SOM forges its own path in executive education

Business school administrators at institutions around the country know that bringing executives back to the classroom can be lucrative and good for publicity. Yale officials are no different.

As the popularity of executive-education programs has taken off at other schools, officials at the Yale School of Management think they differentiated their programs from those offered at more well-established, higher-ranked peer institutions by focusing their offerings only on business leaders, not professionals looking for a general business education.

Senior associate dean of executive programs and management professor Jeffrey Sonnenfeld gives a lecture to Bearing Point consulting executives at the Omni Hotel.
Grant Smith
Senior associate dean of executive programs and management professor Jeffrey Sonnenfeld gives a lecture to Bearing Point consulting executives at the Omni Hotel.

The SOM, which began its executive-education programs in fall 2001 — later than most other comparable business schools — offers adults both degree and non-degree programs markedly different from those of its peer schools. While these schools’ programs may differ in structure and educational approach, many of them were created for similar reasons — financial well-being and a rising reputation, among others, according to interviews with deans at the SOM and a number of other business schools.

Open-enrollment courses, which cater to working adults who want to expand their general knowledge of business topics, are popular at schools such as Wharton School, Harvard Business School and the Massachusetts Institute of Technology’s Sloan School of Management. But open-enrollment programs often serve students who have uneven skill levels — and in some cases, the information taught in such programs is so basic that it can be taught better at other schools, said Jeffrey Sonnenfeld, senior associate dean of executive programs and the Lester Crown Professor in the Practice of Management at the SOM.

Yale has rejected this model, he said. Instead, the University has put an emphasis on creating specialized programs for business leaders and major organizations as a whole and does not offer programs for adults seeking to build a base of executive skills.

“Our greatest strength is not to offer what many other universities offer,” Sonnenfeld said.

The SOM executive-education program’s focus on offering classes for top business executives makes it distinct. Yale works hard to attract top executives and further differentiates itself by focusing on bringing such executives together in a peer-driven learning environment, Sonnenfeld said.

The SOM was established in 1976 and is consistently ranked among at least the top 15 business schools in the country by major business publications.

Still, when drawing participants for its executive-education programs, it must compete with top-ranked institutions such as the Wharton School, Harvard Business School and the University of Chicago Graduate School of Business, which have long-standing executive-education programs — Chicago began offering its program in 1946. Yale was one of the last schools among its competitors to establish such a program.

Still, Yale’s innovative programs have gained the attention of other schools, Sonnenfeld said. In fact, a few other institutions have even begun using Yale’s specialized programs as a model for their own executive-education setups, he said.

One of the most distinctive parts of Yale’s program is the Chief Executive Leadership Institute. The institute’s goal is to bring together top business leaders and faculty for “peer-driven learning,” said Sonnenfeld, the institute’s founder, president and CEO.

The Chief Executive Leadership Institute runs two programs: the CEO Summit and the Leadership Exchange Analysis Program.

Sonnenfeld said the twice-yearly CEO Summit — which will be held in New York City this December — brings together up to 100 CEOs, as well as Yale faculty and even congressmen and senators, for a two-day conference. The program facilitates “candid free-for-alls,” he said, and participants can formulate actual business and government policies through discussions at these forums.

Past participants have included Steven Schwarzman ’69, recent winner of the SOM “Legend in Leadership Award” and CEO of the Blackstone Group; John H. Eyler, CEO of Toys “R” Us; Michael Dell, CEO of Dell Computers; and Elaine Chao, the secretary of labor.

The LEAP program is designed for top executives of major firms, mainly excluding CEOs, Sonnenfeld said. For a fee of $15,000, these executives are brought together with major faculty members from Yale and other schools and are provided with field-based learning experiences.

Through these exchanges, executives are able to spend time at a non-competitor firm, observing its dynamics and structures — something difficult for them to arrange on their own, Sonnenfeld said.

“They get a fresh view,” he said. “This is the kind of thing only a university can do.”

Yale also offers customized programs and an executive MBA for Leadership in Healthcare, which graduated its first class this past spring.

The SOM administration sees many benefits for students in its unique programs, Sonnenfeld said. Students are able to learn with accomplished peers and faculty, he said.

“When accomplished adults stop learning, they atrophy,” he said. “That has a devastating effect, as their lack of freshness travels down the firm.”

Institutions providing such programs also benefit. Among the benefits of the program for the SOM Sonnenfeld listed were interactions between faculty and top executives, increased recognition of the school, the attraction of new recruiters and financial gain.

“We send millions of dollars of revenue back into the school,” he said. “The programs have been financially very successful.”

Such reasons for founding such executive education programs are not unique to Yale, administrators at several business schools said.

At the Stanford School of Business, the executive-education program is a significant part of the school’s mission, Robert Joss, the school’s dean, said. As with all such programs, one of its numerous benefits is financial support for the institution as a whole, he said.

“Executive-education participants can afford to pay fees that more than cover direct costs, thereby contributing to the support of the school’s overhead structure and helping to fund our degree programs and research efforts at the school,” Joss said in an e-mail.

Still, he said, the main challenge for an executive-education program is to avoid becoming simply “a mediocre ‘consulting’ firm.” It is important that a business school’s executive-education program remain focused on the school’s academic mission, Joss said.

At the University of Chicago’s Graduate School of Business, the executive-education program has done well financially, said Steven LaCivita, the school’s associate dean for executive education.

The fees collected each year by the school’s executive-education program have increased from $0 to $20.2 million since its founding only 11 years ago, he said.

Dipak Jain, dean of the Kellogg School of Management at Northwestern, said building the school’s reputation among top executives and recruiters was one main impetus for the creation of the school’s executive-education portfolio. But Jain said the school’s administration also values the chance for teachers to learn from business professionals, which allows them to bring increased rigor and relevance into their curriculum.

An executive program not only enhances a school’s curriculum but also gives professors another avenue through which to share new discoveries, LaCivita said.

“It is a forum for dissemination of information for new research findings,” he said.

In addition to offering chances for faculty to share research discoveries with executives, such a program can help faculty think of new ideas for research and approaches to teaching, said Paul Danos, dean of the Tuck School of Business at Dartmouth.

Because an executive-education program gives faculty close contact with senior executives, LaCivita said it acts like “a marketing arm for the school.”

Yet despite the myriad motivations shared by executive-education programs at the SOM and other business schools around the country, the programs at the SOM remain distinctive, Sonnenfeld said.

“Nothing we do at Yale is a model or copy of what someone else is doing,” he said.

Comments