The New Diversity. Executive Summary 2013

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1 Executive Summary 2013 The New Diversity Tomorrow s MBA Prospective MBA students set out their views on what they think of the MBA qualification, what they expect from the business school experience and what they want to study.

2 carringtoncrisp CarringtonCrisp February 2013 All rights reserved. Reproduction in whole or part prohibited without prior permission of the authors. No part of this publication may be reproduced, stored in a retrieval system or transmitted in any form or by any means without prior permission of CarringtonCrisp, ABS and EFMD.

3 tomorrow s mba It s rare to find a group of MBA Directors or Deans who don t at some point in their conversation question the future of the MBA. Four years ago when the Tomorrow s MBA study started this seemed like a real issue MBAs were criticized for failing businesses and a global economic crisis loomed. Yet looking at the findings from the fourth year of the Tomorrow s MBA study, while uncertainty about the future remains, the discussion now is just as likely to be what type of MBA will you offer? Data for the fourth Tomorrow s MBA study was collected in October Just over 1200 potential MBA students responded to the survey from 69 countries. Looking beyond the survey data still leaves a degree of uncertainty. Large numbers now use the GMAT to apply for a specialist business Masters; overall numbers are up, but much of the growth is down to increases in China and among younger candidates. Just under half (47%) of all GMAT test takers are now under 25 years old, in Asia-Pacific it's 58% and in China it's 81%. Over five years those taking the GMAT aged under 24 has grown from 58,688 in to 91,028 in An MBA is surely a long-term asset. However, the existing economic situation brings some fear of huge investments, with high risk. Irrespective of the ranking of a School, the employability of an MBA passout becomes the immediate factor of success. In the UK, 84% of full-time MBAs are now international students. In India the numbers taking the CAT preparation test for entrance to the business schools was down by 1,000 last year. The messages from the data are many and varied, but looking solely at the results from this year s Tomorrow s MBA study some clear themes emerge. Figure 1. Preferred learning mode of respondents 23% 13% Block taught weekends Block weeks 19% E learning 14% Blended learning a combination of face to face and e learning Evenings 8% Academic terms office hours 23% 3

4 carringtoncrisp Younger, male and Asian Respondents to Tomorrow s MBA were largely male (72%) and the biggest group (55%) was aged However, 1 in 6 of the respondents are aged under 24, reflecting the growing trend of younger applicants. Indian nationals made up 1 in 7 of the respondents, but there was a strong response from other Asian countries as well. Among international recruiters much interest has been focused on Indonesia and South Korea, while The Economist has recently identified Mongolia and Macau as two of the fastest growing economies in the world. Rise of the specialist Whether it s the specialist MBA or the alternative of a specialist Masters (MSc), both are becoming more significant in the marketplace. Those looking for a specialist MBA are consistently about 40% of the marketplace. In both cases, Finance is often the preferred specialism, but students have diverse demands for everything from Corporate Social Responsibility through Healthcare Management to Technology Strategy. Figure 2. Factors considered important when selecting an MBA programme that has programme content informed by close links with business and industry that has students with a wide mix of experience that includes a strong focus on corporate social responsibility/sustainability/social enterprise with work experience opportunities with international study options with flexible study options (e.g part time, evening, distance learning) that offers good value for money that has a good range of modules available for study that will provide me with new skills that will improvemy earning potential that will improve my career prospects that will challenge me to think differently that combines academic theory with real world application that has content I can tailor to my needs that has strong practical content 0% 10% 20% 30% 40% 50% 60% 4

