When it comes to executive education, the biggest concern many employers have is getting a return on their investment in talent development.
Traditional leadership development programs aren’t generating the desired results, according to a 2013 joint survey of 329 organizations by Skillsoft and Brandon Hall Group. The survey found that 75 percent of organizations rate their leadership programs as “not very effective.”
In light of widespread dissatisfaction, corporations and business schools are looking to improve the effectiveness of executive education. “Companies want the experiences their employees have in education programs, whether it’s in a two-week program or a residential program at a university, to translate into real, valuable business results,” said Scott DeRue, associate dean of executive education at the University of Michigan’s Ross School of Business.
The Ross School of Business has seen its business increase significantly over the past two years in North America, India and other parts of Asia. DeRue attributes this to a trend in greater corporate spending on training as more organizations turn to executive education programs to develop employees with the skills to tackle their unique business challenges.
Michigan isn’t the only university experiencing an upswing in business. The push for increased executive education comes from the challenges and opportunities top management face to create organizational value.
In the past 12 months, the number of corporate universities also has increased. A 2014 survey conducted by UNICON, an executive education consortium, estimates there are more than 4,000 corporate universities in the United States and 10,000 globally. Industry experts argue this trend indicates a significant amount of attention is being placed on the effect executive education has on a business’ bottom line.
Source: UNICON, 2014
The impending “silver tsunami” is one driver for executive education’s expansion. According to a 2011 report by the Pew Research Center, about 10,000 baby boomers — people born between 1946 and 1964 — will turn 65 each day through the end of 2029, which equals about 69 million people. More importantly, federal estimates suggest only about 40 million new workers are projected to enter the U.S. workforce during the same time.
Not only is learning and development an increasingly important part of business strategy, learning executives have a positive outlook for learning investment, according to the Association for Talent Development’s LearningExecutive Confidence Index.The LXCI is measured on a 100-point scale, and a score of more than 50 indicates more positive than negative responses. At deadline, the LXCI score was 66.9, slightly more than score of 65.7 from the year’sprevious quarter.
The learning industry will continue growing in the next 12 months, especially corporate universities, which can be more responsive to business problems unique to anorganization.
While corporate universities are trending up, respondents to UNICON’s survey pointed out the important role traditional academic institutions play in their executive education programs. Close relationships with external learning institutions can be critical assets for chief learning officers. These relationships can bring in experts from academic institutions to teach courses at corporate universities. However, monetary exchanges are not the best way to build relationships with business schools. The report suggests corporate university leaders, most of whom have attained an MBA, leverage connections with their alma maters to buildexternal relationships.
External connections with academic institutions can be even more critical when considering 92 percent of corporate university leaders do not have a background in learning and development. According to UNICON’s study, perhaps as a result of needing more knowledge in thisdomain, corporate university executives have created a connected community of their peers. Its members serve as each other’sresource, sharing vendors, approaches, practices and challenges. Because communicating leaders are often from different industries, it becomes easier to adapt shared practices for different contexts.
From Provider to Partner
The University of Michigan’s executive education programs are booming like never before, DeRue said. He attributes this increase to Michigan’s shift in approach to business learning. Instead of simply providing content, the university has turned itself into a business partner.
“We’re creating a workspace for executives to work on unique problems that affect their business. We help them develop a specific plan to tackle whatever problem they’re currently facing,” DeRue said.
This trend is not only occurring at Michigan’s business school, but also throughout the industry. Collaborative efforts in executive education have developed out of a need toaddress the sizable skills gaps many organizations believe are present in their managers after they complete a training program.
“For a long time, there was a strong focus on technical training. But executive education should go beyond just technical training,” said Tatiana Sehring, director of corporate and strategic relationships at American Public University. “It’s still important, but what was lost were things like leadership development and other soft skills.”
Different organizations value different soft skills in their executives. But soft skills often refer to somebody’s emotional intelligence or personal attributes that complement essential business skills.
High emotional intelligence may be linked to increased career success, entrepreneurial potential, leadership talent and happiness, among other things, according to “Can You Really Improve Your Emotional Intelligence?” an article published in the Harvard Business Reviewin 2013. High emotional intelligence is also an effective antidote to work stress, and people with higher emotional intelligence may be more rewarding to deal with.
