Developing talent: two companies tackle vital employee development in very different ways that suit their business needs

HR Magazine, Jan, 2006 by Robert J. Grossman

Unlike the leaders of many Silicon Valley start-ups who dream of being acquired by a big player so they can cash out, Richard Mott, CEO of Kyphon Inc., believes his company can emerge as a giant in its own right. In fact, Mott and his board see almost limitless opportunities for growth for the Sunnyvale, Calif., company--but only if it can put workers with the right skills into the right jobs.

That may be easier said than done. Kyphon's skill needs are both specialized and broad. For example, the company has long relied on salespeople (called spine consultants) who are so well trained on its patented device for correcting painful spinal conditions that they can, in turn, teach surgeons what the product is--and how to use it in the operating room.

In addition to training employees on these specialized skills, Kyphon also needs to develop workers with a vast array of more commonly found skills--such as operations, accounting and HR. The company has rapidly outgrown its infrastructure and without such skills in place, further growth will be hampered. As a result, employee learning in a number of areas is vital for the organization's continued growth and success.

Farther north, in San Francisco, Patricia Lee-Hoffman faces a similar challenge. Lee-Hoffman is a founding principal of Triage Consulting Group, a company that helps hospitals identify and recover outstanding medical insurance payments. New employees learn the company's custom process and techniques for identifying such funds, then travel extensively around the country to put the practice in use at client sites.

The challenge for Triage: Workers can't walk in the door knowing the company's specialized, but learnable, system. They must be taught--and quickly. The rigorous travel schedule (employees are on travel three weeks out of four) often leads to burnout and job churning, and annual attrition is 22 percent.

In this environment, time is the enemy, and getting workers up to speed quickly on the company's system is vital to business success. Triage tackles this through continuous training; new associates are taken out of the field about one week per month to receive ongoing instruction.

Similarities certainly exist between Triage and Kyphon. (See "Similarities Abound" on page 44.) Both companies face an equally pressing need to train and develop employees, and both companies tackle that need effectively. (Kyphon fills 44 percent of its management positions through internal management promotions. In 2005, Triage filled all vacancies from within.)

Yet both organizations train and develop workers in ways that are different, and that are tailored to their specific business models and concerns.

KYPHON

Three years ago, when Rich Mott took the reins at Kyphon, the company--now six years old--had morphed from a fledgling start-up fueled on dreams and enthusiasm into a publicly traded company poised to become a global player. But management had not caught up, had not upgraded its administrative structure or clearly articulated its culture and values.

"We succeeded up to that point in spite of ourselves," says Art Ferdinand, manager of R & D, who has been with Kyphon from the beginning. "The company had no mission, vision or strategic plan."

Among Mott's first priorities was implementing a strategy and articulating a vision that would attract and develop the leadership talent Kyphon required--and encourage those leaders to stay with the company for the long haul.

But when Mott looked to his chief HR officer for help, he ran into a problem: He didn't have one. "We had a hard driving sales force, but no foundation, no executive structure--HR included--that could take us to the next step," he recalls.

With world-class companies like Hewlett-Packard (HP) and General Electric as models, Mott established the position of vice president of HR and hired former HP executive Steve Ham to fill the role. Ham had broad experience in HR and specialized expertise in training and development, and he had demonstrated a wide range of executive competencies as chief operating officer for the now-defunct women's American Basketball League.

Ham was a key element in Mott's strategy, one in which HR would play a central role. "When you're in a business like ours, the HR dynamic is incredibly important," Mott says. "Education--training and teaching others--are key elements of our culture. It's a consistent theme. If our organization doesn't continue to evolve and develop, it will fail."

Anything Goes (Almost)

Under Mott and Ham, Kyphon's flexible, open-ended approach to employee development has become a highlight of the culture. The company values virtually any type of learning. From scientific training to lifestyle management, employees are encouraged to pursue knowledge in any format that suits them, in-house or outside, formal or informal. Support for learning extends to families of employees through a dependent education reimbursement program. This year, Kyphon will spend $4,075 per employee on training, up from $3,200 last year.