The Association of Master of Business Administration (AMBA) and Business Graduates Association (BGA) has launched new research that polled more than 433 business school decision-makers globally about their overall structure and qualifications on offer.
The associations found that most – 85% - of business school leaders remain confident that their programmes are updated to reflect the latest trends in business.
Two-thirds – 66% – of business school leaders think the calibre of Master of Business Administration (MBA) graduates has increased over the last five years.
A little more than half – 57% – of business school leaders think the calibre of master’s graduates, excluding MBAs, has increased.
On average, MBA programmes account for about 26% of a business school’s total income.
The associations say the leaders typically believe that factors relating to the reputation of their MBA and quality of it have the greatest impact on demand for their programmes.
Leaders typically believe that factors relating to the reputation of their MBA – cited by 89% - and quality of their MBA – cited by 87% – have the greatest impact on demand for their programmes.
MBA rankings, which are a product of both internal and external factors, are also seen to have a substantial influence on demand. The majority of business school leaders deem both rankings and the marketing of their MBAs as influential factors.
The external factor deemed to have the greatest impact on demand is levels of economic growth in participants’ home countries – AMBA and BGA say 59% gave this a significance of at least seven out of ten.
Additionally, 51% gave a rating of at least seven out of ten for economic growth within their domestic region and 33% for levels of growth outside their domestic region.
Political issues are seen to have less impact on business school demand. Three in ten gave at least a seven out of ten for domestic political issues and geopolitical issues as having an impact on demand. “This low level of perceived impact may reflect the relative stability of the regions within which responding business schools are based,” the associations believe.
Leaders were further asked to state what proportion of their business school cohort is international. On average, 46% of cohorts are made up of overseas students, illustrating the importance of international demand on the overall health of business schools.
The associations asked the leaders to what extent various characteristics of an application are important when recruiting MBA students, with 96% of them saying prior experience of leadership or business is important.
Oral and written communication is deemed to be the next-most important, followed by interpersonal skills and academic achievement (62%). A commitment to social impact was also regarded as being important, with 51% saying it was “very important” or “essential”.
“Something which comes across strongly in the findings is the high regard leaders have for the core elements of their business school, such as the quality of its teaching and the calibre of its graduates.
“Without these strong building blocks of educational institutions, and what they deliver to their core customers – the students – business schools would be unable to thrive and produce the kind of research and insight which can help shape the world,” the associations state.
Three in ten leaders say their business school offers an industry-specific MBA programme, including oil and gas, luxury management, or finance, and 6% of business school leaders indicate they have plans to develop industry-specific courses.
Leaders were asked about the ways in which their business schools have innovated in terms of programme delivery in the past year. Positively, some of the measures schools are taking relate to areas of improvement around flexible learning.
One in five say that their school has increased the amount of digital and online learning opportunities, 19% of leaders offered flexible timings for delivering programmes.
Other frequently mentioned innovations include that they collaborated with industry to deliver programmes and increased capacity of teaching related to new technology and innovation, such as artificial intelligence or big data.
In terms of marketing spend, open days came out as the highest average spend in the survey, by far, at $1.2-million a year. However, by excluding the top three and bottom three amounts reported, the average falls drastically to $17 718 a year.
The open day spend is followed by online advertisements with newspapers or other publications, social media, print advertisements, career fairs, paid-for/sponsored articles and careers websites.
AMBA and BGA marketing director David Woods-Hale comments that, as the study highlights, 68% of all business school income is understood to be derived from student course and tuition fees, on average.
“It is interesting to note, therefore, that leaders highlight the role of programme quality and reputation in shaping the future demand for its programmes more than they point to the role of external factors, such as local economic growth.
“Nevertheless, leaders are fully aware that the world they live in does impact on the demand for business students, which is perhaps most obviously highlighted by the high number of students who come from overseas,” he says.
Woods-Hale says, on the whole, this report should be a source of optimism for the industry, as business school leaders report great breadth and depth to their schools’ differing programmes and topics, funding arrangements, and forms of practice.
“This variety provides the prospective management education student with a range of options from which to select a high-class degree that suits their ambitions best. In this light, the business of business schools looks well prepared to take on the challenges that will arise over the next decade.”