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Business Schools

Realistic Expectations

Founded in 2002, the Executive MBA program at the Sino-U.S. School of International Management is a joint venture between the University of International Business & Economics (UIBE) in Beijing and the Robert H. Smith School of Business at the University of Maryland. Most of the students come from the Chinese subsidiaries of big multinationals, including IBM (IBM), Microsoft (MSFT), Ericsson (ERICY), Alcatel (ALA), and Dell (DELL).

The curriculum is identical to the University of Maryland MBA program in the U.S., except for two additional courses on Chinese law and public policy, and all but two faculty members are professors from the U.S. program. One of the two Chinese faculty members is Baocheng Liu, who sat down recently in Beijing with BusinessWeek B-Schools Editor Louis Lavelle to talk about rising tuition, declining company support for EMBA programs, and what it all means for the future of MBA education in China. Following are edited excerpts of their conversation:

In your first class, 70% of the students were fully funded by their employers, but in the second class, the number fell to just 30%. What happened?

Companies feel that paying the students to do the degree program is a dangerous thing. [The students] have bargaining power, and there's more chance that they'll feel dissatisfied with their jobs. [The companies] do not have that high level a position for these guys to take. That's one concern.

Is there another?

The uncontained rise of tuition in MBA and EMBA programs really makes me feel concerned as an educator. China is China. The per-capita income in Beijing is no more than $5,000. Shanghai is a little more than $6,000.

Many companies and now schools have unrealistic expectations for the China market. They think it's a golden opportunity. It is a golden opportunity to grow the market -- but it's not a gold mine.

Do very high tuitions create unrealistic expectations on the part of MBAs? Your own program charges $26,000 for two years' tuition -- more than a year's pay for a typical student.

[The graduates] have to be realistic. We do urge the grads from the MBA program to be realistic about their work. I cannot just say, "I want $30,000." You are not worth that before you can prove it.

You cannot just bring BusinessWeek magazine and tell them, "See the Harvard grads? Over 80% of the guys get a first job with over $100,000." You cannot do that. In terms of their position, [our graduates] have to be prepared to start from the entry level.

What does all this mean for the future of management education in China?

Whether this [MBA] market will grow and how fast is really dependent on the Chinese economy. This is the primary element that really decides how many MBA students we need and what type of MBA students we need. China is still in a transitional period from a planned economy. We used to have [administrators], not managers.

Now these [administrators] are in a rush to learn the proper management skills and philosophy. The other growth will be the entrepreneurs. They used to be opportunists -- they used guts without rational calculation. These two types of people are in the dominant position of Chinese management, so they do need training. The EMBA program is very much catered to their need.

What's at stake for China itself? If Chinese B-schools can't produce enough MBAs to meet all the demand, what will happen?

I could see that China would hardly be sustainable without proper management. For the last 20 years, we achieved double-digit growth every year, but there's a danger to this fact. If we continue this way, there's heavy energy consumption, heavy pollution, and heavy reliance on cheap labor. How long can China provide those?

China is really a resource-scarce country per capita.... How long can we sustain it this way? You've got to properly allocate your resources to make it more sustainable. I can see that the infusion of business education in a more systematic way can really bring very visible -- if not revolutionary -- effects on the productivity of the companies, even if they're state-owned.

With tuitions rising, employer support waning, and prospects for landing a plum job post-MBA less than ideal, what motivates students to devote two years of their lives to a business degree?

With all programs, [students] really hit two birds with one stone. Many of the people learn English for 10 or 15 years, but they can't be as fluent because they've been left out of a completely English-speaking environment. [In B-school], they really can improve their English, along with the fact that they progress very well in the business-management courses. UIBE and [the University of] Maryland are really reputable names. Another motivation for them is that they can have a good network with two alumni [groups].

There has been a lot of criticism of joint-venture programs like yours that use Western case studies and Western teaching techniques in their Asian programs. Do you think your program should adapt its methods to its Chinese audience?

In terms of teaching styles...there's not much adaptation necessary. They come here for American-style teaching. For Chinese-style teaching, they can shop anywhere. The whole pedagogical structure [here] is very American.

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