excellent

customer service to all parties is an important aspect of running the corporate university. This

also includes allocating the appropriate resources to analysis, design, development,

implementation and evaluation, and streamlining the “make versus buy” decision.

i. Demonstrate the Value of the Corporate University

Top executives are asking corporate universities to thoroughly demonstrate their value to the

organization. A typical approach is to develop a corporate university scorecard, showing the

value of all programs using qualitative and quantitative data. The challenge is to move

beyond the traditional approach of counting “inputs”—such as the number of people served,

the number of hours, costs, etc.—to show the contribution in terms of application, impact and

occasional ROI studies. An effective evaluation system allows a micro-level scorecard to be

developed around each program, even if only reaction is measured, and to roll up the data to a

macro-level scorecard, showing the contribution of the corporate university on a weekly,

monthly, quarterly or annual basis (or even instantaneously).

j. Stay Relevant to the Customer

Corporate university leaders must avoid becoming out of touch with the customer. Corporate

university clients need content delivered locally, with products and services that are relevant

to the participants’ and the organization’s needs. Programs need to be unique and customized,

using “just in time,” “just enough” and “just for me” as a guide. While this is difficult, it is

achievable with today’s technology and modular formats.

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k. Involve Managers and Specialists in the Learning Cycle

The higher the level of executive involvement, the more the corporate university appears to

be a part of the organization. Managers should be involved in all phases of the learning

process, with some serving in active roles, such as facilitating programs or in review and

advisory roles. Jack Welch, former CEO of General Electric, is a classic role model for this

level of involvement. For years, he devoted several days each month to work at GE’s

management institute. This effort not only enriched the programs, but also provided the

impetus for other executives to become involved. The key point is to get executives and

managers involved without consuming much of their time.

l. Market the Corporate University in a Strategic and Subtle Way

Every entity needs marketing and branding for visibility, acceptance and success, and a

corporate university is no different. Marketing communicates the purpose, role, scope and

success. Branding is important so that the internal stakeholders understand what the corporate

university represents. A consistent and subtle approach is needed. Problems can surface when

marketing too much, turning off managers or even participants, or when marketing too little,

choosing instead to be the organization’s best-kept secret. A balance between the two

extremes is necessary.

Corporate universities can be a driving force in an organization. They can add value, drive

change and contribute to the growth and development of the overall enterprise, but only if the

corporate university is connected to the business, relevant, managed in a productive, efficient

manner and valuable to the organization. The success factors identified in this article are

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review points to judge the success of the corporate university and provide the impetus for

sustained improvement, change and growth.

12 GOALS AND MISSION OF A CORPORATE UNIVERSITY

Corporate universities are set up for a variety of reasons, but most organizations have the

same basic needs. These are to:

Organize training

Start and support change in the organization

Get the most out of the investment in education

Bring a common culture, loyalty, and belonging to a company

Remain competitive in today's economy

Retain employees

Corporate Universities offer valuable training and education to employees, but they also help

organizations retain and promote key employees. Although a CU may sound attractive, there

is a lot of work that goes into the planning and implementation of such a project.

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Mission of Corporate University

1. Participant satisfaction

2. Cognitive acquired knowledge

3. Technical skill acquisition

4. Attitude and perception change

5. Individual behavioral change

6. Individual behavioral change regarding application of new knowledge

7. Critical mass change

8. Culture change

For Example:

At McDonald’s, their training mission is to be the best talent developer of people with the

most committed individuals to Quality, Service, Cleanliness and Value (QSC&V) in the

world. Our strong commitment to the training and development of their People has resulted in

many “firsts” and honours, including below:

The first restaurant company to develop a global training centre

The only active QSR currently to receive college credit recommendations from the

American Council on Education (ACE), the United States’ oldest and most

recognized unifying body for higher education

Continually recognized for excellence in training

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13 PLANNING FOR A CORPORATE UNIVERSITY

Before planning a Corporate University a corporation should conduct a full learning audit and

assessment, a series of design workshops, the creation of a business case and

recommendations to senior management, implementation, and finally, further

recommendations and review. One of the most important goals is to ensure that the project

has support from the CEO down.

There are ten steps to implementing and sustaining a successful corporate university. These

steps are:

i. Executives or top management of an organization must form a governing body for the

corporate university, much like that of a traditional university, which will establish

and profess the organization's commitment to the program.

ii. The vision or strategic plan of the corporate university must be crafted;

thereby,determining the organization's goals for the program.

iii. The organization must then recommend a funding strategy. Most commonly,

corporate universities are either funded through corporate allocations or through

charges placed on individual business unit budgets.

iv. Next the organization must determine its audience or stakeholders who will use the

corporate university service.

v. In addition to determining the audience, the organization must also determine how the

needs of the audience will be met while continually pursuing the strategic goal of the

corporate university.

