Bountiful market for students

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If there is one word that sums up the consumer market for Executive MBA programmes these days, it is choice. There is a choice of when you study, where you study and how you study. All of which, you might think, would mean a hugely competitive market with schools in a bare-knuckle fight to enrol the best students.

But this is only partly the case because demand from students is so high, as business schools report an ever-increasing number of applicants.

Demand for the EMBA – an MBA degree for experienced working managers and once the Cinderella of the MBA world – is experiencing increased demand across all geographical regions but is concentrated in the world’s most influential cities. Anyone who wants to study in New York, for example, can choose from five programmes ranked in the top 21 in this year’s Financial Times EMBA rankings (see Page 11) – not to mention the Wharton school at the University of Pennsylvania, just an hour away. Four of the top 10 programmes are taught wholly or partly in London. But it is in Asia, and in particular Hong Kong and China, where the EMBA is really proving its worth. Late on to the scene, Asian business schools have found that managers in the region really do not see the economic logic of giving up their jobs to study on a full-time MBA programme. At Ceibs in Shanghai, for example, where more than 700 managers enrolled on its EMBA programmes this year, demand is buoyant, says Neng Liang, EMBA director.

“Application to our programme has been growing at a rate of more than 25 per cent per year for the past 12 years and it is still growing,” he says. This year the school had planned to enrol 120 students on its September programme in Shanghai, but in the end took 180. “Did we lower our standard for the larger class? No,” he insists.

In Hong Kong, Steve DeKrey, associate dean of the business school at the Hong Kong University of Science and Technology says that the school has had its best year yet in terms of the quality, diversity and seniority of the students applying for the
Kellogg-HKUST EMBA, which is ranked number one in the world in this year’s FT rankings.

“The application pool includes many senior decisionmakers earning very high salaries,” he says, including several who earn more than $1m before they even start the programme.

In China, where HKUST also runs EMBA programmes, the market is dominated by two types of applicant, says Prof DeKrey. The first are managers who are involved in global business and probably work in multi-national companies; the second are those who are motivated by growing opportunities in China.

In Shanghai, Prof Liang says Ceibs, which arguably runs the largest EMBA programme in the world, has seen an increase in the number of applicants from multi-national companies and a decrease in the number of applicants from state-owned enterprises – from 12 per cent four years ago to 7 per cent today.

He also points out that the school is seeing an increasing number of “fly-in” students from outside China, notably Japan and Singapore.

This is a pattern repeated on the Tsinghua-Insead MBA programme that began in June this year in Beijing. Charles Galunic, dean of the EMBA at Insead, says that just one quarter of the participants on the programme are from China, the rest coming
from South Korea, Singapore, Malaysia and even further
afield.

There is also a growing interest in executive degrees from managers in the Middle East. Not only have schools such as London Business School begun offering programmes there, but more students are travelling from the region to study in Europe. At the London campus of the University of Chicago, 12 per cent of this year’s incoming class are from the Middle East.

The profile of the latest Chicago class in London – 38 per cent from western Europe, 25 per cent from eastern Europe, and the remainder from Asia, Africa and the Middle East – demonstrates the increasing willingness of managers to travel to select the best programmes. When the Saïd business school at the University of Oxford launched its EMBA in 2004, it predicted that most students would be local, says Stephan Chambers, EMBA programme director. “We got it slightly wrong,” he admits. “Managers on the programme have come from as far afield as Tokyo, San Francisco and New York.”

In the FT EMBA rankings this year, the popularity of programmes that combine multi-site studies taught by two or more business schools is all too apparent: three of the top four programmes are taught by schools in partnership. Even Wharton, ranked number three in the world this year, teaches its EMBA degree in two locations: Philadelphia and San Francisco.

As managers become more selective in their choice of programmes, they are also demanding more for their money (many of the EMBA programmes in our rankings cost more than $100,000). Increasingly, career counselling, once thought to be taboo on the EMBA where managers are frequently sponsored by their companies, is becoming part of the package. And business schools are increasingly bullish about it.“Our moral contract is with the student [not the company],” says Jim Fisher, vice-dean for MBA programmes at the Rotman school at the University of Toronto. However, companies are becoming more aware that they have to manage the careers of EMBA graduates, he says. “When people take an EMBA they change, they become a different person. If you think you can keep them in the same job – you can’t.”

One of the first schools to offer career counselling was Columbia, and these days, managers who graduate from the New York school with an EMBA have access to a whole term of

career counselling. Ethan Hanabury, associate deanthere, says that companies are more aware that if they lose their best managers they will not be able to replace them. But they have competition. Recruiters are now targeting students on EMBA and MBA programmes.

“Companies see the EMBA as a a talent pool,” says Mr Hanabury. “It is not a revolution, more an evolution.”

EMBA programmes are beginning to emulate MBA programmes in other ways too. In particular, in the US and Europe, younger students are beginning to enrol on these executive programmes. According to EMBA directors, this is because managers are achieving the same job titles, levels of responsibility and salaries at a younger age than they did five or 10 years ago. This tends to be in certain sectors such as IT, says Julie Cisek Jones, assistant dean at the Kellogg School at Northwestern University.

This blurring of the market between the target students for MBA and EMBA degrees gives a further choice for prospective students who can decide between weekend programmes or those with blocks of study, as well as a mix of face-to-face teaching or distance learning, and group work.

All in all, selecting the right programme is a bit like playing with a Rubik cube, and school’s are having to help applicants make the right choices,. Insead’s Prof Galunic says: “It puts pressure on us to explain to people what the programmes are about, beyond the brand.”

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