You say masters degree, I say MBA diploma

When the development of South Africa is discussed, the state of the country’s education system is often the elephant in the room.

Its poor quality is blamed for the low skills, rampant youth unemployment and the sluggish progress of racial transformation in the workplace, with the legacy of the apartheid-era Bantu education programme (racial segregation within educational institutions) still casting a cloud over the country.

Yet its top universities, including Wits, Cape Town and Stellenbosch, have stood out as able to hold their own at an international level. Indeed, South Africa boasts that it was the first country outside the US to offer an MBA, after the Graduate School of Management at the University of Pretoria was established in 1949.

However, a controversial debate about the status of MBAs is causing uncertainty and consternation among the country’s business schools at a time when international institutions are showing increasing interest in Africa. China’s Ceibs Business School, for example, opened a campus in Accra, Ghana in 2009.

At the core of the issue is a proposal by South Africa’s Council on Higher Education (CHE) to categorise the MBA in the same bracket as a postgraduate diploma rather than as a masters degree. The move, which would also effect the state subsidies business schools receive, comes in the wake of a series of reviews of the country’s higher education sector in recent years.

From the CHE’s perspective, the proposal is about ensuring that all masters qualifications are treated equally in terms of entry requirements. Currently, masters applicants require an honours degree or postgraduate degree. But the MBA has no such barriers to entry. Instead it is professional experience that is considered an important factor.

The business schools insist that their entry processes are already rigorous and worry that by placing the MBA a notch below a masters and classifying it in the same category as a postgraduate diploma, the qualification will be perceived to be downgraded, with the risk of damaging the standing of the South African MBA.

“I think it’s a gamble to start saying we are going to downgrade,” says Wendy Ngoma, head of Wits Business School. “It will have negative implications for schools that are competing at high levels. I can’t offer two diplomas, I already have a diploma that is preparing students to go on to an MBA.”

She says South African schools, the most established in sub-Saharan Africa, are already competing with wealthier international schools offering scholarships to attract the continent’s top talent, and worries that categorising the MBA at the level of postgraduate diploma would hurt the country’s competitiveness.

Another concern, Prof Ngoma says, is the potential impact it could have on Wits’ links with international schools through the Partnership in International Management, a programme that facilitates student exchanges between member universities.

“When they [international universities] send their students here, they are not sending them to come and do diplomas,” she says.

The roots of the debate can be traced back to 2005, when the Higher Education Qualifications Framework conducted a review of MBAs. It recommended that the MBA be regarded as a masters degree, with a research component equivalent to a third of the total number of credits that constitute a masters degree. When the HEQF was promulgated in 2008, the MBA was put at the level of a masters, but it was only to be implemented this year.

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Then in 2010 the CHE announced its own review of the HEQF to address a “range of identified gaps and inconsistencies”, according to Ahmed Essop, CHE’s chief executive.

A key issue for the CHE was to create an environment that would lead to universities offering a wider array of professional masters that would have a “more flexible” research component.

The intention was that these masters could benefit professionals such as teachers or engineers who would not necessarily profit from a more academic masters. But to ensure the professional masters would not be deemed a lesser qualification – or “second-class masters”, according to Mr Essop – they would have to have the same entry requirements as the traditional academic masters.

“So when we were re-looking at all of this,” Mr Essop says, “the issue became: where do we place the MBA? When the MBA is described, we think it fits more closely to what is known as a postgraduate diploma in terms of its purpose and characteristics and so forth.

“That was our assessment. We knew it was contentious because internationally MBAs have always been a contentious qualification.”

Last year South Africa’s business schools put forward a submission outlining why they believed the MBA should be regarded as a masters, “but in our view the submission didn’t make a case,” Mr Essop says.

The business schools and the CHE are in discussions to find an amicable solution to the debate. Mr Essop says the organisation is open to ideas.

But there is a further contentious issue – the level of state subsidies business schools will receive. Under the new framework, higher education qualifications are being ranked with a doctorate at level 10 and a masters a notch below at nine.

Should the MBA be placed in the postgraduate diploma category it would be deemed level eight, which would mean it would qualify for less state funding than a masters.

Nick Binedell, dean of the Gordon Institute of Business Science (Gibs) at the University of Pretoria, believes this is a more substantive issue “because we desperately need to grow the system”.

“In our case we subsidise the MBA quite significantly and the real issue is in an emerging economy you want to build management depth. That’s what the business schools do – and we have strong business schools.”

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The challenge for business schools, says Prof Binedell, is to maintain standards while also increasing access, a critical point for South Africa, which is battling to reverse the disparities created by decades of apartheid.

“The concern I would have is that if you look at winning, emerging countries, a huge part of the economic growth has been generated by the production of leadership, management and technical skills – look at South Korea, Brazil, India and China,” he says. “The [South African] universities are reasonably funded but the pressure is when they are asked to do more with the same resource.”

Jon Foster Pedley, head of Henley Business School in South Africa, the only international school accredited to offer a local MBA in the country, says there is a danger that debate over the categorisation of the qualification could detract from a broader conversation about the development of education in the nation.

“If you make it just about level eight or level nine, you are not having a real progressive debate about education – what are the forms of education that can make a contribution to developing countries,” he says.

“I agree with them in thinking to maintain the level of masters education, but masters education is a broad church …Why damage the reputation of great business schools internationally and why make South Africa a special case internationally?”

But the onus appears to be on business schools to convince the CHE the MBA should be treated as a masters.

“If you’re a CEO in a big company you don’t worry about what level it [the MBA] is. You recognise if it’s from a reputable business school,” Mr Essop says. “Our intention is not to downgrade the qualification. We’re trying to fit it into the qualifications framework …But we don’t want to open the floodgates where every professional masters says: ‘We don’t need an honours’.”