Learning a valuable lesson

How do we ensure our executives are equipped to deal with the challenges of running a modern business? Many commentators believe that executive development programmes – whether MBAs, distance learning, open enrolment courses or one-on-one coaching – could provide the answer. CXO spoke to a number of leading experts to find out how companies can capitalise on executive development to help add value to their operations.

Professor Ken Russell is the Associate Dean for Postgraduate Programmes at the Aberdeen Business School (ABS), a Faculty of the Robert Gordon University in Aberdeen. ABS offers a wide range of taught master’s courses and is actively engaged with a range of corporate clients to deliver bespoke management development courses.

Dr Jørgen Thorsell is the Executive Vice President responsible for the international activities of The Danish Leadership Institute. He has been with the institute since 1984, has extensive experience in designing and implementing leadership and management programmes, and has been a key contributor to some of the organisation’s major achievements.

Soumitra Dutta is the Roland Berger Professor of Business and Technology and Dean for Executive Education at INSEAD. His research and consulting have focused on the inter-relationships between innovation, technology and organisational design. He has also conducted research into national ICT strategies and global ICT benchmarking in collaboration with the World Economic Forum.

Supam Maheshwari, CEO of Brainvisa Technologies Pvt Ltd, is one of the chief architects of the Brainvisa vision. He has been responsible for converting key prospects into business success stories, a result of the blend of his vast experience in the e-learning field and his passion to ensure a symbiotic growth between the client and the company.

Jérôme Couturier was named Senior Vice President of Thunderbird, The Garvin School of International Management, in March 2003. He is responsible for the strategy, growth and profitability of executive education and corporate learning, and for further advancing the standing of Thunderbird among the leading centres for international executive education worldwide.

CXO. With corporate budgets an ever-present concern, companies must take a long, hard look at their training plans to ensure they get the most out of them. What are the benefits of sending employees on executive development courses?

KR. I am a great believer in the notion of the ‘three-legged stool’ when it comes to provision of executive development. The three legs are the organisation, the person being developed and the development provider.

There is a need to unpack the process into a series of steps to provide a coherent response. The training plan will only be as good as the training needs analysis that underpins it and in the degree of alignment with the strategic development of the organisation. In other words, organisations need an integrated performance management system. Managers need to spend some time considering how a training need can best be met and not automatically assume that this means sending their staff member on a course. Any substantive training investment in an individual should have three main stages: pre-briefing (an exploration of what the employee should be seeking to achieve as a result of the training), the training itself, with opportunities to reflect on issues with others, and debriefing with follow-up actions to capitalise on the training. With executive development, it is also useful to use a mentoring process where the training is not simply to support development in the current role. The point that I am trying to make, irrespective of the benefits to be obtained, is there needs to be a mechanism to maximise capture of the identified and validated benefits.

If a need has been carefully specified there still remains the process of supplier search, commissioning, and evaluation. If the effort put into the supplier selection does not match the circumstances, then the full benefits may not be achieved (the provision may be too theoretical, too broad brush, too narrow, etc.). Inevitably, compromises are made and shortcuts are taken in selecting solutions.

SM. Getting the most out of your training plans is truly a challenge; identifying a training need and addressing it adequately is not as simple as it sounds! For industries that depend heavily on human capital, nurturing talent and honing skills is a continuous process that cannot be over-emphasised. Well-designed executive development programmes address the mid-career training needs of executives and develop them into managers earlier on. As a result, you have a larger pool of talent making a wider, more credible business contribution. Such training also ensures the professional growth of high-potential senior executives – a crucial factor in retaining talent.

I find that we have organisations suffering a direct impact on their bottom lines from lack of executive development training. A striking example that comes to mind is a corporate bank that needed leadership training for its senior level employees. The bank was facing a dearth of resources for top management executives and needed to quickly train the employees from the senior level for the required positions in the top management. The training programme that we offered enabled these senior level employees, who have risen to the management cadre, but have no experience as leaders and managers to enhance their knowledge, perspectives and develop mutual skills.

I’d say that the need for executive development programmes is widespread. The key, however, is having well designed programmes. We need to take a closer look at the programmes and see if they are filling the training need.

