After a company is acquired or merges with another business, each department needs to merge, too. When Komatsu, a manufacturing company, acquired Joy Global, in 2017, each company’s training organizations began a process of merging people, functions and content.
In the first episode of the second season of “The Business of Learning,” we speak to Scott Farley, group director of talent management at Komatsu, and David Fogleman, chief learning officer at SkillPath, about their experiencing managing this merger process and its accompanying culture change.
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The transcript of this episode follows.
PODCAST INTRO: Welcome to The Business of Learning podcast from TrainingIndustry.com.
SCOTT RUTHERFORD: Hello, and welcome to The Business of Learning. I’m Scott Rutherford, head of digital operations and marketing at Training Industry, Inc., here with my co-host, Taryn Oesch, managing editor of digital content at TrainingIndustry.com.
TARYN OESCH: We had a great season 1, and we’re excited to make season 2 even better. This season, we’ll be expanding the episode notes for each episode and making more resources available to support the topics we cover in the podcast. To find the episode pages, go to TrainingIndustry.com/Training-Industry-Podcast.
SCOTT RUTHERFORD: Also new for Season 2 of the podcast, we’re going to move to a new release schedule, so you’ll have a better idea when new episodes will be available! Starting with this episode, look for new episodes of The Business of Learning on the last Monday of every month.
TARYN OESCH: We’d love to hear your feedback, as well. If you enjoy the podcast, leave us a review on Apple Podcasts. Do you have any topics you’d like to hear about? Email us at firstname.lastname@example.org. Now, for episode 1 of the second season of The Business of Learning! Thanks to SkillPath for sponsoring this episode.
[ Sponsor Message – This Episode of The Business of Learning podcast is sponsored by SkillPath, www.skillpath.com ]
TARYN OESCH: Our guests today are Scott Farley, group director of talent management at Komatsu, and Dave Fogleman, chief learning officer at SkillPath. Today, we’re talking about the challenges of integrating businesses after an acquisition, particularly for Learning and Development, and how L&D can help employees adapt to a new business structure. Scott, Dave, thanks for joining us.
SCOTT FARLEY: Absolutely. Thank you.
DAVE FOGELMAN: Thank you.
SCOTT RUTHERFORD: So let’s start off, maybe we’ll start with you, Scott. If you could start by just telling us a little about your business and you know for those who may not be familiar with, with what you do.
SCOTT FARLEY: Sure, absolutely. So I work for a company called Komatsu. We manufacture heavy equipment for the construction, mining, and other industrial segments as well. And relatively recently, about two years ago, the company that I was working for at the time, a company called Joy Global, that focused on the mining part of that industry group, we were acquired by Komatsu. So we’ve gone, we’ve been going through the experience of being the acquired company over the last two years, figuring out what that integration looks like and prior to that we had made a number of significant acquisitions in our own space. So it’s been interesting over the last eight years to experience integration from the standpoint of being the acquiring company. And now, of course, in the last two years, having been acquired. My role within the organization as group director of talent management is to lead our strategy and our efforts around talent development talent acquisition and inclusion and diversity and in the talent development space in particular that starts to kind of expand out into both talent management and learning. We’re very much an integrated talent management function. And so, have had a chance over the last two years to give a lot of thought to this question of, what is it that Talent Management can do to add value in times of what can be fairly tumultuous change for employees across the organization and looking forward to getting into the conversation today.
SCOTT RUTHERFORD: And, Dave, maybe to set us off a little bit, can you give us 30 seconds of what SkillPath is all about?
DAVE FOGELMAN: SkillPath is a learning and training company that a focus on what would typically be called business soft skills. We have a particular capability to support leadership, productivity, teamwork, communication, and compliance programs. We have the ability to customize solutions for clients, businesses we work with, and have the opportunity to also leverage the opportunity we have to present on site at a customer’s location, and at the same time present public seminars on many of these same topics, that employees of those companies can attend as they wish.
