EMBAs provide real value for employers
But fewer companies now sponsor their employees’ degree
FOR MANY executives, one of the greatest attractions in pursuing an executive MBA (EMBA) degree is the return on investment (ROI) they can guarantee themselves upon graduation. EMBA alumni speak of salary increases, career advancement and promotion even before they have completed the prestigious business school course.
But they are not the only ones reaping the rewards. As EMBA participants return to the workplace between modules, employers can gain from immediate implementation of the latest knowledge gained from experts in the field.
The EMBA has traditionally been an employer-employee partnership. Given the format of the degree (which allows employees to continue working while they up-skill with one of the highest accolades in business education), company-sponsored candidates have been somewhat the norm in business school classrooms. In return for sponsorship, these candidates have demonstrated loyalty and commitment to their financial backer.
However, the availability of EMBA financial aid is becoming more stringent. Business schools are reporting more self-funded EMBA participants as company sponsorship wanes. With such changes on the financial front, who is really benefiting from the EMBA experience?
SELF-FUNDING ON THE RISE
John Lees, executive director of the EMBA at Warwick Business School says that, as recently as 2010, 73 per cent of the school’s EMBA students received full sponsorship from their companies. This year that number has dropped to 55 per cent.
“We have seen the overall level of [company] sponsorship drop over the past three years,” Lees says. “However, there hasn’t been a drop in students on the [EMBA] programme – there are simply more individuals paying their own way.”
Kristen Neymarc, associate director at HEC Paris, one of Europe’s most prestigious business schools, has also seen a change. “The overall picture, with certain exceptions, is for around one third [of candidates] to receive full funding from their employers, one third to receive part funding in such areas as travel and expenses, and the balance to be fully self-funded, which is definitely an increase on previous years,” she says.
That’s not to say that company sponsorship is a thing of the past. Organisations are still prepared to fund the EMBA studies of deserving employees. “Organisations are beginning to select high potential individuals to invest in because they would rather do that than lose them for one year (if they studied toward a full-time MBA),” explains Dr Andy Bailey, director of the EMBA at Lancaster University Management School. “But organisations that are sponsoring candidates want a more immediate return. They’re placing greater emphasis on how individuals can add value to the workforce – and quickly.”
But are organisations properly aware of the true value of the degree, and what EMBA graduates can bring to the workplace? “I think employers still need to develop an understanding of how best to make the most of an employee with an EMBA,” says Bailey. “We are seeing loyalty from the candidate to the organisation that has sponsored them. But the organisation and the managers haven’t fully understood how best to utilise the candidate or understood the value of the degree – particularly upon the candidate’s return to the workforce.”
IDENTIFYING EXPECTATIONS
Bridging this gap, and providing organisations with opportunities to fully appreciate the value of the EMBA, is a key focus for business schools. Steve Seymour, director of MBA programmes at Ashridge Business School, says it is possible to demonstrate significant value to the sponsoring organisation. “Our programme provides a tangible ROI from both content and recommendations,” Seymour says. “Students get 60 to 80 days of internal consultancy, 13 work-based assignments covering areas such as strategy, operations, finance, marketing, information systems, and HR, the opportunity to reappraise the business from the inside-out and an improved management skills base,” he says.
Dr Claudia Jonczyk, associate professor of organisational behaviour studies, and academic director of the EMBA London track at ESCP Europe Business School, says that more than ever employers need to be reassured that sponsoring a key executive to pursue an EMBA is not giving them the key that they need to unlock jobs with other companies. “While it may be true that some EMBA graduates use their new found skills and confidence to change jobs, it is equally true – even more so now than ever due to the ongoing effects of the financial downturn – that the EMBA graduate’s objective is to rise or maintain strong footing within his or her own organisation,” she says. “This goes hand-in-hand with participants placing great value on increasing their employability by doing an EMBA.”
The EMBA continues to provide real value for employees and employers alike. But the true worth of an executive MBA lies in all those involved ensuring that they make the most of the opportunities it uncovers.
Ann Graham is senior features writer for the QS TopExecutive Guide.