Recent Read: “The Future of Leadership Development”

The latest issue of Harvard Business Review has a strong piece by Mihnea Moldoveanu (Professor, Rotman School of Management) and Das Narayandas (Professor, Harvard Business School) on the future of leadership education. Their thorough analysis lays out the major forces driving a profound transformation in the way leadership (and indeed many other subjects) is taught in the corporate environment.

The authors start by noting that the traditional teaching agents and models are being torn apart, because they quite simply have not yielded the results to justify their existence. The authors cite three main reasons for the decreasing relevance of the traditional leadership education model:

The first is a gap in motivations. Organizations invest in executive development for their own long-term good, but individuals participate in order to enhance their skills and advance their careers, and they don’t necessarily remain with the employers who’ve paid for their training. The second is the gap between the skills that executive development programs build and those that firms require—particularly the interpersonal skills essential to thriving in today’s flat, networked, increasingly collaborative organizations. Traditional providers bring deep expertise in teaching cognitive skills and measuring their development, but they are far less experienced in teaching people how to communicate and work with one another effectively. The third reason is the skills transfer gap. Simply put, few executives seem to take what they learn in the classroom and apply it to their jobs—and the farther removed the locus of learning is from the locus of application, the larger this gap becomes.

The authors present several trends that are emerging as a new ecosystem of learning takes shape. The first trend is a movement to targeted learning shaped for specific individuals and not generic groups/classes. They call this model the “personalized learning cloud” or “PLC.” The authors note that the arrival of the PLC “has lowered the marginal cost of setting up an in-house learning environment and has enabled chief human resources officers (CHROs) and chief learning officers (CLOs) to make more discerning decisions about the right experiences for the people and teams in their organizations.

The second trend they highlight is the decline of classroom-based instruction for executive development, which has been the traditional strength of business schools and universities. As they note, younger managers are very comfortable in digital environments and are increasingly skeptical of the campus setting as a sine qua non of education. Moreover, note the authors, “there is also a growing recognition that leadership development should not be restricted to the few who are in or close to the C-suite.”

The third trend they highlight is the rise of custom learning environments, “through platforms and applications that personalize content according to learners’ roles and their organizations’ needs.” These new platforms, the authors highlight, are changing the core fundamentals of leadership education. First of all, they allow the best instructors to de-couple themselves from academic settings and tech digitally. Second, they allow content to be custom-tailored to the needs of small clusters of users. Lastly, they allow companies to measure impact and value close to, and even in line with, actual operations.

It’s important to highlight the first change noted above, because it has the potential to be the most disruptive. As the authors note:

Companies can go online to identify (and often curate) the highest-quality individual teachers, learning experiences, and modules not just the highest-quality programs. Meanwhile, instructors can act as “free agents” and take up the best-paying or most-satisfying teaching gigs, escaping the routines and wage constraints of their parent organizations.

They are quite right, and this decoupling of the best instructors from once-captive academic settings will only increase in the future. Indeed, my own company, KatalystNet, is creating bespoke cohorts featuring world-class thought leaders from academia but also from the c-suite and venture capital worlds to create new digital-only collaboration and innovation environments that were impossible just a few years ago.

For now, our own Cohorts are not focused on accreditation, but that may not be too far into the future. For, as the authors note, the revolution in education taking place today is also creating new accreditation models and platforms. We are entering, they write, “a new era of skills- and capabilities-based certification that stands to completely unbundle the professional degree. Indeed, in more and more cases, it’s no longer necessary to spend the time and money to complete a professional degree, because organizations have embraced certifications and micro-certifications that attest to training in specific skills.”

A good example of this phenomenon is Viridis, a startup founded by Felix Ortiz, an Army veteran who wanted to make it easier for Vets to map their training and skills into the civilian workforce. Part of the Viridis model is the creation of a “Universal Skills Passport” that allows workers to gather and manage their accreditations in one company-independent setting. This feature has always been available to college graduates, of course, who take it for granted that Company A will recognize the same degree as Company B, a massive benefit that was not the case for those trained in the military or corporate technical programs. It’s great to see this kind of evolution, and I foresee the increasing availability of independent accreditation models, a trend which is already underway, e.g. Google’s Cloud Certification model.

Indeed, I predict that a classic unbundling will happen not just in leadership training but in higher education as a whole. Today, higher education has three main building blocks: educational content creation and delivery, campus life, and accreditation functions. We are already seeing the breakup of these three elements, and, in a few decades, I think we will see multi-school campuses, where students live and play, while attending digital classes from multiple education providers. Once their work is complete, or along the way, they will “sit for exams” and acquire skill validation from independent third parties, some of whom may be today’s universities but others will be corporations or “accreditators” not yet born.

In closing their piece, the authors write, not without some understatement, that “business schools will need to significantly rethink and redesign their current offerings to match their particular capabilities for creating teachable and learnable content and for tracking user-specific learning outcomes.” Anyone who spends time in business schools today, even the most elite ones, knows the great debate underway about the decline of the traditional MBA and the rise of new players, as well as the shift of some management training and innovation funding to graduate schools of engineering. Personally, I welcome this shift, since it not only democratizes once-exclusive learning and collaboration platforms but also brings them closer to the daily working lives of professionals.

“How you gather, manage, and use information will determine whether you win or lose,” Bill Gates famously wrote two decades ago. As in so many things, he was right, and what matters is having a network of insight sources around you throughout your career, not just during the few years you are at school. Indeed, a study by Stefano Breschi and Francesco Lissoni illustrated this point well. In an earlier post, I described how they found that an innovator’s knowledge of her field was based much more on her connections with other researchers than her own individual research. As I wrote, “the more isolated an innovator is, the less likely it is that she has a full grasp of the field in which she is trying to innovate.” I would say the same applies to young managers as well as to c-suite executives.

The good news, as the authors highlight in this excellent article, is that the old models of rigid, programmatic insight delivery are breaking down rapidly. This will be a challenging transition for business schools, but one I think is long overdue. Hopefully, we will soon find that the information revolution, which has heretofore largely bypassed business education delivery models, will open the best learning to everyone.

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Carlos Alvarenga

Founder and CEO at KatalystNet and Adjunct Professor in the Logistics, Business and Public Policy Department at the University of Maryland’s Robert E. Smith School of Business.

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