Live Updates: Coronavirus Impact On Business Schools
What is the impact of coronavirus on business schools? We bring you the latest updates including campus closures, changes to MBA admission requirements, and more
- MBA application deadlines released amid COVID-19 disruption
The flexibility of the HKUST MBA program allowed Lin Yuan to extend his three-month MBA internship with BASF. He’s now set to start a full-time role with the firm
You can now book to take the GMAT Online Exam through 2021, with the online test becoming a permanent option
A new Executive MBA, launched by the University of St Gallen and ETH Zurich, puts executives at the heart of business and technology and empowers them to lead in the name of social impact
Starting salaries for MBA consultants at McKinsey, Bain, and BCG frozen in 2021, while many other top consulting firms cut their pay packets
Turning My MBA Internship Into A Full-Time Career During COVID-19
‘Be like water, my friend.’ Lin Yuan says the Bruce Lee quote has guided him throughout his career. Be flexible; adapt to your surroundings; be prepared for change—those are the biggest learnings Lin says he got from his MBA at HKUST Business School.
Lin is one of thousands of MBA students around the world thrown into the uncertainty caused by the COVID-19 pandemic. As business schools were forced to adapt, Lin explains that the flexibility of the MBA at the Hong Kong University of Science and Technology’s (HKUST) Business School has allowed him to thrive.
After an MBA internship with German chemical giant BASF—the world’s largest chemical producer—that was initially supposed to last three months, Lin has spent nearly 11 months with the firm. He’s now set to start a full-time role with the company’s strategic marketing team, overseeing the whole of the Asia Pacific region.
Why MBA: HKUST
Lin was born in China before migrating to Australia at the age of seven. A business degree from the University of New South Wales followed, along with the start of Lin’s career in sales. He spent time with chemicals company Linde before moving back to Asia to join consumer goods company RB.
Australia’s smaller market size was dwarfed by the pace of change and growth in Asia. That meant opportunity and a time for change.
“At that time, I’d been working in sales for seven years, in different industries, and I felt there was more room for growth,” Lin explains. “I felt like I lacked exposure to the breadth of the business world.”
He had two options: To either switch industry or function, or to study for an MBA. Lin chose the latter and HKUST.
“I’d always wanted to come back to Asia believed that this is where everything is happening,” he says. “Knowing a bit of Chinese there was no better place in Asia for me to develop.
“Hong Kong as a location has the best of both worlds, east and west. It’s a two-hour train ride to Shenzhen, or a two-to-three-hour flight to anywhere South East Asia. I saw it as a strategic hub.”
The flexibility of the HKUST MBA
Lin describes the classroom on the HKUST MBA as the catalyst for his broader understanding of business. The class of 2020, for example, was made up of professionals with an average age of 29 from consulting, finance, accounting, HR, IT, marketing and sales, operations, and logistics. 96% were non-local.
“The MBA is a melting pot of most people you’d find in the world all coming together and letting themselves learn and develop for 16 months. You rarely find that in an organization or a day-to-day role,” says Lin.
“Not only do you enhance your own skills in terms of showing people what they can learn from you, but you also look at other people and learn from them.”
The flexibility of the MBA curriculum also allows students to tailor their education to their chosen career path. Only about a quarter of modules are core courses, with nearly three-quarters being open for students to select as electives.
The value of an MBA internship
The flexibility of the HKUST MBA extends to students’ internships. What began for Lin as a three-month internship with German chemical giant, BASF, extended to 11 months.
He explains that when COVID-19 caused mass disruption and his MBA exchange with NYU Stern School of Business was delayed, BASF offered to extend the internship to bolster his practical education. He was also able to postpone classes for two months to go on a business trip to Shanghai and has since been offered a full-time role with the firm, which he’ll start alongside his virtual exchange with NYU.
HKUST were open to Lin working full time during the MBA internship and taking classes in the evening at the school’s building in the central business district of Hong Kong. He’s been working in the day and starting classes around seven in the evening.
Lin adds that the student visa he’s on in Hong Kong requires the school to approve a set number of hours for work. When his internship terms changed the school adapted, he explains, and approved his extra hours.
That flexibility has also led to better networking opportunities for Lin. Evening classes are also mixed with HKUST’s Part-Time MBA students too.
“The part-time guys are great as most of them have a stable job in Hong Kong, and you can have a conversation with them to learn about their industry’s environment, or where you want to take your career,” explains Lin.
“We’re highly encouraged to mix with the part-timers on assignments to broaden our network during the MBA to achieve our career goals in the future.”
The flexibility, learning to be agile, and adapting to the unexpected have all led Lin to his post-MBA career with BASF, something he says he wouldn’t have been able to achieve without the degree.
“I think for me that’s the mindset you have to take. You have to be like water, be flexible and agile in situations, which is a lesson you take for the rest of your life, as well as in the business world,” he concludes. “It all starts with the mind, and then you'd be surprised at all the opportunities that surround you."
GMAT Online Exam Appointments Extended Indefinitely
The Graduate Management Admission Council (GMAC), owner and administrator of the GMAT Exam, has announced that appointments for the GMAT Online Exam will be extended through 2021.
