MBA blog

MOOCs Won’t Replace Business Schools — They’ll Diversify Them

MOOCs, or Massive Open Online Courses have been extremely popular in the recent years. Such popularity is understandable: they are cheaper and time-saving, unlike the traditional education. Hence, it has been a major concern for b-school administrations.

In time, top business schools took to giving their own online courses at web sites like Coursera. Given the diversity and quantity of these courses, it’s now perfectly possible to gather together enough credits for a top MBA degree. This has been extremely good for companies, as they don’t have to send their top performers to EMBA programs anymore, instead just letting them self-educate at MOOCs. At the same time, EMBAs are a large source of profit for the best business schools: for instance, 20% of Wharton’s revenue is derived from such programs. For Harvard and IESE, these percentages equal 26% and 50%, respectively, HBR reports.

Are the fears substantiated?

So, do business schools have reasons to fear the advancing MOOCs? It depends on who decides to take these courses. If they are the people any top business school would gladly pick up – fitting the school’s demands and profile – then universities really have something to worry about. Conversely, the statistics shows that people taking MOOCs have very different profiles and backgrounds from those who would enroll into top-tier business schools. Better still, MOOCs offered by top business schools attract potential students who wouldn’t have been able to pay the education expenses otherwise.

While there have been many studies focused on people taking MOOCs, none of them concentrated on students enrolling in online business courses – until now. The data was based on the responses of more than 875,000 students participating in 9 online courses given by Wharton, complete with a demographic survey. The courses consisted of Finance, Marketing, Accounting, Operations Management, Global Business of Sports, Gamification and others. These online courses do not pose as competitors to traditional MBA programs, instead helping several population groups embrace business education.

Wharton’s data shows that 78% of people participating in those courses are not US citizens (compared to 14% for EMBA programs, 10%-32% for part-time MBA programs or 45% for full-time MBA). This means online courses have far better multinational reach and scale.

Thus, MOOCs represent a brilliant opportunity for business schools to dig into completely new markets, specifically those of developing countries, where entrepreneurs have far fewer opportunities to develop their skills (like Africa, for instance).

Underrepresented groups targeted by MOOCs

As for US participants, there are 35% of foreign-born and highly educated US citizens enrolling in MOOCs. 17% of them are unemployed, compared to a 13% unemployment percentage for American-born participants, which again shows that MOOCs help business schools to reach untapped markets of people who would otherwise be unable to afford business education.

Additionally, there are many members of underrepresented minorities among MOOC enrollees. Despite the attempts of business schools to reach this population, many of them had been unable to experience the benefits of this education.

There is, surprisingly, one area where MOOCs do worse than traditional MBAs, and it’s attracting female students. At traditional MBA programs, 40% of participants are women, but at business MOOCs, women make up only 32%.

Learn more about the diverse business education on MBA25 event in Kyiv!

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