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History of development
On the world's largest continent lives 60% of the world's population who produce a quarter of the world's GDP. Out of all the countries in the Asian continent, it is China that has sustained economic growth in the past 25 years at an average rate of 9.4%, which is double that of developed countries. With such rapid growth, what are the challenges that face its enterprises? One of the most critical issues of the moment is human resources.
In order for China to maintain its miracle growth, the race is on to create a new managerial class ¡V a new breed of local talent that can manage its regional and global enterprises. Management Education is a new area in China with a history of only 20 years. It is estimated that China will need 75,000 top-level executives with global experience by 2010, which is 15 times more than it currently has. This critical shortage of well-trained managers has led to a huge increase in the number of business schools in China and in just 15 years, Chinese business schools have raced through the evolution it took US business schools more than half a century to accomplish. At one time, the MBA graduates of these new business schools were experiencing a dramatic 100% increase in their salaries when re-entering the workforce. However, as is typical of an emerging market, the roaring growth in demand has outstripped the number of available high-calibre management educators, so the kudos of the average MBA has weakened.
The number of applicants for MBAs in China has been falling since 2003, with 2004 seeing a 20% decline. Despite this, the fight for MBA places still remains strong, even with the number of MBA programmes in China increasing more than 10 times in just 15 years ¡V last year there were 96 MBA programmes and 30 EMBAs. The competition from other professional qualifications, such as MPA (Master of Public Administration) and CFA (Chartered Finance Analyst) combined with the concern over the quality of the MBA standards, has negatively impacted the popularity of the MBA in China. However, this is not altogether a bad sign: "The fewer applicants are a healthy sign that the country's MBA market is adjusting after its binge and starting to find a groove for future sound growth." said Zheng Zukang, vice-dean of the management school of Fudan University.
Types of MBA and MBA providers
So, how does one negotiate the maze of MBA providers in China? First of all, understand the different types of providers.
- Local business schools with a high-status
These are schools that have been accredited by the National MBA Education Supervisory Committee (NMESC) and are therefore allowed to run their own MBA programmes and may recruit professors from overseas. The content usually emphasises the challenges and conditions faced by Chinese enterprises. Students must take the national entrance exam, the GRK, to apply.
- Joint programmes, or international collaborations
These programmes are run in co-operation with overseas Universities and the curriculum is modelled on the international MBA standard. The courses may be co-taught with local and foreign professors, with the focus, again, being on entrepreneurial challenges from a Chinese perspective. The awarded MBA degree is recognised by the Ministry of Education. Students must take the GMAT (Graduate Management Admissions Test) and go through the interview process to apply.
- Imported programmes
There are two kinds: -
a. Non-state business schools and company-specific programmes
These are private training programmes launched by multi-national corporations in China e.g. Motorola University, HP Business School and Shanghai Jiayu Management Institute, and are run in co-operation with local or overseas business schools. These programmes are actually for the companies' own staff, but staff from connected enterprises e.g. suppliers and customers, may also join.
b. Foreign business schools run under the brand name of a PRC partner
Under PRC law, all foreign MBA programmes must have a Chinese business partner. Such foreign MBA schools recruit all their professors from the home country of the educational institution and the core courses are the same as the ones offered at home. These degrees are not recognised by the Ministry of Education. All courses are taught in English.
There is also the local EMBA, which is taught in Chinese and popular with young executives in state-owned enterprises and government office, as well as entrepreneurs. These programmes also appeal to Chinese representatives working in foreign enterprises. Students of EMBA English classes are usually Chinese executives in multi-national companies.
Why Choose to Study an MBA in China?
To young entrepreneurs, embarking on an MBA is one way to explore and exploit the fast-paced economic environment of China, especially when it has become imperative to find guidance in understanding such an uncertain environment. But how does an MBA graduate know his or her worth on graduation? What is the return on investment of an MBA?
Graduates have commented that social networks built on the courses have been most valuable, sometimes inspiring them to take on entrepreneurial projects they previously thought as too risky. These courses are often used to negotiate business deals, hire talent, and even form new companies.
Salary increases is one of the tempting reason, as the return can be harvested three to five years after graduation. Hong Kong University of Science and Technology (HKUST) was a local business school to make the Financial Times' most recent list of the world's top 100 MBA programmes, their graduates averaged a relatively modest 85% salary increase. The MBA programme at the China-European Institute of Business in Shanghai averaged graduate salary increases of 154%.
Earning an MBA in the West used to have its prestige, but now Chinese students prefer to study close to home because it avoids an unnecessary career-break during which they could lose sight of the Chinese business environment and their business contacts. This is not only a trend in China, but also in the West. A few years ago, the majority of Westerners would not have considered an MBA in China, but now they are flocking in the tens of thousands to get a place in a Chinese business school.
General guidelines for choosing an MBA/EMBA
- Language and accreditation
The level of English proficiency will be the first factor in determining the type of programme a student will attend. Overall, joint and imported programmes are considered to be more rigorous because most of them are based on long-established courses with good reputations.
- Corporate seniority
The current level of corporate seniority will affect a student's choice. If he or she is already a senior executive with significant work experience, an EMBA course should be considered.
- Internationalization of the programme
A joint or imported programme is able to offer students more international exposure, which allows the student to consider career advancements beyond China. Programmes with a global perspective are also more likely to be recognised abroad and it is this deadly combination of gaining experience in China, together with international exposure that is drawing MBA students away from Western schools.
