FROM SA TO THE WORLD
Foreign business schools see Africa as a future source of MBA students
South Africa is becoming the target for international business schools anxious to sign up the country’s high-calibre students, but also to create a launchpad into the rest of Africa. Faced with ageing populations in traditional markets, they are lured by the size and relative youthfulness of the African population.
At an MBA expo in Joburg this month, a record 12 foreign business schools from as far afield as Spain, France, Switzerland, Canada, the UK and the US touted their programmes to students potentially keen to broaden their education horizons.
Segran Nair, director of Milpark Business School — one of several local institutions whose MBAs are internationally accredited — believes it’s only a matter of time before more major foreign schools establish South African campuses.
Henley Africa, an offshoot of UKbased Henley Business School, has been here for many years and become a leading member of the local business schools community. Its South African MBA students are among the top achievers in the global group.
More recently, Duke Corporate Education, part of Duke University’s Fuqua School of Business in the US, has carved out a sizeable share of the local executive education market not only by bringing international expertise to the game but also tailoring it to local needs.
Not everyone achieves that. Australian and UK schools tried and failed in South Africa, mainly because their local MBA programmes were virtual carbon copies of those offered by their parent universities, with limited relevance to the local market or the broader African ones.
That remains a potent argument against foreign MBAs. During audience discussions at the recent expo, local and overseas school representatives traded opinions about whether a US MBA, for example, prepared South African students for a career in Africa. While there is no doubt many business principles are global, local or regional realities are not.
“Foreign MBAs lack African context,” says DaVinci Business School CEO HB Klopper firmly.
For many South African students, however, that is not an issue. Local business schools may be world class, and have the international accreditations to prove it, but the perception that a foreign MBA is superior can’t be eradicated.
In some cases, the African focus of a local qualification can seem a disadvantage. For the growing number of South Africans planning to quit the country and make their fortunes elsewhere, an African slant is the last thing they want.
Representatives of foreign schools at the expo — even those that have attracted South African students before — admit they were surprised by the increased level of interest.
Daniella Wagner, marketing and recruitment assistant director for the executive MBA programme at Insead Business School, reveals that the Parisbased institution already has more than 900 South African alumni, though not all for the MBA.
The University of St Gallen in Switzerland is “in an exploratory phase to assess the level of increased demand”, says marketing and talent manager Andrea Echeverri.
As for the US,
South African students are prized not just for their academic talent but for the different perspectives they bring to the classroom, according to Rebecca Mallen-Churchill, recruitment director for the WP Carey School of Business at
Arizona State University.
Jako Volschenk, MBA head at Stellenbosch Business School, says: “South Africans are used to obstacles and to the going being tough in ways that other students can’t comprehend. They bring a different and balanced context to the classroom.”
Students aren’t the only ones eyeing the international route. Market research for this cover story shows some employers think their executives can benefit more from the cachet of a foreign MBA. Their favourite, perhaps not surprisingly, is Harvard Business School in the US, followed by London (UK), Insead, Stanford (US), Cambridge (UK), MIT/Sloan (US), Oxford (UK) and Columbia (US).
The last of these topped the 2023 London Financial Times ranking for the world’s best full-time MBA programme.
One of the main drawbacks of a foreign MBA is cost. Local programmes in 2023 are priced from below R100,000 to just over R500,000. Study at a reputable school in the US or Europe and you’ll be very, very lucky to get change from R1m. At some the real cost can be double that.
That may be fine for a corporate sponsoring one of its high-flyers, but a selffunding individual?
Don’t panic. Echeverri tells the FM that South African students can apply for
St Gallen bursaries worth up to 40% of programme costs. Some US schools say their scholarships run as high as 70%.
A number of companies offer studynow, pay-later deals to South Africans studying overseas. Megan Williams, student adviser at Sable International, says her company is helping scores of young South Africans in this way.
Repayment may be less traumatic than students think, says Vivien Tran, recruitment and admissions manager at the University of British Columbia’s
Sauder School of Business in Canada.
She says North American student visas allow recipients to live and work there for a period after completing their courses. In Canada, an MBA graduate can stay up to four years. Make a success of your time there and you’ll be repaying rand loans with dollars.
None of this is meant to detract from the value of a South African MBA. Four local schools can boast the “triple crown” of international accreditation: from the Association of MBAs, or Amba, in the UK; the Quality Improvement System from the European Foundation for Management Development, better known as Equis; and the Association to Advance Collegiate Schools of Business in the US.
As of June this year, only 124 business schools around the world, of an estimated 30,000, held that triple crown distinction. In addition, eight local MBA programmes are accredited by Amba. What all this adds up to is that South African business education is world class.
This quality is what makes the country such a desirable target for foreign business schools, says Stellenbosch director Mark Smith. “It is a recognition of the talent that exists in the country but also perhaps the potential role of South Africa as a hub for management educa
tion on the continent.”
