ISBInsight: Why has executive education gained so much significance over the past few years?
Steven Burton: I have been involved in graduate management education for 15 years and have been on and off involved with executive education. And over the past year, I have been closer to it. It is fascinating to watch the evolution that is occurring in education in general and how that is impacting executive education.
The degree programmes will continue, but you hear a lot today about upskilling and reskilling, and those terms typically aren’t associated with traditional degree programme education and so you begin to get more into lifelong learning and lifetime learning concepts. Executive education has been the concept of lifelong and lifetime learning.
As the need for continued development increases, executive education or corporate education is playing a larger role in that. You see more focus in that as a necessary component to an individual’s education portfolio as they move through their careers. So, it keeps them fresh, current and attractive to employers.
One of the things that I hear largely from a lot of the corporates is the willingness and the ability to learn — the intellectual curiosity — is an in-demand skill and that doesn’t stop when you get a degree — a bachelor’s degree, an MBA degree or any other advanced degree. The necessity to continue learning is something that organisations are desirous of and executive education plays a large role in that area.
How does executive education differ from mainstream MBA programmes?
There is this conversation that is happening and you read quite a bit about it — is the MBA or our degrees dying? Or are they becoming less valuable? I fully disagree with that. There will be a market for that in the foreseeable future but it doesn’t stop there. And that’s where executive education and the lifelong learning concepts come in. There’s a large transformation that occurs in a cohort-based or in a structured degree programme offering.
But again, the world is changing and so are the needs of organisations. As an individual grows in their career, the gaps in their knowledge set in and the gaps in their capabilities become more evident. This is where you get ‘plug and play’ executive or corporate education coming in.
Business schools have started realising that executive education does contribute to a big portion of their revenue. From your experience, has that impacted how schools function?
It is a really interesting question. Perhaps, to some degree. You do also read a lot about the business models of universities and schools coming under fire. But in many business schools revenue from executive education is still a small part or even a much smaller part than the revenue from MBA or other degree programmes. That is a vital component.
Schools are looking to it as a potential source of revenue as either their MBA programmes may diminish or as they see other funding sources dry up. But beyond that, through executive education, value is being created. I am very much a supporter of where we are creating value. It is not necessarily a bad thing to take advantage of that.
But beyond the revenue side there’s also a valuable component that executive education plays for the school. It does a fantastic job of helping develop the research faculty as classroom teachers. Teaching an MBA programme or an undergraduate programme is one skill set. But teaching an executive education course — where you have probably a more practice-based, an audience that is more experienced and more tending to want the challenge — is a fantastic way to develop faculty.
It also helps in getting the faculty close to corporates. Through executive education, you get leaders who are practising on a day-to-day basis. The questions they ask and the problems they pose in the classroom trigger thoughts and new ideas by the faculty. So, it is a way to bring the corporate practice to the faculty research side to create new ideas, learnings, collaborations and partnerships. Beyond the revenue generation model, which is a part of it, there are a number of other benefits that an executive education programme offers to a school.
Which are the main themes in executive education that have gained prominence over time?
There are some fundamental things that executive education offers for corporates. And I hear this from a number of people. The MBA degrees or graduate management degrees teach some of the functional fundamentals and introduction to management. Beyond the general management, functional leadership, the general management skillset and this mysterious concept of leadership — those are the things that I see playing a key role in many executive education portfolios in any school.
And the same is true for ISB — our stepping into transformational leadership and our custom bespoke programmes for organisations. One of the key things that we hear from many of our organisations is, “have a leadership foundational component”. As individuals grow in their careers, leadership becomes a key skill and you will hear so many different avenues about this. Leadership may not be taught, but it certainly can be learned and developed. Integrating that into a structured programme is what executive education has done. That’s one of the reasons why it is one of the more common components.
Beyond that, you get topical subjects like Artificial Intelligence (AI), data analytics and technology components in digital transformation. Those seem to be the other themes that are very popular now. That will mature at some point and you will have new concepts that business schools in faculty research will begin working on and then those will migrate over into the executive education side.
