North and South

Business schools in Latin American countries may inhabit different cultures than their counterparts in the U.S., but they have much to share with their neighbors to the north.
North and South

Like so many business schools around the world, those in Latin American and Caribbean countries (LACC) are taking steps to become more globally competitive—and they’re doing so at a rapid pace. But they are achieving this goal much differently than many of their international counterparts. Although Latin American schools tend to follow the U.S. model for business education, they also rely on international alliances more extensively, use practitioner-instructors more frequently, and tie corporate involvement into their curricula more closely than schools in the U.S. and Europe.

Such strategies can work against LACC schools when it comes to being recognized by international ranking systems and accrediting bodies, which place great weight on the scholarly output of academically qualified faculty. Many U.S. and European educators might view the LACC approach to global development as, at best, nontraditional—or, at worst, counterproductive to building globally recognized business programs.

But many LACC schools are earning that global recognition. In fact, of the nearly 2,000 LACC business schools—which include undergraduate, graduate, private, public, and even for-profit institutions—16 are accredited by AACS International and another 49 are in the process of seeking AACSB accreditation. Dozens more have obtained or are seeking accreditation from EFMD or the Association of MBAs (AMBA). From Mexico to Argentina, schools are pursuing international accreditations in greater numbers to compete globally for students and to be more visible among the world’s business schools.

LACC schools have developed a number of innovative and untraditional approaches to curricular design. These approaches strike a balance between an emphasis on corporate involvement in their curricula and an effort to adopt best practices in global management education. We believe these models offer valuable examples for other schools that want to strengthen their international programs and sharpen their competitive edges—all while following their own unique missions.

Minding Their PQs

Work with the business community is important to any business school, but LACC business schools take corporate involvement to another level. They maintain much closer links to their corporate partners than U.S. business schools typically do. This model affects their curricula in three significant ways and presents them with a number of advantages—and disadvantages.

First, many LACC schools were actually founded by the business community. These range from schools launched by groups of companies, such as EGADE Business School at Tec de Monterrey in Mexico; by chambers of commerce, such as ICESI and Universidad del Norte in Colombia; by single companies or their foundations, such as Dom Cabral in Brazil, Arthur J. Lok School in Trinidad, and Universidad Adolfo Ibañez in Chile; and by religious groups that encourage business, such as IAE in Argentina, IPADE in Mexico, and PAD Escuela de Dirección at the Universidad de Piura in Peru. A number of for-profit schools have entered the market in recent years as well, including the Apollo Group and Laureate International.

Second, because they have such strong corporate ties, LACC business schools often take a very pragmatic view of business education. They place a strong emphasis on decision making and real-world application of business knowledge in their curricula—so much so that company managers and executives are often recruited as instructors. While schools in the U.S. emphasize case studies and research by academically qualified (AQ) facult, LACC schools tend to place more emphasis on practice-based learning and professionally qualified (PQ) instructors.

Third, graduate business education throughout Latin America is primarily part-time, because most MBAs and other graduate business students work full-time while they attend classes.

All three of these aspects mean that LACC schools have more direct links to the corporate community, which only enriches the curricula. Working MBA students and instructors who are practitioners themselves bring a wealth of real-world business knowledge into the classroom. This further strengthens the support that schools receive from the business community over time.

But LACC schools’ reliance on corporate relationships comes with several drawbacks:

Too few full-time students. Because so many of their students hold jobs, few Latin American MBA programs have more than 50 full-time MBA students. These programs often have hundreds of part-time students, which can hurt them in the international rankings that compare schools based on the number of full-time students they enroll.

Too little time for international projects. Because Latin American professors are so involved with university organizations, companies, and external organizations, they often have limited time to gain international experience. Latin American professors’ local obligations also leave little time for them to take international sabbaticals. They often leave their posts only for doctoral studies, a pursuit that is, in itself, a huge challenge.

Too many PQ faculty. The fact that LACC schools recruit so many instructors from the corporate world can result in an excess of professionally qualified instrutors and a scarcity of academically qualified instructors. This presents a challenge for these schools, both in the rankings and for accreditation.

Even though the Latin American model places LACC schools at a disadvantage in the global market in some ways, they are not willing to sacrifice their close corporate relationships in their pursuit of global status. They see too much value in those ties to let them lapse. Instead, they are looking at other ways to achieve their goals.

Shifting Focus—to Research

Because LACC schools have focused so heavily on practice-based instruction, they have underemphasized publication in international journals and other outlets. In fact, research in international publications is often not considered mandatory for Latin American faculty. But since they began making global competitiveness a priority in the late 1990s, Latin American business schools have been doing more to encourage their professors to publish internationally.