Now, with coronavirus seemingly here to stay and the world shifting to life online, the online GMAT will continue to serve candidates looking to enroll in MBA and master’s programs.
The GMAT Online Exam has now been updated to include the Analytical Writing Assessment (AWA), the GMAT essay section, previously only part of the traditional test center GMAT. Additional enhancements have also been made to align the online GMAT with the test center version.
Registration for the enhanced GMAT Online exam will open from February 17, 2021 for appointment dates beginning April 8, 2021. Testing appointments are available for the current version of the GMAT Online Exam through April 7, 2021.
The Executive Assessment Online, a GMAT-style test for Executive MBA candidates, will also be available to take through 2021.
The Updated GMAT Online Exam
GMAT Online Exam vs. Test Center GMAT
Although GMAT test centers have re-opened in some countries, many elsewhere remain closed or with limited capacity. It’s also trickier for candidates to plan ahead or travel to test centers with the ongoing threat from COVID-19.
In terms of content, there is no difference between the new online GMAT and the test center version. The online GMAT has the same structure, number of items, and duration as the test center exam. It also uses the same scoring algorithm and score scale for the Section Scores and Total Score.
Candidates were initially unhappy that they weren’t permitted to take physical notes during the GMAT Online Exam, but GMAC was quick to address this and test-takers are now able to use a physical whiteboard as well as the online whiteboard tool.
The test is available in impacted markets globally, excluding markets limited by regulatory restrictions: Mainland China, Iran, Cuba, Sudan, and North Korea.
Note: The GMAT Online Exam now allows a physical whiteboard option.
GMAT Online Exam | A permanent solution
The GMAT Online Exam is set to stay. GMAC says it has seen widespread acceptance of the GMAT Online Exam from business schools. Both GMAT and GMAT Online scores are valid for five years.
“Since April, candidates representing 124 countries have sent scores to more than 2,000 business school programs around the world,” said a GMAC spokesperson contacted by BusinessBecause.
“Schools globally have been very comfortable and confident utilizing the GMAT Online exam to evaluate their applicant pools.
“The purpose, construct and scoring structure of the online assessment is comparable to the exam delivered in test centers and GMAC has observed scoring outcomes comparable to exams delivered in test centers.”
Applying To Business School During COVID-19?
EMBA X: The Executive MBA Combining Business & Technology
Strong leadership, technology, and social impact. A triumvirate that should sit at the heart of business in the 21st century. That’s what two of Switzerland’s top universities believe, as they launch a new Executive MBA that hopes to drive forward a mentality of social responsibility among executives.
EMBA X is the result of a collaboration between the University of St Gallen and ETH Zurich.
The two schools began developing the 18-month program in 2019 with the aim of tackling the future challenges facing global society. It was an opportunity to combine the leadership expertise of St Gallen with the technical prowess of ETH Zurich to provide executives with a business education fit for the future.
Why EMBA X?
Even before the COVID-19 pandemic, a shift was underway. Digital disruption posed a challenge to the way executives lead their companies.
There was also already growing pressure on companies to move away from a model of shareholder primacy and toward one of stakeholder value, considering employees, the environment, and wider society.
EMBA X aims to educate executives on how to lead their companies with this in mind.
Recognizing where technology can have a positive impact is something Karolin Frankenberger (pictured right), academic director of the EMBA programs at the University of St.Gallen and co-director of EMBA X, emphasizes was key to the design of the program.
“What’s important to me is executives need a willingness to make a significant impact on society,” she says, “the new EMBA will [push] this.”
Alongside leadership development and implementing technology for social good, the EMBA X program also focuses on personal development, with an integrated Personal Development Journey running throughout the course.
The aim is to send executives back into their companies with the ability to extend their own personal development and cutting-edge knowledge to their teams. There should be a trickle-down effect from the top that results in an overall positive impact for the organization.
EMBA X: Business + Technology
Combining the expertise of a business school with a science and technology-focused university gave the EMBA X team the advantage of designing a program that would sit at the cutting edge of industry.
But you can’t do that without first-hand industry insight. That’s where Claudio Feser came in. Claudio (pictured left) is a senior advisor at McKinsey & Company, and acted as industry expert and senior advisor on the creation of EMBA X.
As he made sure the program was relevant to the realities of the contemporary business world, he notes the challenges faced by the two universities when collaborating.
“There are very different cultures, perspectives, and priorities with the two,” he says, “but our mission of creating something to prepare the leaders of tomorrow was so compelling that it made it easier to bring the two institutions together.”
The program was created to enable leaders to learn skills that will become more prevalent in the upcoming years. As further technological advances and demands for more corporate responsibility blend together new roles will be created that executives on the EMBA X program will have to both fill and take on themselves.
“Many of the jobs that are going to exist by 2030 don’t yet exist,” Claudio emphasizes.
“Executives need to know about emerging technologies and the impact they have on business,” Karolin adds. That’s why the team chose to eschew a traditional EMBA structure in favor of a more integrated approach.