SCOTT RUTHERFORD: So maybe let’s start in with looking at the experience of managing talent and learning development opportunities from the perspective of Scott of, first, as the acquiring company. You mentioned the arc has been, having brought on companies within Joy Global, and then having Joy Global be acquired by Komatsu. Are there different challenges when you’re the parent, for the lack of a better term?
SCOTT FARLEY: Huh, yeah. You know, I think there are, I think they’re in our particular case some of the, the potential benefits ended up looking the same, but I don’t know that that’s particularly common so from the and I’ll speak more to what I mean by that a little bit, but from the standpoint of being the acquiring company, I think, we’ve been very much looked at to bring the project management change management and to really make the case to employees within the acquired company of how does this make their lives better. Or if there are changes that aren’t making their lives better, is there some offset that we can talk about where maybe their lives are being made better in some way. Because now we’ve got professional development opportunities that weren’t available before, or because of the financial circumstances of the company, that wasn’t an investment that they were able to make, and now, because you’re part of a larger organization, you’ve got access to some of these opportunities. Those sorts of things become part of the case for, why engage with this new company. And, I think the biggest challenge, a lot of times with an acquisition, you know, people can cross off all of the the logical check marks, the legal integration, the integration of financial results. I mean, those are all absolutely necessary and need to be looked after. But we all know you know the people side of one of these transactions is enormous. And it shows up in interesting ways when people aren’t engaging with the new parent company, if you will, everything from, you know, the old sorts of logoed merchandise and things from the old company still being out there on the desk to, you know, people just not letting go of that old name. And there are things that you can do, and I think sometimes it goes even deeper than that, you know, we’re going to focus on this site that used to be a site of the company that got acquired and we’re not going to really connect. We’re not going to collaborate with the larger organization. We’re going to continue to operate as our own little entity and I think those are some of the strategic decisions that an acquiring company needs to make- are you going to allow that? And there may be good strategic reasons to allow it, or are you going to actively look to bring these new employees into the fold and engage them with the culture and opportunities that exist within your company. That’s what I’ve seen as our role as an acquiring company. And, you know, from a standpoint of talent management, we’ve been fortunate in that we have been able to be part of that positive case to say, look, you weren’t focused on succession planning. You weren’t talking about high potential development. You weren’t providing leadership development training. We can give that to you now. And so immediately day one, people were receiving something that hopefully positively impacted the work they were able to do and the opportunities they were able to have.
SCOTT RUTHERFORD: Right, and you’re talking about, you’re really, you’re managing culture change through demonstrating benefit to the employee. It would seem like the first role that management would have for L&D in the context of an acquisition would be to focus on operations, to make sure that people are skilled and able to perform appropriately, which is sort of the harder side of L&D. But what you’re talking about is, is all of the facets that affect culture and retention and the softer objectives.
SCOTT FARLEY: Yeah, absolutely. If it’s all right. I’ll shift, just a little bit to when we were acquired by Komatsu. Interestingly, they didn’t as the acquiring company have that business case that said, or that that case to employees that said, now you get X, Y, and Z in the development space. We as Joy Global have been actually able to scale up and introduce development opportunities to the company that’s acquiring us. And so early on we identified opportunities for the talent management function to come in and do training on change leadership and some key soft skills that we saw as necessary for managers who were starting to engage with their counterparts in other parts of the business. Cultural acumen at both the national and organizational level, and product training. And product training starts to get into that hard space you were just referring to. But we really had to sit down and think about what are all the ways that we can touch this integration and help to facilitate it, by imparting knowledge or sharing best practices or just guiding our leaders to a mindset that was going to be really effective and it helped drive this change forward.
TARYN OESCH: Scott, when did you start working with skill path and why?
