Business schools operate in an intensely global marketplace, with the mobility of students and staff at the core of their international orientation. The growth of international league tables and rankings reflects the sector’s global scale.
Arguably, business schools face greater international competition than any other department within the typical UK university. Yet the British business school sector has been conspicuously successful over the past two decades.
Top tier business schools compete fiercely to attract the top global students and staff. International rankings, such as those provided by the Financial Times, sharpen the competition. The slip of a few places can have profound effects on recruitment to major programmes such as an MBA or Masters in Finance.
The growth in the scale and significance of international business schools has occurred in parallel with the unprecedented globalisation of business. The programmes, the research and the development support for companies is anchored in the globalised economy and the assumptions of an ever more connected world. In this context, Brexit is a perfect storm for British business schools.
The first headwinds of the Brexit vote will be felt, as it will in the wider university, in operational impact. Business schools will unquestionably suffer, like their parent institutions, the loss of international staff and student recruitment and research funding. But I fear the waves will crash harder in the business school sector for a number of further reasons.
Unique Brexit challenges for business schools
Firstly, a business schools are typically home to a higher proportion of international academic staff and students than in the wider university. Recruiting and retaining international staff will become more difficult as a result of Brexit. Like many of my fellow business school deans I am acutely aware of the anxiety among my colleagues originating from EU countries about their future in the UK. We are equally aware of overtures being made by business schools around the world to entice such staff to leave the uncertainty of post-Brexit Britain for (literally) sunnier climes. We will have to work harder to be ‘open for business’, and to communicate this to both the European and the wider international academic community. Unless we can continue to attract that top global talent the UK’s leading position within the business school sector will be lost. There are plenty of rivals willing to exploit our post-referendum weakness.
Secondly, unlike for most other parts of the UK university sector, business schools’ international competitors are increasingly teaching in English. One of the main draws for European and international students to UK business schools was the opportunity to develop their English language skills while studying. The top three destinations for international students studying in business schools have all been English speaking countries: the US, the UK and Australia. Yet competitor business schools in Europe and Asia are increasingly offering at least some programmes in English to attract international, particularly international postgraduate, students.
Alongside the advantages of studying in English, British business schools have also traded on the benefits of studying in a dynamic, liberal, open economy. Whatever the long term outcome of Brexit, there is evidence that potential students are seeing post-referendum Britain as less liberal, less open and potentially less economically dynamic. Whilst I am confident in the value proposition of top tier British business schools and that it will continue to attract talented international students, our task just got a little bit harder.
Thirdly, a core component of the work of business schools is the provision of organisational and professional development support for businesses. Outside of major cities business schools support many small and medium sized businesses (SMEs) rather than the major corporates. For many business schools, the provision of such business support for SME’s has relied on EU funding. Major development initiatives managed by top tier business schools such as Lancaster’s leadership of the Wave2GrowthHub project, as well as those delivered more locally by post-92 university based business schools, have been primarily funded by the EU through mechanisms such as the European Regional Development Fund.
This has become increasingly the case recently as the UK government has cut expenditure on regional support for businesses. Through initiatives backed by the coalition government, such as the Small Business Charter, business schools have increased their support for SMEs and their wider regional economies at the very time the established support infrastructure has been systematically dismantled. The loss of EU funding could compromise the vital role played by business schools in regional economies. Without this activity, efforts to rebalance the economy away from the financial sector and to address the north-south economic divide will be ever harder and further cement the working class disillusionment which has led to Brexit.
Despite this almost perfect storm of challenges around staffing, student recruitment and funding, Britain’s business schools will remain leading players in the global market and key components of our universities. It will, however, require that we redouble our efforts to be international in our orientation; to be open to the world, to people and to ideas. It will also require us to be ever more innovative in our operations and how we differentiate ourselves from global competitors. Never was the old saying about necessity being the mother of invention more true.