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Why undertakers are going to business school

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The business of death offers seemingly endless commercial possibilities. Last month's National Funeral Exhibition in the U.K. had memorial bench makers, life insurers and hearse manufacturers, all pitching their wares.

But while funeral service professionals once focused on developing softer skills, new economic pressures and market demands make business education an increasingly important tool for the industry.

Competition is heating up for funeral companies. In Europe, for example, new rules will allow more private companies to vie with public providers in selling funeral services and products. Meanwhile, rising demand for cremations, "green" funerals and more personalized send-offs means rolling out the traditional funeral cortege is no longer sufficient for today's funeral directors.

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For funeral professionals, such developments demand an ability to adapt and innovate. "They're realizing that the days when they had a protected market and a sure stream of clients are over," says Jaume Massons, director of the Master of Business Administration for Funeral Services (FuSeMBA), a program designed for the industry and sponsored by the University of Barcelona and the European Federation of Funeral Services.

Offered by a group of European education institutions and funeral industry associations, the two-year FuSeMBA program is accredited by the University of Barcelona. Like many MBAs, the FuSeMBA combines face-to-face sessions and online learning.

However, few business school programs have content quite like this one. The FuSeMBA includes everything from discussions on the logistics and design of coffins and tombstones to lectures and demonstrations on cremation and embalming techniques.

The program has also offered field trips to places other business school students rarely see. While most MBA participants visit factories or R&D centres, in 2010 on the French portion of the FuSeMBA, students visited Paris's Père Lachaise cemetery.

Delivery of the FuSeMBA is divided between members of the group. The French Confederation for Funeral Services Professionals manages the content on topics such as cremation and funeral organization, while the Italian National Federation of Funeral Service concentrates on operations, logistics and materials such as marble for headstones.

The National Association of German Funeral Directors focuses on planning, regulation and cemetery management, while the portion of the course delivered by Spain's Funeral Service of Barcelona includes communication techniques. The British Institute of Embalmers provides instruction on embalming techniques and body treatment.

Core topics such as accounting and finance are covered in the MBA, but given a funeral-specific slant in the case studies. "When [students]learn about accounting, it's the general accounting you would use in any company," says Mr. Massons. "But all the examples are from accountancy specialists with expertise in funeral service – this is the added value."

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The FuSeMBA is the only industry-specific course so far available, although some business education is offered through companies such as Johnson Consulting Group, the funeral home and cemetery advisory, business training institutes and funeral directors' associations.

While most funeral directors gain degrees from mortuary science or funeral service colleges, business training tends to be a small part of the curriculum, says Robin Heppell, owner of Canada-based Funeral Futurist, a marketing consultancy. "And they're so overwhelmed with everything else, learning how to read a spreadsheet isn't going to stick with them."

However, some in the funeral business are embarking on mainstream MBA programs. In the U.K., The Co-operative Funeralcare, the country's leading funeral director, sponsors staff to take part-time or executive MBAs at Manchester or Warwick business schools.

As head of strategy and development for The Co-operative Funeralcare, Alison Close, who took an MBA at Manchester, says the degree has helped her in areas such as business development (building the company's crematorium portfolio) and business turnround (intensifying the customer focus in the Co-op's masonry business).

"The experience of my MBA helped me move into the strategy role and then with some of the things I've done since taking up that role," she says.

Ms. Close argues that even for smaller, independently owned funeral companies, business education is becoming more important. "It's not enough to just perform the funeral. You're actually managing a business and to manage that business you need qualifications and exposure to some of the modules within the MBA."

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Given the shifts in the industry, business skills such as innovation, cost control and marketing are likely to become more important for professionals who have not, until recently, had to think about how to compete.

For the United States, the biggest of these changes is the rise in cremation. While in the U.K., cremation has long been favoured, with more than 70 per cent of Britons choosing it, a sharp rise in cremation in the United States has sent ripples through the industry. Today, about 35 per cent of Americans are cremated, a figure expected to rise to almost 60 per cent by 2025. And since cremation costs as little as a fifth of the price of a funeral and burial, this is a blow to an industry that once counted on embalming services and casket sales for much of its profits.

In addition, baby boomers are looking for something different. "Families would like more personalized services that often are very non-traditional," says Jane Jones, vice-president of human resources at Texas-based SCI, the U.S.-based funeral services group. "They may not be conducted in a church but, for example, at the beach."

This means funeral homes have had to become more creative in the services they offer clients, with some entering new business areas such as catering and event management. "Much of the culture has shifted from being dead-body-centred to experience-centred," says Todd Van Beck, a U.S.-based funeral educator, consultant and historian.

There are also new products on the market such as resomation, an eco-friendly technique that uses an alkaline solution to accelerate the natural decomposition of a body – something in which the Co-op is investing. "Effectively this is a brand new product and we need to get acceptance from the public," says Ms. Close. "So in areas such as customer management, consumer marketing and how to launch a new product, I've drawn on my MBA."

Revenue streams are also changing: demand is rising for green funerals (biodegradable wicker and cardboard coffins do not generate the same margins as silk-lined, walnut-veneered caskets with brass handles) and for services such as web-based memorials and live streaming of funeral services to relatives who are unable to attend.

And funeral companies are also competing with new industry players, with retailers such as Costco and Wal-Mart now offering low-price caskets.

It is therefore comes as no surprise that the FuSeMBA includes topics such as "generation of monetary flows" and "cost control and calculation".

"What we focus on ... is the organizational change that all these companies have to embrace," says Mr. Massons. "Because if the profile of professionals doesn't evolve and the mentality of the providers of this type of service doesn't change, the whole industry will be stuck."

However, this message does not yet seem to have permeated the industry. The FuSeMBA is not running this year, says Adrian Haler of the British Institute of Embalmers, "due to lack of support."

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