Business schools have traditionally been aligned and have traditionally taught students along functional lines. Departments have been formed and managed, case studies designed, curricula defined and courses taught around relatively discrete disciplines, such as marketing, finance and international business. Students selected concentrations and mixed-and-matched courses from each discipline in accordance with their particular interests. These specializations, however, have traditionally been taught within the context of a broad management framework that was intended to provide students with the type of integrative perspective required to make complex, multi-faceted decisions.
Many mid-tier schools, particularly those with regional, rather than national/global reputations, saw a big limitation in this model. The vast majority of their graduates would not become the type of top corporate executives that would make full use of these integrative frameworks. Most companies were looking to these schools to provide specialists who could immediately contribute demonstrable value to their companies.
Rapidly growing numbers of mid-tier schools, therefore, are working to increase and demonstrate their graduates’ relevance to these employers by restructuring their programs around increasingly focused disciplines. Many offer MBAs that are targeted at preparing graduates for specific jobs or for work in specific industries.
The Birth and Growth of Specialized MBAs
The trend toward specialized MBA programs began in 1990 after the Association to Advance Collegiate Schools of Business International (AACSB) changed its accreditation guidelines to encourage schools to develop innovative curricula. The University of Wisconsin at Madison was one of the pioneers in this practice, launching its first specialized program that same year. It has since gone further than virtually any other university in its embrace of such programs. In fact, it eliminated its general MBA program altogether in 2004, opting for a program that consisted of 14 specialized programs including applied corporate finance, market research, real estate and urban economics.
Such specializations provided a convenient way for mid-tier schools to differentiate themselves from, and change the terms of competition with larger, better-known and better-funded schools. Then, as some of the early specialists began to improve graduate placement rates, the trickle of specialization grew into a flood. AACSB figures, for example, show that 298 U.S. business schools now offering specialized MBAs.
These schools often begin by introducing specialized programs in established management sub-disciplines, such as human resources, project management, information technology management, supply chain management and nonprofit management. A growing number of schools have created new specialties in areas that hold the promise of particularly attractive or rewarding careers, as in business analytics, asset and wealth management and brand management. New programs have since begun to emerge around currently hot fields including entrepreneurship, sustainability, corporate social responsibility, global management, innovation, social media and risk management.
Such programs are also proving to be popular among students. AACSB, for example, estimates that more than 20% of all MBA students are now enrolled in such programs and that this enrollment continues to grow at about 4% per year.
A Global Phenomenon
Nor has the trend toward specialized MBAs been confined to the United States. European B-schools, especially in France, were also early adopters of the specialization model. The ESSEC Business School, for example, launched its first specialized MBA program (in international luxury brand management—with sub-specialties in fields including fashion, fragrances, jewelry and cars) in 1995. It now offers a couple such programs, including one in hospitality management. The BEM Bordeaux management school, logically, offers its Wine MBA, built around a curriculum that is intended to prepare managers for careers in different aspects of the wine trade. France’s HEC School of Management, meanwhile, now offers 12 specialized master’s programs in areas including law and international management and entrepreneurship. U.K.-based schools, such as the Cranfield School of Management, offerings specialized degrees in areas including innovation leadership, international human resources management, logistics and supply chain management.
Asian universities have begun to follow suit. MBA India, for example, lists about two dozen schools offerings specialized degrees in fields such as real estate, construction, bank, travel and tourism, pharmaceutical and even rural management. The Hong Kong University of Science and Technology Business School, meanwhile, offers master degrees in e-commerce management, investment management and information systems. China, which has so far authorized about 60 universities to offer MBA programs, is following suit. The Beijing Institute of Technology, for example, offers MBAs in manufacturing and government management and Beijing University now offers an Aviation MBA. In fact, according to AACSB, more than 140 schools outside the U.S. now offer such specialized programs.
In other words, worldwide, 438 out of 599 AACSB-accredited graduate business schools already offer at least one specialized program—many offer multiple programs. Other schools are introducing specialized programs or integrated multi-disciplinary programs every semester. But while such programs may well differentiate these schools from those that offer more generalized MBA programs, how can schools differentiate their specialized programs from those offered by others? That is the topic of my next post.