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Research shows that the most expensive MBAs in Russia (EUR 38 000 and EUR 90 000 for an 18-month course) have no problems finding students. At medium-priced business schools a 5 percent dropout rate has been noted.
Graduate-level students now display a growing interest towards getting an MBA degree in Russia. A new generation of businesspeople is in the process of formation. At the same time, Russia needs to establish new business schools that would be capable of producing top-of-the-line experts to address the problems of the country’s economy. A quality education should prepare young men and women for the realities of doing business in Russia, tempering any overinflated expectations of the students.
Following the coalescence of private capital in Russia, a process that was marked by tremendous social turmoil, the subject of effective enterprise management has become prevalent in discussions among businessmen, political leaders, and educators. Companies in Russia need first-class top and mid-level managing associates. The professional business education market caters to such needs and stands to benefit immensely from these new trends. Studies show that by 2012, the number of students coming to study to various short-term, medium-range, or long-term business education programs, including MBA, will rise to 200 000 per year. Still, notwithstanding the expansion of the institutional infrastructure of Russian business education, the low supply of top-quality managers is frequently cited as a significant predicament to the growth of the Russian economy.
According to analysts, the market of MBA schools in Russia is well-balanced. The number of educational opportunities available to Russian students is commensurate with the demand for an MBA degree. In general, MBA students are satisfied with the quality of education they receive. MBA programs are one of the more costly types of academic training that one could get in Russia.
Overall, slightly more than 100 Master’s of Business Administration programs are now open in Russia. The number of graduates each year is from 3 to 6 thousand. The growing focus of the Russian economy on innovation, efficiency, and new technology, however, means that the need for first-rate managers at Russia’s companies is significantly higher than the demand of business students for an MBA education. Raising the students’ demands has simply become indispensible if Russia is to succeed in its ambitious goals set for the future.
The demand dynamics is wholly related to the personal goals of the young generation of Russian businessmen, who came into business not during the violent decade of capital formation, but in a more “auspicious” economic environment. The task before Russia’s MBA programs has now become more important than ever before. To assess the significance of business education in Russia and to realize the importance of the new generational forces, it would be worthwhile to analyze just in what way the second wave of business students impacts MBA education. Next, one must ask how should Russian MBA schools change their techniques and position themselves from a more appealing angle in the eyes of young students.
In academic discussions on the topic of today’s level of business education development within Russia, emphasis is often placed on the problems affecting the quality of MBA programs, such as curriculum and the absence of qualified instructors. Additional factors that are taken into account include the level of the students’ preparedness, personal expectation fulfillment, and the ability to pay. Russian programs are also compared with Western models, and such analysis does not yield encouraging conclusions. Little attention, however, is paid to the practical aspects of education, the connection between an MBA education and real business situations. There are almost no studies that examine deep societal and socioeconomic ramifications of business education in Russia. Institutional and social group structure, as well as the quality of the HR potential of the Russian society, are rarely factored into the calculus of MBA education assessment.
The new educational system in Russia, whose very foundation was laid less than two decades ago, must nevertheless deal with complex societal issues that directly affect the country’s development. Two models can describe education in Russia. The first model that follows the course of overarching global trends regards education as a critical competitive advantage of individuals and national economies. Supporters of this framework call for continuing education and even lifelong learning, the relevance of academic work to practical experiences, as well as for increasing the participation of educational establishments in the market. The second model, by contrast, recognizes the practical limitations of Russia’s young market economy that has not yet caught up with the Western world. Relevant factors in this regard include social group structure in today’s Russia, the stance taken by the regime towards private business, the little size of the middle class, the people’s mentalities, and the personal characteristics of businessmen and managing associates, such as the level of their education, experience, legal knowledge, as well as business culture. A comprehensive assessment of business education must factor in all of these social parameters, as by its very definition it is meant to handle practical tasks and provide people who have experience in administering business operations attain successes in their professional careers.
In a recent study by members of the Russian Academy of Sciences, a detailed survey was conducted among 1 445 MBA students at the Academy of the National Economy under the auspices of the Government of the Russian Federation. The Academy of the National Economy has first-place ranking among all Russian MBA programs and supplies almost half of all MBA graduates. The preponderance of those taking the MBA curriculum – 60 percent – were senior managers. 28 percent were heads of company divisions. 9 percent of those surveyed were lower-level managers, analysts, and associates.
The new generation of entrepreneurs studying for their MBE degrees consists of those who are under the age of 35, as this category of students has not worked in the business sector in the pre-reform period. These managers have attained business success in new market conditions and, therefore, represent one of the most intellectually-advanced subclasses of the business community in Russia. The new generation is very diverse.