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vi. Following the completion of the above tasks, corporate university organizers must

develop a template for how products and services will be designed to achieve

university goals.

vii. The organization must also select suppliers, consultants, traditional universities and

for-profit firms who will act as learning partners, if appropriate.

viii. The use of technology and resources to be used by the corporate university must then

be determined.

ix. Additionally, a measurement system should be developed that will allow the

organization to continually monitor its progress against the university's strategic

goals.

x. Lastly, the governing body must communicate the vision of the corporate university

constantly and consistently. All stakeholders should be made aware of the mission,

products and programs that make up their organization's corporate university.

These steps may need to be tweaked to align with the size or goals of your organization.

Corporate Universities can be outsourced to a consulting firm or planned and implemented in

house. It is a growing trend for organizations to partner with traditional universities. A

traditional university brings organization, structure, and faculty. Universities are often

interested in Corporate Universities opportunities because of the economic gain. There are a

number of consulting firms that will help you to set up you Corporate University, but that can

become very expensive. This process can also take a long time, sometimes up to a two years.

Forming a cross functional team of business stakeholders can be used to launch the corporate

university.

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14 EXAMPLES OF CORPORATE UNIVERSITY

i. Walt Disney

ii. Boeing,

iii. Motorola.

iv. Hamburger University

Hamburger University is a 130,000 square foot (12,000 m²) training facility of McDonald's

Corporation, located at 2815 Jorie Boulevard in Oak Brook, Illinois, a suburb of Chicago.

This corporate university was designed to instruct personnel employed by McDonald's in the

various aspects of the business. Over 70,000 managers have graduated from the institution

and it has 30 resident professors.

Today, Hamburger University is on an 80 acre (320,000 m²) campus with 19 full-time

international resident instructors to teach students from more than 119 countries. The state-

of-the-art facility includes 13 teaching rooms, a 300 seat auditorium, 12 interactive education

team rooms, and 3 kitchen labs. Hamburger University translators can provide simultaneous

translation, and the faculty has the ability to teach in 28 different languages. Restaurant

employees receive about 32 hours of training in their first month with McDonald's and more

than 5,000 students attend Hamburger University each year.

Hamburger University was founded in 1961, at a McDonald's restaurant in Elk Grove

Village, Illinois. In the early 1960s, the first students had to complete strictly required courses

such as chemistry, marketing, and cooking so that when they graduated, they would be able

to create formulas to increase the profit of the company. Many of those with a "McDegree"

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were able to get jobs in a lab where they could invent new ways to enhance the food in an

economical way.

Curriculum

They have three different types of courses: Business specific courses, organizational learning

and communication classes, and management and executive training. What your company

decides to offer will depend on your needs (such as sales training, marketing, or soft skills)

and your company's business (like manufacturing, consulting, or technology).

Most CUs offer a blended curriculum of online and in person classes. Some organizations

offer courses during the workday while other offer them at varying times. Courses can be

short workshops or longer, more traditional courses.

Unlike traditional universities, CUs demand a return on their investment. There must be

concrete evidence that the classroom is delivering results. Many CUs provide hands-on and

team learning as a more effective alternative to lecture-based courses, but all CUs agree that

what is learned in the classroom should be directly applicable to the work environment.

For example:

Their curriculum is delivered using a combination of classroom instruction, hands-on lab

activities, goal-based scenarios and computer e-learning modules.

Like the UN, we have interpreters working with them, and they have the ability to teach in 28

languages including Spanish, German, French, Japanese and Mandarin Chinese. 

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McDonald’s employees align training with their specific career paths, including development

paths for crew, restaurant managers, mid-managers and Executives.

The Crew Development curriculum is developed and supported by the professionals at

Hamburger University and facilitated in the restaurant. For crew, this serves as a

foundation for management and support-staff career paths. 

Restaurant Managers progress their way through Shift Management and Systems

Management courses while attending one of our 22 regional training centers. Once these

courses have been completed, managers attend Hamburger University where they learn

the additional knowledge and skills they need to run a multi-million dollar restaurant. 

The Mid-Management learning path at Hamburger University is for business consultants

and department heads. It builds on their leadership and consulting skills, teaching

individuals how to effectively operate a business and how to coach and consult with

others to run great restaurants. 

The Executive Development learning path helps reinforce ongoing business and

leadership skills for top management. The courses available at Hamburger University

build upon the leadership competencies needed to support employees, owner/operators

and sales growth.

