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Executive Education Embraces Action Learning: Today’s Executives Learn While They Solve Their Business Problems

Author: Rosie Innes, Associate Director of International Executive Education, IESE Business School, Barcelona and Madrid
First published: 2002

Executive education is a multi-billion dollar business. In the United States alone, executive programs offered by business schools generate $10 billion annually. This boom is fuelled by the fact that today's executives struggle to stay abreast of change in an increasingly volatile world. In the 21^st century, companies that do not evolve, do not survive. Globalization, fluctuating stock markets, new technology, European integration and emerging economies are just some of the factors that complicate decision-making for today's senior managers.

Only a decade ago, business schools' role in Executive Education was to teach corporate managers about topics like Total Quality Control, downsizing and outsourcing. Few programs were customized, and one size seemed to fit all. In the new age of global business, however, this approach is not enough. Business schools like IESE in Barcelona, Spain have tailored their programs to meet today's educational needs. The programs impart new abilities and develop "soft" skills like cross-cultural sensitivity, strategic vision and the ability to manage change and knowledge.

Alongside the more traditional forms of executive education, such as customized in-house programs or open enrolment courses, is "business-driven action learning," an innovative approach that is quickly gaining ground. "Action learning means that there's no action without learning and no learning without action. People learn more effectively when they are involved in what they are doing," said Dr. Yury Boshyk, one of the pioneers behind this new educational framework and the co-founder and director of Global Executive Learning, based in Nice, France.

According to Boshyk, there are really three types of action learning at work today. "Business driven action learning" focuses on a critical business issue, "action-reflection" concentrates on the reflecting process and "classic action learning" works on self-improvement. The first of these, business driven action learning - a combination of personal development and organizational strategy with business results - is set to take off. "It's being practiced by the leading corporations of the world and more and more companies are attracted to it," said Dr. Boshyk.

Corporations like Boeing, Exxon, General Electric, General Motors and Johnson & Johnson have realized that their senior managers no longer have time to slip away from the office for extensive training programs. In today's fast-paced business environment, managers must solve pressing daily issues while they learn. They need "just-in-time" learning as opposed to "just-in-case" learning. At the core of this new framework is a significant business problem or challenge with no easy answer. The issue might deal with a firm's global ambitions or its operational challenges.

Since 1990, Boshyk has led many multinationals through business driven action learning programs. At the onset of the e-revolution, he steered General Electric through a program called "Destroy your company.com" that examined how GE could stand up to e-business competition and become a major player in e-commerce. Boshyk also led the aerospace and defence company, Boeing, to IESE Business School for a program meant to groom the participants for international assignments and to familiarize them with Spain, a country with tight connections to South America. "Business schools can provide a comprehensive approach to a country," he said.

Consistent with the corporate world's new emphasis on teamwork, action learning is designed for a range of company leaders with different backgrounds and perspectives. Working in teams, the participants tackle the problem at hand through a combination of workshops and fieldwork. Workshops provide the participants with insight, information and tools. Field experiences foster teamwork and gather data. To cull information, the managers conduct interviews with relevant sources, including industry leaders, academics and analysts. Reading a report is simply not the same as shaking a hand. In the end, the executives come together to analyze the data and to identify possible solutions to the business challenge.

Since action learning programs vary according to the company and the issue, it is difficult to describe a "typical" program. However, the method is perhaps best illustrated by a real-world example. Consider the recent experience of Barloworld, the South Africa-based industrial brand management company, which is one of the world's leading Caterpillar dealers and the world's leading independent lift truck dealer. Based in Johannesburg and with operations in 32 countries and customers in over 90 countries, Barloworld recently set out on a new international challenge: to enter the South American market. More to the point - where should the company plant its flag in this vast and diverse continent? In Argentina, Brazil or Chile? The company's top execs needed to learn more about the region before making critical decisions.

Instead of analyzing Latin America in a classroom, Barloworld´s CEO, Tony Philips, decided that the company should take action by going there and scouting out its own business opportunities. Philips called on IESE Business School to custom design the action learning program.

The program included 27 top executives from the company. After an initial workshop conducted by IESE faculty members at Barloworld´s headquarters in Johannesburg, the executives were divided into three teams and each was assigned a country, either Argentina, Brazil or Chile. The groups then traveled to their destinations, where they spent three intense days gathering information through one-on-one interviews with local executives, potential clients, distributors, journalists and government officials. IESE professors and local facilitators briefed the executives and pointed out subtleties that they might otherwise have missed. The teams finally convened in São Paulo for a strategic discussion on where and how Barloworld should invest.

The Barloworld participants studied the collapse of Argentina, South American business practices and the nature of a dollarized economy. Yet, they also savored regional wines, watched the tango and crossed sprawling São Paulo by helicopter. Radically different from executive education of years past, action-learning programs are able to combine management and cultural education. The Barloworld executives gained international insight, both on a personal and a professional level.

Venturing onto foreign soil can be risky and globalization has created a growing need to understand foreign markets. Thanks to their fieldwork, the Barloworld executives now understand these countries well enough to make sound business decisions. "Action learning is targeted at senior managers who have already been to Harvard or INSEAD or another top business school. They want a case study, but they want their own case study," said Dr. Paddy Miller of IESE, who led the Barloworld program. The executives´ experience will ultimately benefit the company with real results. "With action-learning, you have every senior manager and the CEO in the room, so you end up with a serious commitment," said Dr. Miller.

IESE´s previous action-learning program for Boeing ultimately led to the construction of a Boeing research and development center just outside Madrid. This outcome demonstrates the potential power of business driven action learning. In the case of Boeing, it led to a decision fraught with implications for the highly competitive aerospace industry and for the Spanish and Madrid economies. Action learning is clearly a far cry from the Ivory Tower.

Due to such positive, real results, IESE and other respected university-based graduate schools of management are beginning to tout action learning as a highly effective form of executive education. While there is room in the market for the services of non-academic providers, such as consultants, business schools offer many advantages and are becoming a vitally important resource for corporations. Thanks to the research and consulting activities of their faculties, business schools are able to keep their finger on the pulse of the corporate world. They also have far-reaching, international networks and can provide an added value: objectivity. "Business schools can connect companies to all kinds of people, and without a filter," said Dr. Miller. "From a teaching point of view, it's an opportunity for professors to be involved in what they teach."

A major challenge for business schools will be the intensity of the programs. "They require a lot of resources and are the costs are high, so only some schools can put programs together," said Boshyk. "But if done properly, they will be a substantial opportunity."

In his upcoming book, Action Learning Worldwide: Experiences of Leadership and Organization Development, to be published in July 2002 by Palgrave Publishers, Dr. Boshyk demonstrates the effectiveness of business driven action learning and argues that it's not just for multinationals or large companies. Small and medium-sized businesses and the public and not-for-profit sectors also stand to benefit from the process. Dr. Boshyk also organizes an annual global forum on business driven action learning. The 2003 event will be hosted by ABN-Amro Bank on May 20-23 in Amsterdam.

In today's business world, life long learning is indispensable to the viability of the executive. Managers are globetrotters, leaders and visionaries. And as they learn, so too must their organizations. Said Rory Simpson, director of International Executive Education at IESE, "Client needs are becoming far more sophisticated and business schools must be ready to adapt their practices and teaching methods to satisfy those needs. It's a simple matter: 'If the mountain doesn't come to you, you must go to the mountain.'"