UNICON
2007 Fall Conference
The Newcomers Workshop
November 27, 2007
Bob Stilliard
Ashridge
Steve LaCivita
University of Chicago
Welcome and Introductions
Outline of Presentation
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UNICON: Your Professional Resource
The Executive Education Business
The Executive Education Marketplace
Strategic Framework and How We Compete
• Group Discussion/Questions
– Why am I attending the conference?
– What do I want to learn?
– How do the answers to those questions relate
to my job challenges?
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UNICON
Who We Are
• The International University Consortium
for Executive Education
• Worldwide – 84 Academic institutions
• Non-degree Programs / Services
• Volunteer
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UNICON
How We Work
• Board – 6 Year term
• Exec Committee – Chairman / Vice Chair /
Former Chair
• Committees
 Benchmarking
 Board Continuity
 Conference
 Research
 Finance
 Membership
 Communications
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UNICON
Core Values
• Collaboration
– Openness
– Mutual respect
– Community of practice
• Knowledge
– Creating the base for sharing
– Conducting research
• Service
– Devoted to the university sector
– Developing useful products
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The Executive Education “Business”
Typical School Objectives
• To meet the needs of corporate customers.
• To enhance the school’s general awareness and
expand its corporate relationships.
• To provide a vehicle for enhancing the school’s
reputation.
• To provide a forum for the dissemination of
information on new research findings.
• To provide faculty an additional source of
income.
• To make a financial contribution.
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The Executive Education Business:
Some criteria for success
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Does the faculty deliver high impact ideas?
Does the quality of teaching live up to expectations?
Are faculty members at the leading edge of knowledge in
their fields?
Are faculty members curious about the knowledge
participants bring into the classroom and their particular
business situations?
Was the level of the participants appropriate for the content?
Is the return on investment worth the money spent and time
away from the job and family?
Executives seek a compelling reason to attend.
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The Executive Education Marketplace:
Customer Expectations of Business Schools
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Tomorrow’s knowledge today
– “continuous access to cutting edge thought and research”
Targeted messages
– “an investment in learning about my industry and my company”
Increased organizational capability
– “teaching that bridges theory and practice”
Integrated learning
– “a holistic approach—from strategy to execution”
Partnership
– “a relationship through which we can drive growth—personal and
business”
Network of resources
– “a group of exceptionally smart faculty, students, staff and alumni
that I can rely on to get the information I need to run my business”
Full service environment
– “a place apart to recreate the sense of the possible”
Value for money
– “a positive return on our investment”
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The Executive Education Marketplace:
Strategic Management Development Issues
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Creating unity and alignment
Increasing bench strength
Achieving responsible growth
Integrating executive development and
HR systems
• Developing business acumen and
leadership skills
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The Executive Education Marketplace:
We Live in our Clients’ World, Too!
• Market growth
• From open to custom
to partnership
• More “action
learning”
• Executives as
teachers
• Use of coaches
• Shorter programs
• More flexibility
• Need to accelerate
quality improvements
• Systems approach to
executive
development
• Companies reducing
the number of
suppliers
• Expectation of
measurable bottom
line impact
• Value vs. price
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Executive education in the Wider Business
Education Market
Four segments
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Undergraduate
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MBA/Masters
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Executive education
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One-to-one
So how does executive education relate to the others?
