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November 2013

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The Alsop Perspective: The New and Perhaps Final Frontier of Graduate Management Education

By Ronald Alsop

Africa is the new and perhaps final frontier for graduate management education. Given the continent’s expected economic and population growth, its need for business leaders will certainly intensify and its pool of potential MBA students will expand rapidly as well.

“There’s strong economic growth in some of the countries in Africa, and they need to grow management talent to advance further,” says Ronald Sibert, GMAC’s director of business development in Africa. To help fill the management pipeline, “you’re looking at 48 percent growth between 2010 and 2030 in the age group between 21 and 29; that’s about 80 million people.”

With such striking demographics, it isn’t surprising that GMAC and educators both inside and outside Africa are trying to boost the number of applicants to MBA programs. But first, they must overcome some significant obstacles. Many young people in Africa lack the financial resources to pay for an MBA degree, and some aren’t academically ready for the GMATexam or the demands of a graduate business school.

“Financial issues are the number one concern among Africans, and scholarship opportunities are limited, as is information about how to get them,” says Suzanne O’Brien, executive director of the Foundation for African Leadership in Business, which offers MBA fellowships to African citizens.

 The critical point is that schools and our corporate partners, [which include Google and GMAC], need to work collaboratively to provide solutions.

Suzanne O’Brien, Executive Director
 Foundation for African Leadership in Business

The foundation encourages business schools to become partners and offer full scholarships to African students. Thus far, IE Business School, Thunderbird School of Global Management and Vanderbilt University’s Owen Graduate School of Management have signed on with the foundation.

Separately, Stanford University’s Graduate School of Business is awarding as many as eight fellowships annually to African citizens to cover the tuition and fees of $140,000 for its two-year MBA program. “The spirit of the fellowship is to encourage Africa’s development; the recipients must return to Africa within two years of graduating,” says Sabah Khan, assistant director of MBA admissions. Because of Africa’s growing economy, “it’s also important to have the voices of African citizens represented in our classrooms.”

Meanwhile, GMAC is working in Africa both to increase awareness of graduate management education and to help prospective students boost their GMAT scores by preparing more effectively. Sibert found that test takers in Africa typically don’t spend enough time getting ready for the GMAT exam; instead, they study the night before the test, as they might for a classroom exam. “We called it last-minute Nigerian mentality when I was talking to the dean of the Lagos Business School,” Sibert says.

So far, however, there’s been limited progress in attracting more test takers. The number of African citizens taking the GMAT has hovered between 6,000 and 6,500 in recent years. The number fell to about 5,500 during the 2012-13 testing year, but GMAC considers that drop a one-time aberration. The number of those test takers who lived in Africa totaled 3,424.

Several African schools accept the GMAT exam, but it’s required at only the University of Cape Town’s Graduate School of Business in South Africa. Test scores are important, of course, when Africans apply to schools abroad. More foreign schools are sending representatives to Africa to recruit students, and a few, including China Europe International Business School and Henley Business School, have established management education programs on the continent.

But given the limited pool of qualified MBA candidates in Africa, some local educators are wary of such competition and the lure of scholarships to well-known overseas schools. Although some scholarships stipulate that the recipients return to Africa after getting an MBA degree abroad, African business school officials still worry that graduates might be tempted by jobs and higher compensation to stay in the US or Europe.

“Western schools are competing with us and other local programs for students, and I’m not sure they are really thinking about the economic development of Africa as much as they are about enriching their MBA classes with the perspective of a few African students,” says Walter Baets, director of the University of Cape Town’s Graduate School of Business and the incoming chairman of the Association of African Business Schools.

While the need to produce more African business leaders is quite clear, Baets believes a Western-style graduate management program may not be the best approach. “We don’t want to recreate Harvard in Africa,” he declares. Instead, he contends that Africa needs a new business school model to prepare students for an economy with a high degree of complexity, uncertainty, and inequality and poverty. “We should give more attention to social innovation to help solve our issues,” he says. “Africa needs more inclusive business models that focus on developing the base of the pyramid and creating shared value.”

Baets does appreciate assistance from other countries in trying to improve the quality and reputation of Africa’s own business schools. He favors more academic partnerships with other universities, including joint degree and research programs. Currently, he says, his school is in talks with the Massachusetts Institute of Technology about a relationship that would involve sharing knowledge about innovation.

While the University of Cape Town boasts triple accreditation by AACSB International, the Association of MBAs and the European Foundation for Management Development, some of the newer business schools in Africa still lack such endorsements.

One of the big challenges is the development of a local pool of talented professors. Because of the salary differential, it is often difficult to attract professors from Europe and the US.

- Alejandro Lago, Associate Professor of Production, Technology and Operations Management
IESE Business School, Barcelona

IESE, which has played a key role in the establishment of several African business schools, including Lagos in Nigeria and Strathmore in Kenya, continues to provide visiting professors and offer faculty development programs.

GMAC also is committed to strengthening Africa’s business schools. In terms of the GMAT exam, “it doesn’t matter whether people study inside or outside Africa,” Sibert says. “But from a goodwill standpoint, it matters. We want to work with African schools so they can compete effectively with schools in other regions; our challenge is to bump up the quality.”

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