Long-term gains may propel more Western students to seek admissions at Chinese business schools

Compared with the growing number of Chinese students going overseas for studies, often dubbed as "a gold-plated journey", the number of foreign students who study at Chinese business schools is still "trivial". But the number has been increasing in recent times.

According to a recent ranking of Chinese business schools by Bloomberg Businessweek China, international students account for 40 percent of the students at the China Europe International Business School (CEIBS), 45 percent at the Tsinghua University School of Economics and Management, 28 percent at Guanghua School of Management of Peking University, and 10 percent at School of Management in Fudan University.

An MBA education is often expensive and time-consuming and also a major human capital investment. If we analyze the trends by using the most basic cost-benefit methods that business school professors usually adopt, it will not be too difficult to fathom the reasons.

The ultimate goal of an investment is to secure a return. In a market economy, if you want your efforts to pay off, it is necessary that there are demands and "scarcity" in the market. An MBA investment is nothing less than that. For foreign students studying at Chinese business schools, their career prospects and opportunities can mainly be reflected in three aspects.

First, as competition intensifies in the Chinese market, the era when you could simply copy the kind of products and management from the mother country and make a fortune out of it in the Chinese market is long gone. It has forced most multinational companies to be more localized in their daily operation and management. It also further requires that multinational business managers be better integrated into the local Chinese community. They now have to better understand the Chinese market demand and the needs of their Chinese employees. They cannot merely serve as the "mouthpiece" of the headquarters of their transnational companies.

Second, Chinese companies have been "going global" for a decade. These moves are mostly for mergers and acquisitions followed by investments and setting up factories. All of these have triggered huge demand for management talent with a global vision and a balanced understanding of both Chinese and Western culture. The talent search also extends to people who act as an international coordinator and a good communicator between the headquarters in China and the local country's subsidiary company.

Third, compared with the financial crisis in the West, as one of the BRICS nations, China's rapid economic growth and industry upgrade has been creating innumerable market opportunities. For those expats who wish to "get rich" from the opportunities in China, the Chinese business schools are ideal platforms to have a good understanding of the Chinese market. They can also cultivate their social capital in China while studying in these schools. They usually study with the Chinese business elite, and hence get an ideal opportunity to understand China's social system and cultural practices, and also improve their social capital. Its significance has gone beyond the mere study and understanding of general economic management knowledge.

The rapid development and constant reform of MBA education in China has reduced the costs and risks for these foreign students, thereby making Chinese business schools more appealing to foreign students. Chinese business school enrollment patterns and selection criteria are getting geared to international standards and practices. They have also in recent years actively recruited many overseas teachers and established a curriculum system that is in English and in line with international standards.

At the same time, more and more Chinese business schools are setting up joint schools with leading business schools in Europe and the US and have been actively participating in the international certification authorities.

All these initiatives have improved their brand and employer recognition, and also greatly reduced the study costs for foreign students. After attending business schools in China, they will have fewer risks of facing market rejection.

Although Chinese business schools are still not on par with top international business schools in teaching resources and research capacities, the gap is likely to reduce even further in the foreseeable future, as the benefits and cost advantages will continue to increase the foreign student intake at Chinese business schools.

The author is a postdoctoral fellow at the Renmin University of China.

(China Daily 03/23/2012 page7)