During her fourth year working for Goldman Sachs in Bangalore, Manasy Vidyasagar began preparing for the GMAT.
She was happy at Goldman, but wanted a formal business education—preferably a fast-track MBA close to home.
“I was looking for a high-quality education that was in one of Asia’s financial centers,” says Vidyasagar, who was born in Chennai, India.
She found her fit, and two years later, enrolled in the University of Hong Kong’s full-time MBA—a 14-month program that has partnerships with London Business School, Columbia Business School, and Fudan University. Vidyasagar chose the LBS track, as she’d previously worked in London.
“I would’ve been happy doing the program in Hong Kong, but I’m getting the bonus of two global financial hubs, and gaining exposure to the resources and alumni networks of both schools,” she says.
“All these things are quite appealing, and create a niche that many MBAs haven’t been able to tap into.”
In addition to her courses in Hong Kong and semester at LBS, Vidyasagaralso took a four-week, intensive Mandarin program in Beijing. In November, she’ll graduate with a HKU degree with a certificate from LBS.
HKU’s program is on a fast-growing list of partnership MBA degrees between Chinese and western business schools looking to build networks in the world’s second largest economy. This month, Cornell University’s Johnson School of Management ushered in the inaugural class of its new Dual Degree MBA/FMBA with Tsinghua University’s PBC School of Finance.
Peking University’s Guanghua School of Management has been one of the most active in forming partnerships in recent years; in early 2014, it launched a Beijing-based Executive MBA program with Northwestern University’s Kellogg School of Management. This September, it will also commence a dual-degree MBA with Spanish business school ESADE.
Switzerland’s IMD Business School also joined forces last year with the Beijing-based Cheung Kong Graduate School of Business to offer a dual EMBA. And in November, French business school Audencia Nantes signed an agreement with the Beijing Institute of Technology for a double-degree MBA.
These nascent programs join a growing roster of more established partnerships, including EMBAs offered by INSEAD-Tsinghua and Washington University-Fudan University, as well as inherently international programs like the MBA offered by China Europe International Business School (CEIBS).
“The big schools all know they have to be in China,” said Patrick Moreton, associate dean of Duke Kunshan University, a partnership between Duke University and Wuhan University. “All the best Chinese students are looking for schools that will give them a global platform.”
The programs draw a wide range of students. Some, like Cornell-Tsinghua, cater almost exclusively to native Chinese students. Others are more international; Spain’s ESEUNE has an EMBA taught in China, with around half of its students from Europe or the States. Vidyasagar’s class of 52 students comprises roughly 17 nationalities, with the majority Asia-based.
“There’s definitely a growing market for local talent,” Vidyasagar says. “If you’re a Chinese student and you studied in Hong Kong, it’ll be easier to do business there.”
Growing trade relationships, particularly between China and Europe, have made it necessary for business schools to look east; the EU is now China's biggest trading partner, while China is estimated to be a $350 billion market for US firms, according to US Congressional research.
China’s education sector had also undergone gradual reform that dovetailed with the country’s economic liberalization beginning in the late 1980s. Legislation passed in 2003 allowed for partnerships between foreign and Chinese universities, as well as the establishment of foreign campuses within China.
“It’s a market that has grown remarkably since its economy opened, and there’s a lot of opportunity out there for business schools,” says Kristen Lynas, director of executive degrees at INSEAD, whose dual-degree program with Tsinghua, TIEMBA, was launched in 2007.
Lynas says that INSEAD’s program, which is taught in English, addresses the contrasts and tensions between Chinese and Western styles of management by exposing students to both approaches through distinctly different teaching styles.
“The classes taught by Chinese professors will often take a much more philosophical approach to a question, whereas ours will approach it from a more empirical angle,” Lynas explains. “It lends a deeper understanding of how a Chinese business-person might think.”
The vast majority of such partnerships, however, has taken the form of executive programs, which generate a much higher profit margin for universities seeking to expand footprints abroad.
“You can’t just look at names,” says Moreton. “Some programs are merely cooperative ventures, where the American university’s name is in the program, but its involvement on the ground and devotion of resources is actually quite limited.”
The shift to China has occurred as the US faces an over-crowded market for MBAs, which have become the most popular post-graduate degree in the US, according to the Department of Education. Margins for regular MBA programs are slim, so business schools are facing pressure to expand into other markets to stay competitive.
A dual program offered in China could also benefit international students who struggle to land jobs in the US after graduation due to visa sponsoring costs; multinationals often prefer to hire locals in their home countries in order to skirt immigration issues.
The popularity of joint programs has also been boosted by rankings, which hold significant power in the industry. Lynas notes that due to the Financial Times’ ranking metrics—which carry an emphasis on purchasing power parity—many China-based programs consistently rank in the top slots, as the salaries of graduates working in China will appear relatively high compared to per capita GDP.
“I can see competition heating up in region, but part of me thinks that some institutions might be a little naive in assuming what it takes for a partnership to work, and work well,” Lynas says. “Reaching the level of cooperation we have now took years.”
Despite the tailwind, western universities still face significant obstacles expanding into the country. EMBA programs will face increased scrutiny after the central government, as part of a widening anti-corruption campaign, banned Chinese officials from accepting scholarships.
Yet for many western universities, China is no longer a choice. With an oversaturated US MBA market and a sagging European economy, China—despite its recent slowdown—will still be the new frontier of business education.
“At the end of the day, China is still growing—even if you study in the US, you’ll likely come back here,” says Vidyasagar, who hopes to work in strategy and business development for financial institutions after graduation. “Europe is in crisis, and the US is still unstable. The headwinds are all this way.”