Henley Business School in the UK recentlycancelled its full-time MBA programme for the 2019/2020 academic year, the first time a large UK institution has done so for this flagship business course. The programme had beenranked number five in the UK, and 14th in Europe, by the Economist's full-time MBA rankings in 2018.
This understandably sparks concern for the MBA's relevance and longevity, globally and in South Africa. Henley cited lack of demand as the reason for cancellation, driven by increasing fees, with applicants in the early stages of their careers opting for shorter courses or specialised degrees as a more cost-effective alternative.
This mirrors a growing trend in the US - the Graduate Management Admission Council (GMAC) reported a 7% drop in applications to US MBA programmes last year, following a decrease over the last four years. Full-time MBA programmes seem to be most affected, with more than 70% of business schools reporting a decline in applications in 2017.
In South Africa we see similar trends playing out. In some cases, these are magnified due to our unique and challenging socio-economic context. To stay relevant and competitive, business schools in South Africa must pay attention to five key emerging trends.
1. The need to bridge theory and practice
The traditional MBA model is steeped in business theory, but for the last 20 years or so, the relevance of this approach in a complex and emergent world has been increasingly interrogated. Rather than focusing exclusively on core business principles, we believe that the future of business education lies in bringing the worlds of learning and practice closer together.
The reality is that managers and leaders don't operate on a plane removed from the world around them where they can employ abstract, rational thinking to lay out their options and pick the most applicable theory. They are constantly in situations that require on-going adjustments and adaptations rather than pre-determined plans. To be successful in this kind of context you need a certain amount of practical wisdom that only comes from experience.
READ: Business interrupted: How leadership needs to adapt to a changing world of work
Augmenting the MBA's business fundamentals with experiential learning is therefore vital to ground students in the realities they need to face to lead in a complex environment. This needs to be achieved through a variety of approaches including the study of relevant case studies, reflection on one's own experience and practical or consulting assignments.
2. The need for resilient leadership
Klaus Schwab's seminal speech at the World Economic Forum (WEF) in 2016 pointed to the accelerating rate of change facing the ways we live and work, and the difficulties in training a workforce for a future we cannot yet imagine. In such a world, talent, more than capital, will represent the critical factor of production.
Organisations and people need to be adaptable, innovative and responsive, which requires MBA programmes to cultivate essential capabilities such as creativity and emotional intelligence in order to develop resilient leaders. The WEF's Future of Jobs report identified the top three skills that will be most needed in 2022: analytical thinking and innovation; active learning and learning strategies; and creativity, originality and initiative. Many of these are already part of good MBA programmes, because we have long understood the importance of the softer skills of human interaction in effective management and leadership.
It's essential to instil in students an attitude of lifelong learning. Graduates should be accomplished and knowledgeable, of course, but they also need to be humble and emergent. They need to understand that even though they have a degree under their belt, they may have less agency than they would like in a complex system. To navigate this world, they need to be able to reflect on their context and who they are, in order to make sense of where they have come from and step boldly towards the future.
3. Creating formats that speak to different demographics, experience and business needs
The traditional MBA programme was all about developing a "well-rounded" manager.
It was, in its essence, a generalist degree developed in the age of industrialisation, but this is changing. Fifty years ago, when the UCT GSB launched its first MBA, the class was exclusively white and almost entirely male, and all came from industry. Today, our classes reflect a much wider demographic and experience base that needs to be valued and accommodated.
Both the kinds of skills needed, and the way students acquire those skills, are changing. An increasing number of business schools globally now offer a range of options both in terms what you can study (specialisation streams) and how you can study it (modular, part-time or blended learning).
We are also seeing a heightened degree of collaboration between business, government and educational institutions to co-create relevant curricula that meet current and future needs. Educators supply industry with critical skills. In turn, industry should have a hand in shaping the talent pool, as well as informing educational institutions of the changes they foresee and the skills they wish to develop.
4. Responding to the rise of social and environmental concerns
One field of study that is enjoying more and more interest, especially in South Africa, is social innovation and entrepreneurship.
MBA students are increasingly motivated to make a difference in the world and view business as an agent of change, rather than just a way of generating profit. A recent GMAC study surveyed 5 900 MBA applicants across 15 countries and found that 12% fall into the "impactful innovators" segment. In Africa, 32% of applicants are in this segment.
READ: Want to expand your business in Africa? Toss the 'cut and paste' strategy
Another global study conducted at 29 top business schools concluded that students overwhelmingly consider environmental protection as vital to improving economic growth and providing employment, and that one-fifth expressed unwillingness to work for organisations with bad environmental practices - no matter what the salary.
In a country known for its stark wealth gap and mounting social and economic troubles, an MBA programme that aligns its teaching, processes and content with a societal focus will stand out from the rest.
5. Widening access through support and funding
Last but not least, the MBA is a premier degree and it comes with a high price tag, particularly for full-time MBA programmes, where students forego income in order to study.
In this country there are many strong candidates who meet the entry requirements for the degree but lack financial resources. It is therefore critical to make funding and scholarships available to high-calibre applicants. Scholarship opportunities further any school's objective of increasing student diversity to better represent the market that they serve.
Additionally, in a country of unequal access, we need to recognise prior learning as part of the entrance criteria for those who may not have the prerequisite degrees. Recognition of prior learning is the identification, assessment and acknowledgement of the full range of an individual's skills, knowledge and work ethos obtained through informal training, certificated learning, non-accredited courses, workshops, on-the-job experience and life experience.
Widening access to the MBA is critical for mending the skills gap in our economy. Increasing student diversity - across race, gender, age and educational background - ensures greater societal impact but also enhances the experience of each cohort through offering a wider perspective.