5 tomorrow s mba Figure 3. Factors considered important when selecting a business school that is located in or near a major city that has excellent on campus facilities that offers many scholarships/bursaries that has oneor more of the following accreditations AMBA, AACSB and EQUIS that provides dedicated career services for MBA students with high standards of customer service with high qualityteaching staff that has a good recordof enhancing career prospects with a strong alumni network that has a high league table ranking that is located close to where I live and/or work that has been recommended tome that has a diverse mix of international staff and students that focuses on giving students a global perspective that has a strong international reputation that has a strong national reputation with a world class research reputation with a strong academic reputation 0% 10% 20% 30% 40% 50% 60% 70% A quarter of respondents in this year s Tomorrow s MBA would definitely consider a specialist Masters as an alternative to an MBA and a further 20% said this would be a possibility. Masters in Management are becoming increasingly popular for young students and those with limited or no work experience; they are often cheaper and quicker to complete than an MBA and offer a means to differentiate a graduate in the labour market. No longer a full-time programme MBA study comes in many different shapes and sizes today with the demand for full-time study outweighed by those looking for part-time or distance learning alternatives. The rise of MOOCs, ever improving technology for learning, the high costs of study and continued economic uncertainty in many developed countries are likely to see the trend away from full-time study continue. The ROI I am interested in is the leadership skills, strategy planning skills & networking that could indirectly help me with my business. I would like to see more entrepreneurs in the class, even if the entrepreneurs are young. Young entrepreneurs could mean innovative & dynamic individuals that could offer new insights to the class. Only 23% of respondents in this year s study want traditional academic terms, while a similar number choose blended learning as a preferred way of studying for an MBA. Around 1 in 7 choose both weekend or evening study. 5

6 carringtoncrisp I believe that fees should be disclosed on all business schools websites, otherwise students often choose not to bother to enquire about these. Career lessons for schools It s no surprise that the main motivation for studying an MBA is career improvement and that career prospects are a key element of the choice of where to study. When choosing an MBA programme, respondents to the survey suggested that five issues stood out as most important: that will improve my career prospects that will provide me with new skills that will challenge me to think differently that combines theory with real world application that has strong practical content All of the responses set out above were selected by more than 40% of the total sample. However, there are more important career lessons for business schools how is career success portrayed, are alumni involved in providing careers support and are there dedicated career services for MBAs? The latter was the top choice among this year s respondents when asked what career services they expected from their chosen school. Increasingly alumni have a powerful role to play in career services. Alumni provide an authentic voice when it comes to post-study employment, their stories bringing to life the data and claims made by a school. Providing access to alumni and featuring their stories on a school website offers an ideal approach to enhancing a school s career offer. Figure 4. Preferred MBA specialism 1% 6% 8% 5% 2% 7% 1% MBA Accounting MBACorporate Social Responsibility MBA Entrepreneurship MBAFacilities Management 10% MBA Finance MBAHealthcare Management 21% MBA Human Resource Management MBA International Management 1% MBA IT MBA Leadership 8% MBA Legal Management MBA Marketing 8% 2% MBA Tourism MBA Technology Strategy 9% 11% Other 6

7 tomorrow s mba Figure 5. Content considered important for an MBA programme 60% 50% 40% 30% 20% 10% 0% A third trend emerging from this year s research is a growing demand from students who are looking to gain a placement/internship as part of their MBA experience. For younger candidates such an opportunity will strengthen their CV and potentially provide a route in to full-time employment on graduation. Even an in-company project of a week or two will be considered advantageous and career services need to be able to support this interim job search as much as a post-graduation career. Choices, choices, choices Choosing an MBA programme may be dominated by career issues, but there s more to consider when choosing where to study. Six reasons were identified by more than 31% of respondents in this year s study: That has a strong international reputation With a strong academic reputation With high quality teaching staff That has a good record of enhancing career prospects That focuses on giving students a global perspective With a strong alumni network New to the list this year were a school that has a strong international reputation and with a strong alumni network. 7

