Academic journal article Competition Forum

MBA Academic Strategy: A Competing Values Approach

Academic journal article Competition Forum

MBA Academic Strategy: A Competing Values Approach

Article excerpt


Shifting public expectations and industry trends are forcing most MBA programs to evolve. MBA strategy falls along two continua, innovation versus efficiency and internal versus external strategic focus. While the traditional diversified MBA remains popular, increasing competition and resource constraints have led to other viable strategies such as focusing on a market niche or developing a distinctive academic brand. In the absence of proactive initiative, strategic drift will likely result in consolidation. Emerging hybrids and implications will be discussed.

Keywords: MBA programs, academic strategy, trends in higher education, strategy evolution, graduate education


The traditional, diversified Masters of Business Administration (MBA) program remains the most widely prevalent model for business school strategy. However, due to increasing competitive, cultural and economic pressures, other strategic approaches are rapidly gaining ground. This paper explores these strategic orientations, and the likely fate of MBA programs that strategically react and drift, rather than proactively define and maintain an alternative strategic orientation.

The demand for business education continues to expand worldwide, creating a market whose limits have yet to be defined. In the new millennium over 90 percent of accredited institutions of higher education now offer a degree programs in business on the undergraduate and/or graduate levels, accounting for approximately 25 percent of all undergraduate degrees in the United States (Clegg & Ross-Smith, 2003). Similarly, Master's of Business Administration (MBA) degrees have become legitimized as an essential credential for managerial careers in large organizations, and now constitute over 23 percent of all graduate degrees (Friga, Bettis & Sullivan, 2003). "It [the MBA] is the most popular business qualification in the world. Virtually every country in the world recognizes it as a form qualification for a career in management" (Clegg & Ross-Smith, 2003: 89). Consequently, both undergraduate and graduate business education has become, in itself, big business, generating billions of dollars of revenue, and growing approximately 10 percent a year (Pfeffer & Fong, 2002). Together, corporate and education institutions spend a combined 885 billion each year in the U.S. alone (Friga, Bettis & Sullivan, 2003). The availability of quality MBA programs has never been greater, as demonstrated by the doubling of the number of quality AACSB accredited institutions around the world in the at past 35 years (Seybolt, 2004; Zupan, 2005).

With success come challenges, due to (a) global economic forces, (b) value differences in cultures and organizations, (c) increasingly diverse employees and customers, and (d) rapidly changing technologies in every segment of the value chain (AACSB, 2005). Competition among business education providers has also exploded, particularly in the form of non-traditional programs offered by private education firms (most notably the University of Phoenix), technology firms, other major corporations, and consulting firms (Friga, Bettis & Sullivan, 2003; Rowley & Sherman, 2001). International alliances between business schools of different countries, coupled with technologic advances in web communication and distance learning, allows institutions a broad range of creative strategic options to increase enrollments, share resources and manage risk (Bisoux, 2003, Seybolt, 2004, Thomas, 2003). Even the degree itself offers a variety of permutations: the general MBA, the specialized MBA, the executive MBA, the accelerated MBA, and the part-time MBA (Bisoux, 2005; Zupan, 2005).

However there is some evidence the market has become saturated, and the industry is entering a shakeout phase. Student applications for MBA programs are down, as is the overall potential applicant pool of GMAT registrants, by 15 to 25 percent (Zupan, 2005). …

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