Cutler-Hammer University

Cutler-Hammer University (CHU), the corporate university of Milwaukee-based Cutler-

Hammer—a division of the Eaton Corporation, which manufactures electrical distribution

equipment controls components—is quite aggressive in its approach to marketing. In addition

to standard marketing vehicles (email announcements, posters, a brochure, a

printed/electronic course catalog, and a web site), CHU also markets its programs through

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trade shows, open houses, videos, CD-ROMs, extensive branding, and PR targeted to both

specific industry publications and universities from which it recruits. CHU is also regularly

promoted through a column in two company newsletters—one for employees, and one for

distributors.

“We make sure that we’re included in all of our corporate marketing programs,” says Molly

Murphy education manager of Cutler-Hammer University. This type of “co-op marketing”—

with both internal and external (vendors,etc.) business partners—is becoming increasingly

common as corporate universities establish relationships across parent organizations’

business units and the entire value chain.

A joint marketing approach is important to a corporate university like CHU that serves four

different audiences—employees, channel partners (distributors), industry (trade associations

and customers), and academia (faculty who use CHU’s online programs and campus

recruiting offices). Such an approach allows the corporate university to expand its reach and

more effectively tailor its marketing message to different audiences. The marketing vehicles

used to communicate to these different groups vary because the message varies; also, access

to the different groups varies, so some tools work better than others. For example, CHU has

more access to Cutler-Hammer employees, so posters found throughout company facilities

and the firm’s intranet are effective vehicles. For the distributors, ads and articles in their

newsletters have proven to be a successful marketing vehicle.

(http://www.corpu.com/site_media/journal/2000/may_june00.pdf)

NCR University

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NCR University, a division of the Global Learning organization of Dayton’s NCR (which

manufactures ATMs, scanners, and provides data warehousing solutions), is a globally

focused corporate university whose marketing strategy is appropriately broad in its scope and

methodologies. One of NCR University’s most notable marketing vehicles is its satellite

broadcasts of self-produced commercials. These one- to two-minute spots employ scenarios

that begin with titles and end with tag lines that communicate the corporate university’s

values, such as “Work Smarter”; “You’ve Got Plans, That’s Why We’re Here”; and “Success

Through Sharing.” The company screens these commercials on monitors deployed

throughout its facilities around the world. In addition to commercials, the broadcasts include

schedules of upcoming events and other training information. NCR University also holds

open houses around the world where representatives demonstrate the online component of the

university NCR University, like some other corporate universities, makes extensive use of

other marketing resources at the company that are not directly related to learning. “We

leverage all of the company’s communication vehicles,” says Bradley Luckhaupt, vice

president of global learning. “We have our own newsletter, The Learning Curve, that we

customize for each business unit, but we also do a lot of cross-linkage. We’re a part of human

resources and we’re linked—through a database—to all HR communications, so programs

we’re doing are automatically put into HR communications as they go out.”

( http://www.corpu.com/site_media/journal/2000/may_june00.pdf)

15 COMPARISON BETWEEN TRADITIONAL TRAINING DEPARTMENT, CORPORATE UNIVERSITY, AND TRADITIONAL UNIVERSITY

UNIVERSITY CHARACTERISTICS: REMARKS

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CORPORATE UNIVERSITY

Board of governance link learning to business strategies Speed and reach competency leaders Supply virtual network/ capability partnership with strategic alliances

An engine for knowledge capital that creates and enhances value for the Corporation. It is often deployed by an organization to enhance learning to respond to the future business challenges. Primary vehicle to develop and grow future leaders for the corporation. Often headed by the Chief Learning Officer who is directed by a high level Board and responsible for the realization of the “Learning Vision”.

CORPORATE LEARNING CENTRE

“Business Heads” council proactively build courses develops individual and team competencies leadership developmentLearning centre facility partnership with learning solutions providers

Provides specific requested and planned “ Courses” and supports specific On Job Training activities. Often acts as the coordinator for employees to acquire “Learning” for career development and job performance proactively. Often headed by a Training Manager who Is driven by Annual Training Calendar and Budget. Cover the whole Corporation to promote integration.

TRAINING CENTRE or DEPT.

Scattered training units reactively source courses addresses skill issues coordinate request for external courses

Provides generic requested short-term “ Courses” and supports specific “Job Skills Training” activities. Often the coordinator for employees who request for “External Program”. Part of an Organization that view Training as a expense and handle performance issues reactively. Often headed by a Training Officer who is driven by “Training Budget”.