The language barrier presents another challenge. In most regions, business faculty speak and write in Spanish or Portuguese, while most international journals are published in English. For the purposes of accreditation, it is generally sufficient if a schools faculty publishes in local-language outlets for research. However, if LACC schools want to appear in international rankings, it’s becoming more necessary that their faculty publish in English-language journals.

Recently, LACC schools began to redouble their efforts to increase the scholarly output of their faculty. They’re working to attract more professors with doctoral degrees and more experience with academic scholarship. They’re also investing more in educating existing faculty members at the doctoral level and supporting them in their efforts to publish in international outlets. Still, the challenge remains quite daunting as few Latin American business schools offer PhD programs. This is yet another factor that leads to low levels of AQ faculty, and difficult meeting the AQ requirements of AACSB accreditation.

Boosting Research Capacity

LACC schools are finding other ways to hire more AQ faculty and increase scholarly publication, while still maintaining their emphasis on corporate relationships and application-based instruction.

For example, LACC schools offer a range of incentives to encourge their professors to pursue doctoral studies and scholarly research. The Universidad Católica de Chile, INCAE in Costa Rica, and Centrum in Peru provide financial bonuses to faculty whose research appears in journals with high impact factors, as measured by Thompson Reuters’ Journal Citations Reports.

INCAE also provides AQ professors with annual research budgets to permit them to travel to international conferences, buy database access, and pursue other ways to support their scholarship. In addition, many schools offer a reduced teaching load for AQ faculty, further supporting their research efforts.

While they have been playing catch-up in academic research, Latin American business schools have been quite innovative in other areas of scholarship. Schools such as IESA in Venezuela and INCAE have long histories of publishing business cases and technical notes that identify practical ways to apply business knowledge to real-world problems.

Interestingly, using a tactic similar to one used by European schools seeking accreditation, Latin American schools that needed more AQ faculty originally pursued visiting faculty from abroad. Serendipitously, the programs have been enriched by this high-quality faculty sharing. As a result, many LACC academic and scholarship programs have evolved, grow-ing more robust, because of the cross-pollination of ideas and viewpoints.

For example, Tulane University’s Freeman School of Business in the southern U.S. has created a technologically supported educational model that aims to boost the number of doctorally qualified faculty in Latin America. In this model, Tulane offers a PhD program to Latin American business school professors, which allows them to study in their home countries via weekend and occasional weeklong modular courses. As part of this program, these professors stay at Tulane for parts of four summers to work on their PhD theses with their lead professors. During the school year, Tulane faculty travel to Latin America to teach the pro-gram’s courses.

The program has been offered in Caracas, Venezuela, where Venezuelan and Colombian professors meet for classes with Tulane professors. It also is offered in Mexico City, where Mexican professors likewise meet for classes on a regular basis for two years, and then pursue their PhD thesis projects with an advisor. Approximately 100 Latin American business professors have completed the program to date. In return, Tulane benefits from additional tuitionrevenue and greater international exposure for its own professors.

One of the key elements of the program is to encourage the student-professors to produce dissertations that include one chapter prepared with the intention of publishing it in a leading academic journal. This effort enables Latin American professors to re-enter the academic world upon completion of their PhDs with at least one paper ready to submit for publication and a clear idea of what is required to compete in the world of academic journals.

Mission-Based Innovations

While they might still face challenges establishing themselves in the global business education community, LACC schools have repeatedly demonstrated their ingenuity and initiative in designing programs other business schools would do well to emulate. They’ve proven their strengths in three areas in particular:

Making all students entrepreneurs. Entrepreneurship is a large part of business programs world-wide, but few schools require all students to start legally registered businesses—especially at the undergraduate level. At the Universidad del Pacífico in Peru, all undergraduate business majors, either individually or in small groups, set up and launch legally registered companies during the final semesterof their programs—in fact, doing so is a requirement for graduation. The school doesn’t expect all stu-dents to become entrepreneurs, but it wants to ensure that, by the end of their studies, they all understand what it takes to set up a business.

Going paperless. In a small number of cases, LACC schools are leaders in taking advantage of new technology. For example, ESAN in Peru was the first school in Lati America to provide laptops to its MBA students. More recently, in a move toward becoming a paperless organization, the school became the first to give its students iPads.

