Home Madrid education Business schools compete with digital providers for a slice of corporate training

Business schools compete with digital providers for a slice of corporate training

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As she tilts her head to one side, crosses her arms defensively and raises her voice in irritation, ‘Lisa’ describes how she berated one of her team members before admitting her aggressive approach would likely backfire against her.

Her words are spoken by a real actor, but she is portrayed as an avatar, a symbol of how pioneering training companies deploying new technologies such as augmented reality are shaking up schools’ traditional face-to-face classroom format. of commerce providing training to managers.

“We’re in high demand,” says Mark Atkinson, chief executive of Mursion, a San Francisco-based company that offers artificial intelligence-based simulations. It allows sales managers, front desk staff and others to cost-effectively role-play online, without feeling embarrassed or held back in front of their colleagues. “It’s a unique component of learning that’s sorely lacking.

His company is among a growing number of providers that have thrived during Covid-19 amid signs of an upsurge in demand for training in different formats for growing numbers of employees.

Executive training

The FT, in conjunction with Unicon, AACSB, EFMD, EMBAC and Nomadic Learning, is seeking input from executives overseeing learning budgets, on investments, formats and themes for their staff. Please complete the survey by March 7, 2022, which can be completed at www.ft.com/closurvey.

“The training industry is digitizing in important new ways,” says Josh Bersin, a seasoned industry consultant. “There’s a lot of innovation going on, and vendors are getting loads of money from venture capitalists.”

Technology-based new entrants have added new pressure on business schools, which were already facing an explosion of alternative vendors. A survey carried out last year for Carrington Crisp, an education consultancy, suggested that only a third of employers use them for executive and lifelong learning, with the rest turning to professional bodies , consulting firms and internal services.

Established academic institutions took a substantial financial hit early in the pandemic. The lockdown has limited travel and the ability for face-to-face sessions, and many corporate clients have restricted budgets and staff time as they refocus on adjusting to the disruption caused by the coronavirus.

This has created uncertainty even for prominent sites such as the University of Chicago Booth School of Business, which had invested in a substantial new three-story facility to house its London campus but had to delay the opening of several months.

“We really had to accelerate online and hybrid formats in a short time,” says Mark Lewis, executive director of executive education at Booth. “Schools really had to be nimble, resilient and flexible. We have always faced competition, but the competition we are going to face now is for the present and long into the future.

The good news, he says, is that customers are coming back and revenue is rising again for both his school and many other respondents in a recent benchmarking survey conducted by trade association Unicon.

This reflects the findings of an inaugural annual survey of 363 learning leaders around the world conducted in 2021 by the FT with Unicon and other professional bodies, which is currently running again. It showed that more than a quarter of organizations planned to increase their budgets while only 17% planned cuts.

While learning has long been seen as strategic for supporting business development – ​​and sometimes for providing benefits to those in leadership positions – many respondents commented on how it was increasingly being used to attract and retain staff. This has become more important both for a restless cohort of millennial recruits and for older staff contemplating a change as part of the “big quit”.

In addition, the out of necessity shift to online education over the past two years has opened up the possibilities for cheaper and more democratic training accessible to more people at different levels within companies. It sparked interest as the #MeToo and Black Lives Matter movements added momentum to calls for greater diversity and inclusion in the workplace.

Indeed, the FT survey highlighted this topic as one of the top-ranked areas of expertise sought by learning directors, alongside more traditional executive education topics, including leadership, change management and digital transformation.

But some suggest that accelerated breakthroughs in online education provide greater flexibility and convenience for students and lecturers, which is unlikely to reverse. There are indications that digital programs may even offer better quality and satisfaction among participants than in-person programs.

Silicon Valley Executive Education offers personalized “hybrid” online education that combines experienced business practitioners and academic professors from leading business schools such as Harvard, Wharton, Stanford, UC Berkeley, and UCLA in its programs. Its leader, Robert David, says the greatest interest is in “the three Rs” of resilient leadership, remote collaboration and ruthless prioritization.

Such growing “disintermediation” of faculty experts from their business schools could pose a threat. Another pressure comes from within, as schools balance the temptation of pricing versus volume in their online offerings.

Andrew Crisp, co-founder of Carrington Crisp, said one executive summed up his view: “Rather than spending $50,000 to send two people to a program at Harvard, we can now try to send 50 people at Harvard. [online] content for the same price. That seems to sum up a lot of the current market development,” he says.

Bersin says there is a strong growth in “micro-learning” and providers running a range of programs online. But he warns that to be effective, they must also be innovative and interactive, as libraries of training videos designed simply to be viewed passively are falling out of favor. He adds that “there is still a very big need for face to face. Things happen in a room when people talk to each other that never happen online.

Business schools are also adapting their pedagogy, both with virtual reality, simulations and with innovative face-to-face formats. At Edhec Business School in Lille, for example, executives from the Leadership Under Pressure unit of its Advanced Management program join military commanders aboard a French warship for 10 days of rigorous training.

Lee Newman, Dean of the Madrid-based IE Business School, says: “I don’t see business schools being pushed out of the whole value chain, but we need to look carefully in the mirror to identify our relative source of value. We have to disturb each other and double up.