The majority of participants sing the praises of advanced management programmes. Do companies gain as much as they do? Anita van de Vliet.
'A wake-up call, not just in business, but in life,' comments one manager. 'The most formative period of my 20 years in business,' says another. 'It lifted my thinking, my career, my life to another plane,' claims a third. Such a display of managerial fervour is rare. It has been occasioned, in all three cases, by the recollection of their experience at an advanced management programme (AMP), the flagship course of the world's leading business schools.
AMPs are designed for business people with around 15 years' management experience. Usually aged 45 or thereabouts, participants from larger companies tend to be high-ranking officers or managers of major business units; at the very least they head up a functional area but are expected to reach a general management position in the near future. Candidates from smaller companies are likely to be on the main board or to report to it. Though there are no formal educational requirements, some participants do already have an MBA, acquired some years ago: such candidates attend these senior programmes in search of insights into the enterprise in a current global context, rather as some medical doctors go on refresher courses for an update on current best practice.
Business schools offering an AMP (their number includes Harvard Business School, Insead, IMD and London Business School) claim that selection for the programme is rigorous. In fact, at the most recent Insead programme 15 applicants were rejected and 95 taken on the course. Selection is critical, since these courses are largely based on the exchange of best practice among senior executives, and much therefore depends on the quality of the participants. 'If I'm not sure about an applicant's seniority, I ask what assets they manage, how many people, what cross-functional experience they've had,' says Mary Farebrother, programme director for the senior executive programme at LBS. 'I'm not just concerned with the needs of the participant, but with what he or she has to offer.'
The other main criterion for admission is commitment from the sponsor.
This means not only paying for the course and continuing the participant's salary throughout, but leaving him (and the occasional her) strictly in peace, absolved of all work responsibilities and stripped of mobile phone connections with the workplace. 'There is constantly more pressure from companies to maintain contact,' remarks Professor Dominique Heau, programme director and teacher of business policy on the Insead AMP, 'but the effect is to drive the participants schizoid: it is not possible to combine the programme with attention to work'. Most participants agree. For one thing, says Richard Close, regional director of Lex Services retail division, who attended Insead last year (when he was director of the company's Hyundai division), 'you have to work very hard, from 8am to 6pm, with case studies to prepare taking you through half the night'. For another, he adds that, without wishing to sound mystical, it is only through such single-minded concentration that students will be released into the realms of 'pure' strategic thinking.
From the company's point of view, covering for participants during their absence is probably the main burden of the cost - and one reason why programmes generally have been shortened and intensified in recent years, to four weeks at LBS, Insead and Templeton College, Oxford, and to just 18 very full days at the IMD seminar for senior executives. Harvard remains the exception, judging that 10 weeks is the right time to allow participants to reassess their roles within their companies and develop a broader perspective of their business. Comments Allan Leighton, Asda's new chief executive and an enthusiastic participant at the Harvard AMP last year (when it lasted 12 weeks): 'Within one week you are wrapped up in the Harvard environment. And then the programme is long enough so that you really do learn: it seeps into your blood. With shorter courses, you soon forget.'
The course takes its toll in terms of hard cash too. Ten weeks of the Harvard experience will cost $37,000 (£23,900) all in, including tuition (from world famous professors like Michael Porter and Michael Beer who are not only 'great teachers', says Leighton, but who earn their keep from real-life consultancy with the world's top companies), books, case materials, accommodation and board. Four weeks at LBS, which has its own galaxy of star teachers and researchers, such as Gary Hamel and Sumantra Ghoshal, but rather less in the way of social amenities, will set you back £13,250. Insead charges FF98,000 (£12,500), but does not include evening meals. Templeton College which accepts just 35 on each programme and prides itself on its 'familial' atmosphere, charges £12,750. This includes dinner as well as trips to the theatre at Stratford, preceded by a disquisition from a suitably erudite Oxford don, and constant contact with members of faculty. IMD confesses boldly that its 18-day course is the most expensive since the fee of SFr21,000 (£10,250) does not include accommodation.
For their money, participants and their sponsors are hoping, primarily, to get a broadening of perspective, often because either the candidate's career or the company, or both, are entering a new phase. Thus, for example, Leighton and the Asda executive team decided last year that the time was ripe for him to 'broaden his horizons and get some new ideas': the company was four years into its renewal programme under Archie Norman, and Leighton himself had just graduated from marketing director to deputy chief executive.
(He took over from Norman as chief executive last month.)
At British Gas, Martin Plackett, development manager Europe, went to IMD earlier this year because the company wanted him to learn 'how problems are tackled in other sectors and how multinationals organise themselves', as well as to develop his abilities outside his present function, presumably for (unspecified) projects ahead. His own reasons for going were similar.
In particular, he was looking for (and found) an international perspective.
Comments Farebrother at LBS: 'Many senior managers tend to become entrenched in their views. Unconsciously, they take on the culture of their organisation and assume there is no other way of looking at the world.' Broadening your perspective comes partly through the encounter with executives from different sectors, disciplines and countries, but obviously also includes gaining new academic knowledge. All the programmes cover similar ground - business policy, financial management, management control, marketing, operations management and organisational behaviour, and in some cases, global economics and politics - although the emphases will differ.
