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Executive Education Guide: Who’s going to pay for your degree?

ROB magazine

The delicate question of who's gonna pay

Executive MBA programs can cost $100,000-plus, but today's mix of entrepreneurs and job-shifters don't seem to mind shouldering the cost

Two years ago, Mellie Chow was feeling restless. The engineer, then 34, had helped her employer, a U.S.-based IT consulting company, break into the Canadian market. Selling the company's services beyond her existing network of clients, however, was proving to be difficult.

She remembers asking herself: "Is it me or is it them? What am I missing?" Her uncertainty got her thinking about what she really wanted to do in her career. And so she decided to enroll in an executive MBA (EMBA) program at her own expense.

In the world of executive education, there are climbers, founders and shifters. Two decades ago, most EMBA candidates were climbers—middle managers being groomed for C-suite positions. The company would foot the bill, and the employee was expected to return the favour with years of allegiance.

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Nowadays, EMBA candidates are increasingly like Chow, who recently graduated from the Kellogg-Schulich EMBA program at York University's Schulich School of Business. They're the founders and shifters: entrepreneurs looking to start or expand their own businesses, or mid-career managers burnishing their resumés before jumping to other companies or industries. These EMBA candidates tend to pay their own way, or at least cover a large portion of it.

"When the program started in 2002, almost the entire class was funded by their organization," says Su-Lan Tenn, assistant dean of Schulich's EMBA program, which costs $120,000. "It was a small percentage that was self-funding." Now, she says, between 50% and 55% of Schulich EMBA students are self-funded, with the rest split between full and partial employer funding.

This shift is rippling across business schools from coast to coast. At the University of Ottawa's Telfer School of Management, for instance, the number of self-funding students has skyrocketed from 10% to roughly 70% over the past 20 years, says program director Sophia Leong. And for those lucky few still getting funding from their companies, more are receiving partial, rather than full, reimbursement.

The reason? Companies aren't as willing to invest significant amounts of money to put their employees through EMBA programs as they used to be. Thanks to changing career trajectories, most professionals no longer expect to stay with their employers for decades. Companies have less incentive to fork over tuition, which can run to more than $100,000 for top-tier programs.

"We've been starting to see millennials, and they tend to embrace this whole idea of being very flexible with their career, self-funding, looking at a three-year horizon, a five-year horizon," says Tenn. "It's not a matter of them not being loyal to their organization; it's more a case of them being very strategic."

That's how Chow saw the EMBA—as a chance to expand her skill set to support her company, but also as a way out of IT consulting and into the world of tech startups and venture capital. She's now in the process of launching the Revolving Kitchen, a digital marketplace for kitchen-space rentals, in the vein of Airbnb, which she and an EMBA colleague developed as a capstone project.

"I was definitely not an anomaly. I felt like I was among a group of highly ambitious and capable folks who also aspired to be founders or shifters," says Chow, who paid her tuition using a combination of personal savings and working while she completed the program. "Entrepreneurs are the new executives. And these are the businesses that are disrupting major Fortune 500 companies."

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The change in EMBA demographics isn't just happening in Canada. Around the world, an average of 40% of EMBA candidates received full funding in
2003, according to the California-based EMBA Council, which advocates for the industry. That number had dropped to 22% by 2016. Correspondingly, the number of entirely self-funded students rose from 25% to 41% from 2003 to 2016.

In some cases, there's pressure on program funding because large companies are developing in-house educa-tional opportunities. Deloitte, for instance, opened Deloitte University North in Toronto earlier this year. Part of a network of five campuses around the world, the in-house program offers courses to employees at various stages of their careers.

"The curriculum, by and large, is delivered by our leaders in the classroom, and that's the best way we can think of to make the link between the strategy of the firm, what its leaders are looking for, and the learning experience in classrooms," says Duncan Sinclair, vice-chair and dean of Deloitte University North.

The company does, however, continue to offer funding assistance to high-achieving employees seeking EMBAs. "The EMBA funding activity is likely still there, but the profile it takes is probably less because there's more other stuff going on," he adds.

Although the funding, across the board, has doubtlessly declined, Douglas Hyatt, academic director of professional MBA programs at the University of Toronto's Rotman School of Management, points out that the story is different depending on how you define company support.

"We have four one-week-long residential modules, over approximately 13 months. And students are required to be here every other weekend, and that includes a full day on Friday," says Hyatt. "In some instances, the form of the employer's support is to allow the student that time away. And when you have executives who are earning good salaries, that's a significant obligation."

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Despite the changes, many people still fit the more traditional EMBA profile. Jesus Atias, market development manager with Dow Chemical Canada, received 50% funding from his company to study at the University of Calgary's Haskayne School of Business. He signed an agreement to stay with Dow for at least 18 months—the length of time it took to complete the program—and he expects to stay on longer. But even Atias, who stuck with Dow despite the siren song of oil sector salaries, admits his motives for taking the EMBA were mainly personal.

"If you asked me the main reason I did my EMBA, it's not really to continue growing and moving up the ladder within the Dow Chemical Co. It's actually to create options for myself, outside Dow, if I need those options at some point in my career."


Getting your employer to pay

More executives pay their own way, but if you want your employer to chip in, try these tips:

• Make sure your company knows you're committed to sticking around,
at least for the medium term. If you won't invest in them, they won't
invest in you.

• Note that an EMBA will help you innovate within the company. More entrepreneurs are getting EMBAs—but entrepreneurial thinking is also valuable for traditional employees. Show that you're an "intrapreneur" who can be as innovative within your firm as your entrepreneur EMBA colleagues.

• Demonstrate leadership potential. Even with changing demographics, EMBAs are still all about grooming people for C-suite positions. If you
want your company to fund your education, make sure your personal goals align with upper management's succession plans.


5 ways to find time for your EMBA

Get family buy-in You won't see your loved ones for weeks at a time. You'll also need your partner to take on the lion's share of child care and housework during exam time. Make sure they're cool with that before you sign up.

Get employer buy-in Even if your boss won't spring for your tuition, try to negotiate a reduced work schedule. Some programs involve weekday classes. If you can get a day or two off work, that leaves more time on the weekend for other stuff.

Be ruthlessly selfish If someone asks you to do something that isn't absolutely necessary, either for work or school, just say no.

Become a time-management ninja Schedule each day down to the last minute—class time, study time, family time, even "me" time.

Outsource whatever you can You can pay someone to do just about anything these days—cooking, child care, laundry, lawn care. The time you'll save is worth the money.


Don't have 30 hours a week for 2.5 years?

Here are some more time-conscious alternatives for up-and-coming leaders

Mini-MBA Many business schools now offer variations on Harvard Business School's pioneering advanced management program, which has graduated 20,000 senior executives since 1945. The six-week leadership development course/schmoozefest costs $80,000 (U.S.).

Refresher Most business schools offer classes that last a day or two, and help leaders brush up on a specific skill—building better teams, fostering innovation, change management and so on.

Industry crash course These intensive programs bring together leaders from a specific sector for days, weeks or months at a time. The Rotman School of Management's three-week, $12,000 police leadership program (developed with the Ontario Association of Chiefs of Police) includes classes on financial statements, the politics of budgeting and diversity.

Bespoke Most business schools will build customized programs, mixing a general leadership curriculum with sector- or even company-specific classes. At Ivey Business School, customized programs account for 60% of the executive education offerings. At the Rowe School of Business, it's 90%.

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