Online MBAs: digital degrees come of age

Technology has transformed the way people live and work but it has yet to change fundamentally the MBA market. Despite the digitisation of many aspects of teaching, not least the plethora of free-to-study Moocs (massive open online courses), most people completing an MBA from a leading institution still take a career break in order to study on campus.

There are signs, however, that the online MBA could become the most popular option eventually. A growing number of teaching institutions and students are embracing qualifications that are delivered entirely or mainly over the internet. Online education is coming of age.

Last year there was a small but significant increase in the take-up of programmes covered by the annual Financial Times Online MBA Ranking. Enrolment numbers on these course rose on average 7 per cent for the 15 schools in the 2016 ranking. Five more schools were added to this year’s ranking, reflecting an increase in online offerings from notable institutions.

Several factors have come together to drive this shift. They include the tightening of visa conditions in the UK and elsewhere, schools attempting to reach overseas markets, advances in teaching technology and the growing credibility of online degrees.

Both the supply of online MBA courses and demand for them have been rising around the world, albeit for different reasons in different countries, says Matt Robb, managing director at Parthenon-EY, an education industry consultancy. Australia, for example, has long had a strong distance learning market because of people studying in remote areas. Being able to deliver courses online has allowed leading Australian schools to offer a more interactive experience for remote learners, he adds.

In the UK, online courses have become a means for business schools to reach overseas students prevented from studying on campus by stricter student visa controls and cost.

“Nearly everywhere you look, demand by students for online education has exceeded supply,” Mr Robb says. “The question has never been whether there is a market but whether there is sufficient supply.”

Another important factor in the evolution of online MBAs is that schools are more sophisticated in the way they use technology. Many break down lessons into video segments and run interactive online lessons, in which students can ask a professor questions as they teach, says Mr Robb. “Nobody will sit through an hour-long lecture online, so you have got to ‘chunk things up’,” he says.

Leading schools are waking up to the potential of online education to spread their brand more widely than campus-based learning. Warwick Business School in the UK, for instance, has more than 1,200 people on its online MBA, mostly overseas, compared with 75 on its full-time campus-based programme.

The school has built two film studios on campus to create online content. A simulation of a bank trading floor is one example of how it has developed new ways of teaching. Its production team visits companies to film short documentaries that students can stream.

“More and more people are used to being online and expect, in some ways, to be educated online,” says John Colley, Warwick’s associate dean in charge of the MBA.

“The flexibility an online MBA allows is very attractive for a generation where time is constantly being squeezed and the demands of work heightened — you can fit the distance-learning MBA around your life,” he adds.

Imperial College Business School launched its fully online global MBA (GMBA) in January 2015. Now, with 220 students enrolled, it is the London school’s biggest course. Most GMBA students would not consider a conventional MBA, says David Lefevre, director of Imperial’s Edtech Lab.

“There is a growing proportion of MBA students who routinely work and collaborate online and across time zones,” he says. “To these students, the blended approach is completely natural and it is the value of the purely face-to-face traditional MBA format that needs explaining.”

For all the growth of the online market, at many schools there remains a dichotomy between teaching purely digitally and bringing students to campus. In Spain, IE Business School prides itself on the technology at its Madrid campus, such as the WOW Room (Window on the World), whose wall of 48 screens enables professors to hold interactive lectures with students watching online.

The school has used online content for the past 15 years to teach MBA students and it is integral to the experience of coming to the school, says Jolanta Golanowska, IE’s director of learning innovation. But IE, which has a corporate learning alliance with the FT, has yet to offer a purely online MBA.

“We believe very strongly that there is a need for connecting people in person,” Ms Golanowska says. “People don’t just do an MBA for knowledge, but for personal advancement, so they need to network. If you try to do that online, it doesn’t have the same depth as if you do it in the classroom.”

Also in Spain, Esade, which the FT ranks among the top 20 full-time MBAs, does not run an online MBA but does use technology to supplement teaching at its Barcelona campus. For example, a video may be pre-recorded by the tutor so that more lecture room time can be devoted to group learning and discussion.

The school does offer purely online teaching, but it is aimed at the executive education market, reaching people who are in work and at a later stage in their career and who might struggle to justify coming to Barcelona to study full time.

Esade, too, emphasises the importance of the campus experience.

“We are fortunate to be in a city where people want to be,” says Jonathan Wareham, professor of information systems. “For the courses we run on the campus the question is not whether to do it online or offline but how to use technology to help the student learn while here.”