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Entering the EMBA Market: University of Michigan

Since its launch in August 2001, the executive MBA (EMBA) program at the University of Michigan Business School has faced a sluggish global economy, post–September 11 travel moratoriums, and a massive blackout that shut down much of the eastern United States and threatened to derail the program’s 10-day residency session.

That’s a lot to endure when you’re the new guy trying to compete for a shrinking market of senior-level executives willing and able to participate in a two-year EMBA program. But thanks to an innovative faculty and professional staff and a parent organization with a stellar reputation in MBA and executive education, Michigan’s new EMBA program has managed to fill its rosters and begin carving out a niche among its competitors.

“People said we would never fill our first class,” says the program’s director, Dave Ardis. “We filled that class and had a wait list of 12 people. We surpassed all expectations.”

Executive MBA programs have been part of the management education portfolio for more than 30 years, and with tuition and fees often exceeding U.S. $100,000 per participant, they have made many schools a lot of money.

Still, Michigan refrained from jumping on the EMBA bandwagon—until now.

“We were innovating in other areas,” says Susan Ashford, academic director of Michigan’s EMBA program and the Michael and Susan Jandernoa Professor of Business Administration.

The school’s innovations—which include breakthroughs in online education and the addition of action-based learning to the curriculum—have helped put Michigan on the management education map. The school shocked its competitors when it soared to the number 2 position in BusinessWeek’s 1996 ranking of full-time MBA programs—thanks in large part to what graduates and recruiters deemed one of the most innovative general management curricula out there. Since then, Michigan has remained in the BusinessWeek top 10 and was ranked number 3 in the latest Wall Street Journal/Harris Interactive survey of corporate recruiters’ favorite MBA programs.

Michigan is also known for its nondegree executive education offerings, which include courses in health-care management and leadership development. In BusinessWeek’s 2003 ranking of open-enrollment, nondegree executive education programs, Michigan landed in the number 3 spot, behind Harvard Business School and the University of Pennsylvania’s Wharton School.

With all this going for it, why launch an EMBA program—especially during an economic downturn?

Michigan didn’t do it for the money, Ardis says, although the program is expected to “at a minimum pay for itself.”

Rather, after excelling in nondegree executive education and creating a handful of successful customized global MBA programs in Hong Kong, Brazil, Korea, and Japan, Michigan felt it had something valuable to add to the world of executive MBA education.

“We didn’t want to be another run-of-the-mill program,” Ardis says. “We had the confidence and resources to launch a program that would stand out from the competition.”

A Different Kind of Program

The format of Michigan’s 20-month program immediately sets it apart from other EMBA offerings.

Participants attend two 10-day residency sessions in August of their first and second years. Then—unlike other EMBA programs, which have students return to campus every other weekend—Michigan requires students to come back to the school’s Ann Arbor campus once a month for a two-day session on Friday and Saturday.

The program format, which requires students to complete approximately 30% of their course work online, was developed to help participants better balance their professional and personal responsibilities.

“A lot of other schools make the every-other-weekend model work, but we felt it wasn’t very convenient for executives,” Ashford says. “We were fortunate to be inventing this program at a time when the Internet and long-distance education was all the rage. We took advantage of those innovations to create a program that is much more workable for people’s lives.”

The flexibility of the format may be one reason Michigan has been able to attract more women executives to its EMBA program. Women make up 29% of Michigan’s EMBA class of 2005. In comparison, most of the top EMBA programs typically draw less than 20% women.

Nan Plummer, who graduated from Michigan’s EMBA program in May 2003, says the program schedule enabled her to earn her MBA degree while attending to her family and serving as the executive director of the Arkansas Arts Center in Little Rock.

“I couldn’t have done it any other way,” says Plummer, who is married and has two teenage children. “This particular format gave me the flexibility to be a family member at the same time I was being a student and the CEO of a small art museum.”

The EMBA curriculum, which focuses on preparing executives to assume higher levels of leadership within their organizations, is a draw for executives, as well.

Although courses cover the basics of marketing, accounting, and finance, they do so from “the perspective of someone who is trying to run the place,” Ashford says.

“We don’t teach participants to be CPAs,” Ardis adds, “but we make sure they understand how to read annual reports and can identify when their organizations are not operating at the most efficient levels.”

The curriculum also includes an array of classes taught by a team of faculty members from across the school. For example, M.P. Narayanan, professor of finance, and Aneel Karnani, associate professor of corporate strategy and international business, coteach a capstone course during the second year on how to grow a company. By pulling from the academic worlds of finance and management strategy, the course is able to cover everything from globalization to mergers and acquisitions.

