Overview of trends and developments in business education

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Proceedings of The 21st World Multi-Conference on Systemics, Cybernetics and Informatics (WMSCI 2017)
Riga Technical University, Faculty of Engineering Economics and Management
6 Kalnciema Street, Riga, LV-1048, Latvia
ABSTRACT "Industrial Revolution" when the full-time schools were found to
increase qualifications of low and middle management "in trade,
The aim of the research is to determine the latest trends and industry, and banking" [30].
factors in the global external environment influencing the However, the modern views on business education and the
development and management of business education, as well as science of management were shaped later in the United States
the impact of European Union policies on the transformation of when in the 19th century the pioneers in the field were
business education. The research paper is developed on the basis established: Wharton Business School at the University of
of scientific publications review, using logical and comparative Pennsylvania and the Haas School of Business at the University
analysis methods. The essence of the research is to analyse the of California, Berkeley as well as in 1919 the famous Harvard
latest trends influencing business education development and Business School (HBS) was founded and already by 1925 there
management, as well as to summarize the findings and define the were about 40 schools in the country [33]. It is worth mentioning
set of factors affecting the development of higher education that European influence at higher education institutions was
institutions. significant first due to educated Europeans immigrating to the
United States, and secondly, due to the opportunity to travel and
Keywords: business education, higher education institution study abroad, for example, HBS's first dean was Edwin Gay, who
(HEI), curriculum, massive open online courses (MOOC), online had taken his PhD in Berlin, Germany [36]. Students at the new
education, student-centred learning, competency-oriented institutions studied foreign languages, English literature,
education, university and business cooperation (UBC). philosophy, Latin, mathematics, physics, and apart from that
were trained in leadership, "economic and mercantile science"
[33], actual business practices and techniques.
1. INTRODUCTION The general definition in Merriam Webster dictionary [9] states
that business education is a training in subjects (such as business
Business education is directly connected to business and society administration, finance, accounting) useful in developing general
as the entities have strong influence on higher education business knowledge or useful in developing commercially useful
institutions (thereafter - HEIs) perspectives in their curricula skills. Hereafter, business education today involves teaching
development; hence the interconnection and mutual impacts of students the fundamentals, theories, and processes of business
these bodies generate new directions for the development of practices.
business education. The aim of the research is to reveal the latest Today schools offer core courses in marketing, human resources,
trends and factors in the global external environment influencing management, economics, as well as a wide range of elective
the development and management of business education, as well courses in other disciplines, including, for instance, management
as the impact of European Union (thereafter - EU) policies on the of non-profit organizations, preparation for entrepreneurship
transformation of business education. [38], or advanced courses on strategic management of different
Research is conducted to reveal current trends in business types of organizations, such as family business, social
education, changes in its definition as well as shifts in perception enterprises, new technologies ventures or start-ups. For example,
about business education. In the article the authors use mapping London Business School [22] is ready to provide dedicated
as scientific publications review method and literature overview courses to teach future business administrators how to manage a
method to explore and structure literature's quantity, study growing business, handle mergers and acquisitions, or provide
design, areas for further research as well as concepts observed by with specialization in managing healthcare, sports, or
researchers chronologically to classify the tendencies. entertainment.
Changes in local market demand as well as specific turns that Focus on entrepreneurialism is highlighted in the University
might be significant for a country or a number of them are Business Cooperation (thereafter - UBC) - that highlights new
excluded from the research, the authors are interested in general kinds of cooperation between universities and businesses, with
results, hence this might be defined as a limitation of the study. the assumption that this will foster innovation [37]. Business
education reflects the major changes in external environment as
2. THE FORMATION AND DEVELOPMENT OF it is expected that future business leaders that are trained in higher
BUSINESS EDUCATION education institutions would be capable of responding to the
challenges in the environment. For example, one of the issues is
The very first institutions were founded in the first part of the employment and to address the problem HEIs have to consider
17th century in Plymouth [33] where students were trained the employability of postgraduates. Academic education is based
primarily in bookkeeping and business correspondence on gaining theoretical knowledge and skills which often does not
administration. The first elements of business education appeared facilitate development of the practical competences needed by
in Germany in 1727, in Sweden in 1750, in Russia (Moscow) in successful managers [18]. Researchers [28] agree that
1804, in France (Paris) in 1819, then in Austria (Vienna) and collaboration between businesses, HEIs, and students improves
Hungary (Budapest) in 1856, and in 1868 in Italy (Venice) [36]. the design of university programs and has a positive effect on
In Europe the trends might be observed in the last two decades of human capital development as it assists in shaping
the 19th century due to changes in European society named as entrepreneurial behaviour and students' perception of
Proceedings of The 21st World Multi-Conference on Systemics, Cybernetics and Informatics (WMSCI 2017)
educational experience. UK and three schools from Sweden, Austria, and the
Business education in higher education traditionally is divided Netherlands.
into two levels - undergraduate, i.e. bachelor degree, and The development of business education has been influenced by
postgraduate, or master of business administration. Business changes in the external environment, especially by business
topics in the form of academic subjects are taught on different development, manufacturing, technologies and entrepreneurship
levels and almost all programs universities and even in secondary trends. Unlike most of the university education, which is highly
education in many countries. dependent on national or EU funding, business education is
All around the European Union and even wider the Bologna mostly dependent on student tuition fees, business support.