Although studies show emotional intelligence is unlikely to change drastically, the most coachable element of emotional intelligence is interpersonal skills, according to the same article.
Developing custom learning programs is perhaps the most significant aspect of collaborative executive education. For example, 70 percent of respondents to UNICON’s survey had between one and five partners for custom programs. When asked if those kinds of partnerships would change over the next year, most respondents answered no, expressing contentment with their providers.
Further, “alignment with organization’s goals” is the most important factor for learning leaders when choosing an external partnership for a customized learning program. Design is the second most important factor, followed by cost. “Corporations aren’t just looking for somebody to deliver a lecture or provide content,” DeRue said. “We’re partnering with companies that allow them to build the capabilities to solve the problems their business is facing.”
By positioning itself as a business partner, the Ross School of Business hopes to solve the “Monday Morning Quarterback Problem,” when an executive fresh out of business school, or a shorter learning program, lacks the skills or support to apply their newly acquired knowledge in ways that create value for their organization.
DeRue said Michigan’s philosophy can be boiled down to three words: learn, grow and develop.When students pursue a higher business degree, they learn through challenging situations they would likely encounter in their careersafter business school. These academic challenges — accompanied by in-depth feedback, a support network and frequent follow-up discussions with business professors and the organization’s top brass — can help new MBA students develop into executives capable of helping their company realize important goals.
Frequent follow-up discussions post-program appear to be the key part of Michigan’s partnership strategy. These discussions allow the school to adjust custom programs developed with clients. “Sometimes things don’t work out the way you intended,” DeRue said. “But we partner with our clients to work through any problems that may arisebefore, during or after a program.”
Like the University of Michigan, American Public University tailors learning content to its clients’ specific needs. Sehring said subject-matter experts work withacademics at the university to develop content thataddresses trends across a broad range of industries.
Each client develops a unique approach to executive education with American Public University. For example, many organizations tie their education program to career advancement and development, while some focus strictly on executive leadership training. “Executive education really is just one component of talent management,” Sehring said. “All it’s trying to do is create a high-performing culture within an organization.”
Over the next 12 months, DeRue said corporate investment will increase along with perceived value in university-based executive education. “Universities provide the most innovative skills training for corporations,” he said. “Unlike consultants, we’re able to be actual business partners with an organization. I always like to say, ‘You can either fish for somebody, or you can teach them how to fish.’ We’re teaching people how to fish.”
Executives Like Technology
In today’s hectic work environment, technology promotes accessibility and flexibility in executive education. Online learning platforms, for example, allow busy professionals to pursue executive education and maintain a high quality of work, said Tatiana Sehring, director of corporate and strategic relationships at American Public University.
The rise in executive education may actually be closely linked with the increasing speed and capabilities in computer technology. Technological advancements continue to make information more readily available, and software engineers increasingly rely on that free-flowing data to do their jobs, which can change every day. Organizations need their employees to stay up-to-date with the latest business trends to stay competitive.
While advancements in technology have benefited the learning industry, they have also created challenges for learning leaders. Scott DeRue, associate dean of executive education at the University of Michigan’s Ross School of Business, said technologyis reshaping how executive learning gets done. “One of the main focuses in the industry right now is trying to blend technology with the learning experience.”
According to Sehring, the use of technology in executive education is now expected. There’s certainly weight to this claim, as nearly every form of technology-based learning was once named a future trend: mobile, distance, hybrid, online, blended, gamification and digital curricula, according to a 2014 study conducted by UNICON, an executive education consortium survey.
The survey also found corporate universities tend to be savvier than academic institutions when it comes to incorporating technology into learning programs. Quality executive education isn’t limited e-learning, DeRue said. Such technology should be used to “flip the classroom,” he said.
Instead of only having learning take place on-site, a customized program may include e-learning and video-based learning, which continues to move into the mainstream. Some 47 percent of companies surveyed use video to some degree, according to “Using Video to Impact Learning Initiatives — Video Learning,” a 2013 report from Bersin by Deloitte. Despite the surge in adoption, organizations’ use of video is not consistent or coordinated. Less than 10 percent of organizations “are leveraging video across the organization or even standardizing the use of video across the enterprise,” the report found.