On the basis of the time period when the members of the second generation entered the business world, it would be possible to distinguish two waves: the first includes entrepreneurs who went into business during the 1990s, and the second consists of managers who went into business after the default of 1998, during a more favorable period of peaceful assimilation and economic growth.
The first generation includes businessmen who started to work in the 1990s, as the large centers of Russian capital were in the process of formation.
Indeed, representatives of the new generation of businessmen account for 64 percent (first wave – 23 percent, second wave – 41 percent) of students surveyed at the Academy. Entrepreneurs of the older generation constituted only 28 percent of the MBA class. For this group, the choice of these individuals to acquire a business education deserves attention as an important indicator of the changes in the Russian business environment and the rising professionalization of the business community.
Human potential
Members of the new generation are rapidly making advances in business education. In 2004, members of the new generation accounted for some 21 percent of the students enrolled in MBA programs. By 2006, the number doubled, and the new generation now represents the most numerous category of MBA trainees.
While the members of the new MBA generation are diverse, their business experiences do have common features. For one, these people have not been in the business for an extended period of time, on the average for 5.3 years. This group is not significantly different from students in any American MBA program. Furthermore, these professionals went into an MBA program before spending much time in a given company or in a specific position. Two-thirds of these MBA candidates have worked in their current position from one to three years. For the older generation, only 23 percent have been with their present employer for one to three years. Furthermore, the proportion of individuals who are involved in industrial production is the smallest in the second generation. Compared to the first generation, where over 51 percent of the trainees come from an industrial background, the second generation contained only 38 percent of individuals with similar professional experiences. The new generation also has fewer members who are employees of companies that underwent privatization – only 11 percent, in comparison to 23 percent for the older generation. At the same time, the number of people who are working in the financial and trade sectors of the economy is high. In the new generation, 30 percent of the people work in finance, and 15 percent in trade, while in the older generation finance and trade sector employees each account for 20 percent of the group’s members. The proportion of people working for newly created private companies in Russia in the second generation is around 52 percent.
The second wave within the second generation also includes a larger number of women MBA candidates, 41 percent in comparison to 34 percent in the first wave of the second generation and 21 percent in generation one. Ordinarily, however, women do not occupy high-level company posts – 64 percent of women compared to 49 percent of men. The gender gap does not disappear even as the length of time of the candidates’ years in business increases. For the new generation, the disproportion is even more pronounced. The number of women in the second wave of the second generation is high most likely because of the greater popularity for women of undergraduate education in Economics. For both the first and the second waves, 52 percent of women have an Economics degree, compared to 24 percent of men in new generation 1 and 32 percent in new generation 2.
As a general matter, students in the MBA program are more likely to have technical education. 35 percent have an economics background, while 44 percent have a basic Economics degree. The same trends no longer hold true for new generation 2. Thus, around 44 percent of individuals in the second wave of the new generation have an economics background, and only 35 percent have technical education. In the old generation, only 22 percent of trainees have a degree in Economics. In fact, the dominance of people with economics degrees persists across all company position groups for both the second and the first waves of the second generation. A conspicuous exception here is in the senior-most executive level – over 52 percent of directors and general directors hold a technical degree.
MBA students usually give very high ranking to the quality of their undergraduate education: over 70 percent rated it as good. In this respect, the first wave of the second generation stands out as an outlier, as only 59 percent of its members expressed satisfaction with their degrees.
Ambitions and status
Because members of the second generation are much younger and have not worked in business for a long time, the second wave of the second generation includes the smallest number of senior managers. Only 44 percent of people in the youngest group were top-level executives, compared to 80 percent in the first generation. There were only 19 percent of business owners in the second group, in comparison to 37 percent in the first. The lower job positions and economic status that these people have curtails the opportunities for their personal advancement and the application of their knowledge to real problems. These limitations understandably impact the expectations these people have with respect to the MBA degree. The inability of these young individuals to realize their full potential for the benefit of themselves, their companies, and their country is one more distinctive feature of the new generation that is now entering Russia’s business schools.
As a general matter, the newly-devised system of business education in Russia fills an important societal need for qualified managers and business leaders. MBA programs offer a different kind of knowledge than what one would find in traditional colleges and universities. The discipline of management imposes a framework on economics and helps one clearly understand the practical interrelationship between the various concepts scattered across the academic fields of public and private finance. In times past, the only way to learn the workings of the Russian business world was through years of experience by trial and error Research shows that the most expensive MBAs in Russia (EUR 38 000 and EUR 90 000 for an 18-month course) have no problems finding students. At medium-priced business schools a 5 percent dropout rate has been noted.
