MANAGEMENT: Asian MBA programs, 1995
Masters of their Own Destiny
Asia-Pacific MBA programs are a major growth industry, promising fast-track
careers to the brightest graduates. But student hopefuls should beware of
Roc Peng Yang balances his tuna sandwich and soup on a plastic tray as he
heads to the cash register. This is his third week at school, and the cheap-and-cheerful
canteen culture is light years away from the black-tie dinners he attended
as a senior interpreter with China's Foreign Trade Ministry. In that role,
Peng would emerge from the shadows to repeat in palatable English the ministry's
dire threats against the U.S. for linking China's most-favored-nation trading
status with human rights.
Those were heady days, but Peng, 26, wanted a change, a new stimulus. The
kind of challenge, and enhanced career prospects, offered by a master of
business administration (MBA) program. When Peng graduates from the University
of New South Wales in 1996, he can expect a salary of more than $ 50,000
a year from a China-invested multinational eager to capitalize on his newly
learned skills and guanxi (connections).
Hong Kong's Michelle Ho, 23, also sees an MBA diploma as a passport to a
new career. After two years with the accountancy firm Arthur Andersen, Ho
enrolled in the program run by the swanky new Hong Kong University of Science
and Technology. "Without an MBA, I'd have to work as an accountant for the
rest of my life," she says.
Across Asia, as some economies grow at gravity-defying rates and others emerge
out of self-defeating autarky, young men and women such as Peng and Ho are
setting aside two years to try to inscribe their names on the MBA roll call.
This is no soft option. For a start, it's expensive. And it requires spunk
to gamble the present on the future and give up a well-paid job.
Besides, the program itself can be grueling and tedious.
Candles burn late as students wade through screeds on topics as diverse as
power pricing in California and handling a strike in Tanzania, and wrap their
weary brains around arcane mathematical equations. Cold fried rice, stale
pizza and hot coffee become nightly staples.
Yet each year more than 100,000 status-seekers worldwide commit themselves
to this grind, and for a very good reason. An MBA degree can put managers
on the express elevator to their organization's upper echelons and bring
a salary that trails many zeros, as well as all the other perquisites of
fast-track Corporate Man (and Woman). Of course, you don't have to have an
MBA to live in a waterfront condominium, drive a plush car and flash a gold-tinted
credit card, but it certainly doesn't do any harm.
Terence Leung, 30, has no need to worry about his place in a corporate hierarchy:
He has worked for six years in the family company. But he was determined
to bring all the skills of the model manager to his job, and so enrolled
in the Hong Kong University of Science and Technology MBA program. "As (my
company) grew and expanded, we needed to be more efficient," he says. "We
needed more experts in accounting and computing. As a project manager, I
needed these skills and I didn't have them."
Given Asia's hunger for knowledge, regard for academic credentials and rising
disposable incomes, MBA programs are enjoying a surge in popularity. The
prestigious Indian Institute of Management school in Ahmedabad receives nearly
25,000 applications every year for its 200 places. Institute Director Pradip
Khandwalla says overseas applicants don't stand a chance. Lee Kam Hon, dean
of the business school at the Chinese University of Hong Kong, adds: "Asian
MBA programs can be competitive but they are overwhelmed by local demand."
This year, Asia, Inc. ranks the Top 25 Asia-Pacific business schools that
offer full-time, two-year MBA degrees (see page 48). In evaluating them,
we have given due weight to subjective criteria such as reputation among
recruiters and academics and overall academic excellence, and objective criteria
such as entry requirements, alumni network, strength in original research
and employment-placement record.
For many Asian students, an Asia-Pacific MBA makes compelling sense. Moreover,
by bunching together bright young minds in a full-time MBA program, business
schools can create embryonic networks of managerial talent that will help
to drive the region's economies of tomorrow. An Asia-Pacific MBA has at least
five significant advantages over those offered elsewhere:
Cost: A two-year program at Harvard Business School in Cambridge, Massachusetts,
reputed to be among the best in the world, could easily cost an Asian student
a cool $ 60,000 in tuition fees, learning materials, and accommodation and
other living expenses, compared with $ 25,000 at most for a course closer
to home. Says Burmese trader Felix Nyuntwai, 41, who chucked his emerging
business in Singapore to pursue an MBA in Australia: "In the U.S., I'd pay
four times as much. Frankly, I don't think that's worth it."
The Indian Institute of Management offers a quality program at a mere $ 1,500
a year. Yet management consultancies such as McKinsey & Co. and Coopers
& Lybrand line up to cherry-pick the school's top graduates with the
lure of glamorous international careers. One example: Bank of America Senior
Vice President V. Shankar, who at 37 manages the bank's U.S.-based Asia banking
unit, is a graduate of the institute's Bangalore school.
