The evolution and internationalization of business schools
The evolution of business schools
Business schools, the ubiquitous institutions that deliver several types of programs in management, such as the MBA, the Executive MBA, the Executive Education, and the Executive Education Open enrollments, present an interesting evolutionary path. Three distinct periods in the evolution of programs of management education.
The first phase occurred before the 1950s, mainly in the United States of America. During that period, the approach was very functional and most business professors were practitioners or retired corporate managers, whose focus was to train students in business lessons. Moreover, because corporations and their current/retired employees contributed so much as teachers and participants to set the MBA agenda, the aforementioned period was called the “Corporate-Based Era” (Friga, Bettis, & Sullivan, 2003).
The second phase started during the 1950s and finished around the end of the 20th century. This phase was marked by an increasing professionalization of the faculties, the use of PhD-trained professors, the rise of MBA rankings, and the start of competition in regional levels (e.g. the USA vs. Europe). This period also featured the emergence of many new courses such as the Customized and Open Enrollment Executive MBA programs. Moreover, the said programs consisted of traditionally offered courses in business topics such as Strategy, Finance, Marketing, Operations, and Organizational Management. In this phase, the main source of the creation of knowledge was research in managerial topics. It is important to also note that the rise of ranking systems for business schools forced them to be more proactive in making changes (Friga, Bettis, & Sullivan, 2003).
The third phase of the programs in executive education started in the 21st century. The MBA programs of this phase fostered the capacity of the students to integrate various functional perspectives to meet the complex business challenges of the new century. This skill is called “integrative thinking” and refers to the capacity of taking a cross-functional, multidisciplinary approach to provide solutions for unstructured problems. Indeed, to facilitate the acquisition of the said skills, business schools need to reposition themselves to face the changing nature of business around the world. Among many fronts in which the repositioning of executive programs may happen, there is the rise of digitization of processes and the use of Industry 4.0 tools (Kaltenecker, Kahle-Piasecki, 2019), innovation and internationalization, Corporate Social Responsibility (CSR), and the emergence of consulting projects (Lockhart, 2013; Kaltenecker, 2018). The third wave of executive education also witnessed the use of managerial knowledge by non-profit sectors, such as governments and Non-Governmental Organizations (NGOs). The following table illustrates the phases of the evolution of the executive education industry.
Evolution of the Executive Education Industry
|1st wave: Corporate-based||2nd wave: Faculty-based||3rd wave:
|Time||Pre-1950s||1950-1999||2000 & beyond|
|Type of professors||Practicing and retired corporate managers||Ph.D. with theoretical backgrounds||Mixed faculty: corporate managers and research-oriented faculty|
|Type of customers||Corporations and their managers||Corporations and their managers, entrepreneurs, investors||Corporations and their managers, entrepreneurs, investors, and the general public looking for non-executive careers|
|Focus||Business lessons (transfer of knowledge)||Research in management (creation of knowledge)||Integrative thinking (integration of knowledge)|
|Types of program||Full-time 2-year MBA programs||Full-time 2-year MBA programs, Executive MBA programs||Full-time 2-year MBA programs, Executive MBA programs (customized and open Enrollment), Modular programs, Online programs|
|Geographic distribution||Local, but mostly in the USA||National/Regional (the US and Europe)||Global (in addition to the US and Europe, new markets and players from Asia and Latin America|
|Creation of mass-market consumption||Rise of MBA rankings,
Use of computers, analysis of cases, and simulations
|Internationalization of programs, Industry 4.0technologies, use of business concepts in Non-Governmental Organization (NGOs), Start-ups, and Governments|
The internationalization of business schools
The historical international nature of universities plays out in new dynamic ways by pushing these institutions to pursue new market opportunities in the host countries. Moreover, like any multinational companies, business schools internationalize to internalize knowledge obtained in the host countries (different consumer behavior, business models, and regulatory frameworks), as previously addressed by da Silva Lopes, Casson & Jones (2019), and Narula, Asmussen, Chi & Kundu (2019). Moreover, the globalization of markets including that of the educational sector has brought a new challenge for business schools (Altbach, Reisberg, Rumbley; 2019). In the case of executive education, as many companies internationalize and face global competition, students and employers demand a solid international education in management. In response, most business schools have adapted their organizational structure, and geographic dispersion to be international. Using two analytical dimensions, location of delivery and the origin of the students, Engwall & Kipping (2013) proposed four mechanisms of internationalization of higher education: Import of ideas (knowledge imported through international research networks and business school models and templates), Outsourcing (internationalization through the mobility of people), Insourcing (internationalization through international student and/or faculty, delivered in the home country), and Foreign Direct Investment (FDI), internationalization through investment abroad requiring the highest level of commitment, and representation of the highest financial and reputational risks, delivered in the host country. Although the high-level risks associated with this strategy, Silvanto, Ryan, & Gupta (2017) suggests they are worth because leading business located in economically globalized locations schools offer greater levels of international experiential learning students. Hawawini (2011) proposed five models of internationalization of executive education programs.
