Western Cape Business News

Send  Share  RSS  Twitter  23 Feb 2010

EDUCATION: What Management Is Really Worth


Recent Western Cape Business News

Ensuring that employees have the appropriate skills is crucial to the growth and success of a business, but in the context of continued belt-tightening, Return on Investment (ROI) is a major focus for top management.

Evidence emerging from a study being conducted with the UCT Graduate School of Business (GSB) suggests that there can indeed be a strong, measurable ROI for businesses investing in leadership development programmes – something HR practitioners have long suspected, although have struggled to prove to the satisfaction of their finance-orientated colleagues. In the study, respondents reported financial gains running into the millions of Rands.

The ongoing study looks at the ROI from the GSB’s Programme for Management Development (PMD), a flagship GSB Executive Education short course which annually attracts managers from many leading companies both in South Africa and other parts of sub-Saharan Africa. The PMD is targeted at middle-to-senior level managers and is the School’s longest-established and one of its most successful senior leadership development programmes.

According to course director and convenor of the ROI study, Bruce MacDonald, PMD is a very popular programme, enjoying a repeat business rate of between 80% and 90%.

So it is obvious that sponsoring companies already recognise its value. What we are endeavouring to do is give an accurate idea of how sponsoring attendance on the programme impacts the bottom-line.

Typically, feedback from such a programme is couched in qualitative terms. The problem is, qualitative feedback doesn’t cut much ice with the number crunchers. My research is aimed at providing HR practitioners with the wherewithal to communicate with the bean counters in terms that they will relate to – and thereby improve their access to limited financial resources,” says MacDonald.

He points out that a ROI study in management education has its challenges.

Management effectiveness is not inherently measurable – unlike the case of, say, a touch typist, whose output and performance improvement can accurately be measured. Management effectiveness is generally measured in unquantifiable ‘touch-feely’ terms – ‘better communication’, ‘better delegation’ and ‘better working relationships’,” he says.

MacDonald’s survey of 110 past PMD participants provided rich ‘soft’ feedback suggesting that the programme had achieved its objectives. 97% of respondents reported that the programme had been either ‘completely successful’ or ‘largely successful’ in providing them with an improved understanding of the nature, requirements and responsibilities of a manager’s job. 96% believed that the course had given them substantially improved effectiveness as leaders through a better understanding of human behaviour and individual differences.

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