Western MBA schools a threat to Asia?
By ALEJANDRO REYES
Keen to dotcom yourself? You might do well to emulate Hong Kong cyber-celebrity
Jonathan Cheng, a former investment banker and co-founder of Internet
incubator Incubasia. At least, that is the message of newspaper ads touting
the executive MBA program in Hong Kong of Richard Ivey School of Business,
a unit of the University of Western Ontario. In the "Ivey will transform
your life" campaign, Cheng gives a short testimonial about his experiences
at the school's Canadian campus, where he earned an honors degree in business
administration in 1993.
Artist's sketch of the University of Chicago business campus in Singapore.
Many Western MBA schools have long had links with counterparts in Asia.
But some are now setting up their own units here. Ivey opened a center
in Hong Kong in 1998. Three months ago, INSEAD of France started a full-time
MBA program for 53 students from 25 countries in Singapore. The University
of Chicago is renovating an old Chinese family mansion in the same city
as it prepares to launch an executive MBA program there in September.
In India, well-known American institutions Kellogg Graduate School of
Management and Wharton School are partners in the planned Indian School
of Business (ISB), a project of Calcutta-born consultant Rajat Gupta.
The newcomers face some difficulties. "We're finding Asia to be a saturated
market," says Larry Wynant, Ivey's Hong Kong-based associate dean for
Asia. "There may not be room for yet another school here. Companies are
much less willing [than in the West] to invest in the training and development
side of their people." An executive MBA program run by one of the Western
institutions can cost more than $50,000 over two years, not including
travel and expenses. NUS Business School in Singapore charges less than
half that for a similar program.
Local institutions are bracing for a fight. "With years of experience
in the region, our indigenous knowledge of the economy will make the difference,"
says David Tse of the University of Hong Kong. "Their fees are too high,"
says Jahar Saha, director of the Indian Institute of Management in Ahmedabad,
which charges less than $2,000 for an entire full-time MBA program. One
worry: poaching of professors, who are not always well paid. "If the Indian
School of Business tries to lure away our teachers, we will be hit hard,"
says Rammohan Rao of the Indian Institute of Management in Bangalore.
The Western schools say they bring other things to the party. With their
global outlook, they cater to the needs of companies that are spreading
their wings internationally. Their students earn a world-recognized degree
as well as plug into a major institution's global alumni and corporate
network. In the classroom, they get to mix with peers not just from Asia
but from Europe and America as well. ISB, which will admit its first students
next year, says it will cast its net worldwide, not just in India. Students
at the University of Chicago's Singapore campus will have face time with
counterparts in Chicago's units in Barcelona in Spain and the U.S. "That
expands the network," says William Kooser, associate dean of the university's
executive MBA program.
For now, the foreigners are concentrating on niches. Most focus on executive
MBA programs for managers in their mid-to-late 30s with a dozen years
of work experience. INSEAD is pitching for a younger mid-to-late 20s market
for its full-time course, which involves attending classes in Singapore
and Fontainebleau in France. Others are looking at in-house MBA degree
programs. The University of Michigan, for example, has been running customized
courses for companies like Hong Kong's Cathay Pacific Airways and Korean
chaebol Daewoo. The schools also plan to develop week-long or shorter
refresher and other courses.
Why set up in Asia directly? Kooser says his school looked at the possibility
of a tie-up, "but we always came back to the fact that we wanted to offer
a University of Chicago degree. To do that, we need to have it taught
by our faculty." Ivey came to a similar conclusion. "We looked at a couple
of schools, but found there was a great difference between our approach
and their traditional academic style," explains Wynant. Ivey is a strong
proponent of the case-study method and is a major producer of cases for
business schools worldwide, publishing about 100 Asia-related ones a year.
The foreigners may be ruffling feathers, but some local schools prefer
to look at the bright side. "There are benefits in having top schools
here," says John Rose, director of the Melbourne Business School. "Additional
high-quality faculty from the northern hemisphere might be brought to
our region and develop relationships with us." New entrants do two things,
adds Chris Hall, director of the MBA program at Australia's Macquarie
Graduate School of Management. "They grow the market, because more people
become aware of the product, and they cannibalize the weak." Let the weeding
With reporting by Maria Cheng/Hong Kong, Sanjay Kapoor/New Delhi and
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