Chinese Businesses are Conquering The World. But without quality MBAs, they could just find themselves up The Creek without a Paddle

When it comes to enthralling the global market with their products, Chinese companies seem to know it all, with Chinatowns dotting the landscape across the globe. Unfortunately, Chinese B-schools haven’t made the same kind of impact globally, in fact, not even in China, leave a puny handful! However, this one comes as a blinder. A cursory look at the 2011 Financial Times B-school rankings makes it clear how global management philosophy is undergoing a transformation. Way back in 1999, the FT rankings showed that 20 of the top 25 B-schools were based in the US. In 2011, only 11 of the top 25 B-schools belonged to the US. What is even more surprising is the entry of a Chinese B-school (which was until recently alien to world of B-school rankings) in the list of the top 20. Surprisingly, the China Europe International Business School (CEIBS) (ranked 17th globally) was established in 1994 and didn’t even have a formal global accreditation till 2008.

Then, there are a few more like Antai School of Business, Fudan University-MIT Sloan and the Beijing International MBA at Peking University, which have just about started making marks on the MBA landscape. But once the dust from these global management education rankings settles down, the jolt of realism is bound to set in. Indeed, as things become clearer, you find pressing challenges facing China’s B-school boom. For starters, the world class management schools we just mentioned have either been set up in collaboration with the likes of MIT Sloan or have been founded through a consortium of Western Universities.

The fact is, despite being an economic powerhouse, China lags behind in the pecking order of globally relevant business education. A report released by McKinsey, ‘How to address China’s growing talent shortage’ shows how this problem is deeper rooted then one can imagine. Some 44% of the executives surveyed by McKinsey at Chinese companies reported that insufficient talent was the biggest barrier to their global ambitions. The report further adds that 37% responding companies to an AmCham Shanghai survey of US owned enterprises said that recruiting talent was their biggest operational problem.
Prof. Mauro F. Guillen, Director of the Lauder Institute, The Wharton School, University of Pennsylvania reaffirms this looming situation as he exclaims, “One of the most significant bottlenecks that the Chinese economy is facing has to do with qualified human resources. When an economy grows at 10% for 30 years, you are bound to have this problem. China is sending a lot of graduates abroad to pursue advanced degrees, but not all return. Thus, it is key for them to invest locally in business schools. Given that all US and European schools want to set up operations in China, I would predict that in 10-20 years this will not be a problem. However, local B-schools with no foreign connection will remain an issue.”

This is reaffirmed by The Institute of International Education (IIE), which describes China “as the largest supplier of international students to countries around the world over the past decade”. The fact that Chinese students are the single largest group of students in the UK (outnumbering students from even EU countries) speaks volumes about the state of higher education in the mainland.

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Source : IIPM Editorial, 2011.

An Initiative of IIPM, Malay Chaudhuri and Arindam chaudhuri (Renowned Management Guru and Economist).

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