Financial Times
Training Investment Returns

By Sarah Murray

Advertising executives have, over the years, gone to great lengths to demonstrate the return on marketing dollars to their clients - and still no clear measurement model exists. Executive education suppliers have not yet expended the same amount of energy and resources in proving the business case for their services, but they are under increasing pressure to do so.

Smeal College of Business Administration at Pennsylvania State University even gets its clients to put these goals on paper in an attempt to make concrete the value of what Christopher von Schirach-Szmigiel, Smeal's associate dean for executive education, describes as "the most difficult area - (to measure) intangible investment".

Before starting an executive programme with the college, the company fills out a short form.

"First, it's important for them to decide on the purpose of the programme," he says. "Is it to create growth, reduce costs by better operation of business processes, or to have closer alignment of strategy and leadership? These are the three areas where we see our programmes creating value for companies."

At the end of the programme, the college evaluates how the cost of the training, both out of pocket and time costs, has furthered the company's goal.

"If the goal is growth of 10 per cent or, say, Dollars 10m on sales of Dollars 100m through the new business models, we deduct the cost and see what's the ROI," says Professor von Schirach-Szmigiel. "It's not a very precise instrument but we don't have a better one."

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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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