16 THE FUTURE OF CORPORATE UNIVERSITIES

Corporate universities, like other lines of business within an enterprise, have customers and

other stakeholders whose wants need to be satisfied. They operate in an environment subject 31

to demographic, technological, and political trends that could affect their business. The

leaders of corporate universities need to define the business situation they face so as to

leverage their university’s strengths, minimize its problems, actively seek out and select

opportunities, and protect against threats. To treat a corporate university as a staff function or

support activity is likely to lead to the demise of the university. Corporate universities - if

they are to persist past a faddish stage of lip service to “learning organizations” - should be

managed as lines of business serving the learning needs of internal, and at times external,

personnel.

a) The corporate university business

The production of talent in every organization has become a business - a business that we

should examine as such. In order to determine the success factors in a business, an

environmental assessment is typically conducted and the current business situation is

examined. This information is used to identify alternative strategies to accomplish key

objectives. Alternatives are then examined in light of those critical factors that analysis, logic,

and intuition suggest are key in moving the organization toward its vision (Stumpf, 1993).

We begin by examining the corporate university environment.

b) The corporate university environment

A business, like a fish in the ocean, has many different environments. Fish may see their

environment as water, or water and photoplankton (food for many fish), or water,

photoplankton, other fish, predators, sunken ships, algae, and so on.

The “right” definition of the corporate university’s environment, much like the fish’s

environment, depends on what external factors affect the university over time as it attempts to

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achieve its objectives. The environment will change for many reasons, most of which are

outside of the control of the university. Some changes will adversely affect it, others may

have no effect on it, and still others may benefit it.

Three areas of the corporate university environment require particular attention: stakeholder

wants, competitive alternatives, and trends that could affect business education. Failure to

assess and reassess these aspects of the environment will hamper the analyses which follow

and lower the quality of decisions based on such analyses.

c) Corporate university stakeholder wants

The stakeholders in a corporate university are many, but four stakeholder groups are critical

to its survival and effectiveness: participants (typically company employees), instructors,

senior management (through their resources and ongoing sponsorship), and past participants

(those who have attended previous programs or programs at the corporate university). While

the wants of individual stakeholders may change over time as one moves from a participant

role, to a past participant role, to possibly a senior management role, the wants of each

stakeholder group are fairly well known. Some of these wants are widely shared across

stakeholder groups - for example, all stakeholders want the corporate university to provide its

participants with the knowledge, skills, and attitudes (KSAs) necessary for individuals and

the organization to perform at high levels of efficiency and effectiveness as a result of

participation in the program.

d) The corporate university threats

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Threats, things that could go wrong within the corporate university, are as numerous as are

the corporate university opportunities. To list them all would be demoralizing. However,

identifying a few might stimulate thought and change. Consider the following threats which

could materialize by the year 2000:

• the price-value relationship offered is not accepted by senior management;

• the proliferation of specialized programs cannibalizes the corporate university core

curriculum concept; resources get spread too thin and enrollments decrease;

• economic conditions become severe – educational efforts are curtailed.

• senior instructors do not retire and younger hopefuls are denied this career path – the

quality of education suffers as the more senior instructors lose touch with new educational

techniques or the changing business environment.

CONCLUSION

Corporate universities can be a driving force in an organization. They can add value, drive

change and contribute to the growth and development of the overall enterprise, but only if the

corporate university is connected to the business, relevant, managed in a productive, efficient

manner and valuable to the organization. The success factors identified in this article are

review points to judge the success of the corporate university and provide the impetus for

sustained improvement, change and growth.

REFERENCE

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AACSB (1999), “Corporate universities emerge as pioneers in market-driven education –

1999 survey of corporate university future directions”, AACSB Newsline, Spring,

available at: wwwaacsbedu/publications/printnewsline/NL1999/

Becker, G.S. (1964), Human Capital: A Theoretical Analysis with Special Reference to

Education,Colombia University Press, New York, NY.

Meister, J.C. (1998), Corporate Universities – Lessons in Building a World-class Workforce,

McGraw Hill, New York, NY.

Paton, R., Peters, g. Storey, J Taylor, S. (20050 Handbook of Corporate University

Development, Gower, USA

Paton, Rob; Geoff Peters, John Storey and Scott Taylor (2005). Handbook of Corporate

University Development: Managing Strategic Learning Initiatives in Public and Private

Domains. Gower Publishing, Ltd.

Price, C. and Beaver, G. (2001), “The rise and rise of the CU: the emerging corporate

learning agenda”, The International Journal of Management Education, Vol. 1 No. 3,

pp. 17-26.

Solomon, C.M. (1989), “How does Disney do it?”, Personnel Journal, Vol. 68 No. 12, pp. 50

Schultz, T. (1959), “Investment in man: an economist’s view”, The Social Service Review.,

Vol. 33 No. 2, pp. 109-17.

Smith, A. (1998), Training and Development in Australia, 2nd ed., Butterworth.

Taylor, S. and Paton, R. (2002), Corporate Universities – Historical Development,

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Human Resource Development, Pearson Education, London, pp. 412-37.

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