business Is the MBA dead? The star of business schools is renewed to survive The master’s degree in management training is reinvented to survive
business , Drums of war shake the flagship product of business schools, the MBA or Master of Business Administration. They arrive from the United States, where it was created, and from the United Kingdom, as is usual with almost all the trends in this sector. There, the number of management training centers that withdraw them from their offer are growing. They are taken for dead. First was the prestigious London School of Economics; now it is the King’s College of London, the University of Wisconsin-Madison, the Tippie College of Business (Iowa) and the University of Wake Forest, in North Carolina. Instead, these institutions have launched big data programs , business analytics or artificial intelligence, the new tools that the market demands from executives.
In some institutions, business administration programs represent up to 45% of their income Some leave the MBA full time (one or two years and for which little work experience is required) due to lack of students or because it is a program whose costs are very expensive; others, because they do not add value to the extensive offer of their competitors and prefer to focus on postgraduate programs, where they do offer this differential; and others, because they lose money with this emblematic product. And all are satisfied by their decision to remove it from the market.
The question is clear: Is it worth risking leaving the race for one or two years at the time when we are more professionally bright to pursue a Master of Business Administration that allows us to ascend ?, argues Luc Theis, general manager of Deusto Business School. “The MBA is in crisis because it has a lot of competition for products that are better suited to the needs of students,” argues Theis, whose educational organization decided to do without him a few years ago because the economic crisis had problems to market and Deusto preferred focus on the most exclusive Executive MBA, for managers with more experience, where “we can provide network “.
IE, ELIMINATED FROM ‘RANKING’
The rankings matter much. They are perhaps the first indicator used by students to choose the business school where they will take their MBA and, therefore, one of the arguments that these institutions exhibit in their advertising to capture them. IESE, Esade and IE Business School have been strolling for years at the top of the world ranking that is taken as reference in the sector, which is prepared by the Financial Times (FT).
But this year there have been surprises. And it is not that the French school Insead, which led it in 2017 for the first time in its history, has been ousted by Stanford or that Harvard continues to lose positions once again. In the ranking of the 100 best Global MBA of 2018 of FT there are only two Spanish business schools: IESE, in the twelfth position, and Esade, in the twentieth. No trace of IE, which usually stood ahead of the others (specifically, its latest brand, the 2017, was the eighth place in the world).
The Financial Times has expelled from the list to the training center of Madrid executives alleging irregularities in the questionnaires that the students answer to demonstrate their work progression since they attended the MBA in order to evaluate the quality of the program of this institution. They have not answered the students they owed, nor their addresses were correct. “There have been anomalies in the reception of information,” reads the official version provided by IE and FT.
A few months have passed since then and the ex-dean of the school, Santiago Íñiguez de Onzoño, recognizes that they did not pay enough attention to the process of gathering information to be ranked , as it is called in the jargon of the schools. That is why the process has been changed, monitored to introduce transparency, and the people who took care of it have been removed, he explains. Next year IE will return to the ranking , and here peace and then glory. His expulsion in terms of enrollment has only affected four or five, according to the current president of IE University.
The MBA is again in question, just like during the last economic crisis. And this is noticeable in Spain. “The program has been questioned on many occasions since its inception in the 1960s,” recalls IESE Business School CEO Franz Heukamp. And “since the recession it is not so important for some recruiters to have this title; In fact, financial institutions have stopped considering the MBA essential to sign their executives. There is a content problem. MBAs are too general, “says Josep Maria Altarriba, dean of EAE Business School.
Renewed or die
“The MBA model as we know it is dead,” says Ignacio de Pinedo, CEO of the Higher Institute for Internet Development (ISDI), “the new MBA is the master’s degree in Internet business. And not only the contents are different, but also the methodology. It is a model in which the important thing is not what you learn, but what you implement in the company “.
To prevent the demand from running out, Spanish business schools are trying to give a total turn to their star master. “In this dynamic sector we need to be alert to changes in paradigm. Even more so with a program like the MBA, which enjoys a lot of prestige “, declares the general director of Esade Business School, Eugenia Bieto. Because we must not forget that for many management training centers is the manna. In IESE, for example, 700 students a year attend the full-time MBA , which has grown by 25% in the last two years, and if we count the other MBA formats, they approach 1,500 students, so that these master’s degrees represent the 45% of the school’s turnover, according to Franz Heukamp.
Renewing is the paradigm. IE Business School decided to give a twist to its full-time MBA to place it at the forefront, because, according to the president of IE University, Santiago Íñiguez de Onzoño, “it is not that the MBA program is mature, it is that some schools business are mature. ” The organization has opted to incorporate content of big data and business analytics into its Master of Business Administration , so that the students who answer it respond to the demands of the companies and enjoy a double degree, so requested at present. “The MBA is very much alive. What is needed is to complement it with technology, with specialization, with new formats and a greater presence of women in the classrooms, “says Íñiguez. IE has more than 700 students in its flagship program.
The same has been done by the Barcelona School of Management, dependent on the Pompeu Fabra University. “Now we ask that the training be transversal. Knowing humanities, creativity, big data and technology, knowledge that goes beyond pure business. And schools have to give these tools, “says Daniel Serra, dean of the center. The institution decided to customize its MBA, introducing more and more elective subjects so that this master’s degree continues to be the star of executive education, adapting to each student. The students consider an individual project that is the backbone of their learning, which is directed by an academic mentor.
For its part, Esade plans to turn around his full-time MBA next year, because, in the opinion of Eugenia Bieto, it is a program that will not disappear, but it does need to be rethought. With about 375 students each year, the idea of the entity is that this master’s degree is very close to the company and to innovation. “We want to train transforming managers, who are the agents of change,” he explains. And for that they have changed the methodology and incorporated creativity, big data , robotics and all the tools that facilitate the decision making at the moment. “We seek to respond to what companies demand: people who are capable of leading the changes,” Bieto adds.
Contents of ‘big data’. ‘business analytics’, artificial intelligence or creativity modernize the most sought-after postgraduate courses on campus
Because the main Spanish business schools are clear that the demand for MBA is still very powerful and should respond. The heads of IE and IESE believe that the best management training centers in the world will continue to enjoy a growing number of students, to the detriment of the rest of the institutions. “The MBA will be for a few schools of world renown and with presence in the top positions of the main rankings of the sector,” agrees Theis.
However, this moment has not yet arrived in Spain, where the candidates to take this master’s degree are still very large. So much so that the offer, far from diminishing, grows. The CEU has just made its business school independent from the university because the training of professionals must be taught by professionals, according to Álvaro Rico, general director of the CEU Institute for Advanced Management Business School. But in this transit that has meant a complete revision of the curriculum, the MBA full time it has not been dropped from the catalog, which has increased significantly (from 8 to 52 programs). “You have to train managers and decision makers with a 360 degree view of the company. That’s why the MBA has to continue to exist and what needs to be done to survive is to enrich it with specialized training in 4.0 industrialization, robotics, artificial intelligence …, as is our case, “he argues.
That is precisely the idea of the newly created CMI Business School. Its president and founder, Rafael García, is clear about it. Its management training center will be the first to devote itself to corporate social responsibility and will offer a single program: a responsible MBA that can be done in three ways: full time, part-time and combining online classes and lessons. Come on, what management schools usually do. “The MBA is disappearing in many schools as such, but in others it is adapting to the new times. Shortening the duration of the master, because people have less time and want to spend less money, and specializing, as we are doing, because the subjects of all life are no longer enough for executives of the XXI century.