Dispatches from the Front: EdTech Leaders Face Covid-19 – Week 7

Dispatches from the Front
EdTech Leaders Face Covid-19
 
This is the seventh of a series of mini-interviews ODP conducted with EdTech Founders and Senior Executives to gain insights into how industry leaders are adjusting their strategies and evolving their management practices during the current pandemic.
 
THIS WEEK: Michael E. Hansen, Chief Executive Officer, Cengage
 
 
 
Michael E. Hansen, Chief Executive Officer, Cengage
 
Michael E. Hansen became CEO of Cengage in September of 2012. Under his leadership, Cengage has transformed from a print publisher to a company which today is creating some of the most highly rated digital learning products and platforms. Michael was named one of Fast Company’s Most Creative People in Business in 2020 for his leadership in tackling the affordability crisis in higher education, with the introduction of Cengage Unlimited and was recognized by Glassdoor as a Top CEO as part of their Employees’ Choice Award in both 2018 and 2019. Michael has built a strong reputation for transforming businesses across many media and information sectors; prior to joining Cengage, he served as CEO of Elsevier Health Sciences and as President and CEO of Harcourt Assessment.
 
 

1. Now that the school year is underway, what has surprised you the most about what your customers/students are doing and what’s happening in your market in general?

It has been uplifting to see the massive efforts of institutions and educators to bring students back to colleges has paid off. The early enrollment results of only 2.5 percent decline indicate a big success despite unprecedented challenges.

Second, hybrid learning has now become the norm rather than the exception. The swiftness of this change was surprising, and it remains to be seen whether it will stick beyond Covid. Cengage is focused on successfully giving students and faculty highly satisfying experiences, regardless of modality; satisfaction will mostly depend on the service and support students and instructors receive.

2. What does the new normal for Cengage look like and do you see this continuing or do you think education will go back to what was ‘normal’ prior?

Starting in March 2020, we started seeing certain trends in education accelerate; now, seven months later, we have seen tremendous momentum in two areas of our business – adoption of digital solutions in our US Higher Education business and the need for career training and reskilling to help the global workforce in the face of unprecedented unemployment.

We are seeing increased demand across all our markets for digital solutions that is playing out across Higher Education, both here in the United States, but also in international markets, and to the English language markets. The shift to digital has created strong momentum for us.

While it is unclear how much of the shift to digital will stay, it is clear that education will not be the same as it was pre-COVID. Whether the shift to digital is a short-term trend or points to a “new normal” in education will depend on many factors such as ease of use and service.

In terms of the growing need for workforce training and reskilling, pre-Covid we were already planning an expansion of our ed2go business as a natural step for Cengage; our ed2go business offers career training programs for the adult continuing education and training markets. The demand for online certificates and micro-credentials was growing pre-Covid and has surged during the past seven months. Looking at a year-over-year comparison, in the first half of the year we have seen gains of +156% more unique users and +266% increase in overall enrollments.

We expect demand for corporate training and reskilling to continue and recently announced an expansion to our Online Skills business, of which our ed2go business will play a central role.

3. How long do you expect your employees to work remotely (or were most of them always working remotely)? What are your plans for using your office space going forward?

The virus will determine this, as Dr. Fauci said. We will do our part – prioritizing the health and safety of our employees and the communities we live in — to help get us through the Covid pandemic. We recognize the importance of giving employees clear guidance and timing, against which they can plan their personal lives; with this in mind, we have communicated with employees that we do not expect to return to the office before the new year. While most employees continue to work from home, our Future Workplace task force is re-imagining the use of our office spaces based on what we learned from our employees during the past seven months.

4. How has your leadership style changed – or not – during this period? What might you be doing differently now with your team?

I am very proud of the culture we have built together at Cengage. A big part of our culture, and what I think makes us unique, is our transparent and inclusive approach with all employees and our commitment to be accountable to and for each other.

Our response to Covid-19 was and is very much aligned with this statement. At the onset of Covid-19 in the US, we made decisions based on a simple framework that prioritized the health and safety of all employees, ensured customer continuity and the sustainability of our business.

In March, when we decided to close our offices in the US, employees had so many questions and our leadership and HR teams had a great deal of information that needed to be shared. I started hosting weekly open calls with all employees – via Zoom – in an effort to create transparency. Our global workforce was invited to join me to get the latest update on our business or the latest decisions in response to the pandemic. Employees have appreciated these open forums and the direct access to information, so I have continued hosting a live discussion with all employees invited to attend every Friday, for 45 minutes. We use the time together to share information in an open and candid way across a range of topics – from our strategy, to inclusion and diversity, performance of the business, and employee wellbeing.

When we started these forums, I thought we would use the platform for a few months. We are seven months into this weekly schedule, and it has become our new normal that has helped us strengthen our culture and bring our organization even closer together.

Beyond this, the video conferencing capabilities we have through tools like Zoom, combined with the lack of travel and logistics has created an opportunity for me to spend more meaningful time with a greater number of employees, teams and groups, during any given day, albeit via Zoom. As an example, in one day, I joined a retirement celebration for an employee in South Africa, participated in an Inclusion + Diversity discussion with employees about bisexuality, and joined two global business reviews all in less than a day. The impact of this pandemic has certainly created far too many tragedies; with that said, there have been positive moments and opportunities created that we should also recognize, learn from, and celebrate.

 
EDTECH TEAM
 
ROBIN WARNER

Managing Director

r.warner@dp.oaklins.com

JACK NOBLE

Partner

j.noble@dp.oaklins.com

NEAL GOFF

Senior Advisor

n.goff@dp.oaklins.com

ERICA GRUEN

Senior Advisor

e.gruen@dp.oaklins.com

ANDY M. BENNETT

Associate

a.bennett@dp.oaklins.com

COLTON T. SMITH

Associate

c.smith@dp.oaklins.com

Please contact us to discuss your Company and also hear what is happening in EdTech M&A!

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Oaklins | DESILVA+PHILLIPS is an investment bank for clients that operate at the intersection of content, technology and services. This includes enterprises operating within the media, advertising & marketing, education, healthcare, information services and technology sectors.  Over 24 years, clients have included Advance Publications/Condé Nast, Deutsche Börse Group, Elsevier, Hachette, JP Morgan Partners, Microsoft, The New York Times, Time Inc., TPG and Wasserstein & Co., among others. The firm is the TMT practice co-head and industry specialist in Oaklins, the world’s most experienced mid-market M&A advisor, with over 850 professionals globally and dedicated industry teams in more than 45 countries. We have closed 1,700 transactions in the past five years.At Oaklins, we are passionate about M&A. It’s what we do, every day. We give nothing but our very best to do justice to the extraordinary effort our clients put into their businesses. Our partnership with our clients works because we both believe in never settling until we deliver excellence. Coming from every corner of the world and with a diverse range of backgrounds, together we are one global team. The world’s most experienced advisor on mid-market deals.Oaklins is the collective trade name of independent member firms affiliated with Oaklins International Inc. For details of the nature of the affiliation, please refer to www.oaklins.com/legal.

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Robin Warner

Managing Director

Oaklins DeSilva+Phillips

(212) 651-2605