Process [13] is seen as the effort for uniting and making Therefore, EU policies and programs less influence the field of
transparent higher education area to address challenges caused by business education than other study areas in HEIs.
the emerging globalisation process. Hereafter European
educators need to establish institutional mechanisms to transform 3. MODERN BUSINESS EDUCATION TRENDS
knowledge production, innovation, and diffusion. The initiative
is linked to the Lisbon strategy, which defines education and Recent changes in the external environment, such as
competences as core elements to develop businesses in Europe. internalization of education, technological innovations as well as
EU policies focus on a number of initiatives and instruments labour market demands for new skills, inevitably lead to a shift
including: in perception about business education and society expectations
- Europass - the single Union framework for the transparency of about the institutions.
qualifications and competences, Some researchers [31] also mention that modern business schools
- EQF - the European Qualifications Framework, integrate into curricula subjects that are not related to business
- ECTS - the European Credit Transfer and Accumulation administration directly but indirectly, for example, ethics. The
System, importance of developing not only academic or practical
- EQAR - the European Quality Assurance Register for Higher knowledge, but also skills, such as the ability for creative
Education problem solving, are crucial for business students as for potential
- ENQA - the European Association for Quality Assurance in enablers of innovations [35]. Apart from it, researchers have
Higher Education, observed that during the last decade business schools have
- the provision of support to Union-wide networks and European launched different programs and adjusted their curricula and
non-governmental organisations (NGOs) active in the field of campus experience to address ethnical and cultural differences of
education and training. their students [41].
According to Jurse and Mulej [17], business schools today have Addressing the new teaching challenges the faculty of business
to act as a platform for different stakeholders networking and school has to re-assess their teaching methods; some of the
interactions on global level. Therefore, changes in business schools have already included dramatic arts to deliver courses on
education landscape are more complex than those predefined by leadership [24] while others create business projects to intensify
Bologna Process. The agreements between European countries project-based learning method with virtual entrepreneurial
are required to shape framework to intensify visibility of experience [32].
European higher education institutions and those fit to market Hereafter it is possible to conclude that business education today
worldwide. is not only training in subjects for further business administration,
Naturally, that forerunners in the industry sets the standars and but also solid partnership and networking, actualized curricula
trends for others; for example, in business education field and flexible teaching methods. The trends summary is
European Business School rating is published in the Financial represented in Table 1.
Times regularly reports and announce high performers in the
area. In accordance with the data of 2016 these are London Table 1. Business education trends and examples,
Business School, HEC Paris and Insead in France, as well as IE years 2010 - 2016
Business School in Spain, and University of St. Gallen in Business
Switzerland. Whereas, the full list of business schools in Europe education Examples
including universities that offer studies in business trends
administrations or related areas consists of more than 300 Partnership and With HEIs, educational technology
institutions [12] including, for instance, one school of the new networking organizations, business entities
European Union member states like Lithuania, Slovakia, Serbia Including subjects that are not related to
and about 100 institutions in the United Kingdom. At the same Curricula are business administration directly (such as
time, it is worth mentioning that on global level the business highly ethics), and improving creativity and
schools that have been assessed by the Association to Advance responsive to the problem solving skills
Collegiate Schools of Business (thereafter - AACSB) and/or the needs of society Including specifically designed courses
Management Development Network (thereafter - EFMD) and business to reflect multiculturalism and students
evaluation programs in some respect represent the highest mobility
standard of achievement for business schools worldwide. It was Online education, dramatic arts,
noticed that ordinary business schools that are not ranked highly problem-based learning, project-based
establish partnerships with better-recognized HEIs to expand and Flexible teaching learning, virtual business projects
develop networks outside the schools themselves, as a "business methods Different methods for different
school is about who you meet, not just what you learn" [5]. international students to increase their
In accordance with the AACSB [1] data, there are more than cultural and academic competences
16,000 schools worldwide while only 5% of them have
successfully earned the AACSB accreditation. Unfortunately, A visual representation of the grouping might be observed in
there are no schools from the Baltics states in the list, but among Figure 1 while a detailed description of the groups might be
the recently (in year 2016) accredited 50 business schools are found in the chapters below.
institutions from other European countries: four schools from the
Proceedings of The 21st World Multi-Conference on Systemics, Cybernetics and Informatics (WMSCI 2017)
Additionally, a dialogue between universities and business is
required to increase the quality of entrepreneurship education and
the number of start-ups in countries where entrepreneurship-
hostile environments serve as a motivation for policy-makers to
promote entrepreneurship education [38]. It has been found that
investments in student mobility between universities or
temporary movement of students from universities to business
[14], and collaborative research and applications could support a
positive engagement between the parties [10], [14].