SCOTT FARLEY: It’s a great question. We actually, when I joined join global some of my peers at the time were already doing work with skill path as a way of just strengthening the overall development opportunities that we had for employees. At that time there wasn’t a lot honestly that we were doing internally in terms of leadership development and one of my colleagues in Pennsylvania had been working with SkillPath for some time, offering just regular quarterly development opportunities. One day classes, that sort of thing, just to keep bringing in relevant topics to the business. We had an opportunity then and I believe about 2015 we were looking for training for some of our team leads and supervisors in our manufacturing centers, and SkillPath helped us to customize a training course on Supervisory Skills, and particularly in the moment coaching. You know, we were doing some other work with leadership development, but some of those coaching models were really geared more towards what you do when you know you’ve got a performance issue, or you’re preparing for a longer term view, a career development discussion. And what we said was, you know, what we actually need is we need to help these team leads and supervisors with difficulty they’re having in the moment, they see a behavior that is either unsafe or is somehow violating a process, and they need to respond and provide coaching and redirect right in that moment, we didn’t feel like we had that and SkillPath came to the table with a really nice solution for us. Based on that, you know, we started to do more work making SkillPath courses part of our annual training calendar and then when it came time to develop a course that would be supportive of our integration activities, and the project that we had around change management, we said, you know, there’s, there’s a change management model that we’ve been using, but that supplier is very rooted to English language training delivered in the U.S. And we felt like we, knew we needed to go beyond that we needed to have it multilingual we needed to have it as something that we could effectively do a train the trainer for that wouldn’t take months of certification and again, very collaborative process with SkillPath to get us to a place where we had a three and a half day course multiple modules that we could train others in the business, both within the acquiring Komatsu business and within that Joy Global business to help employees at multiple levels to adapt to the change to think about resilience and to, in some cases, coach others to adopt change more quickly. So it’s been a long and varied relationship with SkillPath, but one that I really feel has both supported and elevated what we’ve been trying to do with the talent management function.
SCOTT RUTHERFORD: So it sounds like it’s really been a partnership on programs and content that started if I’m understanding you right, with Joy Global, and then extended to the larger and combined business through the merger. I’m wondering, Dave, if you can comment to how SkillPath approach this approach that in terms of understanding the needs and how did, how did that relationship come together and, you know, bring us bring us to the current day if you could?
DAVE FOGELMAN: Sure. Now, and I would first of all really accent what Scott was saying earlier about the challenge and a time of a merger or acquisition and all of the operational distractions that are going on. And all the reasons why an organization may say, we don’t have time to really put forward a comprehensive learning program that our employees can personalize or work with their managers to personalize. We understand there’s a lot of change going on but we really don’t have the time, resources or energy to really think through solid change management. And so I think one of the remarkable things, and something that certainly been a pleasure for us to participate and put together with Scott and Komatsu, is a really comprehensive learning and development program that all of the employees can participate in, that creates an element of personalization and choice, which is very important as we all know, these days. And at the same time really tackle those large global issues of change management that are always present in any time of a merger or acquisition. And so the starting point, certainly for the work we did, was the vision and the anticipation that Scott and others and Komatsu had about putting together a program that would address all of that. So we’ve, Scott alluded to this earlier, we had the opportunity to partner with Komatsu and really creating two very distinct paths of learning. The first and long term training solution initiative that we put together with them has been to support Komatsu is open enrollment training and that allows participants employees to self-register for inclusion in a year-long curriculum based on the learner’s needs or preferences, without any kind of formal assignment or required prerequisites. So again, you see that element of choice and personalization in this part of the program. We went ahead and selected the right titles and did the design work and those titles were then deployed at to Komatsu and the topics are generally in what we would just call the business knowledge or soft skills area and they include areas like mastering negotiations, inclusion and diversity, global communication and cultural difference, how to excel at managing and supervising people, which Scott alluded to, innovation and creativity, critical thinking and problem solving, organizational savvy, time management and personal influence. So that was really a comprehensive program put together so that the associates at Komatsu feel like that momentum is absolutely going toward their own personal development and really addresses the ‘what about me’ question. But we also had the opportunity to create kind of a second line of training development with Scott and Komatsu, which was really a consultative client driven custom design that we did, and thats related to change management and everything that Scott alluded to. So we engaged with Scott and Komatsu to design curriculum offerings that we’re going to support the change mental training needs that company had and we created kits that were composed of core course participant workbooks and facilitation guides for three topics that included effective peer to peer coaching change management and resilience and emotional quotient, the keys to successful leadership. So very consultative very collaborative very much a partnership between the skill path team and Scott in the Komatsu team. And our client services model included creating on site instructional design with key internal stakeholders participating putting together correct curriculum mapping where needed, and really making sure that the solutions we were proposing had the right level of review and buy in and then had train the trainer activities and other elements to make sure that the program would succeed.