Thus Insead is reputedly more academic in the high French tradition, and IMD more pragmatic; LBS meanwhile says it has a strong line in creating strategy, in leading people and in effecting change, while the Oxford course is sturdily composed of the 'nuts and bolts' of business, including what looks like a double dose of finance. 'We always ask students what they need, and they always reply, "Finance",' explains Paul Vatter, emeritus professor of business administration at Harvard who runs the negotiation course on the Oxford AMP. Witness Mike Sample, general manager of international business development at the Cincinnati-based Cinergy Corp, who undertook the Oxford AMP partly in the hope of learning more about the changing nature of the utilities sector but partly for an understanding of what drives a company financially - 'one of the great strengths of this course,' he claims.
Seeing more clearly is also the result of exercising sheer intellectual rigour. Certainly Close of Lex Services seized the chance of going to Insead, which the company offers to all managers at divisional director level, partly because he felt that after 10 years in industry it was time for an injection of academic excellence.
Are these high hopes fulfilled? To judge from the responses of the Management Today sample, it seems they are, often as much because of the quality of the other participants as because of the expertise of faculty members.
Close reports of his 60-participant Insead group that around one third were 'people of the highest intellectual level I had ever met in my life - and from all over the world - you could really see why they would be leaders'. One of the major benefits, he declares, was 'being in contact with people who were so intellectually outstanding'.
However, this is not to say that only the most brilliant attend. Even at Insead, Close judged one third of the group as unfit for the course (Professor Heau puts the proportion as closer to one sixth), either because they were not intellectually up to the mark or because they lacked motivation.
Even the multidisciplinary variety of the student body, which is in some respects an essential ingredient for widening perspectives, can conceivably cause problems. Duncan Campbell-Smith, business development director at Penguin Books and a recent attendee at the LBS programme, suggests that the 'huge range of professional skills', from finance to HR, and the presence of both public and private sector managers, could result in 'fragmentation'.
LBS 'managed to finesse it well', he says, but he could imagine being stuck in a finance course waiting for the laggards to catch up. Leighton, however, claims he found that helping fellow students from Korea or Japan over the language barrier (all courses are conducted in English) acted as part of the 'bonding' process - an important aspect of the experience.
The international mix is seen as essential to the widening of perspective and as representative of the new global realities. At Insead, groups are regularly made up of at least 20 nationalities, with no more than 15% from any one country, so that no one culture is allowed to dominate. IMD has a similarly international spread, also with a strongly European flavour.
Templeton College, too, has what one faculty member calls a 'marvellously diverse student body', but its richness stems more from the old Commonwealth, Southeast Asia, Africa and the US than from continental Europe. LBS and Harvard, by contrast, have a larger proportion of domestic participants.
Interestingly, these cultural and national differences seem to have a dual effect, stretching students to think about problem-solving in different ways, but also reminding them that business problems are the same the world over.
Across all the schools, opinions of the faculty members were, generally, high. At LBS, for example, Campbell-Smith found some of the speakers not only 'intellectually challenging' but fired with passion for their subject: 'They brought a good strong dose of business evangelism, which is hugely valuable when you're in your mid 40s. You need to be reminded how exciting it is to be in a good business; and, conversely, that bad businesses are not pre-ordained.' This is not, however, to suggest that all presenters at the schools in question were charismatic. Several participants made the point that they had expected all teachers to be of a world class standard but found some closer to good national university level, with the occasional pedagogue verging on the sleep-inducing. Guest speakers were generally highly regarded, whether these were leading business people (the chairman of Heineken at LBS, for example, or the European operations director of Disney explaining the merchandising of Disney-ware across Europe at Insead) or, as at the briefings at Templeton, luminaries from the wider intellectual world of science and politics.
In all, participants are evidently kept stimulated and involved by the AMP while they are on it. But all programmes are intended, obviously, to feed into participants' jobs back at the ranch. Many clearly do feel that their new insights are transferable. Close even records what amounts to a business epiphany. 'In the second or third week at Insead, when we had moved into pure thinking, it came to me like a flash that we had to do something about the Hyundai replacement parts business.' He started making notes on the spot, and on his return conducted two weeks' market research before putting together a project team to develop strategy on pricing and service levels. The result today, he says, is that 'other parts suppliers are backing out', and the business will generate income 'a hundred times' the cost of sending him on the course.
Leighton at Asda, meanwhile, perceives solid, practical benefits accruing to the company in his new perspectives on 'moving customer service onto another plane', on new technology, and on how to manage organisational change. In addition, he says, in the course of decision-making he now has a bank of 'brainwork' and international experience to fall back on.
It is, however, not always so clear that the sponsoring company benefits from AMPs as much as the individual. Indeed, in some cases one detects in some students a certain restlessness and desire to move on (and out of the present company) precisely as a result of the course. Comments one participant: 'So many case studies are about organisations confronting a difficult challenge and surmounting it - or, if they fail, you discuss what they should have done to achieve success. The more you hear, the more strongly you feel that problems can be solved. But then if your own organisation is stuck in problems, if you feel your own senior executives can't hack it, and you yourself do see solutions but don't have the power, you do get restless, you do want to move on.' Whether the sponsoring company benefits would therefore depend, it seems, on whether it is strong and forward-thinking enough to take new ideas on board.