EMBAs gain ground despite the downturn

At the start of the financial crisis in September 2008, McGill University joined forces with neighbouring business school HEC-Montréal to launch their fully bilingual EMBA. "It was a bold move, both in terms of the program itself and the timing. Even so, we've enjoyed nothing but success," says Michel Filion, director of recruitment for the program.

Consider the numbers: Enrolment has grown each year since its launch, from 36 participants in 2008 to 42 (its maximum class size) participants in 2010. Recruitment for the fourth program cohort is also going well, even though tuition has increased, from $65,000 to $72,000.

"The cost has not been a deterrent to enrolment. People see it as an investment in themselves. In a downturn when markets aren't doing well, companies really want their people to be strategic for the organization," Mr. Filion explains.

McGill/HEC-Montréal's experience seems to be typical for business schools across Canada in the wake of the financial meltdown. While demand for EMBA programs has remained strong, what has changed for some is the level of upfront sponsorship from companies. For example, at the Richard Ivey School of Business, the EMBA program has seen a shift that has resulted in fewer participants being fully sponsored by their companies, while more people are now partially sponsored.

"It used to be in a typical EMBA class people fell into three fairly evenly distributed camps with one-third of students paying for the EMBA themselves, one-third fully sponsored by their employers, and one-third of students sharing the cost with their employers," says John-Derek Clarke, director of executive client services at Ivey. "It's not that corporate sponsorship of EMBAs has gone away. It's that the amount they have sponsored has decreased since 2008."

Shai Dubey, director of the Cornell-Queen's EMBA, has a slightly different take: Employers are becoming more creative in how they choose to sponsor their top talent. "The numbers are a little bit deceptive. Fully sponsored is reported as how much employers are paying upfront for the degree, but employers are also getting much more creative when it comes to how they are reimbursing. For example, through the program I've seen people get two or three promotions and bonuses. It is one thing to have an EMBA paid upfront by the employer but there are other ways to structure it."

That said, this shift in sponsorship hasn't had a marked impact for either program. Participants are still lining up, and applications for Ivey's EMBA have increased by 20% since 2008. The $90,000 price tag remains firmly in place.

"I don't see costs coming down," says Mr. Clarke. "People are looking for an experience that opens up opportunities for them. And when it was corporate-sponsored, those opportunities were within your company. Now maybe that opportunity is looking at other organizations and industries."

Demand has grown through the recession for the Cornell-Queen's EMBA and so have costs, up from $98,000 in 2008 to $100,000 this year. This past year, 13% of participants were fully sponsored while 56% self-funded.

"The amount of corporate sponsorship dipped in 2009, but it's back up," says Mr. Dubey. "One of the most significant trends I have seen is that the average age of participants has slipped from 40 to 37. People are taking part in the EMBA at an earlier stage of their careers."

Bottom line: People are willing to incur the cost of an EMBA. This has certainly been the case since the launch of EMBA programs in Canada in the early 1990s. The market has grown substantially since then, mirroring the rise of professional development as an industry. "Across the board, there is a growing trend of professionals investing in their own development in order to accelerate their careers," says Mr. Clarke. "I only see the popularity of EMBAs increasing."

As a result, Mr. Dubey does not see prices dropping, particularly with the top schools. "An EMBA goes beyond the education. It's the soft skills, the value-adds, plus it's the alumni membership that gets people to go to these schools -the ability to connect to folks who are successful."

If any change is anticipated in how EMBAs evolve post-economic downturn, it will come in the form of a greater focus on value-adds. Athabasca University's EMBA benefits from its flexibility and affordability -it is completely online and has a price tag of $44,000.

"Our courses are designed to allow participants to put theory into practice and so the ROI is immediate," says Deborah Hurst, program director of Athabasca University's EMBA.

"That said, we are always looking for the next thing we can do to address people's needs and add further value. Right now we are looking at accelerated options, specialized streams for finance and international business, for example, as well as new courses in corporate governance and accountability."

Career management and coaching services are also gaining popularity in business schools across North America. "There was a period of time when many schools did not offer career services to their EMBAs. We are seeing a lot more of that," says Mr. Dubey.

"We are also seeing more of a focus towards the soft skills needed to make somebody successful, such as leadership, negotiation, team building, conflict resolution. The question is how as a business school do you differentiate yourself going forward?"

Read full article: Financial Post, March 29, 2011