Going the distance. The Global MBA for Latin American Managers, a joint venture between Monterrey Tec in Mexico and Thunderbird School of Global Management in the U.S., is a larger example of a school making the most of its technological capacity. In the 1990s, Monterrey Tec wanted to take advantage of its advanced distance education program, so it pursued Thunderbird as a partner to offer a dual-degree MBA.

Launched in 1998, the Global MBA is offered via videoconference at Monterrey Tec’s campuses in Monterrey, Mexico City, Guadalajara, and Queretaro, as well as other sites in Latin America. The program has operated for more than a decade and has graduated more than 1,000 MBAs who come from Mexico and the U.S., as well as other countries ranging from Bolivia to El Salvador.

Even in that early era for online learning, Monterrey Tec was bold enough to rely on its videoconference technology, using PictureTel equipment and a satellite for distribution. Today, the program implements a well-orchestrated instructional package, which includes local facilitators at each campus, a Web-based platform for teaching materials, and lead instructors from Tec and Thunderbird. Classes are offered live in real time, with video and audio interaction between instructor and students in 13 locations around the Americas. Because the model requires a local presence in each market served, it is not easily replicated, and the Tec-Thunderbird alliance has remained the sole provider of this program in the region.

This model is particularly attractive because it combines—and strengthens—unique competitive advantages from each school. Monterrey Tec’s distance learning capability has been developed by Univer-sidad Virtual, the distance education arm of the overall university. Thunderbird has further developed its expertise in international business. This model, which leverages the core competencies of each school to serve students and managers in their regions, could be used by other groups that want to link constituents together—such as theoreticians with practitioners, family-owned companies with researchers, or bottom-of-the-pyramid companies with individuals with management skills.

Next-Level Partnerships

While schools in the U.S. and Europe frequently form international partnerships, these collaborations can languish, since often the schools do no more than exchange a handful of students and faculty every year. Similarly, when U.S. schools partner with Latin American schools, they rarely do more than host MBA and EMBA residencies.

Schools in Latin America, however, don’t just form frequent alliances with U.S. and European schools. Most use them intensively, relying on them heavily to promote student and faculty exchanges, technology transfers, and executive education programs. The benefitsof these activities include greater global presence, stronger curricula, and more well-rounded faculty.

Furthermore, the number of agreements with foreign schools tends to be quite high for Latin American business schools, relative to their U.S. counterparts. It is not uncommon in the region to find schools with 30 to 50 interntional student exchange agreements. Although most of the agreements do not result in large numbers of students going in either direction, they often include strategic activities such as inviting groups of foreign students to campus for a week to learn about “Doing Business in Latin America.” This structure has proven quite attractive to U.S. schools seeking to internationalize their own programs.

Many LACC schools also have regular programs in which they invite U.S. and other non-local professors to visit and give guest lectures, engage in joint research, and generally share their knowledge with local students and professors.

For example, Católica de Chile and Monterrey Tec have “Extraordinary Professor” designations that they bestow on foreign professors, who are invited to spend short periods of time on campus getting involved in a variety of activities. ESAN in Peru and Universidad de los Andes in Colombia have one-week and three-week summer programs, respectively, that bring in foreign professors to teach special courses. By highlighting the expertise of these professors, the schools attract both local and foreign students to these highly globalized experiences.

Latin American schools often have more links to Europe than their U.S. counterparts, particularly and not surprisingly, with Spain. Exchange programs and other alliances with Spanish business schools such as Instituto de Empresa (IE), IESE, and ESADE are quite common.

A common language and cultural heritage foster these relationships, so it is almost paradoxical that in both contexts (Spain and Latin America) schools are aiming to offer more programs in English. This situation could, in fact, be a basis for an increase in U.S. Latin American cooperation, since U.S. schools can provide English-language instruction. Latin American schools then could provide reciprocal services in the form of seminars on the Latin American business environment.

Taking Notes on LACC

Latin American business schools’ extensive involvement with the business community has been, for the most part, based on the need to create high-quality business programs. But these interactions have enriched their curricula and provided experiential opportunities for students inside and outside the classroom. They’ve also served as significant sources of funding to LACC schools.

There is no doubt that LACC institutions can benefit from colaboration with U.S. and European business schools for academic research and student exchanges. The examples here show that there is also plenty to take note of in the Latin American model—and plenty to learn from observing how LACC schools balance the richness of their historical missions with their aim to build innovative pro-grams with global reach.

Jorge Haddock is dean of George Mason University’s School of Management in Fairfax, Virginia. Robert Grosse is the director of the school’s Center for Global Business Innovation and Transformation and former dean of EGADE Business School at Monterrey Tec in Mexico.