Teaching on each module will be done with academics from both institutions in the same class, rather than being split down the middle. Students will learn in a hybrid format that splits their time approximately 60% in person and 40% online.
They'll cover topics like business innovation, adaptive technology, and sustainable business, all encouraged by targeted skills building and personal development.
They’ll also be well prepared to lead in a post-COVID-19 economy. Though the program was in its early design stages pre-coronavirus, the EMBA X team were pushed to design most of the program remotely when the pandemic hit.
The impact of COVID-19
When the two schools got together to flesh out the program’s details, they were hit by the worst global health crisis for a century. But the pandemic accelerated trends that were already underway. Trends that the team had in mind when initially designing EMBA X, which starts in February 2022.
“The whole situation and complexity of response to COVID-19 not only medically but economically and socially gave us more confidence in the main principles we wanted to build into the program,” explains Stefano Brusoni, professor of technology and innovation management at ETH Zurich and co-director of EMBA X.
The overarching theme of the program is technology’s role in the future of leadership. The importance of sustainability, science and technology, and effective management have been underlined by the coronavirus crisis and have cemented the two universities faith in their new program.
It's one thing to adapt a program from in-person to online, as most schools did at the start of COVID-19 restrictions. To create a program remotely in a pandemic, Stefano says, is a different task entirely.
“Everything is integrated now. COVID-19 has taken away the boundaries,” he says.
The coronavirus pandemic has taken a decade of change, accelerated it, and condensed it into a few short months. The challenges the EMBA X program was initially designed to meet have already arrived.
If the EMBA X program stays true to its message, the businesses that will benefit will be ones led by strong, tech-savvy leaders with a social conscience.
McKinsey, Bain, BCG Salaries Frozen As MBA Consultants Impacted By COVID
MBA students are drawn to the consulting industry for its fast-paced work environment and generous salaries. Graduates will be dismayed, then, to find that COVID-19 has impacted MBA consulting salaries.
80% of consulting firms either cut or froze MBA consultant starting salaries for 2021, according to the ManagementConsulted 2021 Salary Report. McKinsey, Bain, and Boston Consulting Group (BCG)—also known as the ‘Big Three’—all froze their starting salaries.
This comes after Bain recorded its best ever quarter in Q3 2020 and after McKinsey told BusinessBecause that 2021 would be its record MBA hiring year.
McKinsey, Bain & BCG consultant salaries frozen
McKinsey, Bain, and BCG remain among the top employers of MBA students in 2021. Brian Rolfe, global talent acquisition lead for McKinsey, told BusinessBecause that 2021 would see “the largest incoming class in McKinsey’s history”.
MBA salaries at all three, however, have been frozen at the same level as in 2020, at a base salary of $165,000.
Salaries are still very high compared with other industries. The ManagementConsulted report estimates that total compensation for MBA hires at Bain and BCG (combining salary, performance bonuses, and signing bonus) can reach up to $236,000, while McKinsey MBA hires receive $230,000.
Total compensation includes base salary plus performance and signing bonuses
To break this down, base salaries for MBAs at the Big Three consulting firms all come in at $165k a year. Performance bonuses can add up to $41,500 (25%), while signing bonus comes in at around $30,000.
Top firms like the Big Three seem to have taken advantage of market disruption in 2020 when other top MBA recruiters, especially those who for some time had been poaching recruits from consulting firms, largely froze hiring.
Salaries cut at Deloitte, KPMG & boutique consulting firms
Other consulting firms witnessed a harsher impact of COVID-19 on their MBA hiring. Deloitte, PwC, and KPMG cut MBA consultant salaries.
New recruits at Deloitte Consulting can expect around $151,000 in total compensation, $22,000 less than new hires in 2020, back closer to the rate paid in 2018.
KPMG slashed salaries by $15,000, from $190,000 to $175,000. KPMG Strategy & Operations (S&O) recruits saw salaries cut from $230,000 to $215,000.
EY was the only firm to increase MBA starting salaries, albeit by just $5,000.
According to ManagementConsulted, some boutique consulting firms offer higher overall compensation than some of the Big Three. These firms offer higher pay-packets as a way of competing with better-known, global brands.
Total compensation at LEK Consulting can come in at up to $283,000. On top of the $165,000 annual salary, and up to $25,000 performance bonus and a $55,000 signing bonus, employees could earn a possible $38,000 through the company profit sharing scheme. This is an incentive offered by smaller firms as a way of differentiating themselves.
Close behind is PwC Strategy&, where total compensation can reach $253,400, followed by AlixPartners, where total compensation can tally up to $250,000.
Will consultant salaries recover?
Part of the reason for diminishing MBA salaries was the predicted impact of the COVID-19 pandemic on the consulting industry. Many firms anticipated the same widespread economic damage to their industry as with many other industries, and froze or cut salaries accordingly.
On the contrary, consulting saw a sharp increase in demand in 2020, as companies looked for consultant advice on navigating uncertainty or even restructuring their businesses.
MBA graduates can therefore expect starting salaries to grow again in the future, while MBA hiring looks set to skyrocket as consulting firms look to meet growing demand.