It is easy to be wise after the event and very much harder to identify emerging events early on. So, credit must go to the Benchmarking Committee at UNICON for initiating their COVID-19 survey in late February, a full fortnight before the WHO declared the outbreak a pandemic, and at a time when the international press was still referencing the virus as something happening in the depths of China with little impact closer to Western markets. However naïve and unseeing that moment may now appear, there clearly were those in the business school executive education sector who were not only alert to the grave possibilities that COVID-19 posed for world health but also to the direct and significant impact it could play out on business schools’ prospects.

A fascinating insight into how perceptions of the threat evolved around the world… a sobering reflection on the dangers this crisis is still expected to bring to the sector

The Surveys

UNICON, the consortium for university-based executive education, is the leading organization that brings together academic providers of corporate-level management development around the globe, incorporating major global business schools as well as regional players with significant executive education activity. UNICON’s Benchmarking Committee surveys its membership annually as well as conducts ad hoc research at points throughout the year.

Mike Malefakis, Associate Dean for Executive Education at the Wharton School, who has served multiple roles on the UNICON board, and experienced the impact of previous health and economic crises on the exec-ed sector, was instrumental in encouraging the committee to survey the membership on the impact and perceived effect of Covid-19. The Co-Chairs of the Benchmarking Committee, Nora Anderson, (Carlson School of Management at the University of Minnesota), Eric Bergmann (MIT Sloan), and Markus Frank (University of St. Gallen), oversaw the creation and distribution of the survey under a week, reporting the first results in the first week of March.

A second survey followed a fortnight later, reporting on March 18^th, and then a third, more wide-ranging set of questions, a month after that. The results provide a fascinating insight into how perceptions of the threat evolved around the world during those critical weeks and a sobering reflection on the dangers this crisis is still expected to bring to the sector in the coming months.

On the substantive and immediate question “What is the level of impact you expect from COVID-19 in the delivery of executive education for the remainder of 2020?” there was a dramatic shift in response between the late February survey (reporting March 4th) and the second survey only two weeks later.

The overall and geographic breakdown of responses are shown in Figure 1, which indicates there was, unsurprisingly, a much greater concern in Asia/Oceania than in Europe or the Americas, initially; but a fortnight later, the rest of the world had all but caught-up (though Latin America, while displaying a distinct change from the first survey, was still noticeably more bullish than elsewhere). Europe was, by the end of the second survey, less pessimistic than North America however a striking change from the initial responses.

As we stand in June, this second analysis seems to bear some weight, with many European countries, lifting coronavirus restrictions more rapidly than many might have expected while the situation in the US and Canada, at least in Quebec and Ontario, remains uncertain.

The survey does not disclose individual business school’s responses, but the above scenario may be explained by a second analysis of these figures, by executive education annual revenues, and the expected impact thereon. The larger schools, those with over $20m per annum turnover for executive education, indicated a greater expected impact on their activities than the more regionally focused ones.

The third iteration of the survey, which took place in mid-April, ranged further with its questions and dug deeper into the projected fallout. By this time schools were beginning to assess the full impact of global lockdown measures, including consequences for travel and on-campus education in the medium term. Just 6% of responding schools saw only a temporary impact, and almost 60% saw a significant long-term impact requiring new formats and services.

The larger schools, those with over $20m per annum turnover for executive education, indicated a greater expected impact on their activities than the more regionally focused ones.

The regional analysis showed that Asia and Europe were more optimistic, by this stage than the US schools. It was the larger schools that were the least pessimistic, though only in relative terms and the path ahead for all respondents did not appear to be an easy one.

In a more granular analysis, the third survey showed that at first glance custom programs were more resilient than their open-enrolment counterparts, with only 11.7% of custom programs being canceled against 21.5% of open-enrolment. However, perhaps unsurprisingly given the nature of such tailored initiatives, the bulk of these were being postponed rather than adapted to online or blended formats. Open enrolment (OE) fared better in the adaptation stakes, with 24.3% converting to online to some degree or another, against 17.2% of custom programs.

Given that Asia was further ahead in the progression of the pandemic, it may explain why they preferred to postpone their OE programs (45%) rather than adapt them (5%), while in Europe more programs were adapted than postponed (41% adapted to 34% postponed) very similar to the Latin American experience. In North America, the percentage of OE programs postponed (34%) was double that of programs that were adopted (17%).

This regional trend was seen again for custom, but with more postponement, as noted, across the board. See Figure 2 overleaf.

Technology

As with all seismic events in the business world, there are winners and losers that quickly emerge from the short-term disruption. From the tech sector, one such winner was undoubtedly Zoom. Amongst UNICON’s members Zoom was the online communications platform of choice, used by 71% of respondents, and leaving WebEx in its wake as the next most used platform at 4%, and MS Teams at 3%. Skype does not make it onto the chart, while Blue Jeans did well amongst the larger providers in the US at 14%.

In terms of participant satisfaction, there was no indication that online was preferred to originally planned face-to-face programs, but schools should take heart from the fact that satisfaction scores were, where the data was returned, in large part seen as being similar as expected for face-to-face with a fifth or less feeling they were less impactful. Given the speed required to adapt such programs, and frequently the novelty of the online instruction process for faculty, coupled presumably with the disappointment for many participants in not being out of the office at a leafy campus, this is an impressive figure in the circumstances, and ought to suggest that with more time, practice and changed expectations, online programs can deliver at a very high satisfaction level.

