The MBA for Billionaires

At this international program, there are no apologies for a high price tag.

April 3, 2014

Academics in Britain may be fighting a fifth year of below-inflation pay rises, but some business schools seem to inhabit a different financial universe.

Last month, Times Higher Education attended a champagne reception ­ held at the top of the landmark Gherkin building in London's financial district ­ to celebrate the launch of a new executive M.B.A. The price tag? Nearly
£77,000 (about $130,000) for 20 months' tuition.

"It¹s bloody expensive," said Tom Hunter, the man credited with being Scotland's first billionaire, who is an adviser to the Cheung Kong Graduate School of Business (CKGSB), one of the schools running the program. But, he told the assembled guests, the M.B.A. was also "reassuringly expensive."

Those who take the qualification, ­ reassured by its price or not, ­ will be taught by IMD, the French business school based in Lausanne in Switzerland, and by CKGSB, at its campuses in Beijing, Shanghai and Xian.

In the M.B.A.'s brochure, CKGSB boasts an alumni base of chairmen and chief executives who head companies that account for 13.7 percent of China¹s entire gross domestic product. In other words, their alumni run the rough equivalent of the world¹s 16th-biggest economy. "We have the most powerful alumni in China," Bing Xiang, CKGSB's dean, told Times Higher Education before the reception. "Billionaires come to our school to study."

Just 11 years old, the school now has 43 full-time faculty, of which the "vast majority" have been lured away from a business school in the global "top 15," Xiang said. "We pretty much had to compete head-on with Stanford, with Columbia, with Wharton," he said.

The school is able to do this because it has the backing of the Li Ka Shing Foundation, the philanthropy vehicle of the richest man in Asia, and so is privately funded, unlike other institutions in China.

But another key factor, according to Xiang, is that CKGSB is also the only institution in China to be governed by academic staff, who have secret ballots to decide on strategy, promotions and appointments. He joked that this made him "the least powerful dean in China."

"The [Chinese] government tends to have a heavy hand in the appointment of senior administrators in university academic institutions," he said. Institutional autonomy and financial independence are therefore crucial to attract top U.S. business scholars, who might otherwise fear an overly powerful dean will appoint his "buddies" rather than operating a meritocracy, he added.

Xiang had tough words for most other business schools in China, which he said simply impart Western research to their students. "In China, most of the business schools adopt what I call a teaching factory model, a training company model."

Among other shortcomings of MBAs in China, Xiang listed their failures to teach a "global mindset," to connect "Western theory with Chinese practice" and to develop "softer" interpersonal skills.

In contrast, CKGSB was producing original business research about China rather than regurgitating scholarship based on Western economies, he said.

In its bid to poach "top guns" from the U.S., Xiang acknowledged that CKGSB "cannot outbid the US institutions." But what it could offer, he said, was access to a fast-moving and diverse laboratory for research ­ the Chinese economy itself.

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