Graduate-level students now display a growing interest towards getting an MBA degree in Russia. A new generation of businesspeople is in the process of formation. At the same time, Russia needs to establish new business schools that would be capable of producing top-of-the-line experts to address the problems of the country’s economy. A quality education should prepare young men and women for the realities of doing business in Russia, tempering any overinflated expectations of the students.
Following the coalescence of private capital in Russia, a process that was marked by tremendous social turmoil, the subject of effective enterprise management has become prevalent in discussions among businessmen, political leaders, and educators. Companies in Russia need first-class top and mid-level managing associates. The professional business education market caters to such needs and stands to benefit immensely from these new trends. Studies show that by 2012, the number of students coming to study to various short-term, medium-range, or long-term business education programs, including MBA, will rise to 200 000 per year. Still, notwithstanding the expansion of the institutional infrastructure of Russian business education, the low supply of top-quality managers is frequently cited as a significant predicament to the growth of the Russian economy.
According to analysts, the market of MBA schools in Russia is well-balanced. The number of educational opportunities available to Russian students is commensurate with the demand for an MBA degree. In general, MBA students are satisfied with the quality of education they receive. MBA programs are one of the more costly types of academic training that one could get in Russia.
Overall, slightly more than 100 Master’s of Business Administration programs are now open in Russia. The number of graduates each year is from 3 to 6 thousand. The growing focus of the Russian economy on innovation, efficiency, and new technology, however, means that the need for first-rate managers at Russia’s companies is significantly higher than the demand of business students for an MBA education. Raising the students’ demands has simply become indispensible if Russia is to succeed in its ambitious goals set for the future.
The demand dynamics is wholly related to the personal goals of the young generation of Russian businessmen, who came into business not during the violent decade of capital formation, but in a more “auspicious” economic environment. The task before Russia’s MBA programs has now become more important than ever before. To assess the significance of business education in Russia and to realize the importance of the new generational forces, it would be worthwhile to analyze just in what way the second wave of business students impacts MBA education. Next, one must ask how should Russian MBA schools change their techniques and position themselves from a more appealing angle in the eyes of young students.
In academic discussions on the topic of today’s level of business education development within Russia, emphasis is often placed on the problems affecting the quality of MBA programs, such as curriculum and the absence of qualified instructors. Additional factors that are taken into account include the level of the students’ preparedness, personal expectation fulfillment, and the ability to pay. Russian programs are also compared with Western models, and such analysis does not yield encouraging conclusions. Little attention, however, is paid to the practical aspects of education, the connection between an MBA education and real business situations. There are almost no studies that examine deep societal and socioeconomic ramifications of business education in Russia. Institutional and social group structure, as well as the quality of the HR potential of the Russian society, are rarely factored into the calculus of MBA education assessment.
The new educational system in Russia, whose very foundation was laid less than two decades ago, must nevertheless deal with complex societal issues that directly affect the country’s development. Two models can describe education in Russia. The first model that follows the course of overarching global trends regards education as a critical competitive advantage of individuals and national economies. Supporters of this framework call for continuing education and even lifelong learning, the relevance of academic work to practical experiences, as well as for increasing the participation of educational establishments in the market. The second model, by contrast, recognizes the practical limitations of Russia’s young market economy that has not yet caught up with the Western world. Relevant factors in this regard include social group structure in today’s Russia, the stance taken by the regime towards private business, the little size of the middle class, the people’s mentalities, and the personal characteristics of businessmen and managing associates, such as the level of their education, experience, legal knowledge, as well as business culture. A comprehensive assessment of business education must factor in all of these social parameters, as by its very definition it is meant to handle practical tasks and provide people who have experience in administering business operations attain successes in their professional careers.
In a recent study by members of the Russian Academy of Sciences, a detailed survey was conducted among 1 445 MBA students at the Academy of the National Economy under the auspices of the Government of the Russian Federation. The Academy of the National Economy has first-place ranking among all Russian MBA programs and supplies almost half of all MBA graduates. The preponderance of those taking the MBA curriculum – 60 percent – were senior managers. 28 percent were heads of company divisions. 9 percent of those surveyed were lower-level managers, analysts, and associates.
The new generation of entrepreneurs studying for their MBE degrees consists of those who are under the age of 35, as this category of students has not worked in the business sector in the pre-reform period. These managers have attained business success in new market conditions and, therefore, represent one of the most intellectually-advanced subclasses of the business community in Russia. The new generation is very diverse.