SCOTT RUTHERFORD: You mentioned the collaboration between the two partners here and I wanted to maybe dig into that a little bit more just to understand because, well, I would argue that training needs and development needs in the business are, if anything, not static. So there’s always going to be shifting need. So how do you manage from both the business side and also from SkillPath as training provider partner. How do you manage that collaboration both sort of identifying as needs shift and then making the necessary changes to the course or program offering to adapt to that?
SCOTT FARLEY: You know, it’s a great question. And it’s actually something that, another area and I know we keep using this word, but I think it’s really the right one. The partnership really allowed us to challenge a practice that was in place in some of my early dealings with SkillPath, where we said, you know, if we booked. If we booked a session one of those courses that Dave mentioned that might be part of our annual training calendar. That was it. It was on the calendar. We were locked into it and we needed to market to that and promote it and we were kind of locked in. What we were able to do in the last few years is to really, really look at that and come together and say okay, what we really need to be able to do is to perhaps shift a title, perhaps we put something on the calendar, you know, we’re in the process of building the calendar for our fiscal 2019 right now because our fiscal year starts in April. Here I am building a training calendar in February, we may get to November, and it may be that the focus of the business has shifted somewhat, where we have an influence course on the calendar, but really the business need has shifted to innovation gives us the flexibility to swap that out and in some cases where maybe I put something on there and it’s just turns out to not be the right time. You know, people don’t have the time to take the training or the topic is just not resonating with people, we can drop that with notice and reschedule for a later point. So it’s really given me some of the flexibility, I needed to stay relevant because that that relevance with the business is absolutely essential. And I think it’s essential for – I know it’s essential for me, and I think it’s essential for a supplier like skill path as well. I mean we both have a vested interest in being relevant to the learners that we’re supporting and we’ve been able to come together and do that pretty well, I think.
DAVE FOGELMAN: I would I would echo and add on to what you’re saying. Scott, the what is really required for a partnership and collaboration like this to fully succeed is for both of us to have the kind of business orientation that you’re describing. And so understanding what’s going on the business being responsive to it and making sure that Learning and Development is absolutely and always related to business performance, business operations, business strategy. And I think that’s been one of the success factors is both. Both of us are oriented to thinking that way about the solutions that we’re creating. I think another key piece is what I will call for lack of a better phrase systems thinking and so Scott and some of his earlier comments alluded to making sure that you have that alignment with performance management, succession planning, and that as you’re as you’re thinking through learning and development and solutions in that space, that you’re also thinking about those other elements of what I might call the talent system and making sure that it may be the topics or what you’re working on, or the parameters of the program lineup two things that you’re doing in the other parts of the system, the talent system that effects existing employees in so many ways. And so that’s how we think when we’re thinking of our solutions and the application of them is making sure they have that alignment to what is happening in the learning and development and human resource space for customer partners and obviously as you could tell from Scott’s comments, he’s completely oriented that way.
TARYN OESCH: You know, looking back on this process, Scott. Is there anything that maybe you would do differently if you could do it over again?