Undergraduate
Age
20
Educational Philosophy
Content
Purpose
Judgement/Maturing/Job
Class Size
Up to 600
Faculty
Professor
Faculty Drivers
Peer to peer research
Audience
Individual
Success
Entertainment
Teaching Style
Lecture
Setting
Concrete
Food
Cardboard
Source: Peters/Ridderstrale (2006)
Undergraduate
MBA/Masters
Age
20
-28-
Educational Philosophy
Content
Integration
Purpose
Judgement/Maturing/Job
Job
Class Size
Up to 600
75
Faculty
Professor
Practical Professor or
Professor of Practice
Faculty Drivers
Peer to peer research
P2P Research or
Professional Journals
Audience
Individual
Individual
Success
Entertainment
Entertainment
Teaching Style
Lecture
Case Studies
Setting
Concrete
Concrete++
Food
Cardboard
Cardboard + fruit
Source: Peters/Ridderstrale (2006)
Executive Education
Age
35
Educational Philosophy
Action
Purpose
Career Progress
Class Size
30
Faculty
Professor of Practice
or Practical Professor
Faculty Drivers
Client Satisfaction/
Business Impact
Audience
Organisation
Success
Impact
Teaching Style
Live Cases
Setting
Luxury
Food
4 star
Source: Peters/Ridderstrale (2006)
Executive Education
One-to-one
Age
35
45+
Educational Philosophy
Action
Reflection
Purpose
Career Progress
Making Choices
Class Size
30
1
Faculty
Professor of Practice
or Practical Professor
Psychologist with
Business insight
Faculty Drivers
Client Satisfaction/
Business Impact
Business Impact
Audience
Organisation
Organisation via the
Individual
Success
Impact
Results
Teaching Style
Live Cases
Dialogue
Setting
Luxury
Luxury
Food
4 star
Caviar
Source: Peters/Ridderstrale (2006)
The Exec Ed Continuum
Where Does Your School Fit?
Open Enrollment
Research
Low
Program Types Offered
Custom
Institution Orientation
Teaching
Exec Ed Degree of Independence
from rest of B-School
Senior Tenured
Teaching Faculty
Part of Normal
Teaching
Requirement
Faculty Compensation
For Exec Ed Teaching
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High
Adjunct
Paid for All
The Exec Ed Continuum
Where Does Your School Fit?
Senior Exec
Global
Large
Public
Wide Industry Range
High Involvement
Junior Exec/
Middle Manager
Participant Mix
Regional
Mid Mkt/Small Cap
Private
Targeted Industry Focus
Company Mix
Low Involvement
Faculty Involvement
(program design, administration, etc.)
Faculty Driven
EE Operated
New Program Development
Market Driven
Residential and Teaching
Facilities
Not Provided
Additions to the list?
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The Two Most Important Cost Curves in our
Business
• Scale (Economies of Scale) efficiency
• Scope (The Learning Curve) effectiveness
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In custom executive education, what is the basic
unit of goods or services that we have to sale?
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In open enrollment executive education, what
is the basic unit of goods or services that we
have to sale?
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The Executive Education
Basic Profit Model- Open Enrollment
• Profit = Revenue – Costs
• Revenue = Price x Quantity
• Quantity = Instruction days x Participants
= Paid Days of Instruction (PDIs)
* High fixed cost model
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Metrics:Open Enrollment and Custom Programs
2006/07
2007/08
Programs (Course Titles)
Offerings
Instruction Days
Paid Days of Instruction
Average PDI per Offering
Participants
Participants/Offerings
Participants Per Instruction Days
Average Price/Day*
Open Revenue
Gross Margin / Instruction Day
Custom Days
Custom Price/Day
Gross Margin / Instruction Day
Custom Revenue
TOTAL REVENUE
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2008/09
2009/10
What’s the size of the Executive
Education Market?