JC. At Thunderbird, we encourage our clients to measure benefits in two key areas; change to the person or people and change to the process. Most organisations have a change issue when they embark upon executive education. This change may be an enhancement of skills, knowledge or attributes (for instance, adding project management to their skills tool set); it may be a need to familiarise teams and individuals with different ways of conducting their business (for instance, leadership in China) or it may be a radical change in the way that employees operate (for instance, changing from reactive sales people to proactive strategic advisers of key accounts). The benefits should be measured in direct relation to the expected outcome of the change envisaged, in hard financial and soft behavioural terms.

SD. There are two categories of benefits that organisations seek from executive development courses: individual development and the achievement of business goals. Open programmes provide an ideal vehicle for the development of new competencies and the driving of behavioural changes in the individual executive. Learning benefits are enhanced with the infusion of new knowledge that is shared by the professors and their research and the interactive discussions of the participants. Customised programmes mobilise the collective energies of a group of executives towards a common business goal. The action-orientated learning process of custom programmes ensures a focus on specific business goals and leads to a collective ownership of specific business outcomes. These are significant benefits that can accrue from executive education programmes. On both open and custom programmes at INSEAD, executives benefit from an incredible diversity of both faculty and participants not seen at any other school. A typical open programme at INSEAD comprises some 20 nationalities with no more than 15 percent of any one nationality.

JT. The benefit from any successful leadership programme is impact on performance, both on the individuals and on the business level. To the individual it often means more power to perform due to increased know-how and more market value in terms of documented competencies. Think of the MBA wave. At the business level, we often meet demands for ‘professionalising’ leadership in terms of increased retention, speeding up turnarounds, ensuring successors and effectively implementing new strategies. Increasingly, we find needs for improving corporate image to attract (and to avoid losing) the best. At the end of the day, people don’t leave poor organisations – they leave poor managers.

We see advanced corporations apply leadership development as a highly effective way to leverage corporate change programmes. Leadership development is acknowledged as a low cost and high impact approach to cascading new strategies and values.

CXO. How can companies measure ROI on such courses? And why is it important that training is adequately managed and that progress can be tracked?

SM. Like any other product, an executive development programme lends itself to a thorough cost-benefit analysis. You can arrive at the cost by adding up all indirect and direct costs of design, development and maintenance. It is also possible to measure the benefits, at least the tangible benefits, in terms of pounds saved or earned. For example, the effect of sales training can be measured in terms of reduced time-to-market and increased sales. A customer relationship management programme can be measured in terms of customer satisfaction survey results. A quality management programme can be measured in terms of the reduced number of quality issues. To get valuable return on investment information, such results can be studied on a controlled group to rule out the influence of external factors. Finally, these results can be converted into pound values to arrive at the ROI.

Apart from this, we have intangible benefits such as increased employee morale, better teamwork and increased sensitivity, which cannot be measured in absolute terms but are there for all to see.

In addition, adequate training management is important in order to adequately meet the varied and complex training needs across an organisation. Simultaneously enrolling students for different courses, sending timely notifications and reminders, tracking learner progress, providing scores and printing certificates are some of the tasks that need to be managed for different programmes on offer. When such tasks are not managed adequately, the resulting chaos can defeat the very purpose of implementing a training programme.

SD. ROI requires the cooperation of the educational provider and the company. From development of the needs, to the definition of the learning objectives, to measurement of the expected outcomes, the process of evaluating the impact of executive development courses can be tracked. Several tools and techniques are now used to track the impact: online surveys, coaching follow-up, action-learning projects and actual savings and profit margins. Time is the most critical resource for executives, and hence it is essential that the return on the time that senior executives invest in training is tracked and measured.

JT. In a highly competitive business environment, all activities need to be justified in terms of hard facts and figures. Leadership development has long struggled to justify itself in hard numbers; how to crack that nut has puzzled us all for a long time.

Recently, we have launched a new and radically different approach to demonstrate impact on performance from leadership and organisational development. An effective approach has been developed to identify those leadership behaviours with a demonstrated relationship with a chosen key performance indicator – for example, bottom line, retention rate, customer loyalty or absenteeism. Now we can actually prioritise the leadership behaviours for clients in terms of degree of impact.

Knowing the leadership behaviours that actually have a direct impact on, for instance, the bottom line, we then develop leadership activities to boost exactly those measurers. This allows for highly focused leadership development with impact on those issues that actually matter most. Moreover, we can identify the best leadership practices in the organisation to be used as good examples of how most effective leadership is actually practised within that particular company culture.

KR. I think that there needs to be a sense of proportion here. In mergers and acquisitions, for instance, considerable attention is given to the value of the synergies that will be created. If one looks at the track record of most M&A activity, then it is clear that the supposed synergy was not fully captured; indeed M&A can (and often does) destroy shareholder value.