Some leading European and US schools have already created satellite campuses in Asia, Africa and the Middle East, so setting up shop here would be a continuation of this activity. In fact, Smith considers it inevitable.
“One of the key characteristics of the markets these international schools originate from is that they are rather saturated and that the populations are ageing. As in any sector of the economy, organisations facing saturated markets seek new markets to sell their products and services,” he says.
“Unlike Europe, North America and parts of Asia, where birth rates are falling below replacement rates, Africa offers an expanding supply of young people.”
Global demand for postgraduate students is sky high. A Netherlands student portal lists more than 22,000 master’s degrees in business and management around the world. With the breakdown in international boundaries through online teaching, accelerated by Covid, South Africa is bound to become a battleground.
“One does not have to spend much time on social media in South Africa before an advert appears from an overseas university offering an online or hybrid programme,” says Smith.
The competition is not just for South African students, but for those across Africa and beyond.
“South Africa has world-class business schools, world-class facilities and world-class accreditations,” says Smith. “With an openness to world-class academics and students, it could become a key educational destination for the continent and an important export industry for the country.”
firms are reducing MBA sponsorship of employees. “They feel that they are paying people to be away.”
Graduates who completed their studies during Covid are overwhelmingly negative (72%) about missing out on the expected student experience. Besides the loss of classroom contact, a major gripe was that there was “no distinction between work and home chores”.
Other students couldn’t have been happier. Says one: “Covid had a positive impact on my MBA experience. Working from home gave me more time, and time was what I needed.”
Most new students registering for 2023 MBAs opted for programmes with some level of “live” human contact. Business schools are keeping their options open, with a growing selection of alternatives.
As a speaker remarked at an MBA expo in Joburg this month: “Selecting an MBA has become a minefield: full-time, part-time, hybrid, blended, distance, online, one-year, two-year and even fiveyear programmes, synchronous, asynchronous, block release study, weekend studies ... How do you begin to choose?”
What does this all
mean for the future of MBAs? That’s the catch. No-one can be certain, says Peet Venter, academic director at Unisa’s Graduate School of Business Leadership. “We’re all guessing what the best MBA model should be but we can’t be sure. We may think we know but we have to be prepared to be wrong.”
Johannesburg
Business School (JBS) academic head Tankiso Moloi can attest to that. Online MBA teaching sessions traditionally happen during evenings or at weekends. JBS decided to experiment with 6am-9am weekday lessons, to see if there were any takers. There were — far more than expected. The early-morning shift, allowing students to complete their classwork before the work day, is now a popular part of the MBA programme.
Other schools are experiencing similar demand. At North-West, Grobler says students are even asking to sit exams at 6am.
Some academics argue that this is all part of the post-Covid transition to a new way of everything. Stellenbosch Business School MBA head Jako Volschenk isn’t so sure. He says: “We are still battling to understand what post-Covid means or if we are indeed post-Covid.”
Management College of Southern Africa academic director Paresh Soni suggests that the term “post-Covid” gives people a “certain level of comfort” because it suggests they are in a new era over which they have some control. But
We’re all guessing what the best MBA model should be but we can’t be sure. We may think we know but we have to be prepared to be wrong
“I wouldn’t like to try to define what the world is going to do”.
The “new normal”, if there is such a thing, is throwing up countless challenges, says Volschenk. “Bosses say to us: ‘How do I work with people I never see?’ We are still trying to come to terms with what remote working means, and how we prepare students for that.”
He adds: “Academics are starting to catch up on this but it’s a grey area in the market.”
This future uncertainty provides a “brilliant opportunity” for business schools to reassess everything they do, says Soni. “There’s no one silver bullet solution. Instead, we should all take a fundamental relook at the way we operate.
“The situation forces us to face up to what we are teaching, assessing and creating.”
For example, future executives will need to understand not just AI but also issues such as cybersecurity. “How do we integrate these into the MBA when it is not a technical degree?” he asks.
Peet Venter
Many elements of pre2020 MBA education remain. One is the steady decline of the full-time South African MBA. Only three business schools — Regenesys, the Gordon Institute of Business Science (Gibs) and the University of Cape Town’s Graduate School of Business (GSB) — still offer one.
Of 7,483 applications to study an MBA in 2023 at the 17 schools participating in our research, only 164 were for a full-time programme. Just 53 of those enrolled, from a grand total of 2,679 new MBA students.
Wits Business School is considering the reintroduction of its fulltime MBA, which it halted some years ago, but is gauging demand before it commits. “It’s on the horizon,” says academic director Logan Rangasamy.
Being such an exclusive product may explain why the cost of a full-time MBA has risen faster than for other forms of study. Since last year, the average full-time fee is up from R276,308 to R326,616. For others, it’s risen from R214,711 to R234,305.
However, as can be seen from the table “The Burning Question”, it’s hard to draw a direct competitive line between different schools’ fees without putting readers to sleep with detail. For example, some schools’ fees include the cost of an international study tour.