SCOTT FARLEY: Well, let me speak to the process of integration. Specifically, and then maybe we can get into the process of development of the of the course. And I’m thinking particularly of that custom solution that Dave referred to a little bit ago that was built around change management coaching and emotional intelligence. One of the things that I wish we would have done is to better understand the cultural underpinnings for development sooner. So, in Komatsu, one of the things that we have been learning about as an acquired organization is the Komatsu Way and the Komatsu Way has within it three major components, but the one that people have gravitated to and I think understood maybe first before the other two deals with seven principles that the company engage engages with and embraces. Essentially, an outline of company values. Well, the seventh of those seven principles deals with talent development, and early on I read that and I, I, you know, read it at a rather surface level. I’ll own that. And I said, Wow, okay. This is great. Your organization supports development, we can attach to that, and say this is something that’s in line with that thinking and, you know, trying to drive that alignment, but maybe not fully understanding everything that was meant from a company culture standpoint, within that idea of talent development. So for Komatsu as it turned out, a lot of talent development is focused on the manager’s relationship with the employee and the employee’s willingness to receive coaching learn and develop and move forward. So it’s, it’s not as much of a sort of an endorsement of the types of development programs that we’ve been talking about so far in this conversation as it is about making sure that both managers and employees are equipped for that sort of in the moment feedback that can elevate performance over time. That’s a, it’s a nuanced difference, but it’s a critical one. And we kind of moved forward with this idea, we thought we were attaching correctly to the Komatsu Way. We weren’t, not entirely. And I think to a better understood that I might have positioned this training, just a little bit differently, and in a way that might have resonated more strongly, particularly in some of the parts of the business where, you know, these were already Komatsu entities, they already had a good grounding in the Komatsu Way. All of that, again, just to give us a stronger anchor point for what we were bringing in in terms of a development program. And the other piece around the integration would be just to bring people together sooner and in more ways. I know that over my career there have been times that I have kind of, I’ve received evaluation forms and you know people commented, it was just great to be in a room with people and to network and connect and sometimes, I think, for those of us that are developing content and facilitating content, there’s a risk of becoming a little myopic and of maybe dismissing that value of bringing people together in a room. We want to focus on the learning and sometimes you can read that a what was really valuable was just being in the room together. Like, okay, yeah, but what about all that great stuff I gave you? Well you take a step back and maybe humble yourself a little bit and say, No, you know what, that’s really valuable stuff, that time together with peers that maybe they haven’t had a chance to build relationships with, that can really set you up for future success. And I think to recognize that bring more people together in more ways. Early on, would have been an opportunity to again set ourselves up for even greater success. We’ve course corrected and done some of those things. Now, but looking back, if I were to do a couple things differently. Those are some of the things that I would want to consider.
DAVE FOGELMAN: And Scott what you’re describing, there is such a challenge, right. Because lots of times in a merger or acquisition situation, we very naturally are trying to identify all of those places where we have common ground, or where we think that we’re using the same words, and we want to lots of times, assume that they mean the same thing. And lots of times they do. And then sometimes they don’t. So I think I love what you said about that accent on relationships and how important that is. And lots of times, that’s where the learning’s actually taking place is in those types of things, but what I would say is kudos to the wreck of the quick recognition of that and the opportunity to then go do some course correction. And I think that lots of times ends up being the, the big thing. It’s how quickly you identify what may be some of those remaining gaps and go ahead and deal with those directly and address them.
SCOTT RUTHERFORD: It sounds like part of that system that supports this would require you, Scott, sort of the central, central operation in L&D, to be well networked to the managers. And to be able to-it sounds like supporting coaching conversations throughout the whole of the organization. So people can connect and people can understand, really where the needs are and then, you know, hopefully, collect that and feed that up into the central organization. So that can be, you know, so you can respond programmatically to it.
