What a difference a year makes. Following three years in which human resources managers and directors saw their corporate education budgets pared to the bone, they are now beginning to return to business schools with cash to spend. But will they want the same kind of management development that was commonplace before the recession?
As contracts are replaced by “relationships” and courses by “strategic development”, the coming year will be a testing time for those in business schools. Will corporations see management development as a way of rebuilding their companies after the recession, or as an expense they no longer need? Where will the new business come from: mature markets or developing economies?
For corporations, some of the basic questions still need to be answered. When should companies choose open enrolment programmes and when should they opt for a customised approach? What can business schools offer that management consultancies cannot? What does it all cost? And how do companies measure the return on their investment?
On Wednesday May 11, between 1400 and 15.00 BST, a panel of experts answered your questions on executive education on this page:
The panel were:
Della Bradshaw, business education editor at the Financial Times;
Jordi Canals, dean of Iese Business School in Spain, which tops the Financial Times ranking of open enrolment programmes this year;
Blair Sheppard, dean of Duke University’s Fuqua school of business and creator of Duke Corporate Education, which has topped the Financial Times ranking of customised programmes for the past nine years.
To get value for money, is it better to opt for an EMBA rather than a series of open executive courses?
Jordi: It all depends on what type of outcome one expects and the motivation for management education that each person has. The value for money is a complex indicator - how you define value is always tricky - and not the only reference that should be taken into account when choosing a management development programme.
An EMBA programme offers students a more comprehensive and integrated education about management and managerial decision-making, and provides them with a deep level of understanding of the key business disciplines (marketing, people, operations and finance etc). An EMBA programme is more demanding for students and they need to pass formal evaluations and exams. On the other hand, a series of open executive courses offer a good knowledge and expertise of some specific issues that may be very relevant at some point in one’s career. By definition, they usually have a narrower scope.
Della: I’m pretty certain that an EMBA would be more expensive than a series of short programmes - unless you really did lots of them. But the focus would certainly be different. EMBAs are designed to help managers move to the next level in their careers and are often about personal development and achieving a long term strategy.
Open enrolment problems are there to address an immediate need, such as becoming a manager for the first time and being appointed to the board etc.
Blair: With a series of open enrolment programmes as the alternative, an EMBA will be the best option in most instances. Open executive courses are designed to assist in development for a shift in responsibility or fill a gap in someone’s functional or sector expertise. If someone, had more than one such need an EMBA is a better bet.
EMBA programmes like all MBA programmes are designed to be transformational experiences that cause someone to develop a significantly better understanding of:
- how the market, firms and all functions work;
- how to grow themselves as people, members of a team and leaders;
- how to develop a subtle appreciation of how to manage a firm.
Ours have the additional feature of developing a deep global understanding. If someone was thinking of multiple executive programmes, an EMBA is far greater value for money.
What are the recommended courses to study in executive education today?
Della: Whatever you need at that point in your career.
Jordi: The fascinating thing about executive education today is the large diversity of excellent programmes around the world. It all depends on the needs and expectations that each participant may have. Today, the most popular programmes are those that boost general management and leadership capabilities.
Also, those that deal with the impact of globalisation on different business functions or the overall corporate strategy, and those that explore the effects of technology and social media on sales, clients and business models.
Blair: The traditional programmes that prepare someone for a transition to general management (AMP) or second level management (PMD) are always valuable. Also, the typical programmes designed to fill in expertise in finance, marketing, operations, strategy or leadership as well. These have been around for a long time, and will still be here long after we all retire, as the needs do not disappear. The nature of the challenges and organisational context has changed, but the need is constant.
Newer needs relate to the dramatic shifts in the geo-political and economic context in which we manage. People need to understand how technology is rearranging classic marketing and operational strategies. People need to understand the political economic and cultural aspects of other regions. People need to understand how critical issues such as sustainable energy supply, health risk or environment affect business. Also, most need a primer in the role of regulation, we forgot its function for a while.
I have recently participated in a top rated executive education programme. The overall feedback from the class was quite negative regarding the programme’s goals accomplished. How does one avoid this mistake again of choosing a poor programme? Should schools have something on their websites to allow previous participants to add their feedback like MIT do?
Della: It sounds from what you say that this was an open enrolment programme but I am not sure how you selected it. You are right though, the best recommendations are from participants who have previously studied on that programme. So the answer is to talk to other people who have been on similar programmes and get their advice. For those who work in large organisations, this kind of information is hopefully collated centrally.
You say the feedback from the participants on your programme was quite negative so presumably the students completed a “happy sheet” at the end of the programme. Before enrolling on a programme in future, why not ask the business school to show you the data collected in this way?
Jordi: While it is possible that the delivery of a programme may not meet the participant’s expectations, the best way to make a good choice is to fully understand the school’ s approach and methodology, the goals of the specific course, get to know the work of some faculty members and speak with past participants of the same programme and get their reactions. Most schools will be happy to provide a variety of names of past participants you can get in touch with.
Blair: The best schools get continuous feedback during the programme and adapt, and certainly adjust programmes after given participant feedback. Publicising feedback does not help much. Ask for references from people who attended, and seek input from those you know who have attended. Unfortunately, rankings show overall quality of a school’s programmes and not specific ones.
Does executive education in Europe differ from the US? If so, how? Why would an American chose to attend in Europe when there are so many American institutions and vice versa?
