Aspiring young executives hoping to make their way up the corporate ladder, might well look toward some formal business education to help them on their journey. Yet while it is true that any business degree is likely to help in gaining a first foothold in the industry's management corps, for those who have designs on climbing to more senior positions, the choice of education may prove a critical one. Not all degrees or schools are created equal and a wrong choice could prove costly. For airline employers too there are questions over the kind of education that the industry should want for its next generation of executives.
The debate opens with the choice between a general MBA(Masters of Business Administration), or a qualification more specifically tailored to air transport such as the AMBA (Aviation MBA) or an aviation-focused MSc (Masters of Science). The difference is not simply in the letters that go after the graduates name. Each offers a distinct product and has tended to attract a different class of student.
The MBA programmes naturally aim at enhancing broad managerial skills. Accordingly, they teach students the fundamental tools of business, such as accounting and financial analysis, while using case material from a wide range of industries to inculcate the subtleties of management expertise.
The AMBA is designed to be similar, except that these courses use the aviation industry - principally the airline and airport sectors - as the background for the majority of their lessons. And the case studies relate directly to air transport management.
The MSc in aviation management is different in kind. Its starts out to impart specific managerial and operational knowledge about the airline or airport sector, rather than more general business skills. The students it attracts have often already had some experience of working in the aerospace or aviation sector, but in non-managerial roles.
The aviation-specific MBA is perhaps the newest arrival onto the scene. That largely stems back to 1992 when the International Air Transport Association joined with Concordia University in Montreal to launch the International Aviation MBA (IAMBA)programme. The launch came in response to the growing global trend of airline deregulation, which IATA reasoned would require a shift in focus on the part of its member airlines away from an exclusive concern with operations, and towards a greater concentration on financial management. It worried that nothing in their experience had adequately prepared airline personnel to react to these changes. The IAMBA programme was launched to help lay that groundwork.
Concordia is not alone in offering an MBA tailored towards air transport. Perhaps its most notable counterpart in North America is the Embry-Riddle Aeronautical University in Daytona Beach, Florida. Building on its famous aeronautical heritage, it too has launched an executive MBA in aviation, designed for existing business managers looking to raise their understanding of strategic and business issues.
Aviation versus general MBA
The relative value of a degree in aviation management is much debated. Blaise Waguespack, programme co-ordinator for Embry-Riddle's AMBA programme, says his graduates compare well with students from top American business schools. According to Waguespack, the chief advantage of an airline-specific degree is that the graduate can enter the ranks of a carrier's management corps and play an active role from the outset, owing to industry knowledge gained through study. Dale Doreen, director of Concordia's programme, agrees that this is indeed the central advantage over a general MBA. "You can go to the best business school in the world and not know a thing about aviation."
Airline managers responsible for hiring new recruits agree that there are indeed immediate attractions to be had from hiring a graduate with an AMBA rather than a more general business degree. The real question, however, is over just how long that advantage lasts, either for the graduate or the airline. A senior executive at one US major says his experience with hiring is that the AMBA graduate is indeed uniquely qualified to enter a pricing or planning department and make immediate contributions. However, he comments that, after six months on the job, the holder of a general MBA will typically be contributing at the same level. That suggests that the relative advantage of the aviation element of the AMBA is quickly lost, at least for carriers with established training programmes. "If you have the time and resources to train your employees, it's a wash," says the executive.
The same point is reinforced by other human resource directors. Frank Naeve, a general manager in Lufthansa's recruiting department, says he does not value the focus of a business school as much as its ranking. Furthermore, he does not feel that airline-related academic training carries much of an advantage for the trainee: "Aviation knowledge you can learn, but to be effective in a service business, you need certain talents that cannot be taught, "he says. Naeve adds that Lufthansa seeks certain traits in management recruits that are often unrelated to educational background. For instance, because of the importance the carrier attaches to a well co-ordinated Star Alliance, it places a high value on the ability to work in a multi-cultural, consensus-driven environment.
Headhunter perspective
Senior executive search agencies are also unconvinced of the specific value of an AMBA. They believe that a regular MBA is likely to be more useful, at least those who aspire to climb high in airline managements. Michael Bell, the US-based head of Spencer Stuart's aviation practice, agrees that the AMBA graduate enjoys an early head-start in their airline careers. However, Bell believes the degree could eventually become a liability of sorts. Besides missing the more obvious prestige and networking attached to a degree from a "pedigree" business school like Wharton or Harvard, he believes the AMBA recipient also loses out on the richness of a broad management education. Especially as you get closer to the boardroom, the emphasis shifts towards "broad managerial skill" he says.
He adds that a desire to bring in fresh perspectives - to avoid breathing "one's own exhaust" - sees airlines increasingly recruit people with different professional, as well as academic, backgrounds. To support this claim, Bell points to the much-heralded top management team at Delta Air Lines. He contends that the fact most of them, including chief executive Leo Mullin, brought new ideas with them from previous jobs outside the industry is a major ingredient in Delta's recent successes.
In Europe too, similar trends are in play. Richard Taverner Lewis, with the Marlborough Partnership in Brussels, agrees that there is a growing trend away from hiring top executives who know little besides the airline industry. The fear is that they could have become too "cocooned" in the industry and may miss out on innovations elsewhere in the business world, he says.
Both executive search agencies, however, focus exclusively on senior-level positions. Both Bell and Lewis concede that aviation-specific educational backgrounds would be entirely appropriate for junior- and mid-level management positions. Additionally, both point to the utility of an airline-specific degree for those who work in more technical departments of the carrier.
The MSc option
This idea of business training for technical staff fits well with the mission of the air transport management MSc course offered by City University in London. Its programme was founded for just such a purpose in 1997 in co-operation with the Guild of Air Pilots and Air Navigators. The Guild recognised that its members were ill-equipped to understand, much less participate in, the managerial decision-making process that affected their livelihood. Course director Prof Roger Wootton explains that the programme was constructed around the premise that pilots and navigators were an untapped resource who would add more value to their companies if they understood the real business constraints their airlines faced. Accordingly, the course aims to endow participants with an academic structure for their thinking that will enable them to comprehend and effectively work within these boundaries.
Since its inception, the course has expanded its student base to include almost anyone as long as they are actively involved in the air transport arena. Still its underlying mission - and its self-imposed limits - remain the same. Wootton explains that a problem with airlines today is that "too many people aspire to be directors, too few to manage the engine room. We're trying to help people who aspire to excel in their professions, not convince them they should be managers." Indeed, he says that the decision to offer an MSc as opposed to an AMBA was in large part taken because "we don't want to raise peoples' expectations too high".
Also in the UK, Cranfield University has long offered an MSc course in air transport management, although its viewpoint perhaps differs a little from its newer rival, tending towards at stance that sees education as a life-long endeavour. Programme director Keith Mason points out that for a Cranfield graduate, the MSc is not necessarily the end of their career training. That should continue to be developed either through distance-learning or executive-level workshops.
In the end, when choosing the optimal type of graduate education to facilitate entry into or advancement within the airline industry, the prospective student is advised to take stock of his or her aspirations. For those who choose an airline-specific degree, one of the biggest benefits they may receive lies in the fact that they have a demonstrated commitment to the industry.
In a sector of the economy which has not been famous for its high rates of pay, it is reassuring for hiring officers to know they can reduce the rate of turnover, with its inherent costs and lost productivity. Hiring someone who has spent the time and money to attend an airline-specific graduate programme typically means employing someone who is less likely to leave the carrier for strictly financial reasons. As one airline executive comments: "It's reassuring to know that you've got these people for the long haul."
Source: Airline Business
