This is a presentation intended to stimulate discussions around the future of management education / education at business schools. It outlines a number of macro trends such as tuition and student debt, millennials, competitive factors, etc.
3. STRUCTURE
1. The changing macro environment
2. The changing student landscape
3. The changing competition
4. The changing needs of business
5. The voice of business schools
4. “Of the 26
institutions still
surviving since
the 15th
century, 22 are
universities”
Ives & Jarvenpaa, 1996
AT THE BEGINNING,
THE GOOD NEWS…
5. “Only 500 of the
4,000 plus
colleges are
safe”
BUT ALSO
THE BAD NEWS…
Sellingo, 2013
6. • Business schools as forces of evil?
• Managers, not MBAs (Mintzberg, 2004)
• Management education has little effect upon career
success (or managerial performance)(Grey, 2004)
• Differences in starting salaries between MBA and
undergraduate degree holders, disappear over time
(Pfeffer & Fong, 2002)
• Most programs have been following the same
structure since the 1950s – academic calendars,
business function orientation, seat-time, semester
courses, grade point average evaluation (Friga, Bettis & Sullivan,
2003)
CRITIQUE FROM THE INSIDE
9. • 59% of US companies are
finding it difficult to attract
critical-skills employees
• Once companies do manage
to fill their critical-skills
positions, 36% report
difficulty retaining those
employees
• The fastest growing segment
will be workers aged 45-64.
• Workers aged 40 and above
exceed the number under 40
for the first time ever.
THE CHANGING MACRO ENVIRONMENT
AGING WORKFORCE
10. • WEF: unprecedented developments in genetics, AI,
robotics, nanotechnology, 3D printing, biotechnology
• In May 2015, Uber hired 40 highly qualified researchers and
staff (almost the entire department) from Carnegie Mellon’s
National Robotics Engineering Center.
• According to WEF, 5.1 million jobs in the US will be lost to
disruptive labor market changes over the period 2015–2020
THE CHANGING MACRO ENVIRONMENT
FOURTH INDUSTRIAL REVOLUTION
• 50% of respondents in Pew
Research Center predict massive
displacement of the workforce by
AI and robotics
• 50% of respondents in Pew
Research Center predict no net
effects of AI and robotics on labor
11. • 69% believe office attendance is unnecessary on a
regular basis (Cisco)
• Only 20% say that leaders can be trusted (Pew Research)
• 71% don’t obey social media policy at work (Cisco)
• 40% believe that they should be promoted at least
every 2 years (Time)
• 60% recognize their current position as a mere
stepping-stone (Time)
• 84% say making a difference in the world is most
important (Bentley University)
• 92% believe businesses should be measured by more
than profits (Deloitte)
THE MILLENNIALS
THE CHANGING STUDENT LANDSCAPE
12. UNDERGRADUATES STUDYING
MORE THAN 20 HOURS A WEEK
1961: 66%
2003: 20%
THE CHANGING STUDENT LANDSCAPE
Philip Babcock and Mindy Marks, “The Falling Time Cost of College: Evidence from Half a Century of Time Use Data,” June 1, 2008.
14. 1. 51% of college students had not written
a paper of more than 20 pages in their
senior year.
2. Approximately 45% of students show no
significant gains in critical thinking,
complex reasoning, and writing skills as
assessed by CLA (Collegiate Learning
Assessment)
THE CHANGING STUDENT LANDSCAPE
Arum & Roksa, 2011
STUDENT LEARNING
15. Percentage of A’s
in 1961: 15%
Percentage of A’s
in 2008: 43%
THE CHANGING STUDENT LANDSCAPE
A NATION OF GENIUSES?
