L I F E L O NG T A L E N T C U LT I VAT I N G ACCOMPLISHED E XECUTIVES
CHANGING With Executive Education By Susan Chadwick Professor James Weston moves exuberantly to the front of the class. It's spring break for Rice University, but some of these students have traveled from around the globe to sit in Room 116 of McNair Hall on this sunny morning. They are men and women with years of real-world business experience, a mix of corporate and business unit leaders, senior project leaders, and senior sales executives who on this day are learning the common language of corporate finance and financial markets so that, as Weston later explains, they can "connect better with the finance and accounting people that they work with." Weston strides enthusiastically back and forth, his somber dark grey suit and light blue tie belying the wit and energy of his delivery. "This class is going to be like a Jet Ski," he proclaims. In one day these executives are going to learn "the major terms and conceptual levers of financial-decision making" and "hit on the core topics" of a normal semesterlong graduate course in finance. 22 // JONES JOURNAL SPRING 2014
The casually dressed students, all seasoned employees of one of the world's largest energy infrastructure service companies, seem unfazed by the academic challenge. It's Finance Day in a two-week long Advanced Leadership Program provided by Rice University Executive Education. Part of the Jones School's custom corporate offerings, this particular program was formulated for CB&I, headquartered in The Woodlands and one of Executive Education’s biggest and longest-term corporate clients. "I'm not an accountant," the youthful Weston tells the class, many of them older than he is. "I'm a finance guy." "What's the difference?" a man in the back asks. Weston is delighted. And thus begins a lively romp through financial valuation, compound interest, discounted cash flow, capital budgeting, net present value, risk adjustment and more, with Weston
patting the blackboard, calling executives by first name and inspiring debate with cries of "Yeah!" and "Why not?!"
Development of opportunities
Founded in 1978, Rice Executive Education has grown by 300 percent over the last three or four years, says Jonathan Harvey, executive director of Executive Education at Rice. Part of the reason for the growth is the uplift in the economy, Harvey says. Houston, energy capital of the world and second only to New York City in the number of publicly traded companies headquartered here, has been booming while other major cities stagnated. And part of the reason is that companies, particularly in the oil and gas sector, are looking at a "demographic hole" between retiring executives and younger talent in a position to take their place, says Harvey. "Companies are concerned that they are going to be challenged to retain top talent," he says. "The company has to plan for the future. And one way for a
company to do that is the development of opportunities. "It's part of the company's talent retention strategy." In the 2012-2013 academic year, Rice Executive Education delivered 46 separate courses — 14 percent of them internationally — to 1,231 participants, of whom 90 percent were post-MBA and 50 percent were in strategic or succession roles, says Harvey. Executive Education at Rice is divided into two types of programs: standard, open enrollment programs and the elite, customized "coaching" specifically designed for a company's strategic needs and goals. These custom-built programs, such as the one in which Weston is teaching, account for two-thirds of Executive Education, says Harvey. Unlike the open enrollment programs, which are taught within the school and attract ambitious business leaders from around the region, the custom programs are also
international, delivered in business and industrial centers like The Hague, South Korea, Singapore, and Baku, Azerbaijan. Typically these custom corporate programs, specially built after lengthy analysis and assessment by the faculty, will have 25 people or so from the same company, with experience levels ranging from 10 to 30 years. Most often these executives are being groomed for the next level of leadership and have been chosen by the company for the Executive Education courses.
It’s not all Fortune 500 companies
"It's fair to say we have a strong presence in the oil and gas sector," says Harvey. "We are developing a reputation that we understand their business: the implications and nature of what it means to explore and drill and refine the upstream and downstream." Beyond what one might expect from the energy capital, Rice Executive Education deals with a host of varying industries.
The school’s close collaboration with and proximity to the Texas Medical Center, the largest in the world, generates business programs for health care professionals and physician executives. In addition, the Executive Education faculty has developed ongoing programs for the Houston Independent School District (HISD). The school district is not a typical Executive Education client, explains Brent Smith, senior associate dean of Executive Education and associate professor of management and psychology at the Jones School. But like their other business clients, HISD came to Rice to solve a particular strategic or operational problem. In the case of HISD, it was to teach school principals to market their schools more effectively to their "customers," the parents, says Smith. "Given the free market for education, parents can now choose magnet schools and charter schools. We are teaching customerfocused marketing to principals."
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