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Online MBAs and MOOCs: A Threat To B-Schools?

Online MBAs and MOOCS are on the rise. Free or often cheaper than MBAs, its unclear how they will impact the education industry. Are they a threat to your business school?

Thu Nov 7 2013

Watch this space. Online MBAs and Moocs are on the rise. 

When Wharton put most of its first-year MBA courses online for free earlier this year, no one could have predicted the trend that would follow. If one of the best business schools in the US MBA Rankings offered free courses, it was only a matter of time before others followed suit.

Massive-online open courses (Moocs) are available all over the web today. Distance learning has come a long way, and those hoping to earn an MBA need not leave the comfort of their living rooms in the digital age.

American business schools have led the way with online learning platforms such as edX, Coursera and Udacity, launched by Harvard University and Massachusetts Institute of Technology (MIT).

In the UK, a trend is being set. In September, British-based Open University (OU) joined FutureLearn – a platform offering courses from universities online. OU works with over 25 UK universities, including Bath and Reading (Henley), which both have high-ranking business schools under their belt.

Norwich Business School in England offers a ten-week course with FutureLearn, and Durham University Business School is developing four of its own Moocs - crisis management, social media, strategy and organisational change – alongside its £19,000 three-year Online MBA.

Grenoble Ecole de Management, a top business school in France, is developing Moocs in geopolitics, innovation and research methods. Many top MBA programs in the UK, such as Aston Business School, offer online-taught MBAs at a reduced cost.

Prospective MBAs might consider spurning the traditional MBA program in favour of reduced-priced or free programs. There is no doubt that some MBA applicants factor cost into their decisions.

MBAs invest vast sums of cash hoping to enhance their business careers. A minimum of about a year’s study is expected at most b-schools, with many students taking up to two years out of industry. Top business schools, such as Harvard, will cost up to $56,175 in 2015. At London Business School, the number-one ranked MBA program in the UK, this year’s cohort spent up to £61,400 in tuition. 

With so many resources available online for free or at a discounted rate, could the traditional b-school be in danger?

David Simmons, Executive Director of the full-time MBA at Cranfield University, isn’t convinced by Moocs: “They may be watching the same lectures, but its not the same experience,” he said. “What they don’t get is the interaction, the conversations. They don’t get the networks in the same way. I don’t think we’ve reached a point where face-to-face interactions can be replaced by online experience.”

He accepts that with technology, b-schools will have to move with the times. Cranfield can’t be immune from change, and MBA programs can’t just ignore the online-trend. It is a good thing that online programs open up business education to thousands that otherwise couldn’t afford it, he says.

But Moocs raise more questions than answers. “The question will be: what are they (students) buying?” he says. “People will pay for what they can see to be a quality experience, but nobody knows the answer to these things.

“You can acquire knowledge but can you really develop genuine understanding? That comes from the interactions between people. I don’t understand yet how Moocs could ever replace that tangible experience; it has to be something you feel.”

Dr Ashutosh Deshmukh, Program Chair of Penn State’s cleverly named online-only iMBA, agrees: “I am not sure that free content equates to education. The basic question is – what is the objective of the students? How do you deliver your program to help students achieve those objectives?"

But online MBAs can replicate the same networking opportunities as their bricks-and-mortar counterparts, even without FaceTime. “They (iMBA students) network with their teammates, and also with the other students in the cohort,” said Dr Ash. “We also assign alums as mentors to students and we have graduated 700 students, of which 400 are active members of the network.”

Dr Brigitte Nicoulaud, Director of MBA Programmes at Aston Business School, says the 100 students on their Online MBA get the same face-time as in-house MBAs: “These facilities are all made available, virtually, to the students and in addition they have face-to-face contact during their Residentials.”

There is a downside to Moocs, however. While prospective MBAs expend serious effort getting through the admissions process, entry into free online courses is done with comparative ease. While many business schools reject scores of applicants, taking only the crème of the crop, as little as 20 per cent of students complete Moocs.

David thinks that many Moocs offered by top business schools are marketing initiatives. “Some open courses that are being offered free of charge, for me, are primarily marketing activities,” he said. “The top US business schools have far more resources to put courses online for free. (For Cranfield) it shouldn’t be done as a commercial imperative. It has to be related to the delivery of quality education.”

A good MBA program will not just give students a great business education, but excellent networking opportunities, a strong alumni network and a dedicated careers team. Some claim that Online MBAs and Moocs deliver these qualities, and others don’t.

Online MBAs can be a great resource for those seeking to advance their careers while juggling busy life-styles. A slightly longer course offers more flexibility.

But while there are also clearly benefits to Moocs, there is a fundamental question that remains: are these programs just marketing initiatives for b-schools, or a genuine alternative to an MBA? It is too early to tell.

But there is one thing that is clear to David: “It does fundamentally challenge how we define the educational experience.”