Nov. 27, 2007

Can Higher Education Manage Talent?

By Doug Lynch

Much ink has been spilled lately about a looming talent crisis, with pundits and industry analysts warning that, in the not too distant future, American employers will not have the requisite talent to succeed competitively.

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In theory, institutions of higher education know a lot about how to develop the skills required for success in the working world — skills like critical thinking and problem-solving. Contrary to the popular notion of the college campus as a cloistered ivory tower, most American colleges are professional schools that focus on preparing students for the marketplace; even within the liberal arts, we produce far alumni who go on into business than alumni who become poets or conduct basic scientific research. Indeed, examples abound of cooperation between colleges and employers to develop the workforce, and as the business community seeks to develop and retain talent, it seems increasingly amenable to turning to academe for its expertise.

But does higher education model what it espouses? One would expect that, in a knowledge economy, the producers of knowledge (those institutions of higher education) would value “talent management” and even have a competitive edge in that realm. But the data suggest that colleges lag behind industry in developing and retaining their own talent.

The American system of higher education is marked by incredible institutional diversity and one would assume that a key component of differentiation among all those schools would be a similar diversity of faculty. The facts suggest otherwise. For instance, some 50 percent of all faculty members are adjuncts, who often teach the exact same courses at “competing” colleges. Even among tenured faculty member, the average consumer of education would be hard pressed to differentiate “products” based on faculty. Do you think you could, without knowing the “brand,” identify a given institution on the basis of its faculty’s pedigree? Institutions trade faculty on the open market, and it is unclear that there are any real differences among the vast majority of them.

While most colleges do a good job of developing their students, they are less successful at helping their faculty and staff improve their skills. The very tools used to develop students are not easily available to the institution’s employees. Most colleges have in place some mentoring of junior faculty to help them make tenure, but few have fully realized strategies for talent growth and development. To date, I have not seen a single college that has the kind of “chief learning officer (CLO)” routinely found in Fortune 1000 companies.

Let me elaborate. A doctoral student at any Ivy League institution might receive $50,000 per year in non-taxable financial aid. But a college employee who takes the same courses at that same institution is most likely taxed on that professional development as if she were the sole beneficiary of the learning. Furthermore, while many colleges market continuing education courses to employers, few encourage or reimburse their own employees to take those same courses. One might argue that the sabbatical is the biggest investment a university makes, but that is limited to tenured faculty members largely and ironically, it is an unstructured professional development experience, if one followed the logic, then we ought to do away altogether with programs of study and curricula.

At the same time, many large companies recognize the value of strategic relationships with higher education institutions in developing talent. According to a recent study by the Council for Adult & Experiential Learning, many employee tuition remission programs have been reassigned to CLO’s as part of their array of professional development tools. Here at Penn, we have launched a program designed to develop CLO’s for companies and have found that companies are happy to pay their employees’ tuition.

There appears to be a mounting trend that has many companies advocating for the worth of talent development within colleges, while colleges themselves dismiss the notion. Companies are increasingly arguing that if, for example, sending an executive to a professional development conference is not taxable, then enrolling her in a Wharton program shouldn’t be either.

The great irony in higher education’s reluctance to join in the growing move toward workplace-based learning is that, with all the infrastructure in place (teachers, classrooms, technologies), colleges and universities face far lower marginal costs in providing such programs than do other employers. At a minimum, colleges ought to:

• Ensure that all faculty and staff can take course or programs of study that develop them professionally whether the programs are for credit or not-for-credit.
• Follow corporations’ lead and stop treating credit bearing courses — if they are for professional development — as a taxable benefit but rather as professional development.
• Develop and implement 360 type evaluations for all employees, including faculty members.
• Work with their own executive education programs to develop customized programs to train staff and faculty on things like leadership.
• Develop comprehensive succession plans to develop leadership talent from within.

Higher education is big business. Here in Philadelphia, the University of Pennsylvania is the largest private employer in the region, and across the country, small towns are often as not “college towns,” where the college is the engine driving the local economy. As an industry, higher education ought to better manage its talent.

More important, if colleges want to be perceived as part of the solution rather than a major cause of the looming crisis, they must examine their culture and policies to better align them with what we collectively know to be true — that access to knowledge and talent is the key to a future society that is both just and wise.

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