The early beginnings of the COVID pandemic posed major challenges to higher education. Business schools canceled in-person classes and rushed to remote instruction online. Many students opted out, refusing to pay high tuition for Zoom classes via the Internet.
But the business school that was most impacted was the Institute of Management Development (IMD) in Lausanne, Switzerland. Unlike the other giants in executive education, which include Harvard, INSEAD, and Kellogg, IMD was far more exposed and vulnerable to the crisis, given its heavy reliance on training executives in no-degree programs. In a typical year, more than 9,000 executives attend IMD’s 60-plus exec ed courses which account for 80% of the school’s annual revenue. IMD, moreover, had only a marginal part of its business in online training.
In early 2020, when COVID began closing down corporate offices and issuing travel restrictions on employees, 90% of IMD’s revenue required travel, either to its campuses or to client organizations. A small school with a modest endowment and few reserves to sustain losses, IMD’s very existence was threatened. As Dean of Programs David Bach put it: “After cruise ships and airlines, IMD was next. Just about everything came to a halt with the pandemic. We had to innovate quickly and dramatically.”
‘We Are Going To Treat This As A Crisis But Also An Opportunity’
“By the middle of February,” recalls IMD President Jean-François Manzoni, “we started getting calls from clients saying, ‘We don’t think we can come in the second quarter.’ It was a threat. I said we are going to treat this as a crisis. We had to manage cash and also trust. But this also was an opportunity to innovate as much as we can over the next three months as we otherwise would have over the next three years. From day one, there was not just this desire to let’s keep the shop open. It was a chance to innovate everything from our pedagogy to the portfolio of programs we offer.”
To manage cash, Manzoni had to do the difficult stuff the managers in his case studies often do. He cut 10% of the school’s staff and ask IMD professors to take a cut in pay. The faculty overwhelmingly agreed in a 44-to-one vote to give back part of their compensation. But the most difficult challenge was to rethink and ultimately redesign its executive education programs. By year-end, IMD had gone into the red by a significant amount of money as revenues crashed by million Swiss francs to 90 million from 130 million.
One big test occurred just three months into the COVID crisis when IMD moved its signature executive education program, Orchestrating Winning Performance, online. “People were a little bit dubious about online remote delivery then,” concedes Manzoni. “And there was a certain leap of fate that we would be ready but it was a galvanizing moment. It was one of the ways to show we could do it ourselves. We had 419 participants for that edition of LiVe and proved we could get the same level of engagement from participants.”
‘We Realized We Could Do A Lot More Through Technology’
That insight–and the crisis itself–was something of an ah-ha moment. “We realized we could do a lot more than we thought through technology, says Manzoni. “And we knew it would never be the same. That meant for us that it was worth investing early and significantly in order to ramp up. COVID accelerated the integration of technology-mediated interactions and being all together on the screen.”
Early into the second half of the year, Manzoni came to the realization that COVID wasn’t going to go away. No less crucial, he and IMD’s faculty came to understand that their executive education programming could actually be improved and made more effective by an embrace of technology. In the past, most had focused on the constraints posed by online education, the challenge of deeply engaging students remotely or providing meaningful project work. Now the focus was on how to leverage technology to deepen learning by blending face-t0-face and virtual learning sessions in programs.
“The learning journey goes on much longer and has much more impact,” says Manzoni. “The more you reflect and return to your learnings, the more embedded they will become. We can do stuff that we could never have done before. We realized quickly that this is just another tool kit that makes programs extraordinary. We can invite CFOs and CEOs to online sessions with managers in the program and they can join from anywhere in the world. We can extend the learning without participants having to spend more time away from work.”
Dealing With Screen Fatigue And Technology’s Constraints
Leading IMD through the crisis was one of the biggest challenges ever faced by Manzoni, who became president in January of 2017 after re-joining the school from the faculty of INSEAD in both Singapore and Fontainebleau. He had taught at IMD between 2004 and 2010. A citizen of Canada and France, Manzoni earned his Doctorate from Harvard Business School. He had earlier graduated from l’Ecole des Hautes Etudes Commerciales de Montréal and worked with Ernst and Young in Montreal before receiving an MBA from McGill University.