M&A activity is far more expensive than most executive development budgets. My contention is that it is more important to ensure that the issues outlined previously are dealt with and not to exert excessive effort in measuring ROI. Behavioural change in individuals may take some time to filter through to the bottom line, and therefore over what period should one attempt to measure the ROI? Competitor activity may easily alter the whole environment in which the company is competing. This does not mean that we should forget about business impact; however, if the right people are being developed in appropriate ways then innovations will emerge that should improve business processes that lead to better customer satisfaction and enhanced financial performance. How this (balanced scorecard) causal chain is managed is fundamental to success and reinforces my earlier point about having an integrated performance management system.

JC. Return on investment can be measured in two key ways: hard and soft. Soft measures, which can be qualified in terms of knowledge gain, behaviour change, and attitude enhancement, can be measured at the end of each intervention or program. Carefully crafted questionnaires asking each participant whether the program had fulfilled pre-determined objectives and learning outcomes can give immediate insights. Thunderbird partners with global personnel survey companies that measure change with a series of interviews before, during and post program to accurately measure behaviour change and knowledge acquisition.

Hard measures are comparatively easy to monitor. The most common method that Thunderbird employs is to conduct a team project for the delegates immediately after a face-to-face or online programme. Such a project should always have hard measures attached, such as increased revenue, cost savings, additional contribution to overheads, etc.

CXO. From one-off seminars and workshops to longer programmes such as MBAs, there are many different types of executive development. What criteria should companies and their executives use to identify the right course to fit their needs?

JT. How to select the right intervention is a matter of focus and relevance. It is how a workshop, a seminar or a programme is actually designed and focused to create a desired difference back home on the job that should be the prime criteria for selection. Learner-driven programmes based on one’s own expressed needs and current situation offer this kind of relevance, focus and impact as a basic prerequisite.

The Danish philosopher Soren Kirkegaard taught us that in order to help others grow one must help them from where they are. In other words, effective seminars or workshops are based on the needs realised and requested by the individual manager at the time needed. When leadership development is based on current real job challenges, the relevance and meaning become surprisingly high. Not only is the motivation for engaging in the learning process considerable, but also the ability to actually make a difference back home increases significantly. By engaging your own reality in the learning process, you prepare yourself immediately for acting out the new insight in your own job situation.

As such, it is less a matter of one-off seminars or longer programmes but more a question of how the programmes and workshops are actually designed and focused. We have interesting examples of corporate rollouts of leadership development based on one day workshops being highly effective, given the fact they all were learner-driven and reality-based.

JC. Thunderbird Corporate Learning is specifically designed to offer the broadest range of executive development. Our portfolio includes open enrolment, both face-to-face and online, case-based learning blended online and face-to-face learning, business solutions development, change-based route map development, individual and small team corporate coaching, corporate certificates, diploma and masters programmes. Added to this, we have a thriving consulting group that offers four types of intervention, and close partners (both upstream and downstream of our core competences) that offer global services. We are capable of delivering all of our offerings on every continent in the world, from within dedicated training environments, and from regionalised online platforms.

KR. Matching course to need will depend on a number of factors. How well defined is the need? If it is not well-defined then request clarification. How widespread is the need? If there is a common, tightly defined need that can be met by a short intervention, then can the need be met in-house or do you need to get a provider to come to you? Can the company intranet be used to provide online help? How do staff engage with material on the intranet? How important is it to create a learning community within the company to generate critical mass for change? Can a series of workshops be designed and developed to create a problem-solving approach with work-based improvement projects to simultaneously develop individuals, teams and the business? How much external facilitation is required? Do you need external certification of the learning?

If the need is for the development of functional expertise in an individual, then consider a specialist or functional master’s course if the individual can meet the university entry criteria. For a more strategic developmental where individuals need to operate in boundary-spanning roles and aspire to senior management, consider an MBA (providing you can commit to releasing the individual). Consider the delivery pattern of the MBA and how this fits with demands of the role.

