When Paul Kirkbride was the chief learning officer at a Fortune 500 company in the United States, he noticed everybody was receiving training in areas like finance, marketing and IT. Everybody except the chief executive officer. The human resources managers assumed their skills did not need further development.
Times have changed.
Kirkbride, now deputy dean of executive education at Melbourne Business School, says that in today’s volatile market, CEOs have a choice: learn or fail.
“If you are a CEO today and you are not curious and inquisitive and trying to learn, then you will very easily lose the plot, because the world is changing very quickly and you need to keep your finger on a number of different pulses,” Kirkbride says.
Significantly, it’s not the CEOs from the big end of the town who are doing the learning. Kirkbride says the CEOs of SMEs are the ones who are educating themselves. They want self-development because they want to build their businesses.
Barry Westhorpe, the chief executive of the CEO Institute, says that a passion for learning makes an effective CEO.
“A personal characteristic of CEOs I’ve observed is one where they are continually learning about current industry trends, people, marketing, technology and performance management,” Westhorpe says.
“They always have a strong desire to learn more.”
Kirdbride says there is a 70:20:10 model to CEO learning: 70% of their development comes from learning on the job, 20% from feedback and working with other people and 10% from formal courses.
It’s a model that gives us the 10 top educational ideas for CEOs.
As part of the 10% rule, an increasing number of CEOs now have gone and done their Master of Business Administration. It’s expensive and time consuming but CEOs who do it can learn all about key areas like marketing, corporate finance, accounting, business strategy and managing processes. Many say it’s worth it.
Tim McLean, founder and CEO of manufacturing consultancy TXM Lean Solutions says he has used his MBA to build his business.
“I am an operational guy and while I have had some experience with sales, to actually understand the principles of marketing is valuable and also understanding the difference between marketing and sales, that’s from my MBA,” McLean says.
“The value of an MBA for me was that it pulled a lot of things together and filled in a lot of gaps. A lot of it wasn’t new but it covered a broad range of subjects.”
Brad Hosking, executive director of the School of Business at Swinburne says the MBA pathway will remain important, although it may move to a blended model with much of the material online. The most important learning experience in the MBA however is the shared experience with other students, he says.
“The value of a post-graduate program is the shared experiences and the stories,” Hosking says. “It’s about hearing how someone else dealt with it or what went wrong somewhere else. Those are the things you actually remember.”
Kirkbride says the MBA is a classic case of “just in case” learning. Some of the material is familiar, and some of it ultimately is irrelevant. Instead of a “just in case” model, however, he says “just in time” learning might be more suitable.
“The whole notion of an MBA is ‘all this stuff in case you need it’ whereas it’s obvious that what’s more effective is ‘just in time’ learning where you have learning delivered to you at the point when you need it and you don’t have to wade through 10 tons of the stuff to get to what is really effective.”
He says online learning is a good example of that. The executive education program at Melbourne Business School-Mt Eliza has put together an online learning program which will kick off in July. It will give executives access to experts and other people in the field. It will use social networking to let them ask questions and solve problems.
“They will only get the stuff they need, not the verbiage that goes with it,” says Kirkbride. Still, some CEOs prefer more traditional forms of online learning.
Dean Calapai, owner of GPS fleet management company Intellitrac Pty Ltd, says he does not have the time to go to a university and do an MBA. Instead, he spends two hours every night working on an online course.
“I get home, have something to eat, play with the kids, put them to bed and at 9pm, I lock myself in my study and go for it,” Calapai says.
He has done a variety of courses and has learned a lot.
“A few weeks ago, I went and did the MYOB course,” he says. “I was absolutely bored to tears but I wanted to see what MYOB was capable of; getting some idea of what MYOB have in it that the internal software packages that we have developed don’t have.”
He is now doing a Visual Studio 2010 course which runs out of America. For a $200 life membership fee, he is completely up to speed with the latest in information technology. He downloads videos every day, does his homework and proceeds to the next lesson.
“I am doing it so that the guys in our IT department can’t run circles around me,” he says.
“After doing it, I sat down with them and I could tell immediately that they were trying to feed me hogwash to give themselves more time. Then they quickly learned that I might know what I am talking about.” He says there are many courses online. For a small outlay, they deliver good results. All part of the 10% module
Another example of “just in time” learning. Thomas Paterson, the owner of Scorpio Foods has never been able to do an MBA. He just doesn’t have the time. Instead, he has done short courses to get a diploma in business management and certificate in manufacturing, which was part of an on the job training module. He has also done units in a commerce degree. He says the diploma has been very useful.
“You get very used to doing things in a certain way and not necessarily the correct way so going and getting some study definitely helped open my eyes to different management techniques and methods,” he says.
Kirkbride says the Melbourne Business School and the CEO Institute have partnered up to deliver a short course focusing on strategy, becoming an effective leader, managing business in today’s environment and working with stakeholders. It runs 17 days over a 15 month period. Westhorpe says short courses on offer can focus on all sorts of issues from environmental management, leadership development to accounting. He says the demand is growing. Some CEOs even head off overseas to places like Stanford University to do short courses.
“We are seeing more interest now in accelerated short courses to give people better understanding of functional areas,” Westhorpe says. The short courses are perfect for CEOs who simply do not have the time to do an MBA. And because they are tailored to specific areas, they are just in time, as opposed to the MBA’s just in case model.
More “just in time” learning. Kirkbride says it fits into the 20% module of the 70:20:10 rule. He says an increasing number of CEOs are now turning to coaches.
“A lot of CEOs realise they can get more value and transfer the knowledge immediately into action in their own organisation by working with a very experienced executive coach,” he says.
