More companies are beginning to recognise the importance of executive education as a tool for developing their managers.
Investing in this can improve managerial decision-making by creating and transmitting knowledge, which positively affects the company performance.
Partnerships with external parties such as business schools, consultants, coaches and trainers have the potential to impact organisational performance.
To ensure success, leading executive education providers have to meet stringent requirements and excel in faculty recruitment and development, design of programmes and cutting-edge research. To stay competitive, a provider of executive education needs to stay relevant to its users.
A few key issues emerged from a recent series of interviews recently conducted with individuals from Allianz Group, Hitachi Group and Tetra Pak, and leading business schools and consulting firms, which include Wharton, Columbia, McKinsey, Mercer Consulting and Monitor Executive Education. The purpose of these interviews was to get the perspective of these organisations, which have extensive experience in the area of executive education.
What users want
The services that users are looking for range from skill and competency-building to strategy implementation and driving change.
More companies are asking providers and consulting firms to help initiate change by working with their senior executives. Interviewees agreed that the most important value derived from using outside executive education partners is "to drive change".
Executive education providers can create awareness for the importance of strategic change among executives and strengthen their ability to do so once they return to work.
However, many business school leaders still see themselves as educators whose primary goal is to broaden the mindsets of executives and not to help implement strategy. The newer trend for business schools is the demand for services leading directly to performance improvements by speeding up capability development or ensuring commitment to a strategy.
An increase in the motivation level of executives was also raised as another reason for using executive education. After a programme, executives may return to work with new ideas. Meeting new people also expands their business networks.
The current demand of executive education users suggests that research should be increasingly customised and applied. Thus, the link between executive education teaching and research may need to be more clearly established within business schools, and consulting firms need to improve the diffusion of the lessons learned from practices.
Traditional business school competitors must build their knowledge and expertise such that the customer perceives it as "applicable" and consultants need to ensure that they have the intellectual capital to make clients demand their services.
Company boards challenge the substantial amounts of money spent on executive education, and there is a clear need to know the value of such activities. Hence, there is a need to invest more time and effort in evaluating executive education outcomes.
At the team and project level, the value-add is easier to measure, but the creation and transfer of knowledge at the individual level remains largely unexplored.
It can also be argued that if executive education participants are aware that there will be a follow-up to measure the success of their learning, they are more likely to apply what they have learned and be more mindful of how they perform in their jobs.
This requires providers to adopt a new approach to post-programme support, which calls for providers and users to work hand in hand. And follow-up post-programmes are possible only if they are an integral part of company policy.
Academics involved in executive education must not only apply their research to the organisational and individual context, but also create content that can be put into practice.
Executives choosing between different providers need to be more explicit about what they hope to achieve with a particular programme when deciding whom to partner.
Business schools have the advantage of mindset expansion and being more able to focus on diversifying the cognitive and behavioural complexity of participants, allowing executives to develop new mental models or increase their behavioural repertoire. Consultants are able to derive lessons learned from previous engagements.
On the other hand, behavioural coaches primarily work on developing leaders. Each choice involves trade-offs when it comes to choosing among different types of executive education providers.
The users of executive education can influence the direction it takes in future. The smartest way to use executive education is working with business schools on a long-term basis and learning how to design effective programmes of change.