Is executive education only confined to the top management? Or, do employees at the lower levels also see value in it?
We see it across the whole range. We do executive education programmes for individuals that are early in their careers, sometimes as early as 5 to 7 years of experience. The sweet spot for ISB tends to be in the 7 to 15 years of experience range. That is where a lot of schools target because it helps from brand building and knowledge transfer points of view; and deepening the relationship with the senior level, C-level, C-minus-one, and maybe C-minus-two, depending on the size of the organisation.
But organisations, maybe in some of the more functional areas, are going further down within their group to take the younger managers and run them through executive education courses. They don’t want to lose them for a year or two to go through a degree programme. Instead, they run them through an analytics course, a negotiations course or even begin to talk about management courses.
Different organisations have different levels of sophistication in identifying talent and training needs. Some of them will identify talent earlier and put them into management, general management and then leadership programmes. And to complement that, they will put them into some very functional skill sets training.
Other organisations may look at it as slightly more transactional to where they look at functional skill sets. Say, I have got a group and I want to train them on advanced sales skills or negotiations as part of their sales training. Or, I may need digital marketing capabilities. In such cases, they will take professionals earlier in the organisation and go for some of those functional skills sets.
So, we do see it across the board. We tend to want to move up the value chain back to leadership in general management and really focus on that because a lot of our faculty have that capacity. It is one of the things that we want to be known for in the market too.
How can organisations better track the impact executive education has on them when they train their executives?
This is one of the most common questions or common things we get when we are talking to our clients. One of the latest studies I read said that it is one of the only spends that corporates do to a large degree– over 50% and sometimes as high as 90%– that does not reflect if they are giving a return. Or even worse, there are organisations dissatisfied with the return on that.
There is a driving need to measure the output, but how do you measure learning? You can do it through assessments, but for leadership and management there really aren’t assessments having that immediate feedback. Organisations are beginning to have very strategic HR policies that identify talent early on and invest in training and watching those individuals develop. And that longitudinal study can take a year or two or even five. That gets fed back to back to how the employees adjust.
Sometimes, the feedback cycle is incredibly long and it is difficult to make adjustments. So, there are other measures that will look at performance reviews, retention and collaboration. There are specific consulting firms and services too that are available to measure the RoI on executive education. Some people embrace them wildly. Some people are more sceptical of that. In some of the startup ecosystems and EdTech ecosystems, that measurement of learning is a driving force behind some of the designs.
But learning is used for performance and so can you tie that to business results? There are also studies in data that show that organisations that invest in leadership training and executive education outperform those that do not invest or invest at a lower level. So, at a macro-level it is a good thing that does show results.
What are the differences that you have encountered in the executive education landscape across different markets?
I’ve been in India now for almost a year and this is really my first time here. I spent about 6 years in Singapore and at the time I had the benefit to get to travel throughout Southeast Asia. I spent some time in the USA and a little bit in Europe. So, I’ve seen a variety of perspectives.
And I think there are definitely cultural components; but one of the biggest differences I see is that the talent needs of an organisation are based on the markets that they operate in. India and lots of Southeast Asian markets are growth markets. Some people call them emerging markets. The needs and the demands of a growth market are much different from that of a stable market. So, the training in the US will be more on a stable market and will have more tailoring to a well-developed professional. Whereas in a growth market you find a more dynamic competitive environment, a faster pace of change and greater uncertainty. It is one of the things that we see that I think is propagating off into developed markets also now but as a greater need for transformational leadership. A lot of people are labelling it Digital Transformation, but we just call it transformational leadership. They are leading in a disruptive, complex and fast-changing environment.
You see that in India, and definitely in Southeast Asia, the sophistication of the participant doesn’t really change. It is one of the things I’ve been wildly impressed by. In my year here engaging with the participants in our programmes, I have seen that these individuals have a level of sophistication, not just from a business perspective, but also in dealing with the complexity and uncertainty that is associated with it. If you put this in the lap of somebody who is in a stable environment, like the US or maybe Europe, I anticipate that they would have great anxiety and would not be able to perform. Whereas, it is a day-to-day business here. Therefore, I see that that the questions that we get from participants, the way classes are run tend to be focused more on growth.
