The unstoppable rise of Corporate Universities

19-10-2022 | News

The number of corporate academies grows every year. The most advanced entities are configured as real containers of knowledge available not only to the companies that give rise to them, but also to the stakeholders with whom they interface.

by Giuseppe Cappiello

It was the year 1927 when General Motors founded, first recognized experience, its own Academy, or a specific organizational structure of the company through which train staff to perform tasks that were beginning to become increasingly specialized. The effects of the Industrial Revolution were manifesting themselves on a large scale and Frederick Taylor had been publishing i Principles of Scientific Management (1911). After financial capital, a new factor of production began to impose itself: knowledge. 

As highlighted by Abramovitz, the main part of the growth that occurred between 1870 and 1950 in terms of per capita income (297%) must be attributed to factors other than the amount of labor and capital used and relate, for example, to greater rationalization of tasks, production or changes in institutional structures; in short, to greater investments in research and more generally in the generation and use of knowledge.

Nowadays, almost a hundred years after the seminal initiative of General Motors, thousands of companies worldwide have decided to have their own structure specifically dedicated to knowledge management. In Italy in 2012 there were 39 and an ongoing investigation promoted by Unica, the Corporate University of the Unipol Group, surveyed more than 130. 

Knowledge, in hindsight, has always been a fundamental resource (thehomo sapiens it asserts itself in the evolution of the species due to the ability to accumulate knowledge), but it acquires specific attention only with the modern age, when the application of the scientific method allows the verifiability of the statements through reproducible experiments. 

In the field of management and business economics, the importance of resources was recognized only around the 1980s "firm specific"Accumulated over time within the boundaries of the company, resources that are difficult to imitate due to legal protections, as in the case of patents, or due to the possibility of combining and using them in an original way. For a long time it was thought to manage the growing complexity of the competitive environment through the calculation of convenience and organization, planning the activities to be carried out as much as possible. But the formula didn't hold up.

The removal of national barriers has made it possible to geographically extend both the procurement of goods and workforce and the outlet markets. In this way, for the fastest and most able to seize opportunities, global value chains have been consolidated that involve companies that previously failed to connect and that now compete and cooperate at the same time. The innovations in the field of communication and information (ICT) have certainly favored this fabric of relationships.

The emerging "revolution" has three characteristics: it is exponential, digital and recombinant

In 1965 Gordon Moore, at the time head of Research and Development at Fairchild Semiconductors and later founder of Intel, predicted that in the following years the quantity of components present in a semiconductor would double every year. Beyond the corrections that could be made to Moore's Law, it is true that the the pace of technological development and the multiplication of uses of knowledge has followed an exponential and non-linear function.

The coding of information and the digital transformation in progress not only lead to a reduction in production and, above all, reproduction costs, but also to a change in the business model and ownership structure. 

As is known, for example, the greatest cost of an editorial product (book, audio, video) is the creation of the first copy and each reproduction takes place at a marginal cost close to zero. However, this is not the richest issue of consequences since digital allows interaction between the various users and also the creation by the user of a part of the final value. The digital road maps have archived the paper ones and facilitated the achievement of a destination; digital maps are also used at an industrial level together with sophisticated programs that optimize routes, but the real potential is manifested when the suggested routes change according to traffic conditions, information that is automatically received from other connected users. It is therefore a business model that is based on co-creation of value

Finally, the current revolution is recombinant, that is, it continuously recomposes new forms using the same "bricks", a bit like the usual seven musical notes that generate ever new songs.

In this context it is difficult to distinguish the causes and effects of the continuous growth in the number and size of Corporate Universities, a phenomenon that goes far beyond the simple reorganization of corporate training; probably the contemporary manifestation and chasing of innovations has accelerated the path of change that we are witnessing and has emphasized the need to generate internally, or acquire from the outside, ever new knowledge to better understand the present and identify greater solutions for the future. customer value.

Knowledge management for a company assumes a strategic role in at least two circumstances: the first concerns the time of hiring new staff; both for the company and for the worker it is important to integrate with the rest of the organization both in terms of alignment of skills and organizational climate and consolidation of "social norms".

The second circumstance, on the other hand, concerns those periods in the life of a company characterized by the introduction of technological innovations, by institutional changes or, in general, by any situation that requires a reorganization of work. Think, for example, of the effects of the ongoing health emergency.

In these crucial steps in the life of a company we are witnessing a rapid obsolescence of available knowledge, as well as the change in the number of tasks. The qualitative component of work is growing and this is especially to the advantage of the most skilled workers. The most pessimistic forecasts regarding the future of work predict one polarization from the tasks to the detriment of entire categories of professional figures. 

In moments of change, the main solution exercised is to fill any gaps or inadequacies with respect to the new challenges through traditional training, perhaps by increasing the hours provided; Corporate Universities seem to have broader objectives. It is not just a question of transferring new content to workers, but of sharing a vision, an interpretation of events, and hypotheses to face the new.

The ways in which companies set up a Corporate University are varied and change, even temporally, according to the needs and culture of those who govern them. The most advanced entities are configured as real containers of knowledge available not only to the companies that gave birth to them, but also to all the interlocutors with whom the companies usually interface (stakeholder university) and with which they consolidate the share capital. 

It will be interesting to see how this phenomenon will evolve and what will be the reaction of traditional training agencies. 

Giuseppe Cappiello he is Associate Professor of Economics and Business Management, University of Bologna.

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