International vs Regional Participation

A month on from the third survey, what are the reflections from those on the frontline? Nora Anderson, as Co-Chair of the Benchmarking Committee and executive director of Carlson’s executive education provision, sees the key segmentation as being fundamentally around the school revenues. The largest players with over $20m revenue tend to be world-renowned brands, and though they are most exposed to the restrictions on international travel, and being hurt from that, their brand recognition and stellar reputations, allied to their ability to adapt to high-quality digital delivery will see them weather the storm, evolve, and remain strong.

Institutions such as Anderson’s own, which are elite regional players, she sees as potentially being in a stronger position. They are not reliant on international clients and have an existing pivotal role in their regional economies, convening networks of mid-sized regional clients and offering facilities without the complications of large residential cohorts (in their executive education programs). For institutions such as Carlson School of Management, this anchored regional position will stand them in good stead, while they offer an increasing range of online programs with the option to bring participants to campus as the lockdown phases loosen.

The same is essentially the position albeit they are further ahead on the timeline at St. Gallen in Switzerland. Markus Frank, Director of Custom Programs at the school was preparing to have participants back on campus in a carefully managed process by mid-June. Like Carlson, St. Gallen has a prestigious position in the region, seen by the plethora of German-speaking ‘hidden champion’ B2B companies in Austria, Switzerland, and Germany, as being very much an equal of the best global schools. The strong relationships and knowledge the business school has with this sector will not be easily affected by a switch to more digital delivery. The greater impact is likely to come from the economic effects of the pandemic, resulting in reduced spend by many of these companies on their executive development initiatives.

In the period of the Covid-19 crisis, many business schools turned their face-to-face programs into fully online ones in an extraordinarily short time, just days in some cases

Eric Bergmann, Senior Director of Executive Programs at MIT’s Sloan School of Management, has a view from one of those larger, very international institutions, and concurs with both Anderson and Frank. The US schools are behind those of continental Europe in terms of a return to campus but are nonetheless focused on what that will look like when it occurs, and the issues around international travel will certainly have their impact. However, Bergmann sees that the main effect of the crisis will be that of ”accelerating existing trends” as at least one US commentator 1 has noted. Those existing trends are ones that most schools were already familiar with, and in a number of cases already dealing with, though they are now discovering that they need to implement ideas and projects more quickly than they had originally expected to.

Foremost among these was the shift to greater online delivery. In the period of the COVID-19 crisis, many business schools turned their face-to-face programs into fully online ones in an extraordinarily short time, just days in some cases, where it would have taken months or longer, under normal circumstances, to get the alignment and approvals to enable this to happen. In terms of acceleration, the move to digital has compressed years into days. Bergmann highlights this as one of the things that has most impressed him about his colleagues their ability to come together quickly and achieve what many would have considered impossible in such a space of time. More enduringly, this shift to online has brought into sharper focus the more nuanced and detailed questions regarding online delivery, especially around design and content.

On program content, the UNICON participants, along with those who took part in the IEDP-UNICON roundtable discussion, noted a shift since the crisis emerged, away from personal development programs and towards business model strategy and other strategy-focused topics. Again, this represents an evolution of something that was perhaps occurring already but is now accelerating.

Re-imagining the Campus for Online Experiences

For many executive participants of management programs, the change of scene to a prestigious, world-class campus, often with iconic buildings and traditions, is a core part of the learning experience. So how can this physical and emotive element be reimagined for a digital program? Bergmann of MIT expands on this, noting “There’s a lot of interest in the digital world around how to create ‘buzz groups.’ Broadcast is impossible for very long, you need the breakouts, the buzz groups, and the channels, to have that interaction not just the interaction with each other, but also to think about ‘how am I going to apply this to my own situation?’.” It is that discussion and application element that is ultimately the core value of many executive programs, particularly those on the difficult ‘soft’ topics of behavior and leadership, and finding a way to replicate the on-campus experiences that bring these concepts alive is the next big challenge.

In parallel with this is the realization that everyone has now had, that focusing on a screen is more tiring, hour-for-hour, than listening to someone in a face-to-face situation where the ability to look around and absorb body language cues, is much less distracting than removing concentration from your screen for a moment. “Watch an online video for three minutes and you think, ‘OK, I’ve had enough of this’, in a way you never would if the person was standing in front of you”, observes Bergmann, and so the focus on online design is ever more critical.

The desire to experience the physical presence of ‘place’ and mix and interact with their co-participants is never going to go away

Online programs may well be ‘chunked’ into many smaller segments, interspersed with discussion and interaction sessions to keep the energy in the virtual room at a high level and focus engaged. Improving the sophistication of technology will also play its part, with schools experimenting with new applications and adapting them to enable the value-add of being on campus to be partially replaced by remote experiences. However, all of those interviewed for this piece continued to see the campus playing a strong role in the future. We, humans, are social animals, and attendees at executive programs, almost by definition, are curious ones, so the desire to experience the physical presence of ‘place’ and mix and interact with their co-participants is never going to go away. There will be an inevitable drop in attendance at both physical and online programs as client organizations recover and regroup, but the sense from the market is that as always, the need to learn and progress will resurge and, though the mix of how that is done will have varied, the core demand for executive development is not going to go away.