On the basis of the time period when the members of the second generation entered the business world, it would be possible to distinguish two waves: the first includes entrepreneurs who went into business during the 1990s, and the second consists of managers who went into business after the default of 1998, during a more favorable period of peaceful assimilation and economic growth.
The first generation includes businessmen who started to work in the 1990s, as the large centers of Russian capital were in the process of formation.
Indeed, representatives of the new generation of businessmen account for 64 percent (first wave – 23 percent, second wave – 41 percent) of students surveyed at the Academy. Entrepreneurs of the older generation constituted only 28 percent of the MBA class. For this group, the choice of these individuals to acquire a business education deserves attention as an important indicator of the changes in the Russian business environment and the rising professionalization of the business community.
Human potential
Members of the new generation are rapidly making advances in business education. In 2004, members of the new generation accounted for some 21 percent of the students enrolled in MBA programs. By 2006, the number doubled, and the new generation now represents the most numerous category of MBA trainees.
While the members of the new MBA generation are diverse, their business experiences do have common features. For one, these people have not been in the business for an extended period of time, on the average for 5.3 years. This group is not significantly different from students in any American MBA program. Furthermore, these professionals went into an MBA program before spending much time in a given company or in a specific position. Two-thirds of these MBA candidates have worked in their current position from one to three years. For the older generation, only 23 percent have been with their present employer for one to three years. Furthermore, the proportion of individuals who are involved in industrial production is the smallest in the second generation. Compared to the first generation, where over 51 percent of the trainees come from an industrial background, the second generation contained only 38 percent of individuals with similar professional experiences. The new generation also has fewer members who are employees of companies that underwent privatization – only 11 percent, in comparison to 23 percent for the older generation. At the same time, the number of people who are working in the financial and trade sectors of the economy is high. In the new generation, 30 percent of the people work in finance, and 15 percent in trade, while in the older generation finance and trade sector employees each account for 20 percent of the group’s members. The proportion of people working for newly created private companies in Russia in the second generation is around 52 percent.
The second wave within the second generation also includes a larger number of women MBA candidates, 41 percent in comparison to 34 percent in the first wave of the second generation and 21 percent in generation one. Ordinarily, however, women do not occupy high-level company posts – 64 percent of women compared to 49 percent of men. The gender gap does not disappear even as the length of time of the candidates’ years in business increases. For the new generation, the disproportion is even more pronounced. The number of women in the second wave of the second generation is high most likely because of the greater popularity for women of undergraduate education in Economics. For both the first and the second waves, 52 percent of women have an Economics degree, compared to 24 percent of men in new generation 1 and 32 percent in new generation 2.
As a general matter, students in the MBA program are more likely to have technical education. 35 percent have an economics background, while 44 percent have a basic Economics degree. The same trends no longer hold true for new generation 2. Thus, around 44 percent of individuals in the second wave of the new generation have an economics background, and only 35 percent have technical education. In the old generation, only 22 percent of trainees have a degree in Economics. In fact, the dominance of people with economics degrees persists across all company position groups for both the second and the first waves of the second generation. A conspicuous exception here is in the senior-most executive level – over 52 percent of directors and general directors hold a technical degree.
MBA students usually give very high ranking to the quality of their undergraduate education: over 70 percent rated it as good. In this respect, the first wave of the second generation stands out as an outlier, as only 59 percent of its members expressed satisfaction with their degrees.
Ambitions and status
Because members of the second generation are much younger and have not worked in business for a long time, the second wave of the second generation includes the smallest number of senior managers. Only 44 percent of people in the youngest group were top-level executives, compared to 80 percent in the first generation. There were only 19 percent of business owners in the second group, in comparison to 37 percent in the first. The lower job positions and economic status that these people have curtails the opportunities for their personal advancement and the application of their knowledge to real problems. These limitations understandably impact the expectations these people have with respect to the MBA degree. The inability of these young individuals to realize their full potential for the benefit of themselves, their companies, and their country is one more distinctive feature of the new generation that is now entering Russia’s business schools.
As a general matter, the newly-devised system of business education in Russia fills an important societal need for qualified managers and business leaders. MBA programs offer a different kind of knowledge than what one would find in traditional colleges and universities. The discipline of management imposes a framework on economics and helps one clearly understand the practical interrelationship between the various concepts scattered across the academic fields of public and private finance. In times past, the only way to learn the workings of the Russian business world was through years of experience by trial and error.