Rojstaczer and Christopher Healy, “Where AIs Ordinary: The Evolution of American College and University Grading, 1940-2009,”
Teachers College Record 114, no. 7 (2012)
16. IN 2014, IN THE US:
MORE THAN
900,000
IN 2013, IN
EUROPE: 340,000
FOREIGN STUDENTS IN
THE US AND EUROPE
THE CHANGING STUDENT LANDSCAPE
17. DIVERSITY
•Positive relationship between gender
diversity and performance of companies
(Columbia Business School and another at the Credit Suisse Research Institute, 2012)
•Diverse groups are more successful in
completing their tasks than homogenous
groups (Stanford,
Northwestern University and Brigham Young University, 2009)
•Racially diverse groups outperform
homogeneous groups
(Stanford University, University of Illinois, 2006)
THE CHANGING STUDENT LANDSCAPE
18. 1. Number of institutions of higher
education in India in 1947: 27
2. Number of institutions of higher
education in India in 2006: 367
universities and 18,000 colleges
3. Participation in higher education in China
in 1990: 3 %
4. Participation in higher education in China
in 2006: 22 %
THE CHANGING COMPETITION
GLOBAL COMPETITION
19. 1. University of Phoenix 477,000 students
(2012) and #64 among top 100
advertisers: $614 million (2012)
2. Free alternatives: Khan Academy,
University of the People, Uglobal,
Western Governors University, Udemy
3. First MOOC with 160,000 students
4. 16 million registered users enrolled at
Coursera, with about 1 million in India
5. 5 million students at EdX
6. 4 million registered users at Udacity
7. 15+ US states allow transfer of
Coursera credits
THE NEW COMPETITORS
THE CHANGING COMPETITION
20. 1. Private equity investments in education in 2011: $224
million
2. Coursera raised an additional $49 million in 2015,
and is now valued at approximately $500 million
3. Private equity investments in educational technology
in 2012: $ 1.1 billion
4. Apple iTunes University passed 1 billion downloads
in early 2013
5. MacArthur Foundation’s $2 million prize for
development of “digital badges”
6. 70% of business schools and 90% of employers
agree that technological innovation will bring new
entrants to the business education market (CarringtonCrisp, 2014)
THE NEXT NEW COMPETITORS
THE CHANGING COMPETITION
21. 21
THE CHANGING NEEDS OF BUSINESS
73% of business leaders contend there is a
substantial skills gap in the current U.S.
workforce resulting in:
• Significant rise in talent-related expenses
(replacement costs)
• Negative impacts on innovation, pursuing market
opportunities, key strategic initiatives and growth
(Northeastern Univ)
THE TALENT GAP
23. Graduate Management Admission Council, Poll of Employers, 2015
TOP 5 GOALS COMPANIES PURSUE
THE CHANGING NEEDS OF BUSINESS
1. Improve performance and productivity (60%)
2. Expand customer base (52%)
3. Launch of new products (39%)
4. Cost reducation (38%)
5. Improving customer service (35%)
24. TOP JOBS COMPANIES OFFER
THE CHANGING NEEDS OF BUSINESS
1. Sales (Europe, US)
2. Finance (US)
3. Marketing (Europe, US)
4. Data Analytics (Europe,
US)
5. Operations / Logistics
(Europe, US)
Graduate Management Admission Council, Corporate Recruiters Survey, 2015
26. FACTORS EMPLOYERS CONSIDER
Graduate Management Admission Council, Corporate Recruiters Survey, 2015
THE CHANGING NEEDS OF BUSINESS
1. Proven ability to perform
2. Strong oral communication skills
3. Strong technical and quantitative skills
4. History of increased job responsibility
5. Strong writing skills
6. Industry of prior work experience
27. 87% of leaders say most college graduates lack
the most important skills required to succeed
into today’s workplace
(Graduate Management Admission Council, Corporate Recruiters Survey, 2015)
90% of employers agree that many business
graduates are strong academically, but
demonstrate little evidence of professional
skills
(CarringtonCrisp, See The Future, 2014)
THE CHANGING NEEDS OF BUSINESS
BUT, UNFORTUNATELY…
28. 1. Real world experience
2. Leadership development
3. Communication
4. People management
5. Strategy
THE CHANGING NEEDS OF BUSINESS
UMBS, 2002
EMPLOYERS EXPECT BUSINESS
SCHOOLS TO FOCUS ON
70% (90% in UK) believe that business
schools should develop joint degrees with
employers
(CarringtonCrisp, 2014)
29. • More than 80% expect technology to support delivery of
their studies
• 90% want flexible degrees that allow to mix study and
work (and life) with completion over an extended period
• 60% expect business schools (90% in UK) to develop
more degrees which provide exemptions from
professional qualifications
• 70% expect degrees to increasingly be delivered in
modules, with credit for each part completed
• More than 80% expect a personalized approach to their
experience, especially with career support
CarringtonCrisp, See The Future, 2014
STUDENTS EXPECTATION FROM
BUSINESS SCHOOLS…
THE CHANGING STUDENT LANDSCAPE
30. MANAGEMENT EDUCATION
QUO VADIS?
GERHARD APFELTHALER
MARCH 16, 2016
1. Technology in Delivery
2. Technology as added
value
3. Diversity and
Internationalization
4. Industry integration /
applied nature
5. Liberal studies
6. Convenience
7. Individualization
8. Life-long learning