8 carringtoncrisp I would be pleased if most universities would offer a distance learning MBA for those that are full-time employed and offer scholarships to candidates, especially females, as I am one of them, but find financial constraints are a barrier. The addition of an international reputation may be career related, with students aware that if an employer is recruiting in a tight labour market they are more likely to do so at the international schools with the best reputations. It may also reflect a student expectation that the best jobs of the future will have a strong international component, hence international experience at a young age will be invaluable on their CV. The rising importance of a strong alumni network is also likely to be career related. Historically, one of the reasons for doing an MBA has been to network, learning not only from professors, but also from the experience of others in the class. Beyond business schools this network becomes even more important as a source of contacts and jobs. Although cost plays a part in the decision-making process, it may not be in simple monetary terms. Asked a series of questions about how cost impacted on school choice, most respondents were likely to agree or strongly agree that they would choose an MBA programme if they believe it would offer good value for money. Such a consideration is not just about the fees, but also about the job prospects on graduation the decision is as much about output as input. However, just over half (51%) disagreed or disagreed strongly that they would choose a school because it was the cheapest of their preferred providers. More than 4 out of 10 respondents (43%) agreed or strongly agreed that I would choose a business school irrespective of cost as my decision is based on other factors. Figure 6. Websites used by respondents when deciding where to study Other Poets&Quants GMATClub BeattheGMAT PagalGuy itunesu Twitter LinkedIn MBA.com Yahoo Google worldclassmba.com topmba.com BusinessWeek.com Masterstudies.com Economist.com MBAworld.com Facebook FT.com YouTube University/business school website 0% 10% 20% 30% 40% 50% 60% 70% 80% 8

9 tomorrow s mba Re-enter the Entrepreneur, but now with Project Management skills Two years ago the Tomorrow s MBA report was titled Enter the Entrepreneur to reflect the identification by respondents of Entrepreneurship as one of the five most valued pieces of content when studying an MBA. Last year the subject dropped out of the top five (although remaining in the top 10). This year Entrepreneurship is back. Clearly, Entrepreneurship is here to stay as a valuable part of most MBA degrees, although it comes in a variety of guises. Of course, there is the original form of starting a business, but increasingly it is also a part of thinking differently in a large organisation or being involved with a social enterprise. Alongside the return of Entrepreneurship, Project Management is also increasingly valued by MBA candidates. Project Management skills are particularly important by those aiming to work in larger organizations where the ability to work on a variety of projects maybe key to long term career advancement rather than specialising in a single field. The global media market Asked to identify the media they are using to find out about business schools and MBA programmes, respondents largely identified the usual suspects Google, FT, The Economist and BusinessWeek, but there are also a wide range of local providers that remain important in particular markets. In addition, there is a multiplicity of social media services focused on particular countries, audiences or language groups, all of which can support student recruitment. Around the world there are some variations and, of course, local media still plays a part; for instance, in Australia the Financial Review is often mentioned by respondents to the study. MBA courses should be designed in such a way that it leads to better employment opportunities. I understand that it depends on individuals on how they perceive or leverage their business school experience, but the school should provide the platform such as interaction with employers, career services and interview. Much marketing now depends on digital media with the online versions of print publications often scoring highly. However, Google and the business school website tend to lead the way, with Facebook and LinkedIn growing in popularity each year. Although Facebook and Linkedin are popular in many countries, there are also many local social media services. In India and Brazil Orkut is particularly popular, ranking in the top 100 sites in Brazil. Elsewhere, tuenti.com is the 18th most popular site in Spain, hyves.nl is 57th in the Netherlands and renren.com is 22nd in China. 9

10 carringtoncrisp Among respondents from India topmba.com, mba.com, PaGaLGuY and GMATClub are widely used. Such sites with a clear market focus are of considerable value for the business school marketeer. The new diversity Wherever you look, whether it s candidate recruitment, specialism of programme, learning style and delivery or marketing, the MBA market is becoming more diverse. Globally, for many years the MBA has not been a two-year, full-time US model. Today and in the future, while this historic will survive, there will be a wealth of new models developed and delivered for a diversity of candidates from around the world. Copies of the full report can be purchased for 200 (+VAT where applicable). To find out how your school can participate in the next Tomorrow s MBA study, please contact us by at or by telephone on

11 European Foundation for Management Development rue Gachard 88 box 3 B-1050 Brussels, Belgium Telephone: + 32 (0) Website: The Association of Business Schools 137 Euston Road, London NW1 2AA, United Kingdom Telephone: Website: CarringtonCrisp 34 Ladbroke Square London W11 3NB, United Kingdom Telephone: +44 (0) Website:

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