To get work, good coaches need certain qualities. Kirkbride says the best coaches have MBAs, they have some experience in psychological profiling and they need to have senior management experience. The client needs to know they have expertise and they have been there and done that. Coaches, he says, are there for specific issues.
“The coach doesn’t have to give the whole of strategy,” he says. “They might just throw in a strategic framework at some point which helps the person unlock the problem.”
This refers to projects where managers take on real issues and problems confronting the organisation and deal with it. Part of the 20%, this is best done with a coach. Kirkbride says one of the issues for CEOs is capturing the lessons they pick up with these projects to make sure they don’t keep repeating the same mistakes. The issue is teaching them how to draw on the experience so that they are better prepared next time. If that doesn’t happen, they will do the same thing again. Kirkbride says the coach in those situations helps the CEOs reflect on the problem and what needs to be done to address it. The coach helps them see what their initial mistakes might have been and how they successfully tackled the problem. With that knowledge, they would be better prepared for next time. It’s about teaching reflection to CEOs. He says that doesn’t come easily to most CEOs, as they tend to be action people.
“CEOs are very busy,” Kirkbride says.
“They tend to get everything done, they tick the boxes and move on. It’s about how you get them to stop and reflect and draw the learning out of what they have done. Chief executives tend to have a lot of strategic priorities going on. Maybe if they can get someone to come in and coach them and provide them some teachings around that, they can help them capture that experience.”
This is related to the lessons in reflection. With every challenge, CEOs should keep a journal. They write what they learnt so they remember it for next time. It was something McLean learnt when he did his MBA at RMIT. He still does it and even uses it with his clients now.
“It’s about stopping and reflecting and action,” McLean says. “People don’t do it, like the manager is never wrong. But that ability to reflect is a key factor in being a successful leader and manager. If you don’t reflect, you don’t learn.”
Kirkbride says that CEOs who don’t keep a journal risk making the same mistakes over again.
“What happens with senior executives is that they tend to miss the reflection part. They tend to repeat patterns that were counter-productive because they are not stopping to think about when they did it the right way.”
The CEO Institute uses this method and Westhorpe says it is a great success. He says CEOs are matched up in groups to discuss key issues such as how to engage staff more fully, how to reward them so that they will stay with the organisation and how to handle Generation X and Y. Some even come with personal issues relating to their family life. It’s about getting together with people who have been there and done that.
“The solutions can come from out of leftfield,” Westhorpe says.
“It can also be about personal growth. Meeting once a month with a group provides you with an opportunity to step away from the business and talk about your own key issues and look at the big picture. It’s about looking back at the business in an objective way and having other people contribute to that thinking process. When you can discuss those issues in a confidential non-competitive environment and have the trust of the group around you, there are some fantastic ways of getting a different range of ideas. It can be very educational.”
Leadership, listening to people, managing staff, doing powerful presentations: these are the soft skills that more CEOs are looking to build through courses, coaching and by talking to experts. This marks a significant shift in priorities.
Most CEOs came up through finance or through other silos (many manufacturing CEOs are ex-engineers). Kirkbride says that has created the problems. Most CEOs were not trained to have soft skills and they are now trying to fix that.
“They were trained to be functionally excellent,” Kirkbride says. “They have great IQ but probably little EQ. They get into their late 30s and 40s and they move into general management roles and all of a sudden, they discover their task focused sets of behaviours are no longer enough. There are now a whole lot of leadership skills, influencing skills and the ability to maintain relationships that come into play and they have had no preparation for it.”
Westhorpe says many CEOs discovered they were lacking in these skills in the wake of the financial crisis.
“A lot went back into their business to be hands on,” he says. “They had to remove middle management, they had to acquaint themselves with key suppliers and customers. But how can they have an understanding of marketing, HR, IT and operational issues if they haven’t been through it themselves? “
And that is where they have discovered the gaps.
“More CEOs are wanting to learn how to lead people, how to keep themselves strong and develop other soft skills like presentation,” he says. “They want to learn how to speak more eloquently and with more passion. And these days, we know that the best leaders have the vision and the passion and the communication skills to drive all that.”
In the US, some business schools are starting to teach softer skills like how to accept feedback and talk to subordinates. We can expect more to take this up. Hosking says developing soft skills is now a priority for CEOs in the wake of the financial crisis and unemployment now at low levels. They have to rebuild trust.
“There were some pretty abhorrent behaviours that went on in the GFC where all that money spent in the top companies on investing in people and those soft skills and coaching went all out the door,” Hosking says.
This is now a big growth area, particularly for the development of soft skills.
“They could be doing anything, from media training to enhancing their personal brand in the market,” Westhorpe says.
Specialists can come from anywhere. Human resources experts can teach them how to manage people and how to listen. Sales people can also teach them how to listen. Media and public relations people can skill them up in media and presentation abilities. Kirkbride says specialists can be brought in to work not only with the CEO but, if necessary, the entire organisation.
“A great way to get interaction is to get somebody to come in and get a group of people in the organisation exposed to what they are presenting so that you are creating a common language in the organisation,” he says.
“Let’s say for example there is a company that has issues with its brands and doesn’t know what to do with them going forward. So they bring in a branding expert who can work with teams.”
Westhorpe says more CEOs are now discovering that they are learning when they are exposed to counterparts from different industries. It’s about getting different perspectives on common problems. This can be done formally through group mentoring, or informally at gatherings and association meetings.
“It’s very much about having a broader view of your business and the business community by listening to other leaders in other sectors. From an educational perspective, we see so many people in general life with a very narrow focus on their own business. They don’t make time to get out and therefore there must be limited understanding or learning available to them. It’s about networking for themselves, their business and for the broader view of different sectors and how they operate.”
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