- The import model, which attracts students and faculty from around the world to the institution‘s campus. In this case, importers maximize the chance of direct interactions and cross-cultural learning. This model has an intrinsic limitation: a campus populated with foreign students and faculty is unlikely to provide the equivalent of the international experience students and faculty would gain had they been physically living, working, and studying in other countries.
- The export model, which consists of sending abroad faculty and students. The faculties deliver courses off-site but the school’s original campuses remain at the center of the entire system. These off-site courses are usually located in the host country and may include students from the original campuses. This model exposes students and faculty to other countries and cultures to enrich their knowledge and experience. In general, successful exchange schemes have a limited number of partners who work closely together around a program that does not involve a large number of students and faculty.
- Academic joint-ventures, which consists of student exchange programs, offering participants in the courses the possibility of having classes in the foreign institution. This mode may evolve into academic or curricular joint ventures in which institutions located in different countries design and deliver joint programs, with graduates receiving either a single co-signed degree or two separate degrees.
- Academic partnerships, alliances, and consortia, which consist of two or more business schools forming broader international partnerships to collaborate on several initiatives such as student and faculty exchanges, joint programs, and faculty research. Common research funds are created to support research projects carried out by teams of faculty members from both institutions. The partnership can also enter into academic joint ventures to create new joint programs.
- Campuses abroad, which consists of extending their international reach through a physical presence, like the direct foreign investment of firms, by establishing full-fledged campuses abroad in which temporary or permanent faculty and staff are posted and where local or international students attend a variety of courses throughout the year. Campuses in foreign countries are the ultimate form of internationalization of business schools. Such units generate knowledge that will influence the original campus, an issue confirmed by da Silva Lopes, Casson & Jones (2019)
It is important to note that not every executive education program evolves into the Campus model. This happens because some schools are small, do not have the resources to become global, or are simply focused on an attractive regional market. Additionally, for some business schools, the right strategy or option is to become a center of excellence in functional areas such as finance, corporate governance, and digital marketing, for example. Finally, the models of internationalization are not mutually exclusive. For example, leading business schools not only send abroad some of their most-renowned faculty to undertake executive programs in major cities around the world but also host the executives from their associated global corporate clients to receive proper training in management on the main campuses.
Altbach, P. G., Reisberg, L., & Rumbley, L. E. (2019). Trends in global higher education: Tracking an academic revolution. Brill.
da Silva Lopes, T., Casson, M., & Jones, G. (2019). Organizational innovation in the multinational enterprise: Internalization theory and business history. Journal of International Business Studies, 50(8), 1338-1358.
Engwall, L., & Kipping, M. (2013). The internationalization of international management education and its limitations.
Friga, P. N., Bettis, R. A., & Sullivan, R. S. (2003). Changes in graduate management education and new business school strategies for the 21st century. Academy of Management Learning & Education, 2(3), 233-249.
Hawawini, G. (2011). The internationalization of higher education institutions: A critical review and a radical proposal.INSEAD Campuses. (2016, January 04). Retrieved October 27, 2020, from https://www.insead.edu/campuses
Kaltenecker, E. (2018) “What will the future of Management Education look like?” Available at: https://evodiokaltenecker.com/what-will-the-future-of-management-education-look-like/ (accessed Sept. 2020)
Kaltenecker, E. and Kahle-Piasecki, L., 2019. The impact of the Fourth Industrial Revolution in the Ownership, Location and Internalization advantages of firms: an exploratory study.
Lockhart, J. C. (2013). Executive education: can it be too good? Journal of Executive Education, 12(1), 5.
Narula, R., Asmussen, C. G., Chi, T., & Kundu, S. K. (2019). Applying and advancing internalization theory: The multinational enterprise in the twenty-first century.
Silvanto, S., Ryan, J., & Gupta, V. (2017). A study of the impact of business education on global career mobility. Journal of International Education in Business.
Source of images:
Main image (Group meeting): Photo by Austin Distel on Unsplash
Notebooks: Photo by Marvin Meyer on Unsplash
People working with fun: Photo by Priscilla Du Preez on Unsplash