CHAPTER 6: LEARNING AND PERFORMANCE MANAGEMENT CASE STUDY American Express: Challenges in Managing Learning and Performance American Express (AMEX), a company with operations in over 130 countries around the world, was founded in 1850 to provide freight forwarding and delivery services. AMEX has evolved over the past 150 plus years into a global financial services company. Like other organizations, enhancing the performance capabilities of employees is an important concern at AMEX. Developing and maintaining employee competencies and skills can be a daunting challenge, as two different challenges in managing learning and performance at American Express illustrate. Learning to Manage the Managers of Learning Not only must the learning operations of an organization address the training and development needs of other units within the organization, but the organizational unit responsible for employee learning must also be concerned with developing the talents of its own staff members. In 2005, this lesson came to the forefront at American Express as the company’s Learning Network evaluated its practices. The AMEX Learning Network discovered that it was not doing a satisfactory job of addressing the training and development needs of its own staff members  those AMEX employees directly charged with providing training and development experiences for the rest of the AMEX organization. The American Express Learning Network subsequently took appropriate steps to improve performance of the Network and craft a new vision and mission for the Network. A crucial problem for the AMEX Learning Network was that it “had been so focused on the learning and development of others that its members had not devoted enough attention to their own knowledge and skills development.” Consequently, the Learning Network began to focus efforts on the development of its own staff members. The Learning Network staff participated in various programs designed to elevate their skill levels. They also earned additional certifications from appropriate professional organizations. The Network also reviewed its compensation policies and practices to ensure they were in line with AMEX’s pay-for-performance compensation model. Finally, to better link its own activities with the rest of the AMEX organization, the Learning Network also improved its measurement of training metrics. To better respond to the needs of AMEX’s managers, the training metrics technology team developed what it called “metrics central,” which is a Web-enabled tool that can be accessed by both Learning Network staffers and other AMEX managers. Mode of Leadership Development at AMEX Another learning and performance management issue at American Express involved the Learning Network’s efforts in the leadership development arena. AMEX was seeking to ascertain the most effective manner in which to conduct leadership training. In 2006, AMEX implemented a new model of leadership ...

1. CHAPTER 6: LEARNING AND PERFORMANCE
MANAGEMENT CASE STUDY
American Express: Challenges in Managing Learning and
Performance
American Express (AMEX), a company with operations in over
130 countries around the world, was
founded in 1850 to provide freight forwarding and delivery
services. AMEX has evolved over the past 150
plus years into a global financial services company.
Like other organizations, enhancing the performance
capabilities of employees is an important concern at
AMEX. Developing and maintaining employee competencies
and skills can be a daunting challenge, as two
different challenges in managing learning and performance at
American Express illustrate.
Learning to Manage the Managers of Learning
Not only must the learning operations of an organization
address the training and development needs of
other units within the organization, but the organizational unit
responsible for employee learning must
also be concerned with developing the talents of its own staff
members. In 2005, this lesson came to the
forefront at American Express as the company’s Learning
Network evaluated its practices. The AMEX
Learning Network discovered that it was not doing a
satisfactory job of addressing the training and
d

2. employees directly charged with providing
training and development experiences for the rest of the AMEX
organization. The American Express
Learning Network subsequently took appropriate steps to
improve performance of the Network and craft
a new vision and mission for the Network.
A crucial problem for the AMEX Learning Network was that it
“had been so focused on the learning and
development of others that its members had not devoted enough
attention to their own knowledge and
skills development.” Consequently, the Learning Network began
to focus efforts on the development of its
own staff members. The Learning Network staff participated in
various programs designed to elevate their
skill levels. They also earned additional certifications from
appropriate professional organizations. The
Network also reviewed its compensation policies and practices
to ensure they were in line with AMEX’s
pay-for-performance compensation model. Finally, to better link
its own activities with the rest of the
AMEX organization, the Learning Network also improved its
measurement of training metrics. To better
respond to the needs of AMEX’s managers, the training metrics
technology team developed what it called
“metrics central,” which is a Web-enabled tool that can be
accessed by both Learning Network staffers
and other AMEX managers.
Mode of Leadership Development at AMEX
Another learning and performance management issue at
American Express involved the Learning
Network’s efforts in the leadership development arena. AMEX
was seeking to ascertain the most effective