SD. For years, competency models matched to specific levels and tasks have been the basis of identifying which professional development programmes one should be enrolling in. Currently, the identification of high potentials, determination of succession plans and retention of key leadership positions are the challenges that companies are faced with. All these needs are used in the identification of ‘the right fit’ in choosing executive development courses. At INSEAD, we have teams of trained professionals both in Asia and in Europe to advise corporations, HR departments and potential participants as to the most suitable open programmes to meet their individual and corporate training objectives. Of course, many companies also come to us for customised programmes that are focused on the achievement of specific business goals such as improving customer service. INSEAD has more than 30 years’ experience in providing such customised programmes, with some 75 percent of companies working with us on a repeat basis.

SM. The answer to this question lies in a thorough needs analysis, whether a company is planning a customised training programme or wants to buy off-the-shelf.

Needs analysis is a detailed study of the target audience to identify the training gaps that exist. Accurate needs analysis is crucial in finding or designing the perfect programme to fit your training needs. A few courseware developers offer this service, and this is perhaps the single factor that should determine the kind of course you want to choose.

For example, a week-long programme in key account management should be chosen for young marketing managers who know their job well, but do not have a great record of client retention. If the target audience is new to marketing management, a more comprehensive training programme in sales and marketing should be chosen.

The results of the training needs identification conducted by the company should be shared with the individual to enable him to choose the type of training that he may require.

CXO. Business management ideas, regulations and technologies are constantly changing. How do you ensure that your courses are always at, or ahead of, the leading edge?

KR. There are a wide range of mechanisms that we use to ensure currency, validity and relevance of our courses. The majority of our courses are accredited by professional bodies and are therefore subject to regular scrutiny, including the need to deliver against a required body of knowledge. The University’s own quality assurance policies also require us to engage in regular review, and many courses have a combination of academic and practitioner external examiners. Courses have to be re-validated every five years.

The Scottish approach to quality assurance is embodied in the ‘enhancement led institutional review’ process. This strategic approach to the enhancement of student learning emphasises employability as a key outcome and requires evidence of consultation with employers.

Our staff all engage in a mixture of scholarly activity, research, professional practice, consultancy and management development that informs our teaching. New ideas are often initially incorporated within existing modules but, as the body of knowledge grows, these may merit an elective module in their own right. Over time, the ideas (e.g. e-commerce) may become so embedded in the way that businesses are run that the demand for the elective may then disappear as the concepts and models are absorbed into the core of the course.

SD. Innovation and original research are key areas of focus for INSEAD. Our faculty spend a significant proportion of their time in conducting research and working with executives in firms, finding out more about their issues and directing research activities to their needs. This often leads to the development of case studies and simulations that in turn come alive in the classroom. Real problems, experiences from global companies and results from research help to drive the continuous renewal of our courses. Feedback from the market also helps to trigger the creation of new courses. Recent innovations at INSEAD to ensure we remain at the forefront of change are the creation of the INSEAD Global Leadership Centre, the International Centre on Learning Innovation and the Asia Pacific Institute of Finance, all of which have close links to business, and all of which feed back into our course materials directly.

SM. We have on board professionals from different areas – content technology, graphic design, project management and instructional design. Keeping abreast of the latest academic and industry news is a challenge and we address it through various internal initiatives such as a dedicated research team, subscriptions to relevant publications, functional and cross-functional training, knowledge sharing and knowledge management. This helps us keep track of and implement the best practices across courses.

JC. Thunderbird listens to its customers to understand their latest challenges and needs. We take time to research the customer’s environment, both at a macro and micro level, so that we can really understand their strategy and competitive situation. By conducting interviews and on-site visits, we enhance our understanding. With existing key customers, we nurture the relationships developed around the learning interventions, talking to senior managers, HR and OD departments, and most importantly, the delegates on the programmes. Thunderbird strives to form a long-term relationship with our clients, and we add most value by intimately understanding their business and its direction and proposing appropriate learning interventions that can help our clients manage their strategies and aspirations. Thunderbird also constantly researches all of the latest learning techniques in the corporate world, through its customers and its partners, to ensure that the most impactful learning experience is delivered to our clients.

JT. We are all part of a fast moving business world with an unprecedented level of research in leadership and management. We are in the business of catalysing corporate leadership performance by applying solid findings anchored in well-documented theory.

Our business model is based on a large global network of more than 450 of the most qualified facilitators organised around five competency centres. Each centre employs a small group of experts who together with their part of the network keep themselves abreast of the latest thinking and insight.

Bringing the best together creates an amazing spin off since the network includes selected professors from leading business schools, experts in business psychology, capacities in project management, and senior business strategy consultants. They all share the same learner driven approach to how to effectively bring the latest insight into organisations in a focused and relevant way.