When COVID hit, Manzoni was expecting IMD to have a record year. Instead, he had to navigate through a crisis that tested his own resolve as well as the commitment of his faculty and staff in a culture that initially seemed ill-suited to fast change.
As Manzoni explains, “We’re a small school and while we are not Swiss, we live in a place where we absorb some of the ethos of the country. People here don’t run to walk to work. They walk to work and somehow things get done.”
Still, there were hurdles in the way of getting things done. “Initially,” says Manzoni, “we underestimated the fatigue. There is screen fatigue. And then we started breaking things up over longer periods of time. It is challenging for participants to close what they were doing before and be present for you. We had to learn how to grab their attention and transition into the session and we realized we had to come to closure more effectively.”
And the faculty had to adopt as well. Student breakout rooms became faculty Zoom studios. Learning circles were formed so that professors could coach each other and the hours of teaching online can be considerably more challenging than on-campus. “there’s a lot more off-hours stuff than there had been before,” says Manzoni. “The faculty had to accept a lot more fragmentation. Some have to get up at 4 a.m. to teach in Asia. But the IMD faculty have been extraordinary.’
The New Normal At IMD: Blended Programming
What does the new normal look like at IMD?
Consider the school’s Advanced Management Program. Before the pandemic, IMD would welcome participants on-campus for a three-week program immersion. “You would come in and after you left we would send you an email once in awhile,” says Manzoni. IMD rethought the program and now kicks it off with a series of virtual sessions during which participants identify the business challenge they want to work on and then learn a framework to apply to it. Before ever showing up on campus, there are a half dozen half-day LiVe virtual sessions over two weeks. During that time, a student gained feedback on the challenge from team members at work and then refines the challenge with an executive coach supplied by IMD.
Instead of spending three weeks on campus, there would be two weeks of face-to-face classes with a focus on experiential learning and a three-day leadership workshop in the mountains. Finally, students leave but stay engaged with faculty and their personal executive coach to follow up on the implementation of a strategic plan meant to solve the challenge. IMD recently enrolled its largest AMP class in four years.
Or consider the signature Orchestrating Winning Performance program. In the past, it would have been held only on campus in Lausanne or Singapore over five days. Now there is a three-day version of the program entirely online. IMD prices the LiVe virtual experience at CHF 4,900, less than half the cost of the CHF 10,900 version on campus. The ability to take the program from work and one at a more affordable price expands the market for IMD’s signature program.
A Growing Reliance On ‘Technology-Mediated Interactions’
“The key thing is relentless innovation,” maintains Manzoni.
“Online is especially a strong option when a client wants to train thousands of managers,” he adds. “We often work with the top 300 executives and we can do that quickly. The top 1,000 we can do in a year. The problem is the client doesn’t know how to get to 10,000. We could deploy it virtually in three months vs. three years. We came with a custom program delivered entirely online with synchronous interaction with faculty, coaches, and one another.”
The transformation was swift. In 2019, only 10% of IMD’s programs were technology-mediated. In 2021, it was 64% This year, nearly 100% will be blended. The school’s wholly synchronous programs had revenues of only $1 million in pre-pandemic 2019. In 2020, it was $3 million. And in 2021, revenue from synchronous programming is nearing $5 million.
‘We Are Going To Take This And Leap-Frog Everyone’
“We are definitely back on custom enrollment programs, and we are about there on open enrollment, says Mansoni. “We are selling a learning journey much more than we would be. It has been a challenging period but one that has been extraordinarily rewarding.
“The net result is really a learning journey for us and for our clients. There is still value to getting people together outside the office. When people are together physically, a lot of great things are going to happen. We can do a lot on a screen but when you get together physically it is different.”
While Manzoni remains a strong believer in face-to-face programs, he sees no going back. “Without COVID we would never have gone this fast. We learned very quickly. We are going to take this and leap-frog, everyone,” he says.