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Trends in Executive Education from the Baltic Management Development Association

Posted on May 28, 2013 by David

Professor Peter Lorange

One of the most pleasant events on my recent trip to Lithuania was catching up with Dr. Peter Lorange, who I last met in Toronto over twenty years ago. He has been a pioneer in the field of management and I have admired his writings on strategy for a very long time. He was President of the Swiss business school IMD between 1993 and 2008 and was instrumental in shaping its strategy that led it to become the powerhouse of an institution that it is today. In 2009 he bought Zurich’s Graduate School of Business Administration and renamed it the Lorange Institute of Business. It focuses on executive education, with a program that includes an Executive MBA and a variety of more specialized master’s degrees. Lorange set up the school to address what he sees as the key drawbacks with many current business schools – an inability to innovate fast enough in terms of the content of the programs and courses and in their teaching methods. He argues that they bear some responsibility for the 2008 financial crisis because of their emphasis on linear thinking and their neglect of the role of cycles in business. As the owner of a small Norwegian shipping company for many years, Peter has an excellent perspective on the ups and downs of that business and the importance of cycles and turning points in general.

At the 11th Annual Meeting of the Baltic Management Development Association in Kaunas, Lithuania Peter Lorange spoke on some trends in executive education. He began with a description of the foundations of the modern university based on the reforms made by Wilhelm von Humboldt to the Prussian education systems in 1809. These reforms, which were to have a profound influence on the American education system, resulted in a discipline-driven, axiomatic focus with academic jobs organized into disciplines. The criterion for promotion (and tenure) was axiom-based research and single-author articles published in axiomatic academic journals. Teaching was seen as a burden to be minimized. Lectures were one-way affairs delivered in standardized courses to large cohorts.

Many, perhaps all, of the American business schools developed in this academic tradition but in Europe there was, also beginning in Germany, a different kind of institution, based on the applied sciences and the arts. These “fachhochschule” emerged from engineering and were based on a much closer association between education and working. In Lorange’s view it is this latter tradition, coupled with digital technology, that is informing the changes in executive education. These changes are based on research from fast-moving consumer goods, the fact that no one can just listen for more than 20 minutes and that the learning context is critical. Lorange cited Piaget’s contention that effective learning requires a situation with ample light, sufficient height under the roof and a context of beauty! In the new format axiomatic material is delivered using distance learning methods, while class time is devoted to activities and interactions that cannot be delivered in any other way.

Professor Lorange identified seven features of this new approach to executive education:

A more integrated teaching approach, in contrast with the current siloed, functional method.
Learning in parallel with doing, with the participants keeping their current full-time jobs; more focus on practical knowledge – how to do it.
Corporate customers will be more thinly-staffed than ever before. They can afford to have their people absent only for short periods of time; where possible intact teams will participate.
More joint research and research combined with teaching; projects working with both students and corporations. Modular, shorter courses with a more flexible curriculum structure.
Less focus on academic departments and more emphasis on career paths for professors that oscillate or pulse between the academy and practice.
A more collaborative approach within academic institutions, with an emphasis on “we, we, we” rather than the current “me, me, me” approach with individual academics teaching “my course”.
Team approach to teaching integrated offerings that may bring in practitioners and visiting professors to create a network of competencies.

Although he didn’t discuss the challenge, it clearly going to be very difficult for conventional business schools to change to models like this one. One of the few successful changes that comes to mind is that of Babson College, which went through years of struggle to come up with its own unique program and its emphasis on entrepreneurship, which is consistently rated highly in the annual rankings of the business schools. The majority of these institutions, however, are held fast in a competency trap where, short of a major crisis and inspired leadership, they will be unable to forsake the methods and assumptions that have made them so successful. In such circumstances the new approaches are best started from scratch along the lines that Peter Lorange is suggesting and doing.