Haas Executive Education: A $13.5 Million Business

Seven years ago, the executive education arm of University of California, Berkeley’s Haas School of Business was a loss-making entity. “When I came in seven to eight years ago, it was almost a turnaround situation,” recalls Whitney Hischier, assistant dean for Executive Education at Haas. “The UC Berkeley Center for Executive Education (CEE) was losing money and there was a question on whether it should be shut down.”

Hischier and her colleagues put in place a plan which in her own words, “wasn’t very sophisticated”. “We started calling customers back and developed P&Ls on programs,” she says. Behind these seemingly simple initiatives, a dramatic shift in focus was being put in place – the executive education wing would now be run as a business instead of an academic thinktank. “It is definitely a weird animal which is probably true of all executive education – you run it like a small firm inside a big academic bureaucracy. But you really have to. It’s a high-touch business which is often really counter to how schools are run – they are not really used to providing high levels of customer service across the board,” says Hischier.

Gradually, a high degree of customer-centricity was built into the programs. “We pull in whatever we need to – whether it’s at Berkeley or outside – to meet the client need. That’s not always the common executive education model – it can be very ‘plug and play’,” says Hischier. More recently, CEE has started implementing serious ROI (return on investment) tracking to see if the programs are delivering. “We are working with the client to calculate business impact and the ROI. Especially in this kind of economy, they need to see results so that shift from what we call ‘happy faces on the evaluation forms’ to real business results is a big one,” says Hischier. CEE has roped in a group called the ROI Institute to help them with this.

The turnaround efforts have paid off. Today the Center for Executive Education is a $13.5-million organization, up from revenue of some $2 million seven years ago. The plan is to ultimately grow it to $50 million. This is much smaller compared to schools like Harvard and Wharton. Harvard, for instance, earned revenues of $113 million from executive education tuition in 2010 alone. “Each school may have a choice about how much growth they want or not and why they exist. We focus on a few things. We are trying to institution-build so we are trying to grow our revenue,” says Hischier. Today CEE has become a critical part of the business school as its profits go back to Haas. It runs nearly 140 programs a year and 5,000 executives participate in these programs.

Equipping Techies with Leadership Skills

“Our sweet spot tends to be providing management and leadership training for engineering and science-based companies,” says Hischier. That focus fits in well with the Bay Area. A lot of people in the Bay Area, like engineers and scientists, rise up the hierarchy on the technical side and suddenly they need to manage a team but don’t have managerial or leadership skills. “This was such a weak spot – take someone who intentionally wanted to work in front of a computer or in a lab by themselves and suddenly they have got a coach and get feedback, and manage a P&L. It can be painful and often a career-ending move for many,” says Hischier. Such people are often unable to enrol for a full degree course due to lack of time and also risk aversion given the economic situation. Keeping in mind such needs, a couple of years ago CEE launched a New Manager Boot Camp which is designed to give participants a headstart into managerial roles.