“Business isn’t run in functional silos, so we are trying to create a more cross-disciplinary approach to our curriculum,” Ashford says.

Professional Development

Michigan’s EMBA curriculum also includes a professional development track that runs parallel to the traditional coursework.

As part of this track, first-year students work with faculty and draw on feedback from coworkers and other professional colleagues about their strengths and weaknesses to create individual professional development plans.

Ashford and Ardis then use these plans to design a series of Next Level Skills Workshops for the entire class. Recent workshop topics include managing senior staff, working with corporate boards, and dealing with the media in crisis situations.

“We didn’t want to just fill our participants’ heads with concepts and ideas,” Ashford says. “We wanted to help them develop practical skills in areas that tend to be barriers for moving to very senior levels of management.”

Anthony Collings, a former CNN and Wall Street Journal correspondent, leads the media workshop, which puts the bright lights and cameras on executives and teaches them how to communicate with reporters during good and bad times.

“Your plant blows up or your CEO is led away in handcuffs. Tony gives participants insights into how to talk to the media during these types of situations,” Ardis says.

Plummer, who landed the job leading the Arkansas Arts Center during her second year in the EMBA program, says she immediately put to use lessons learned during the media workshop. “Every couple of weeks I am in the local press, so that session was invaluable to me,” she says.

The professional development track also includes presentations by CEOs, presidents, and other business leaders. Speakers have included Arthur Levitt, former chairman of the United States Securities and Exchange Commission and Daniel Goleman, author of the New York Times bestseller Primal Leadership.

Although the on-campus sessions are a critical piece of Michigan’s EMBA program, the online component is deemed essential, as well. At least 25% of each course is taught online—usually via CD-ROMs developed by the business school—and participants are expected to dedicate at least 15 hours a week to this material.

By conducting exams online and putting basic course material on CD-ROMs, faculty members are able to reserve the limited face time with students for higher-level learning.

“You can’t learn to negotiate via CD,” says Ashford, who teaches a negotiations course in the EMBA program. “But I was able to take all of the introductory stuff that goes into a course and put it on CD. That gave me back so much time to work directly with students on their skills.”

A full-time staff member from the university’s technology team helps faculty develop the online portions of their classes.

“We don’t want technology to dictate the curriculum but to open up opportunities for learning,” Ardis says. “The executive MBA program is on the leading edge of where the school is going with the use of technology.”

Getting the Word Out

Michigan’s inaugural class of 62 students graduated in May, and two others of 60 participants and 59 participants are walking in their footsteps now. While the Michigan Business faculty is busy preparing these executives to rise even higher in the leadership ranks, the school’s administration and marketing staff are working hard to get the word out about their new program. “Our challenge is to make sure that people know we offer an EMBA,” Ardis says.

Magnifying this challenge is the fact that Michigan’s program has not been around long enough to be included in the BusinessWeek and Financial Times biannual surveys of EMBA programs.

“People think because we are not in the rankings we are not in the top tier,” Ardis says. “But the schools we are stealing [participants] from and that are stealing [participants] from us make us confident that we are competing with the top EMBA programs.”

Like other schools, Michigan is also being affected by the decline in the number of companies willing to fork out hundreds of thousands of dollars to pay for their executives’ MBA educations.

“A greater percentage of people are being expected to pay for a greater portion of the degree than ever before,” Ardis says, “and more people are being self-sponsored.”

More than 15% of the executives currently enrolled in Michigan’s EMBA program are footing the bill themselves, Ardis says. That’s a hefty investment, given that tuition and fees for the program currently run U.S. $100,000 for Michigan residents and U.S. $105,000 for out-of-state students.

The lackluster global economy and corporate travel restrictions left over from the September 11 terrorist attacks have affected the makeup of Michigan’s EMBA classes, as well.

Although the school’s inaugural class (which started the program just a few weeks before September 11) included students commuting from Europe and South America, the program’s current international students are foreign executives working in the United States. Furthermore, whereas participants hail from a wide variety of industries and, in many cases, hold vice president–level positions, only about 30% live outside Michigan.

“Long term, our goal is to have a majority of students coming from outside the state,” Ardis says. “That is happening a little slower than we anticipated.”

Although the road has been a bit rocky, both Ardis and Ashford say the school is proud of what the EMBA program has accomplished thus far. “We have worked hard to create a life-altering program,” Ardis says.

For her part, Plummer says attending Michigan’s EMBA program certainly transformed her life. “Business school helped me land my dream job,” she says. “I have used what I learned every minute in this new position.”

Carlotta Mast

GMAC
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