Financial Times
Prevention Is Better Than Cure

By Sarah Murray

With his talk of easing clients' "pain" with "prophylactic" remedies, Christopher von Schirach-Szmigiel often sounds more like a physician than an executive development specialist. In his prescriptions, Professor von Schirach-Szmigiel - associate dean for executive education at Pennsylvania State University's Smeal College - believes in prevention rather than cure.

One example of this approach is a programme called "Weatherproof Your Business", during which course participants examine the consequences of extreme weather and climate change on commerce. "It's not just about insurance, but different options and new financial instruments," says Prof von Schirach-Szmigiel. "This is a kind prophylactic. You do it before you start to lose money - rather than trying to repair the damage after the effect."

The Weatherproof programme - one of the school's one-day executive "Hot Topic" workshops - also illustrates the way Smeal tries to bring a variety of resources to bear on executive education. For a start, the university underpins much of what is taught during the programme. And with the meteorology department of the university's College of Earth and Mineral Science producing more than half the meteorologists in the US, Smeal is well placed to run such a programme.

The corporate world is also involved, with Swiss Re, the reinsurance company, hosting the programme at its New York City offices where executives from Swiss Re Financial Products offer insights to participants.

Finally, the Weatherproof workshop demonstrates the solutions-based approach Smeal takes to designing programmes for its clients.

"Executive education has become much more about problem-based learning with direct applications to the business," says Judy Olian, Smeal College dean. "You need special faculties that are geared more towards a consulting approach in terms of their ability to listen - it's not just faculty knowledge but ability to take the knowledge and apply it."

She believes the challenge facing the college is to create programmes that are tailored towards the issues keeping its clients up at night. "It has to be designed around the problems of the business, while using the leverage point of university - which is cutting edge knowledge."

For Smeal, that cutting edge knowledge is nurtured in research centres within the college that cover areas such as organisational effectiveness, entrepreneurship, business-to-business marketing, supply chain management and e-business.

With these areas as its focus points, the college comes up with packages that range from open enrolment programmes for junior, middle and senior-level managers, custom programmes for entire organisations, executive degree programmes, "Hot Topic" workshops and one-off programmes for corporate board development.

But the kind of customised, solutions-based teaching to which Smeal aspires is not easy to achieve. "It does create more work," admits Prof von Schirach-Szmigiel. "Because to be successful it's important to conduct a thorough needs assessment, made jointly by our team and the customers. And we have to invest in informing the faculty on the specific issues of those corporations."

Corporations are usually willing to pay for this preparation time because, he says, "this preparation is not only learning for us - it's also for the executives to look in the mirror and ask 'what kind of wrinkles do we have?'"

However, such closely tailored teaching is more effective - and cost effective for executive education departments - if the provider can build up long-term relationships with its clients, something that is not so easy in the current economic climate where executive education can be one of the first victims of spending cuts.

While many of the college's customers - such as Aramark, the managed services provider, and the US Department of Defence - have relationships with Smeal that have lasted up to 10 years, other companies are calling a halt to executive education programmes.

Prof von Schirach-Szmigiel believes these companies will eventually start buying executive education again - some sooner than others when, for example, they undergo strategy shifts, changes of leadership or merger integrations.

For Prof Olian, however, the real return to executive education is as much a question of sentiment as the financial climate. "I'll be asking the economists when they see a psychological turnaround," she says. "When people get back to thinking about the future and not the next 10 minutes, that's when it'll happen."

Copyright 2003 The Financial Times Limited

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REPORTERS & EDITORS: For more information, please contact Wyatt DuBois in the Smeal College of Business Media Relations Office at 814-863-3798 or wed112@psu.edu .

Penn State's Smeal College of Business offers highly ranked undergraduate, MBA, executive MBA, Ph.D., and executive education opportunities to more than 5,500 students at all levels. Featuring academic departments of accounting, finance, marketing, insurance and real estate, management, and supply chain and information systems, the college is also home to major research centers such as the Center for Supply Chain Research, the Institute for the Study of Business Markets, the eBusiness Research Center, the Farrell Center for Corporate Innovation and Entrepreneurship, the Center for Global Business Studies, and the Center for the Management of Technological and Organizational Change.

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