From a growth point of view, Indian organisations– and I would see this in organisations in Southeast Asia also– are looking to expand beyond their borders. How do I take my model overseas? One may have a lot of businesses or family businesses, but the brands are not known outside of Indian markets. How do I take that outside? The topics are relevant to such questions. That is how they vary from what you would see in the US.
Some of the foundational and fundamental components, like leadership and management, are the same regardless of where you are at in the world. Foundationally, there are similar components. One of the things that we do more here in graduate management or management education is much of case-based teaching. And those cases that are used to teach have been historically based on large multinational US organisations. But you are getting much more variety now. What we hear from our clients and our participants in the programme is the desire to see not so much what GE or IBM was doing 50 years ago. Rather they want to see what OYO or Reliance entered a new market. Participants are wanting to see more geographically specific cases that they can relate with markets that they have been experiencing.
India is considered a very price-sensitive market as far as tuition and fees are concerned. Do you also get a lot of feedback on the fees because executive education tends to be priced on the higher end?
I expected more of that than I saw when I got here. I don’t want to say that we don’t see price pressure. We definitely do. But what I have noticed in the time that I’ve been here is that mature organisations, or even organisations that have advanced HR policies, recognise the value that it contributes. They are willing to invest and many of them will send their executives to the US or Europe. They will invest in the developed world and at the more expensive price points. So, they recognise the value that it creates and they’re willing to invest.
Sometimes there is a perception that we are an Indian School not one of the top brand names like a Harvard or Stanford. There are expectations that we should be priced at an India level and we have to be sensitive to that. So, we do face pricing pressures. But I believe that if you can demonstrate that you create value, then that value will be recognised. Now it is our job to work with our clients to understand that value.
ISB has foundationally had some of the best Indian-based faculty. We also have relationships with top schools worldwide like our founding partners Wharton and Kellogg. We have faculty from those schools as well as other top schools worldwide. We can bring those faculty and that is not inexpensive to do. We need to be able to recoup that. But we can bring those faculty in so that these organisations do not necessarily need to send their senior leaders over to the US or to Europe and pay those standard fees there. Instead, they can get exposure to that knowledge in class under world-leading faculty in India at a price that may be at a discount to what you see in the USA.
I talked to our team and my clients. In many ways, this is not as different from the US. There’s always that that pressure to discount and to find ways to reduce their costs. If you think about it, managers are measured on how they manage and how they are a steward of their organisations’ resources and funds. If they can get 50 people trained for the price of 40 then they’re going to do that. and I appreciate that. So, we have good collaborations with many of our clients that go way back and they understand the value that ISB brings.
What are some of the key challenges that the Centre for Executive Education (CEE) here faces when encouraging employees to shift from their outmoded practices towards reskilling?
Change is hard. Think about anything you, as an individual, have done– taking up an exercise regime, relocating to a new place, changing jobs, changing apartments. Change is hard and there is a level of comfort in doing what I am doing. Reskilling is something I see as necessary and maybe it is a long term thing. With an absence of that sense of urgency, I don’t know how to make myself change.
Working with organisations to get that sense of urgency to embrace the learning is important. Now, we can do things from the school side– make it more bite-sized, more practice-based, provide actionable learning so that when they go back to the office, they can begin talking to their colleagues and using the knowledge in meetings and showcasing the skills. The more they are able to do that, the gratification becomes more immediate. Therefore, they are more engaged in doing it.
In the end, it comes into personal change management and – we can’t really do it– creating that sense of urgency and organisations demonstrating that they value the desire and the ability to continue learning. Then it becomes just like any performance measure that you have as an employee. You may not like to do it, but you know that at the end of the year or at the end of the quarter going to be measured on it. And when I’m forced to do it and when I see that I get rewards, I get happy about it. And then I continue to do it.