Proximity: In terms of cost and convenience, this is an important factor.
Students can live at home, or at least keep traveling costs under control
by avoiding the U.S. or Europe. For example, nearly 7,000 Malaysian students
go to Australian universities each year, among them Malaysian Chinese squeezed
out of higher education at home because their government's economic blueprint
sets quotas favoring the admission of bumiputras (indigenous Malaysians).
Networking: Some believe the pool of U.S. alumni in Asia is too small for
effective networking. That point is not lost on Hong Kong University of Science
and Technology student Leung: "If you go to (the U.S.), half of your classmates
will stay behind in the States. If you come here, most of your classmates
will be in Asia."
Age: Overseas students are rarely accepted at a respected MBA program in
America immediately after completing an undergraduate degree. Many Asian
schools also insist on prior work experience, but they are better able to
evaluate the merits of young Asian high fliers. Vijaya Manerikar, director
of the Jamnalal Bajaj Institute of Management Studies in Bombay, says: "This
is a cultural phenomenon. In India you are expected to complete your education
early and then get on with your working life."
Relevance: Curriculum can be the best competitive advantage for Asian schools,
though they suffer in any comparison with the West on the quality and quantity
of their case studies -- the means by which students analyze real-life business
problems and explore solutions. Says Jess Gallegos, dean of the Asian Institute
of Management in Manila: "I admit that most Asian business schools use American
materials and framework. But Western schools lack focus. The Asian management
environments often depicted are from Japan, Korea and more recently China.
There is seldom enough focus on South Asia and Southeast Asia."
While Asia-Pacific schools can't yet boast of an Ivy League freemasonry or
an Oxbridge old boys' network, the best programs have the budgets to woo
top faculty, expand their research base and build high-quality libraries.
No wonder eager blue-chip recruiters stalk their campuses to hire the most
With an admired teaching staff, which has close ties with the international
academic community, and its strong case-study program, the Melbourne Business
School at the University of
Melbourne takes the No. 1 position on the Asia, Inc. list of the Top 25 Asia-Pacific
business schools. Foremost among its credits is that it has developed a global
curriculum with a sharp Asian focus.
According to the school's director, John Rose, today's Asian students are
much more willing than their predecessors "to participate in class, take
the initiative, organize activities." An Asian alumni network is also developing:
MBA students contact successful new overseas applicants, put them in touch
with Melbourne alumni in their home cities, offer to meet the new students
at the airport, and ease their transition into a new environment.
Fred Hilmer, who was managing director of the Australian offices of McKinsey
before becoming dean of the Australian Graduate School of Management at the
University of New South Wales (No. 2), argues against garnishing an MBA program
with a specific Asianness. "A good MBA curriculum uses its material like
a skeleton," he says. "The flesh comes from the students. If you have a class
with a good international mix, you will have an Asian flavor without having
to publicize it."
The Asian Institute of Management (No. 4) does not want for an Asian flavor.
Set up in 1968 with the aim of being the best business school in the region,
its staff is proud of a program that Gallegos describes as "practitioner-oriented."
Half its professors have served as chief executives or chief operating officers,
worked for the government or run their own business. Many are directors of
Another of the institute's undeniable strengths is its 22,000-strong alumni
network across Asia. Gallegos says: "You can look in the alumni directory,
call up that person, introduce yourself as a fellow alumnus and your foot
is in the door." On the downside, campus space is at a premium: Students
often have to meet in campus lounges for group discussions.
By contrast, the Indian Institute of Management school in Ahmedabad (No.
5) is set in a secluded suburb, with a striking complex designed by renowned
architect Louis Kahn. The institute, set up in 1961, began by using case
studies from Harvard University, but the faculty quickly realized that was
not enough. A vigorous case-writing program has yielded over 2,000 studies
from companies in South Asia, East Asia and East Africa.
Anupam Puri, managing director of McKinsey in Bombay, says: "I don't see
very much difference between the best people coming out of Ahmedabad and
the best people coming out of Harvard or Wharton (at the University of Pennsylvania),
with the very important exception that these people are 24 and not 28."
Perhaps the most ambitious emerging business school is at the Hong Kong University
of Science and Technology (No. 7). Associate Dean Leonard Cheng says: "We
want to be one of the best business schools in the world. We set the same
standards in terms of teaching and research as they do." The four-year-old
university's high-tech design integrates 12 buildings within one complex
in scenic Clearwater Bay.
Just edging it out for top honors in Hong Kong is the Chinese University
of Hong Kong (No. 6), perched on a beautiful mountainside overlooking the
New Territories, which launched the territory's first MBA program in 1966.
