Archive for October, 2008

The German dilemma

October 30, 2008

Some soul-searching in Germany this week as influential deans and professors met at the Frankfurt School of Management and Finance to discuss the way forward for that country’s business education.

Germany has been slow to embrace the North American model now prevalent in much of the world—in particular offering flagship, full-time MBA courses. However, there now appears a groundswell of opinion that believes an overhaul is due.

It is not a universal view, though. With Germany still Europe’s pre-eminent economy—indeed this week Volkswagen briefly became the world’s most valuable company—there was some debate as to whether Germany needed to fall into step with the rest of the world. Furthermore, in many ways, the country, it could be argued, is a special case.

With many diploma students not graduating until their mid-20s—typically when an MBA will just be entering a programme—there is a questionable appetite among its target market to return to university at that age. In any case, with employees often loyal to a particular company (or more realistically, perhaps, with generous employment practices a disincentive to chop and change jobs) one of the main reasons for taking an MBA—to change career—is less relevant.

The final argument against a need for change is that, with Germany’s strong heritage in engineering, it has historically been the best engineers—not necessarily the best managers—that have gone on to be the country’s business leaders.

But these arguments were forcefully rebutted by Professor Rolf Cremer, currently dean of CEIBS, but someone who gained his PhD from one of Germany’s technical universities.

Germany needs to be in a position to mould and lead management thinking around the globe, he argued. And that can only be done by fully embracing business education. There is no point in holding out against the norms in the rest of the world and then complaining that you are not a major player.

“Germany does not need to be involved in every industry,” he went on. “Growing bananas, for example. Germany does not need to be involved in the banana-growing industry. But educating managers is not one of those opt-out industries.”

And, for Professor Cramer, that means institutions offering a single flagship, full-time MBA programme. The model may have originated in North America, but it is now the accepted global standard.

But while there is a definite sense of now-or-never among German business academics, according to Frankfurt’s dean, Udo Steffens, there is still a long way to go. Professor Steffens argued that Germany is still to see a truly global player in the business education market. Meanwhile, those talented Germans intent on taking an MBA inevitably look outside the country for their education. Even for Europe’s economic powerhouse, that must surely be an unsustainable position.

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2008 Ranking

October 6, 2008

The latest Economist Intelligence Unit ranking of full-time MBA programmes has placed the Swiss school, IMD, first. Last year’s number one, Chicago, drops to third, while Spanish school IESE climbs to second.

The EIU’s is the most student-centric of the major rankings. The methodology is informed by a survey of well over a 100,000 prospective students spanning more than decade, asking why they decided to take an MBA in the first place. The ranking seeks to answer the questions the students themselves want answering.

However, the unique methodology can throw up some interesting results. Some of the biggest names in the business school world perform moderately by our criteria, while some lesser-known lights shine.

Students who are about to shell out as much as US$100,000 in programme fees (not to mention a similar opportunity cost in foregone earnings), have a right to as many independent assessments as possible. You wouldn’t spend a fraction of that amount on a car without reading a few impartial reviews.

So while there remains some deep-seated wariness, schools now accept that rankings can play a valuable role. And, in any case, students, ever-more willing to scour the globe for the right programme, will continue to demand them. The key to using the rankings is to fully understand the different methodologies used, and then decide whether or not they are relevant to you.

But, at the very least, they provide an endless debating point. So, feel free to let us know where we are right, and where we have got it wrong.

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