Elizabeth Dolinski, New York
Jordi: The main difference between European and US executive programmes are in the nationalities represented in the classroom and the depth of cross-cultural issues that you get into during a discussion on leadership or management. One can see that American companies - or senior executives - want to do executive education programmes in Europe because the cultural diversity and internationalisation factors are important to them.
Blair: European executive education differs from American in two subtle ways. First, the class tends to be multi-national on a European scale. This was a benefit and in some ways is now becoming a liability, as one can think that understanding the differences between Germany and Italy prepares one for doing business globally. China, Japan, Korea, India, Nigeria and Colombia are much different, yet again, than intra-European differences.
Also European executive education tends to be more broadly strategic and less functionally based. This difference is less than it used to be and each has its own strengths. I, of course, prefer the logic behind an American model.
A more interesting question is why would someone not attend an institution in China, India or Brazil?
Della: One of the big problems for European business schools has always been that US managers have little regard for business schools outside the US. By comparison, European managers have always understood the value of studying at Harvard or Stanford. This is in spite of the fact that while US schools are dominant in the MBA market, Europe has had a long tradition of non-degree executive teaching.
Indeed many of the trendiest styles of executive teaching - experiential learning, for example - were developed in Europe. Apart from that, there is clearly an advantage in studying with people from different companies and countries, who bring a different experience to the table. Also, if US companies want to export their products to Europe or Asia, it makes a lot of sense to understand how people do business there.
One needs a basic education to join the workforce. However, the training that highly skilled companies provide is without doubt the best training anyone can receive. The question is what do management consultancies offer that business schools cannot?
Blair: Interesting question, do not buy the premise. Highly skilled companies train well for what they do and so do great business schools. Neither is better than the other. In general, business schools teach the deep logic in all we teach, but occasionally miss out on the translation to a specific circumstance or industry. Firms do the reverse, they tend to teach things relevant to the immediate requirements of the job.
Consulting firms have two additional strengths as places to learn. First, analysts or associates see many different firms during their experience in a consulting firm, thus allowing them to learn critical contextual variation across industries and see what works well generally. Second, all of the consulting firms teach a mode of problem solving they have found useful over the years. Some are more developed and others more flexible.
Jordi: While there are companies offering excellent executive programmes in-house, each organisation has its own comparative advantages. Most of the best executive education programmes around the world are offered by business schools, since they have the faculty and the experience to make management development quite successful across industries. Also, this is the reason why many companies round the world trust business schools for management development.
Della: Consultancies can devise a strategy for a company, a business school can help a company devise its own strategy.
Which industries do you predict will have the most growth potential for executive education over the next few years?
Kris, Adler, US
Blair: On the custom executive education side, industries undergoing significant change tend to have the largest demand. Given that logic, there are two thoughts.
First, industries undergoing such change include the converging space of IT, entertainment, media, sports and energy. Other changing industries include those with a dramatically shifting supply chain and those with significant new regulatory requirements.
Second, industries with firms entering from increasingly developed countries such as China, India or Brazil will need to understand how to compete with new players and those players will need to learn how to adapt their practices to new (or really old) markets.
On the open side, it is less industries, than topics.
Jordi: When one wants to make predictions, it is better to focus more on companies and geographies rather than industries. Every industry has good and bad companies. Many traditional industries are considered mature in the west, while some western companies in those industries are doing great in Asia or Latin America.
In general, companies in those growing regions have a more acute need for managerial talent. Obviously, there are industries, like health care, software, mobility or energy that will see an increasing global demand. The need that they have for management development is strong.
Della: Those that need to retain their highly-skilled employees most, so possibly science and technology companies, pharmaceuticals and medicine.
How can one justify spending so much money on executive education courses during the economic downturn?
Blair: Great question. How can you not? Company specific education is probably the best way to get quick development of a cohesive response to a dramatic change and consistent implementation of that response among a workforce. When people understand the inherent logic to an organisational action in a much broader global, business context they will change much faster and act more consistent with the intent of a change. Executive education, done right, achieves such understanding. In times of crisis, a well executed sharp, simple, coherent strategy is essential. Education is a key component of that.
Second, during reductions in staff people are asked to take on new work, they have often not been well prepared for, again education is the answer.
Third, a focus on key people and key customers is critical in difficult economic times.
Finally, here is a counterintuitive point. The great firms that emerged out of the Great Depression, and are still here today, spent money on products, customers and people during the depression. They emerged stronger and much faster when the economy returned.
In terms of value for money executive education is actually quite inexpensive.
Della: I think it is much easier for companies to justify spending on customised programmes than open enrolment ones, as they help develop strategy rather than deal with personal development. But, I think what the recession has done has been to help companies really focus on what they need and develop programmes which are technology-enabled, and therefore much less expensive.
Jordi: Companies have access to the best technology or capital equipment, wherever they might be round the world. But, unless companies invest in people, they will not make anything out of the best technology or equipment.
Management education is part of companies’ investment in their people, helping develop the next generation of managers and leaders within the firm. A company with good managers and well trained employees has the right ingredients to emerge stronger out of the crisis. Companies that do not invest in education, including management development, run the risk of becoming obsolete.
For individual participants in open programmes, executive education is also an investment in their future. They improve their knowledge and capabilities and become more employable. A good executive programme could be the trigger to start their own company. Both from an individual and a corporate perspective, good educational initiatives always pay off.
The most thought-provoking contributions may be published in the Financial Times newspaper, so please supply your full name and location.