Apart from including the latest from research a vast part of our learning takes place together with our clients. We believe real progress comes from a fruitful close partnership with our clients where all parties gain a higher level of insight. This is how we consider building leading edge insight to the benefit of all.

CXO. What role do you think that more informal executive ‘coaching’ and/or mentoring can play in providing an ongoing source of support and advice for today’s executives?

JC. Coaching and mentoring will have a big role to play in the future of the corporate learning environment. Most senior management teams now employ a series of corporate coaches, not only in the arena of strategy and marketing, but also in leadership, teamship and in latest trends development. Thunderbird has a team of faculty and adjuncts that specialise in this work. The Thunderbird Learning Consulting Network, a part of Thunderbird Corporate Learning, has full-time consultants who work with organisations to gain an in-depth understanding of individual and small team coaching and mentoring needs. Our job is to source precisely the right individual or team to deliver the best solution to the customer. Our consultants are highly skilled coaches in specific business arenas; our faculty are adept at high-level coaching and mentoring and are very skilled in their areas of expertise. In Russia we also have a team of local consultants who serve our client needs there, which require more of a process focus in such areas as supply chain, lean manufacturing and team development. Our final sourcing can occur within our extensive global network, where we have adjuncts placed on every continent who are skilled coaches. We also call upon our partners, who can specialise in a range of talents from performance audit coaching, to advanced transformational coaching to meet the unique customer needs.

What is interesting in Thunderbird’s work with clients is that many of the corporate learning skills we offer will overlap. A consulting engagement could become over time a coaching and mentoring relationship. A coaching and mentoring relationship could introduce some executive education interventions. Business solutions work could result in coaching and mentoring, consulting and very tailored executive education engagements.

SD. Executive coaching currently has the role of an external source providing support in a time of fast-paced, competitive growth in many industries. Taking time to reflect and talk through behavioural issues that impact the motivation and performance of others is important to keep leaders and managers focused on what is important for the company and their success. Effective leaders know their own strengths and limitations well. Coaching and mentoring can help leaders in developing this self-knowledge. This can be supplemented by executive education where you can also develop and acquire new skills, as well as being provided with an excellent forum for benchmarking and networking in a ‘safe’ environment.

SM. I look at unstructured, day-to-day coaching as an important method of executive development. In fact, I would go so far as to say that nothing beats learning by doing and learning by example. The prospect, however, has some practical limitations. This type of coaching takes its own course of time. Due to its informal nature, it may or may not address each executive in a company. And while it is a splendid source of support, we cannot rely on it to fill a training need across the company and in a defined time frame. What I’m trying to say here is that informal coaching is an excellent method of executive development, but cannot replace needs-based, focused training. In this age of competition, a fast track to professional development works better for individuals and businesses.

KR. Mentoring and coaching have their place in the range of options available. Most of today’s executives are time poor. This means that they often want ‘just enough knowledge right now’. The real contribution of a coach or mentor is likely to be in process facilitation and in acting as a sounding board rather than in the provision of knowledge (very few mentors can hope to be experts in more than a limited numbers of areas of knowledge). The effectiveness of a coach or mentor will depend on a range of factors. First is the degree of access that they have to the executive, the rapport that they have built up and the understanding the coach/mentor has of the executive, their team and the business environment. Next is the opportunity to observe the executive in action and obtain feedback on performance. The ability of the coach/mentor to be responsive to needs is also important, as is the degree to which other executives accept the role. Finally, success is dependent on the degree to which the role is defined and operated appropriately alongside the governance system (e.g. the role of non-executive directors) and other professional advisers or consultants.

JT. Leadership coaching has a unique mission in assisting individual executives in reflecting on and learning from their current business and personal challenges. In particular, our international business psychologists have experienced a considerable increase in demand for coaching emphasising the more personal matters. They play the roles of devil’s advocate, soul healer, third party opinion, the novice or just the active listener, allowing for airing views and reflections not possible otherwise.

Coaching is here to stay. The effect of professional personal coaching is unquestionable according to our experiences. However, we believe that executive development should not be limited to just coaching. We recommend executive coaching as a part of larger programmes involving all parties (direct reports, superiors, colleagues and even those from outside the organisation close to the executive. Since leadership involves all the aforementioned parties, they should all be a natural part of any leadership development process. Consequently, we recommend individual coaching combined with group coaching workshops as a highly effective learner-driven approach to leadership development.