Unfortunately, sometimes HEIs do not have the skill set or the
facilities to meet the needs of the business [26], [14]. The
academic rigidity and the lack of proactive strategies of the
higher education institutions to determine business and
government involvement act as barriers for cooperation. It is
interesting that even if academics perceive no barriers they still
may not cooperate with business if there are no drivers in place
Curricula response to the needs of society and business
Due to the urgency of ethical-economic dilemmas solution and
ethical decision-making (thereafter - EDM) in business,
researchers [31] observe the impact of the factors on leadership
studies in the current business environment. It is considered as
not enough to include a course on business ethics as an elective
course in business schools curricula but now is time for cross-
field cooperation between various disciplines.
The key movements and events in the external environment
enable the development of business education. Corporate
bankruptcy scandals within the last 15 years allowed many
researchers to criticize the moral and ethical aspects of business
education [2], [6], [8], [19], hence many researchers reveal the
importance of addressing ethical issues in business education
[31], [24] and even reveal new directions in leadership pedagogy
[7] to increase the role of HEIs in society. According to Lilley et
al. [20] global citizen learning supports a global business mind-
set and the level of employability aimed for in business schools.
Another aspect that is notable in European countries with limited
experience with open market economy, such as Latvia,
improvement of entrepreneurship education is a response to the
Figure 1. Modern Trends in Business Education industry and policy makers' demand for a theoretical basis for
developing and implementing a national level strategic plan of
Partnership and network entrepreneurship education [4] that leads to encourage the
Researchers [28], [10] identify the urgency of engaging development of students' entrepreneurial competences. In the
businesses in curriculum development and delivery, so Baltic states students have expressed a need for more extensive
collaboration of business schools, business people, alumni information about entrepreneurship and especially about social
networking, focus on developing or improving the senior entrepreneurship, as many of them are interested in their
management relationships, as well as the presence of business entrepreneurship skills assessment and development as a
people on HEI boards or participation of academics on boards of potential asset for running own business [23] hereafter this is a
business organizations in addition to internships, practical and call for competence-based education that universities should
mentoring relationships help to build a strategic platform for address in their curricula. Entrepreneurial skills development is
cooperation and serves for external promotion of cooperation crucial for the employability of students and serves for better job
between universities, business, policy makers and society. There matching of college graduates [27] hence establishment of more
are even precedents of collaboration between universities, SMEs demanding higher education programs leads to the ability of the
and NGOs [26]. Gawel [15] has noticed successful experience of graduates to build human capital in the organizations of their
collaboration between universities and companies when employers.
preparing case studies. Researchers [16] believe that HEIs are Apart from entrepreneurial skills, training in a greater variety of
equal partners in a "triple helix of university-industry- dimensions of creative thinking and creativity exercises is
government relations". required for business students to improve their ability to generate
There are researches [29] that report on how students benefit a number of creative ideas, to shift from one idea to another or to
from university and business cooperation as they involve in change the perspective and come up with original solutions [35].
innovative and entrepreneurial activities through internships,
conferences, research projects, seminars, and consequently apply Flexible and contemporary teaching methods
their knowledge in the real world environment. As a result, all Disregarding the fact that IT-based solutions and services are
these actions help to increase the level of satisfaction of developing very rapidly, there is still no common approach
companies with their employees' abilities [15] and increase among business schools about the integration of online programs
employability of students [27]. into school programs. As to the use of IT in business education,
Proceedings of The 21st World Multi-Conference on Systemics, Cybernetics and Informatics (WMSCI 2017)
some HEIs ponder on possible cooperation with the educational 4. LITERATURE REVIEW ON BUSINESS EDUCATION
online platform Coursera [21] and business schools, including TRENDS AND SUB-TRENDS
highly ranked MBA programs, use IT technologies to deliver
MBA programs content online, without on-site experience [40]. Applying mapping as the literature review method it was
Technological innovations and the internet have changed the observed that during the last decade the most researched areas of
methods of business education delivery. Massive open online business education are collaboration between universities,
courses have made MBA programs affordable and more popular businesses and government and its barriers, as well as mutual
than campus-based [5]. The use of IT in business education is curriculum development. Apart from it, courses delivery over the
heavily dependent on student learning style, design of the internet, life-long education, importance of interpersonal (and
courses, and institutional environment [40]. other) skills development for business students, match of
While Wharton and Stanford have experimented with massive education and future occupation, and international orientation of
open online courses and allow MBA courses on no-pay basis, business schools have been researched quite substantially. The
majority of highly-ranked schools do not offer online degrees influence of alumni network and corporate social responsibility
which gives a certain opportunity for less well-known schools on business education is considered as less researched and is
[5]. Hereafter, the modern HEIs need to undertake some actions subject to further studies. As represented in Table 2, due to the
for the purpose of gaining knowledge about and experience with implementation of literature overview method the following
online education and to choose the most appropriate role for their findings about the trends and their sub-trends have been
organizations [40]. E-education at higher education institutions observed.