- Quality, size and diversity of alumni networks
Students are increasingly judging the value of an MBA programme by the quality and size of the alumni networks. By choosing a joint programme, students have the advantage of becoming alumni of both schools ¡V thus having two networks to tap into.
- Entry requirements for MBA and EMBA
The general entry requirements for an MBA programme are: -
- a recognised undergraduate degree
- English proficiency proven by a GMAT score, TOEFL or IELTS
- at least 2 years' work experience for a full-time MBA
- at least 5 years' work experience for a part-time MBA, including more than 3 years in management.
The average age for these applicants is 27 or 28 years old.
The entry requirements for an EMBA programme are: -
- a recognised undergraduate degree
- English proficiency
- the required years of work experience can vary from 3 years to 10 years worth of work experience, with a specified number of years in management.
In general, the qualified applicants are aged 30 and above.
Tuition Fees and Modes of Teaching in a Chinese MBA
In the United States it is common for students to take two years off to study a full-time MBA, but this is considered very high-risk in China's fast-changing environment. Many are unwilling to resign from a well-paid job, especially when they know the same corporation will offer them better paid and even more highly-coveted job opportunities after graduation. On average, MBA programmes in China cost between RMB 100,000 to 200,000 and take between one and three years to complete.
- Full-time MBA programmes
In mainland China, it is the Chinese universities, rather than the joint or imported programs, that tend to offer a full-time MBA. Courses at Hong Kong universities tend to attract a significant number of students from the mainland. Students studying full-time tend to be younger and have less experience than those on part-time or EMBA courses.
The tuition fees range from around US$ 28,000 e.g. at Cheung Kong Graduate School of Business and HKUST; to around US$ 10,000 e.g. The University of Hong Kong ¡V Fudan University IMBA.
- Part-time MBA programme
These tend to attract mid-level executives with a significant amount of work experience. They also tend to live in the same city because the courses are held on the weekends and evenings.
The tuition fees range from around just over US$ 25,700 e.g. HKUST Part-time MBA, the University of Hong Kong Part-time MBA; to US$ 11,000 e.g. the University of Hong Kong ¡V Fudan University IMBA.
- EMBA (Executive-MBA)
These cater for senior to top executives with tuition fees to match. Over 60% of the students are CEOs, general managers, presidents, and vice presidents. Many of these executives have had little chance to study English, so often these programmes are taught in Chinese, with a translation of English lectures. These programmes generally offer classes during intensive four-day teaching sessions once a month, allowing students to fly in from around the country.
The tuition fees range from US$88,400 e.g. HKUST-Kellogg EMBA to less than US$30,000 e.g. Nanjing University - Cornell University EMBA.
The Future of the Chinese MBA
Business schools in China borrowed much of its MBA curriculum from the United States, since the majority of the world's best business schools are located there. However, using a Western perspective on Chinese case studies has the limitation. So, Chinese MBAs have since evolved into courses where entire managerial and entrepreneurial issues have been ¡§approached¡¨ from a Chinese perspective, taking into account the variations in culture and the differences in business environment.
Taking an MBA is not only about career success, but pursuing the personal development that is beyond the job search and career development. It is about questioning your identity, long-term life goals and desired lifestyle so that you may begin your career orientation in full knowledge of who you are and what you want to achieve in life. This is the under-pinning of your entire learning experience and the MBA is intended to either kick-start it or help it along, using an integrated system of support. A personal development backbone is a way of organising information, advice and services along a length of time a student is in school to allow their potential to be maximised.
Personal development is not a new idea in Western schools, but it is not a focus in the curriculum in mainland universities so far. No doubt, it will be a trend for them to catch up.
The primary deciding factor of the future of the Chinese MBA market is the Chinese economy, because it will eventually determine how many MBAs are required and what type of MBA students are needed.
China used to have administrators, not managers. Now, these administrators are rushing to learn the latest and most advanced managerial skills. The other growth is the need for entrepreneurs who urgently need the training to make the most of a booming economy and be a world-class economic player. These two groups help to shape the content of the programmes.
Specialised programmes versus General programmes
China's MBA expansion has reached 230 programmes in over 90 institutions, with the number of general MBA and specialised MBA programmes both increasing. There are a wealth of specialised MBAs nowadays, including programmes that specialise in Finance, Health, Technology, Project Management, Information Technology, Estate Management and other professional areas. Shanghai University has a Global-Local MBA that is designed to combine personal and Asian business skills development with international internships. The Chinese University of Hong Kong has an MBA in Health Care that intends to foster leadership, collaboration, teamwork and communication by working with the health sector in Hong Kong. Specialised professional MBA education has certainly become a trend in China.
Ranking of MBAs in China
There is a new breed of first-class business schools in China that have a growing influence in international circles. Most recently, CEIBS' MBA programme ranked 21st worldwide, the University of Western Ontario: Ivey ranked 31st and the HKUST MBA ranked 47th (Financial Times, 2006).
It appears that China is doing the best in its programmes, with the Kellogg-HKUST EMBA being ranked 3rd worldwide, the Washington-Fudan EMBA ranked 8th and the Chinese University of Hong Kong's EMBA ranked 15th (Financial Times, 2006).
Considering China's a relative newcomer to the world market of MBAs, its international rankings are quite an achievement, showing just how far it all comes.
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