Michael Luger
© Financial Times

As Manchester business school expands globally, dean Michael Luger is optimistic about the future

As an American, at least Michael Luger knows what to expect when Manchester Business School becomes the first British school to open a campus in the US this month.

No British institution has dared to take on the might of the world’s oldest and most prestigious schools in their own backyard, though some have formed partnerships.

But Prof Luger, dean of MBS, is convinced there is an appetite among executives for a more international education, when US companies are increasingly operating globally.

“I speak from life experience. It was a tremendous opportunity to run a business school [in the UK]. US business schools are much more insular. Manchester is a global place educating business people in management in the 21st century.”

US schools have few overseas faculty and many draw case studies entirely from US business, he says, ignoring the fact that the most promising markets for most businesses are in Asia.

“There is a lot of lip service paid to the idea of internationalising, but they don’t do it. There is a xenophobic view of the world from most American universities.”

Prof Luger was headhunted from the University of North Carolina at Chapel Hill in 2006 and admits he knew little about Manchester, a former centre of the Industrial Revolution and a city of almost 3m in the north of England, when approached.

But he has done his homework on Miami, where MBS’s campus will be. It is the first British institution accredited to teach business in the US.

Many companies have their headquarters in Miami, he adds, and the city also hosts a big financial centre, so there should be plenty of paying customers. “We are not setting up next to Stern [in New York]. There is no highly rated business school south of Atlanta. We will be the highest rated business school in that part of the world and that will attract students.”

Miami is also a hub for South America and the Caribbean, home to fast-growing emerging economies, he points out. “The fact is, we are a highly rated business school. Americans study here [MBS] for a full-time MBA. I think it makes sense to try to penetrate that [US] market.”

MBS, ranked 33rd in Europe in the Financial Times European Business Schools 2009 ranking, was the first school to establish overseas centres, opening in Hong Kong and Singapore almost 20 years ago. It now has eight centres between Rio and Shanghai.

The Miami campus will incorporate a centre opened in Jamaica a decade ago when the Jamaican Institute of Bankers invited MBS to train recruits. “We were the biggest fish in a small pond. It was always a push to get them to pay the fees we charge and pretty soon we had trained as many people as they needed.”

The Jamaica hub draws students from across the Caribbean but most have to fly via Miami to reach Jamaica, so Prof Luger believes they will happily transfer there.

The Miami campus will also build on a partnership MBS has with Fundação Getulio Vargas, a private business school in São Paulo. The two schools offer the Manchester Global MBA in Rio de Janeiro and Manchester.

The Miami site will offer MBS’s global MBA programme to an initial class of 30 students from this September. MBS aims to take 600 students within the next three years. The programme will be delivered by MBS academics and emphasise practical, hands-on experience, in line with the school’s slogan “Original Thinking Applied”.

During the two-and-a-half-year part-time course, participants can study at other MBS centres such as Shanghai, Dubai and Rio de Janeiro.

The centre will also link MBS alumni in the US with counterparts around the world. For the first time the school will host annual conferences in Manchester to bring alumni and faculty members together.

Prof Luger stresses MBS’s reputation. But he is unashamed about competing on price. The 18-month Manchester MBA costs £35,600 ($55,000). The Global MBA will cost £21,000, considerably less than the $100,000 or more that some US schools charge for a two-year full-time course.

“It is great value for money. But we are not going to sacrifice quality,” he says. “We are not going to hire a load of local stringers like some schools. They will be mostly Manchester faculty who will travel to deliver the programme.” Using MBS faculty will keep student numbers down, says Prof Luger, but he stresses that the US centre is still worth doing financially. “It is not like we need 10,000 students to make it pay,” he adds.

Prof Luger says cuts to university grants from the UK government will have little impact on the quality of MBS’s teaching or expansion plans. “Three years ago we were running a significant deficit. We have turned a £3.5m deficit into a £4m surplus.

“We get a small proportion of our revenue from the government. Our application numbers for next year are up and we are growing our executive education programme.” Companies such as American Express, BP, Ebay and Unilever send executives to MBS.

The school, which is spread across four buildings in Manchester, is looking to consolidate and aims to build a conference centre with attached hotel that would be run by a private company to help raise finance.

Looking to the US campus, Prof Luger says the vilification of BP over the recent Gulf of Mexico oil leak has not damaged the image of Britain. “There is a very warm feeling for British business in the US.

“We are the first British business school to have a licence to teach a management degree in the US. We are recruiting now and we’re excited. If the students think we are from [Manchester] New Hampshire that’s fine,” says Prof Luger.

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