A. $ 466 billion
B. $66 billion
C. $16 billion
D. $ 2 billion
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If the executive education industry size in revenue is $66 billion
Then this is the approximate
Market share for university-based
programs
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A Strategic Framework:
Porter’s Five Competitive Forces Modified for Executive Education
Potential Entrants
• Consulting firms
• Loosely organized high performance teams—Superstars, general faculty/tenure op-outs and wash outs/consultants
• Major Corporations—backwards integration
Suppliers–Talent
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Business School Faculty
Consultants/Senior
Executives
Tenure opt-outs/washouts
Material Developers
Case producer
Video, Audio, Simulation
Software
Text publishers
The Executive Education Industry
Open Enrollment Programs
Short Seminar
Functional & Mgmt. Dev. General Management
Programs less than 1
Programs 1-3
Programs 4 weeks
week
weeks
or longer
• Associations
• Mostly Business
• Predominately
• Business & Trade
School
Business Schools
Journals
• Some Associations
• Some Associations
• Private Firms
• Some Private Firms
• Some Private Firms
• Handful of Universities
Consortium Programs
Custom Programs
• Corporate. Development Staffs• Business Schools
• Private Firms• Individual Consultants
Rivalry Among Existing Firms / Organizations
Potential Substitutes
• Internet courses• CD Rom
• Interactive video• Teleconferencing courses
Non-Traditional Degree Program, Certificate Programs, In-house Corporate Programs
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Buyers
Buying Centers within Major
Multi-National Corporations
• Fortune 1000
- Service
- Industrial
- International
• Association / Consultants
SLIA Large Cap Mean Revenue
Harvard, INSEAD, IMD, Wharton, LBS, Ashridge, Duke CE, IESE, Cranfield, Kellogg, ESADE,
Stanford, Thunderbird, MIT, Chicago
$50.00
$45.00
$40.00
$35.00
$30.00
$25.00
$20.00
SLIA Large Cap Mean Revenue
$15.00
96-97
98-99
00-01
02-03
25
04-05
06-07
SLIA Large Cap %age Increase
Harvard, INSEAD, IMD, Wharton, LBS, Ashridge, Duke CE, IESE, Cranfield, Kellogg, ESADE, Stanford,
Thunderbird, MIT, Chicago
40.0%
35.0%
30.0%
25.0%
20.0%
15.0%
10.0%
5.0%
0.0%
96-97
-5.0%
98-99
00-01
02-03
SLIA Large Cap %age Increase
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04-05
06-07
SLIA Mid-Cap %age growth
Virginia, Michigan, Columbia, North Carolina, I.E., Babson, E.M. LYON, EADA, Tuck, U of Wisconsin, ITAM,
UCLA, Minnesota, California Inst. Of Tech.
25%
20%
15%
10%
5%
0%
96-97
98-99
00-01
02-03
-5%
-10%
-15%
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04-05
06-07
SLIA Small Cap %age GrowthPenn State, Berkeley, Boston Univ., ND, British Columbia, SMU, Ohio State, Rice, Tennessee, U of
Washington, Indiana, Emory, USC, Case Western, U of S. Carolina, Cornell
25%
20%
15%
10%
5%
0%
96-97
98-99
00-01
02-03
-5%
-10%
-15%
-20%
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04-05
06-07
How We Compete—Core
Competencies
Discipline of Market Leaders
Product
Leadership
Customer
Intimacy
• Business strategy / mix
• Best in-class programs
• World-class faculty
• Superior customer value

relevant content

high pay back
Faculty
• Building and defending
brand equity
• Customer share versus
market share
Operational
Excellence
• Quality / effective
systems
• Economies of scale
• Reengineering
processes
• Anticipating customer
needs
Senior Staff
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Operations
MARKET / PRODUCT MATRIX
Anoff’s model adjusted for executive education
Current
Markets
Current Products
New Products
MARKET PENETRATION
PRODUCT DEVELOPMENT
• Three to five new high
potential public offerings
per year
• Three to five new multisession custom programs
• Modification of current
programs
• Aggressive marketing
communications
MARKET DEVELOPMENT
New
Markets
DIVERSIFICATION
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• Global expansion
– Asia, Europe, Latin
America
• Association Programs
• Other types of JVs
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Video tapes
Instruments and cases, etc.
Software
Distance learning
Coaching
GE/ McKinsey Screening Grid
(adjusted for executive education)
Business Strengths
Customer Satisfaction
(based on a 5 point Lickert Scale)
4.1 < 4.5
30 < 40
> 40
1
< 30
(based on average enrollment per offering)
Demand
Market Attractiveness
4.5 or Higher
< 4.1
2
Premium
Invest / Grow
Selective
Invest / Grow
3
5
Challenge
Invest / Grow
Prime
Selectivity /
Earnings
6
8
Opportunistic
Selectivity /
Earnings
Opportunistic
Harvest
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4
Protective
Selectivity /
Earnings
7
Restructure/
Harvest
9
Harvest
New Program Matrix
Selection By Topic/Theme
Market Demand
Faculty Capability
High
Med
Low
High
Med
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Low
Congratulations!!!!
You Survived Basic Training!
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