SCOTT FARLEY: Yeah, absolutely. In fact, the, the initiative that was supported by the training that skill path helped us to build we referred to internally as the Kyudo Program, which is a Japanese form of archery, and the logic there was that we wanted to attach some sort of metaphor to it that dealt with the focus of the archer, the flexibility of the bow, and the momentum of the arrow, as it leaves the string. That was my little poetic contribution to what you were working on that the marketing team wanted to come up with something that would kind of be that central metaphor for what we were doing. So we move forward with this Kyudo team. And to your point, what we did was we trained individuals at multiple levels. We trained what we call Kyudo Masters, Kyudo Coaches and Kyudo Ambassadors. And the role of the Masters was to really kind of oversee, direct traffic, build and leverage some of those relationships that in many cases they already had, but sort of escalate and elevate issues to a core change management team. Coaches were tasked with exactly what you just described. You know, if we’re in a situation where, and there were a number of them where you’d see two management teams come together one from Joy Global, one from Komatsu, there was a potential to see some behavior that was going to be counterproductive. So how do we make sure that we’ve got people who are comfortable and trained and ready to coach in the moment or coach immediately afterwards and get some of those leaders back on track and into the mindset that’s going to help us move forward. And finally, the Ambassadors who were taking a much more pragmatic and functional approach to developing change management plans driving them to execution being attached to specific project work streams within a particular region or Functional Integration. And so we really did build this structure, and the training that we developed a skill path was designed in that modular approach we described earlier, so that we could kind of emphasize and de-emphasize certain sections, depending on whether we were providing training to the Master, Coach or Ambassador level. So it was very much a system and very much an attempt to leverage relationships with management and where we had to build relationships with management, so that we had those lines of communication throughout the integration and we’re about two thirds of the way through that integration right now. And I think that has that approach is really yielded benefits for us.
TARYN OESCH: Scott and Dave, thanks so much for joining us today. Are there any final thoughts that you want to leave us with?
DAVE FOGELMAN: Scott, do you want to go first?
SCOTT FARLEY: Sure, sure. You know, I think for me, one of the things that has really come clear as both, you know, a member of an acquiring company and now an acquired company, our role as talent management leaders really can be to provide a key element of value that may be the organizations were thinking about when they went through due diligence and they went through and figured out all the negotiations and went through all the machinations of the acquisition or the merger. But the sooner we can get into the discussion and the sooner we can identify that maybe there’s a gap that we can fill. Maybe we can augment what’s already in place. I think generally the things that we can add as a talent management function are, at best, they’re going to be a matter of merging two portfolios or two processes. But in some cases were just an absolute positive. I have yet to see a situation where, you know, a new talent management framework comes in and people look at it and say, oh wow that took something away from me. And so I think we’re uniquely positioned in times of change like this to be advisors to be educators to be partners to the business to help make sure that human side of change, which is so critical is being taken care of and addressed in some really thoughtful and productive ways. So I guess I’d leave it there.
DAVE FOGELMAN: And I would echo what Scott is saying in terms of it’s a huge opportunity and within a huge opportunity becomes that challenge right to take advantage of it. And I think the challenge to all of us in this space that we love so much is to not only be experts and our practice and our specialties and what we do, but to be able to translate that value, just as Scott was saying, translate that value to business situations to whatever the climate is of the moment, whatever the circumstances strategically or operationally that the business is going through. And so to have the opportunity to with something like the change management program that we put together, such an honor to participate in that, and to do something where you’re not only impacting the company’s capability to absorb all of the elements that come with a merger or acquisition, but you’re putting in place, permanently, at that point then change experts at multiple levels and that is a resource that just keeps giving, then, as the months and years go by. So I will certainly say from the SkillPath point of view, it’s been an honor and a pleasure to work with Scott and with Komatsu on this entire effort and it’s been wonderful.
SCOTT RUTHERFORD: Well, Dave, as you say, it’s been a pleasure to work together. It’s been a pleasure for Taryn, and I to have you both on The Business of Learning. So thanks for being here, Dave Fogelman of SkillPath and Scott Farley of Komatsu. Appreciate it.
SCOTT FARLEY: Thank you.
DAVE FOGELMAN: Thank you.
TARYN OESCH: And thanks to everyone for listening to The Business of Learning.
PODCAST OUTRO: If you have feedback about this episode, or would like to suggest a topic for a future program, email us at email@example.com or use the Contact Us page at TrainingIndustry.com. Thanks for listening to the Training Industry podcast.