Sometime in the mid-1950s, Ralph Cordiner, then president of General Electric, was convinced that the single biggest thing holding his company back was lack of talent. The company was growing and moving outside traditional geographies and product lines and he needed his employees’ skills to grow with them.
His solution would be a historic one; Cordiner established the Crotonville Management Training Centre in New York in 1956, popularly known as the world’s first “corporate university”. This was an integrated training academy within GE with a dedicated faculty and a curriculum that reinforced the skills required to achieve overall company strategy.
Today, at least 4,000 companies worldwide have corporate “universities” of their own. They are seen as industry’s answer to the widening skills gaps and the need for companies to take matters into their own hands instead of leaving the main responsibility for training employees to external bodies like universities or vocational institutes.
Some examples include McDonald’s historic “Hamburger University” and global nuclear giant Areva’s training campus in France, which creates the talent that supplies much of the country’s energy. These corporate institutions of learning are responding to the singular need to more clearly align employees’ skills with company needs and institutional culture.
In Africa, corporations are desperately looking for appropriate skills, from entry-level to the C-suite. Entry level skills desired include an aptitude for critical thinking, communication, leadership, project management and data analysis.
Further up, managers and executives need effective leadership, management and financial skills; an understanding of the markets they operate in and an aptitude for complex decision-making. Beyond this is a nuanced understanding of how best to engage with government and how technology can be used to drive productivity.
Traditionally, these African firms have trained employees through short internally-run seminars and by sending senior managers to prestigious business and management training institutes. The hope, for the firms spending on courses at such schools, is that in addition to developing rising managers, their investment would inspire a sense of loyalty among those who are sent to the programmes.
However, the opposite has often been true as marketable diplomas make top talent more vulnerable to poaching by competitors. Another problem is that external programmes are highly standardised, they don’t fully prepare employees to tackle a company’s unique challenges. This necessitates more targeted internal training, a costly duplication of effort.
Benefits of corporate education
Therefore, corporate academies are advantageous on both fronts. They can inculcate company culture and at the same time develop skills that are more specific to the firm’s needs. Internal training certificates are less appealing to competitors and provide an opportunity for career progression while lessening the threat of poaching.
At entry-level, it gives companies an opportunity to prepare talent for a career at the firm by combining skills development with a complete immersion in company culture.
An example of a company doing this is Indian tech giant, Infosys, which founded its $120m Global Education Centre in Mysore in 2005. Most of its 200,000-strong workforce was initiated here through a programme which Fortune magazine claims is “harder than Harvard”.
Classes for “freshers”, the affectionate name given to those who haven’t yet secured permanent positions at the firm, typically run for eight hours a day and include intensive coding workshops, team-building sessions and learning workplace etiquette. In order to graduate, and secure a position, freshers have to pass six hours of testing.
The cost is approximately $5000 per fresher and on average about 2% drop out, a significant margin to lose. However, the company continues to invest in Mysore. A major expansion project was inaugurated in 2009, and today it can train up to 14,000 Infoscions at a time.
However, we have to appreciate that not every African company can afford to replicate training at this scale. This might mean that other pathways for corporate education have to be explored. A possible alternative is training through partnerships with specialised companies or civil society organisations.
Harambee, a youth employment accelerator based in Johannesburg, does just that. They source young talent from areas traditionally overlooked by corporate South Africa, like townships and rural villages. Working with companies, Harambee trains young people for industrial placements with the hope that it leads to long-term careers.
In addition to employability training, many firms working with Harambee top up with in-house or industry-specific courses, thereby significantly reducing their overall spend on entry-level training. Today Harambee works with over 300 firms across the country and has trained 30,000 candidates since 2011.
New-age boot camps
Another option for firms looking to develop talent is outsourcing to new-age “boot camps” which – unlike traditional programmes – are solely focused on skills development versus academic theory. Outfits like General Assembly focus on 21st century skills like coding and data science.
FullBridge uses a similar model, but with a focus on basic entry-level business skills, while Shillington does the same for graphic design. All operate on the ethos that constant upskilling is vital to a modern career.
While many such boot camps started out initially focused on individuals, they are increasingly working with corporate clients. General Assembly, for example, recently learned that 40% of those enrolling for their courses were being sponsored by their employers.
Companies which have smaller training budgets, also have the option to subsidise individual courses, by for example, giving employees a partial reimbursement on, say, a coding boot camp at General Assembly.
Africa needs to establish similar entities to support the skills development of companies on the continent. These training organisations can be adapted to our context and should focus on subjects such as entrepreneurship, leadership or even doing business on the continent.
Companies that aren’t willing to be more proactive in developing their own talent run their own risks. When Infosys began the Mysore project in 2005, it was an unprecedented move by any technology firm on the subcontinent. It wasn’t long before it changed the tech talent market in India completely. As the cost of well-trained engineers went up, firms that hadn’t invested in training their own staff were forced to pay for talent at much higher premiums than before.
In Africa, companies should expect similar consequences. They can either be part of creating a future of talent that they want or accept one that will be imposed on them.