3. manner in which to conduct leadership training.
In 2006, AMEX implemented a new model of leadership
development across the entire AMEX
organization. Three groups of trainees (or learners) were formed
and each group was exposed to a
different training venue. One group had only online delivery of
learning materials and these were studied
through self-direction without any supporting events like peer
discussion, formal meetings, or talks by
senior organizational leaders. Another group of learners
experienced traditional classroom training
without any support of online materials or other formal events.
The third group of learners experienced a
blended learning approach that combined classroom or Web-
based interaction with senior leaders, self-
directed online learning, and encouragement of discussion
among learners.
In evaluating the three different approaches, AMEX assessed
employee traini
learner reaction, wherein the trainees
indicated the level of satisfaction they had with the learning
experience. Level 2 focused on learner
knowledge, or an assessment of the acquisition of new
knowledge and skills. Level 3 addressed the
learners’ behavior by evaluating their observed improvement in
leadership skills three months after the
training sessions. Level 4 focused on the business impact of the
training on the learners in terms of

4. improved productivity of the learners’ direct reports (i.e., those
people for whom the learner has
immediate supervisory responsibility). Level 5 targeted return
on investment (ROI) via a cost/benefit
analysis of the sales productivity of the learners’ direct reports
over the preceding three-month period.
Assessments at levels 1 and 2 were based upon the learner’s
self-report; at levels 3 and 4 the assessments
were conducted via self-report from the learners and reports
from the learners’ supervisor and direct
reports; and at level 5 it was based upon objective data.
Little difference was found among the three learning approaches
-directed, traditional
d
learning proved to be the superior
training approach at evaluation levels 3, 4, and 5.
CHALLENGES TO ORGANIZATIONAL LEARNING
How to effectively manage the managers of organizational
learning and ascertaining the most effective
mode of leadership development are only two of many
challenges that can influence the effectiveness of
learning and performance management activities in an
organization. The manner in which an organization
addresses these challenges can make a major impact on the
effectiveness of organizational learning within
a company.
Suggested Discussion Questions
1. How has the American Express Learning Network utilized
learning theory, goal setting, and reward

5. systems in addressing the challenge of its own staff members’
training and development needs?
2. How is the use of learning theory and goal setting theory
evident in the design of AMEX’s leadership
development program?
3. Using relevant concepts from Chapter 6, explain why you
think the blended learning approach to
leadership development produced the best results for evaluation
levels 3, 4, and
Optional Quiz Questions
True/False
1. American Express recognizes the need for ongoing learning
in the workplace, which can be described
as a change in behavior acquired through classical conditioning.
2. American Express uses a pay-for-performance compensation
model. In a study of pay for
performance, more productive employees chose fixed
compensation when given a choice.

6. 3. The AMEX Learning Network chose to set ambitious goals
for itself because goals crystallize all of the things
an organization has been doing wrong in the past and helps it to
avoid those mistakes in the future.
4. American Express employees who are introverts are most
likely to learn best on their own through
the online delivery of materials without any supporting events
like peer discussion.
5. Research confirms that the personality functions of intuition,
sensing, thinking, and feeling do not
affect employees’ preferred modes of learning, which explains
why so little difference was found
among the three learning approaches the Network offered
(online self-directed, traditional classroom,
and blended).
6. The AMEX Learning Network discovered that the higher the
goal, the more likely people were to
become frustrated and give up before reaching it.
Multiple Choice
7. Reinforcement theory is central to the design and
administration of organizational _______________
at companies like American Express. When well designed, they
attract and retain top employees.
a. operant conditioning programs

7. b. fixed compensation models
c. reward systems
d. disciplinary action committees
e. none of the answers are correct
8. Strategic awards go beyond cash at American Express to
include:
a. fixed compensation models
b. training opportunities
c. educational opportunities
d. fixed compensation models and training opportunities
e. training and educational opportunities