With an annual budget of $ 45 million, it can buy the best. Moreover, its
faculty has unmatched access to companies across the border in China.
At Singapore's Nanyang Technological University (No. 14), the MBA program
stresses the Asian business experience. Based in a huge, airplane-shaped
complex 25 kilometers from the island's business district, the business school
requires students to participate in study missions to China, India, Malaysia
and other Asian countries. Vice Dean Toh Thian Ser says: "We cannot depend
only on teaching tools like cases from the mature economic models of the
West, since the concerns in our region are different. We are obsessed with
growth but American companies are obsessed with downsizing and consolidation.
Our businesses need to follow strategies that increase and sustain this growth."
Set in a sylvan campus beside Canberra's Lake Burley-Griffin, the Australian
National University (No. 10) has developed a new "boutique" course (its MBA,
in a neat twist, stands for Managing Business in Asia). Director Bruce Stening
says: "Our program was developed with a specific focus to improve the ability
of managers to successfully undertake business in the world's fastest-growing
economies." The program is small (43 students) and the classroom is exceptionally
multicultural: A prayer room is even provided for Muslim students. Student
James Horton, 32, a naturalized Australian born in Malaysia, says: "I wanted
a program with an Asian focus. It is critical if you want to succeed."
Despite major investments in gleaming school buildings and talented faculty,
the best Asia-Pacific schools remain poor cousins of their Western counterparts.
When Asia, Inc. listed the Top 25 business schools in the world for Asian
students a year ago (see "A Major Business Asset," September 1994), the Melbourne
Business School was the only one outside North America and Europe to creep
into the reckoning (in 25th position).
With the notable exception of the best in Australia, and perhaps the Asian
Institute of Management, no school in the Asia-Pacific region is truly pan-Asian.
Because most programs serve mainly domestic needs, their MBAs are a less
portable asset. A Hong Kong recruiter, for example, is unlikely to be impressed
by a job applicant waving an MBA diploma from a university he has never heard
of in, say, Thailand.
With the boom in MBA programs, quality control will increasingly become an
issue. India, which generates nearly half the MBAs in the world outside Europe
and the U.S., has authorized 400 new business schools. Says Khandwalla of
the Indian Institute of Management: "Where is the faculty going to come from?
Anyone who wants to start a business school seems to be able to do so. What
is the worth of such a diploma?"
In a recent expos on an Australian television program, Sunday, University
of New South Wales lecturer David Clark said the country's universities were
lowering standards to pursue fee-paying overseas students (mainly Asian),
some of whom went home with "Mickey Mouse" degrees. Curtin University in
Perth and the University of Wollongong have sacked academics who complained
that standards were being compromised.
Also in Australia, the University of Newcastle is proposing to lower its
admission qualifications by offering an MiBA, or Mastersin International
Business Administration. Its rationale: Getting into traditional MBA programs
is too tough for some overseas students, though they are willing to pay top
dollar for the degree. Solution: Change the curriculum to make entry easier.
Result: a profit of $ 700,000 by the third year (if all goes to plan).
Meanwhile, Western schools won't readily concede their supremacy to the Asia-Pacific
upstarts. Distance and cost are hurdles that can be vaulted: Boston University,
for example, runs a full-fledged program in Japan; Wharton offers week-long
China-focused programs for $ 1,500 per student. However, these are substitutes,
Most of the case studies used in Asian business schools were written by Harvard
tutors and relate to Western experiences. The better Asia-Pacific schools
are developing local cases. But they are being challenged from an unexpected
quarter: Some of the best Asian cases today come from the Euro-Asia Centre
at the European Institute of Business Administration (better known by the
shorthand term INSEAD) in Fontainebleau, a tree-lined modern school outside
Paris. Harvard, too, is expanding its vistas, asking two Hong Kong-listed
companies, Li & Fung (Trading) Ltd. and First Pacific Co., to take part
in case studies.
In short, Asia-Pacific schools still have to go some way to prove that they
are worthy alternatives to their Western counterparts. But students like
Roc Peng Yang at the University of New South Wales are not complaining. He
says: "The opportunities are great in China now, far better than anywhere
else in Asia." At such a time, those with the right credentials -- an MBA
of course, among them -- can almost write their own paychecks.
Additional reporting by Allen Tien-Jen Cheng in Hong Kong and Miguel Bernas
Salil Tripathi, Asia, Inc.'s Singapore-based correspondent, obtained his
MBA from the Amos Tuck School of Business Administration at Dartmouth College,
New Hampshire. He chose journalism as a career, and does not get to write
his own paycheck.