With industry connections that would be the envy of any university, the Australian Institute of Management Western Australia has become a large and commercially successful business.
With industry connections that would be the envy of any university, the Australian Institute of Management Western Australia has become a large and commercially successful business.
IT teaches about 20,000 individuals every year, has 1,000 corporate members and generates annual turnover of $25 million.
It also has corporate supporters that donated nearly $4 million to help finance its latest building project in Floreat.
Add in a joint venture with the University of WA and an expanding international program, and it’s clear the Australian Institute of Management WA has come a long way.
The institute is also facing a big change, with long-serving executive director Patrick Cullen due to retire in January after 16 years in the role.
His successor will be Murdoch University’s senior deputy vice-chancellor, Gary Martin.
Mr Cullen is clearly pleased with the progress during his tenure.
“It’s gone terrifically well, and over the 16 years I’ve thoroughly enjoyed it,” Mr Cullen told WA Business News.
“We’re well set up with good people, good strategy, financially strong and a very good brand in the marketplace.”
He believes AIM has benefited from being in a fast-growing sector.
“We’re in a hot space – adding to the knowledge and capacity and skill of people who are in management and leadership roles,” Mr Cullen said.
“That’s our business and we’ve grown quite substantively on the back of that.”
AIM was established in WA in 1957 as the professional body for managers in the state.
It has counterparts in other states, and they operate as a loose federation of independent operations.
“In many ways it was set up as a club,” Mr Cullen said.
“The concept was an entity that would encourage managers to get together, share stories and experiences, so they can learn from each other.
“The aim was to raise the standard of management and leadership in WA, and fundamentally that’s what we still do.”
AIM is officially a private sector, membership-based, not-for-profit organisation and Mr Cullen emphasises the importance of its membership base.
“That’s our reason for being, and it’s a differentiator,” he said.
However, from a commercial perspective, its training and development programs are far more important.
“Everything is reinvested back into the business, we’re not funded by anybody,” Mr Cullen said.
With 70 staff and 50 teaching sub-contractors, AIM runs 185 open programs, and a similar number of customised programs.
It also runs a consulting practice, and has international programs in Malaysia, Indonesia, China and India.
“It’s a highly competitive space,” Mr Cullen said.
“We are competing with every professional membership-based organisation, we are competing with training providers and we are competing with consultants, many of whom are sole operators.”
Getting a precise handle on the size of AIM’s market is a difficult exercise.
Mr Cullen acknowledges that market measures are rubbery, but estimates AIM has about a 20 per cent market share and is keen for more.
“We’re chasing substantial growth, we’re chasing 25 to 30 per cent market share,” he said.
Practical focus
What is clearer is AIM’s focus.
“We are absolutely about running very practical, skill-based programs that impact performance,” Mr Cullen said.
“It’s much less about long-term learning, academic knowledge and theory, and instead has a very strong focus on practical application of knowledge.”
Consequently, AIM tends to use practitioners rather than academics to deliver its courses.
Its programs are run in short duration, with very few running more than a week, and the participants in each course are small, 15 to 20 people.
“We have a very strong focus on sharing experiences and learning together,” Mr Cullen said.
He said AIM also had a focus on measuring the impact of its programs.
“This is the holy grail of the whole training space,” Mr Cullen said.
“We are actively researching, on our own and with UWA, the impact of attending an AIM program once you go back to the workplace.
“Have they done anything different, have they changed, have they improved? We’re getting some very positive responses.”
Mr Cullen recalls the days when it was almost considered a reward to be sent on a training program.
It’s now very different, he said, with organisations keen to see a return on their investment.
“Customers, quite rightly, increasingly expect that we deliver a product that does actually impact performance.”
AIM does not compete with MBA programs run by universities, however it has established a senior executive development program with UWA Business School.
“It was two strong brands getting together and doing something better than they could on their own,” Mr Cullen said. “That’s actually gone quite well.”
Growth milestones
Mr Cullen estimates AIM has quadrupled in size during his time as executive director, with similar growth in staff numbers.
It has also expanded from standardised ‘open’ programs to offering ‘custom’ programs and offering consulting services.
Another highlight for Mr Cullen was completion of AIM’s new building, the first 6-star Green-star sustainable building in the education sector in WA.
Costing $12.5 million, AIM was able to complete the project with only a small increase in debt.
It had $7 million retained earnings, and four corporate members – Wesfarmers, BHP Billiton, Westrac and RAC – donated close to $4 million.
“That’s a very significant help,” he said.
Mr Cullen said the GFC led to a small slowdown in AIM’s business, mostly its custom programs.
However he believes the GFC may prove to be beneficial.
“It cleaned out the industry, there were a lot of people who fell by the wayside,” Mr Cullen said.
“Those who survived came out of it because they were better.”
Another challenge for AIM has been its international expansion strategy.
Mr Cullen maintains there are many opportunities for WA to sell education services in the Asian region, but admits putting this into practice has not been easy.
“We’ve had to measure that very carefully, because I know many organisations that went offshore and lost their shirt,” he said.
And he believes the slow and cautious growth is paying dividends for the organisation.
“We’re now doing very well in Indonesia, doing well in Malaysia, and we’ve got some good commercial contracts in India and China,” Mr Cullen said.
He credits AIM’s board, led by former Woodside executive and current Clough chairman Keith Spence for contributing to its success.
All board positions are voluntary and unpaid, and members are only permitted to serve a maximum of two terms of two years each.
Mr Cullen said this was designed to make it attractive to prospective members.
