Selected Moments of the 20th Century

A work in progress edited by Daniel Schugurensky
Department of Adult Education, Community Development and Counselling Psychology,
The Ontario Institute for Studies in Education of the University of Toronto (OISE/UT)

1961

McDonald's starts first corporate university

In 1961, the McDonald's Corporation founded Hamburger University, marking the starting point for the corporate university. The first courses were held in the basement of a McDonald's restaurant in Elk Grove Village, Illinois. Hamburger University was designed exclusively to instruct personnel employed by McDonald's Corporation or by McDonald's Independent Franchisees in the various aspects of the business and operations of McDonald's. During the following four decades, more than 65,000 managers in McDonald's restaurants graduated from Hamburger University, which eventually moved to a 130,000 square foot, state-of-the-art facility on the McDonald's Home Office Campus in Oak Brook, Illinois. There, a faculty of 30 resident professors can teach and communicate simultaneously in 22 languages with the help of translators and technology. By the end of the twentieth century, Hamburger University had branches in England, Japan, Germany and Australia.

While many other corporate universities were created during the sixties, seventies and eighties, it hasn't been until the nineties that they have become popular in the business community. From 1988 to 1998, their number quadrupled, increasing from 400 to 1,600. (Greenberg, R., 1998). The corporate university is most easily defined as an "educational division that functions as the strategic umbrella for a company's total educational requirements for all its employees" (Meister, 1998). This is a significant change from the traditional training department that has typically been responsible for employee development. This shift is in response to economic factors, which have forced companies to re-evaluate their human resources in an effort to achieve strategic goals. The popularity of the corporate university raises questions for adult education as it readjusts and finds its role in this new landscape.

To understand the appeal of corporate universities, it is helpful to understand the economic factors behind its creation. Computers have affected all aspects of business life and companies struggle to stay abreast of the constant and rapid changes that technology brings. Business is conducted in a global economy, which has led to increased competition. Companies have to contend with their neighbours across the street, as well as in other countries, many of which offer similar products with comparable benefits. In order to be successful, companies need to differentiate themselves from their competition and what sets them apart, are their employees. More and more businesses are looking to their human resources when developing their business strategies. This is in recognition that the contributions of employee knowledge and expertise, ideas and leadership are what make a company successful. They recognize the need to foster and encourage their individual employees and are therefore looking to corporate universities to fulfill these needs.

Traditionally, companies have turned to their training departments and to academic settings to find staff for their growing practices. Now many companies are creating their own educational arms that are more extensive than training departments and more focused than traditional universities. This suggests a gap in the talent pool that neither is able to satisfy. So how exactly do these corporate universities differ from traditional training departments so that they are able to meet the current strategic training demands? The creators and advocates of the corporate university cite several differences between it and a traditional training department.

Traditional Training DepartmentCorporate University
ReactiveProactive
DecentralizedCentralized
Wide AudienceCustomized, strategic focus for specific audiences
Functional information with little depthRelevant information linked to business strategy
Tactical scopeStrategic scope
Classroom environmentVariety of formats - virtual classroom, computer-based, web-based, distance learning…
Does not address company cultureShapes corporate culture
Structured format – clear start and finishLifelong learning approach
Skills basedDevelops intangible skills like leadership, creative thinking, problem solving
Little or no "Buy-in"Management and employee support
Increase in job skills outcomeIncreased performance on the job
Operates as a staff function operationOperates as a business unit
Image of "Go get trained"Image of "University as a metaphor for learning"
(Sunoo, B.P., 1998; Meister, 1998)

In comparing the traditional training department and the corporate university, a general theme that emerges is one of life long learning for the individual. It is through developing individuals and helping them reach their fullest potential, that leading edge companies are achieving the strategic goals they set for themselves and are able to succeed in this global economy.

The concept of lifelong learning is not new to the field of adult education. However, companies have traditionally turned to the community and to universities and colleges to hire educated employees. There are several explanations for why companies have turned inwards to their own resources and created educational divisions, as opposed to relying on traditional universities. While exploring these reasons is beyond the scope of this review, it is important to ask ourselves why this has become the trend. Does it signify a deficiency in the current education system, or that companies want more control over the education process for their employees?

As the popularity of the corporate university continues to explode, and there is more overlap between the philosophies found in the corporate and academic settings, it is unclear whether the corporate education programs are friend or foe to the traditional university. According to the supporters of the corporate university, there are more opportunities for partnership than there are threats of competition. Corporate university advocates are quick to admit that their programs do not replace high end university programs and are eager to form partnerships with accredited universities in order to enhance their own offerings (Landau, M.D., 2000).

The area in which corporate universities do pose a threat is in the area of business management and extension studies. Corporate universities are created by the private sector and therefore have business management and technology as a main focus. As a revenue generating strategy, many companies have adopted an open-door policy that allows non-company individuals to attend courses. The colleges and universities that generate revenue through similar courses may find themselves in direct competition for students.

The corporate university has appeared in the business and educational landscape in increasing numbers over the last decade. As companies compete to be the best in their industry, they are looking to their employees' expertise and talent to take them to the top. To ensure that their employees have the knowledge required, they create educational divisions that have replaced the traditional training department. It is these corporate universities that need to be evaluated in the context of adult education and the traditional academic university. Certainly there are opportunities for partnership and collaboration between the private and public sectors, however educators need to fully explore the implications behind this kind of relationship.

Source:

Greenberg, R. (1998). Corporate U. takes the job training field. Techniques, 73, 7, 36-39.

Landau, M. D. (2000). Corporate universities crack open their doors. The Journal of Business Strategy, l21, 3, 18-23.

Meister, J. (1998). Extending the short shelf life of knowledge. Training and Development, 52, 6, 52.

Sunoo, B.P. (1998). Corporate universities – more and better. Workforce, 77, 5, 16-17.

http://www.mcdonalds.com/corporate/careers/hambuniv/hambuniv.html

Prepared by Hannah Sauer and DS (OISE/UT) 2000

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Last updated on May 26, 2002.

 

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