helps cut the costs and its importance will continue growing in
the future [34]. Table 2. Groups of trends based on mapping literature review
Technologies are not the only factors affecting changes in course Trend Sub-trends
delivery methods. As society demands to teach leadership Adjustments in curricula to increase
critically, enable ethical leadership practice for all the parties employability
involved including employers and policy makers [24] it is Cooperation between universities,
important to avoid the old-fashioned tendency for storytelling businesses, and policy makers
about charismatic leaders to de-romanticize the factor of power Triple helix model Importance of connections with
in leadership in the eyes of the future business leaders. Hence, /University, industry
problem-based learning and case studies are the most actual business, and Collaborative research
methods to deliver courses on leadership [7] teaching methods policy makers'
should foster students' creativity, systems thinking, proactive cooperation Importance of dedicated resource
attitude, teamwork, long-term thinking [11]. allocation to maintain the relationships
Besides the challenges caused by MOOCs development and the between faculty and business
call for ethical leadership, business schools cannot ignore cultural Curriculum design and development
and linguistic diversity in students and its different level of HEI image in labour market
compliance to domestic educational norms and labour market's Development of entrepreneurial
requirements. Competence- competences
As the proportion of foreign students in the campus has been based education Generating productive innovation
steadily and gradually increasing within the last decades, it is Importance of competence based
required to manage students' diversity to tackle the gap between education
the local and culturally and linguistically diverse international Teaching Problem-based/case-based learning
(CLDI) students. Therefore, diversity on campus has been a focus challenges Faculty development to understand
of attention and the faculty members who have not aligned the entrepreneurship education
curriculum are suggested to adjust their teaching practices to the Ethical leadership
needs of the growing number of international students [41]. Leadership Critically assessed role of the leader in a
As already mentioned earlier, entrepreneurship education is a modern organization
new educational perspective that cannot be ignored by HEIs, but Ethical decision making
extending curricula by inclusion of topics such as corporate Online education Assessing HEI strategy to define the
entrepreneurship is not enough. Research by Walter & Block [38] & Massive Open role of online education
cautions against using start-up experience alone because the Online Courses Important role of online education
quality of entrepreneurship education across countries is Limited funding in HEI
conditioned by the national institutional context and has a Funding issues Free education
particularly strong effect in entrepreneurship-hostile Lifelong learning
environments, that is why researchers recommend a cluster of Corporate social responsibility
investments, rather than a targeted investment [10]. Other
Lifelong learning has been developing to become one of the top Presence of international students on
priorities for many higher education institutions [32], [14], campus
therefore the stage for the new transversal skills development has
to be set in HEIs. Problem-based learning (thereafter - PBL) that
requires active participation of learners is one of the cornerstones It is possible to conclude that, disregarding the fact that the
which shifts the focus from teacher-driven education to student- research timeframe covered the last decade, the literature
centred learning and helps to develop the ability for lifelong overview addresses the topicality of the last four years from 2013
learning. Collaborative learning, solving of real-life problems, to 2017. Hence answering to the research question "What are the
teamwork, work-based learning, and professional mentoring are current trends in business education?", the following
the new approaches the faculty could adapt to develop graduates' observations have been made:
competences and behaviour [29]. - University and business cooperation (UBC) as well as
university, business, and policy makers' synergy, and
Triple Helix model implementation is widely discussed
Proceedings of The 21st World Multi-Conference on Systemics, Cybernetics and Informatics (WMSCI 2017)
addressing it from different perspectives, such as: 6. ACKNOWLEDGEMENTS
o Adjustments in curricula to respond to labour
market challenges The article is written in the framework of a project that has
o Importance of connections and relationships received funding from Norway Grants Programme 2009-2014 in
between the parties accordance with the project "EU policies impact to the
o Significance of collaborative researches and case transformations of the higher education and research system in
studies development Norway and Latvia" agreement No NFI/R/2014/006.
- The importance of competence-based education is raised,
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