These are testing time for the world’s business schools. Corporate cost-cuts mean customised executive education, often the schools’ most lucrative business, is suddenly an unaffordable luxury.

Restricted travel budgets can also preclude trips for on-campus open courses, no matter how short the journey and stay. Schools are being forced to tailor these to more modest budgets. In the US, particularly, market turbulence has shrunk endowments, which means less scholarship and student assistance.

If all this were not enough, business schools’ values and teaching methods, too, have again come under scrutiny as the world seeks to apportion blame for the global financial crisis.

However, there is a bright light amid all the gloom, according to experts at Esade and Iese, the Barcelona-based business schools.

With the sudden surge in the number of bankers, managers and executives either out of work, worried about their future, or reflecting on their career choices, they have noted an increase in the number of applicants to their MBA programmes.

“People are saying: ‘I’ve always wanted to do an MBA – it’s either now or never’,” says Mike Rosenberg, director of international executive education at Iese. “The world’s leading schools are being swamped with applications for their MBA courses.”

Both Iese and Esade reside comfortably in this category, constantly ranking in the top 10 of European business schools, and often in the top 10 globally.

They form two-thirds of a Spanish business school triumvirate – the other is Madrid-based Instituto de Empresa – that have made the country, and especially Barcelona, synonymous with high-quality business education.

Their increasing attraction to foreign students – non-Spaniards consistently account for about 80 per cent of MBA course intake – contrasts sharply with the allure of standard, state-run universities in Spain.

It was perhaps because of the low standard of tertiary education in Spain, and the universities’ lack of international scope, that the country’s most successful business schools had to be private initiatives.

The Barcelona institutions are among the oldest of their type in Europe, and have more than their geographical situation in common.

For a start, both are linked to regular universities with Catholic roots: Iese is tied to the Opus Dei-run Universidad de Navarra, while Esade, co-founded by the Jesuit order, also offers undergraduate law and management degrees.

Both are also pioneers in internationalisation, realising early on the value of building global alliances, teaching in English, hiring faculty with vast international experience, and providing a cosmopolitan environment for students.

Being based in Barcelona, with its beaches, Mediterranean climate, vibrant nightlife, and affordable accommodation, also gives them an edge in selection by students.

“Somebody who studies an MBA is taking a risk,” says Xavier Mendoza, a business professor at Esade, “and they want the school to reduce that risk”.

“They expect the school to deliver on all the fundamental requirements – course work, faculty, business connections and so on.

“Beyond that, a school needs five or six unique factors: being based in Barcelona, when students can also study Spanish, can certainly count here.”

Full-time MBA student Amitabh D’Souza of India says he considered institutions in France and the UK before opting for Esade. “Basically, I spent nine years studying and working in Asia, and then worked for two years in the US,” he says. “I needed a European experience. I liked the idea of Barcelona, and had heard good things about Esade.”

This global view of business, common among MBA students in their late-20s or early 30s, is starting to favour European schools. Interest from the US has surged in recent years, reflecting a growing desire by Americans to expose themselves to foreign cultures while taking a more global view of business.

Iese, for one, responded to this trend by opening a satellite campus in New York City two years ago, in a building it is currently refurbishing in the centre of Manhattan. When completed next year, it will serve as a research centre, alumni club and campus for modules of Iese’s executive MBA and global executive MBA courses.

The project follows the recent expansion of Iese’s Barcelona campus, where it spent €25m ($33m) on a state-of-the-art executive education centre over 18,000 square metres.

Esade, too, has just opened a new, 20,000 sq m campus in Sant Cugat, about 20km outside Barcelona, for undergraduate and masters business administration students. The new campus is tied to Creapolis, an adjacent business research and development centre and eventual home to about 50 companies.

Only by forging ever closer links with companies and their development can business schools stay fresh and relevant, says Luis Palencia, associate dean for MBAs at Iese.

Schools also have to assume some responsibility for the poor state of the global economy today, says Alfons Sauquet, dean of Esade. After the accountancy scandal at Enron, the US energy group, and similar cases of corporate wrong-doing, schools were forced to evaluate their role in the creation of dishonest business leaders and their culture of greed.

Mr Sauquet says: “This crisis will be another catalyst, exposing the schools that didn’t take on board the lessons of the last crisis, and helping consolidate and deepen the reform process at those that did.”

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