We see that in our classroom. It is fascinating for me to watch students in the classroom who are Gung-Ho and they are there for a purpose. I also see some that are on their phones and out taking calls most of the time. You get that variety, as in any population where you have a distribution Those that are eager to learn, either ingrained desire or that sense of urgency, exist in some. For organisations to manage that into their performance process, they want to say that “ if the desire and lifelong learning is important, then create measurements and integrate it” into their HR systems.
Could you tell us about the key features of the flagship executive education programmes that CEE offers?
Building upon what we have talked about earlier, what we see as most in-demand, is kind of what we invest in as our “flagship” programmes. The flagship programmes would be in our open enrolment programmes. We have a programme that we call “Stepping into Leadership” and it goes back to these individuals that are moving from management to becoming leaders. We offer that multiple times of the year. It is one that is one of our more popular programmes, specifically targeted to help individuals understand and make the transition from being a manager in being a leader, which is a big transition in most people’s careers.
Next in line would be one that we call “Transformational Leadership” and it’s for individuals that, perhaps, are already in leadership but their organisation is being disrupted, so it’s dealing with transforming leadership component. Thirdly– we offer two of these programmes with partner schools- we have our Global Advanced Management Programme with the Kellogg School and that is one that is for more senior individuals. And then we offer an Advanced Management Programme with NUS in Singapore. These are the open enrolment programmes with a partnership component that bridges the gap between two parts in Asia and the US and are ones that are quite popular from our markets.
What does the future for executive training look like? What are the new trends that you see emerging going forward?
I wish I had a perfect crystal ball, but I will give you my point of view. It is based on my experience, both in the corporate as well as education. There are some very specific things that are short term; then we will talk about the longer-term trends.
We are seeing shorter duration programmes as managers and executives find it difficult to be out of the office for a week or two at a time. You will see more one-day, two-day and three-day programmes occur over multiple different cycles in a quarter or a year. You will see more practice-based and experiential learning components. Individuals will be taking the frameworks that are brought into the classroom and applying them to projects– this is pretty prominent now, but we are seeing more demand as part of the measurement techniques to bring more experiential learning into the classroom. Then there is blended-delivery or technology-based delivery. Technology is not the solution, but as executives and senior managers find it difficult to get time out of the office, being able to digitally deliver that either synchronously or asynchronously will be seen growing.
Way out in the future or at least kind of the next generation for that, you begin to see more direct measurements of learning output and more of a thread between courses. It is not like I am taking this group of 20 people from my firm and putting them into those classes. You begin to see more of an individualised, personalised learning component that an individual designs in collaboration with their leadership team or HR team in their organisation and with the learning professionals at the Business School or in an education provider. These components are threaded with their current job responsibilities and their aspirational job responsibilities, their performance gaps and strengths, making it a very personalised approach. I think you will find learning going beyond the facilitator in the classroom to a variety of mediums, whether it is video or podcast or a reading; whether it is facilitated learning or coaching or technologies that we haven’t even thought about yet. We haven’t talked about what role AI plays or what role augmented reality plays in this. It’s not going to be all about technology, but about how technology enables learning on a personalised level that creates a path for an individual to help them get where they’re going.
Back to the question about whether business schools, add value– they do and they will continue to. But I think you will need to see that the business school, as well as other providers, begin to vary their offering from this list of “50 classes that we offer over a year. Signup and come”.
There was this one quote I saw as part of a World Economic Forum Publication which said that by 2030 the world’s largest organisation would be an education provider. That organisation has not been invented yet or has not been started. The explosion in the need for education, along with upskilling and reskilling, and demand for personalised learning is going to grow. That will directly and wildly impact executive education perhaps in my lifetime; for sure sharing your lifetime. We will see.
About the Interviewer:
Ram Mohan Chitta is Research Editor for ISBInsight at the Centre for Learning and Management Practice, Indian School of Business