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Japan’s age of the MBA

To drive Japan’s business success in the 21st century, young people may need to embrace the MBA over traditional linear career progression within Japanese organisations. Leonard Leiser reports

It may surprise you how few Japanese professionals know the answer to the question: ‘What is an MBA?’ 

Despite Japan having the third-largest economy in the world and being home to the Toyota production system, lean manufacturing, Sanpo-Yoshi, Gemba Gembutsu and Ho-ren-so, the idea of enrolling at a post-graduate institution that teaches business practices is far from mainstream. 

Japan is home to operations management guru Taichii Ohno who penned Seven Wastes and Ten Precepts, and whose ideas continue to be adopted by some of the top global executives of manufacturing companies. However, service firms and financial institutions, which make up a significant proportion of businesses in Japan, do not connect success with business administration and management leadership in an academic context. Despite being among the most commercially advanced countries in East Asia, Japan is not considered a destination for post-graduate studies in business. Searches for any Forbes or Financial Times Top 100 ranking for a Japanese Business School will prove fruitless. ‘Cool Japan’ fails to include the MBA. How many MBA students around the world have come across a case study of a Japanese company? 

Galápagos syndrome

Japan is a country of hidden champions but ‘Galápagos syndrome’ (a term of Japanese origin, referring to an isolated development branch of a globally available product) permeates failed business ventures. It is widely believed that ‘what works in Japan, will only work in Japan’. 

It is also believed that a lack of fluency in English and communication skills among traditional Japanese managers is the primary reason for the dearth of international success. 

There are a handful of well-written business cases being employed in MBA courses around the world that support this theory. One impressive company that bucks this trend is Rakuten, led by founder and CEO Hiroshi Mikitani (a Harvard MBA). Despite the success of Toyota and electronics manufacturers in the past, one need only read the business section of any global newspaper to understand the troubles of Toshiba, Sharp, Nissan, Mitsubishi – and even Sony until recently. 

The management processes and operational excellence that made Japan a winner in the past are no longer a competitive advantage and the development of soft skills is sorely lacking. So how can Japan begin to win again? 

The Japanese way

Before talking about post-graduate qualifications, let’s wind back the tape of the typical academic journey of students in Japan to provide context for the MBA. From junior high school-level, schools in Japan are selective. 

In order to get into good schools, students must take entrance exams as elementary school students. At junior high, there are preparations for senior high school entrance exams and these are followed by college entrance exams. What matters most tends to be your undergraduate institution. Once a student has got into college they may already be set for lifetime’s employment within a system of regulation that makes it incredibly difficult for companies to fire employees. 

I have personally heard from many colleagues and professionals that the purpose of the Japanese education and university system is to prepare young people for company life; in other words, to prepare them for the uniquely Japanese culture of harmonisation and the development of the communal mindset and group mentality that lies at the heart of the Japanese corporate machine and Japanese society as a whole. 

And it’s a system that works very well, overall, in Japan. Big companies recruit directly from undergraduate schools, taking the best talent from the big schools. Furthermore, most companies have their own ‘way’ of doing things. Most readers will be familiar with the ‘Toyota Way’ and the ‘Honda Way’ of management, and on-the-job traning and in-house development helps instil these ‘ways’ into the employee’s psyche. 

Many companies are set up to develop generalists within their ranks and those on the executive track have exposure to all sides of the business at some point in their careers. I know of one high-level executive with a degree in engineering who ended up in financial accounting, as well as Toyota engineers who became hospital administrators and directors.  

Enter the MBA…

Beginning with the value proposition of the MBA, many students see MBA programmes as a chance for personal development and life-long learning. However, in Japan, companies are structured internally to promote employees according to seniority rather than merit. With lifetime employment, few Japanese professionals feel compelled to enrol in an MBA or post-graduate programme for the purpose of career switching. 

In the past, prospective students in Japan may have felt it necessary to develop their English and to move to the US or Europe to enrol in a top-flight MBA programme. This would be a difficult barrier to overcome. However, over the past 10-15 years, domestic Japanese language-based MBA programmes, offered as weekend or part-time courses, have started to gain traction. Those that gain international accreditation from organisations such as AMBA, signal to students that their programmes meet the highest quality standards, and are on par with the best international alternatives. While the average age of MBA students at top Business Schools in the US is 27 or 28, the average age of MBA students at Nagoya University of Commerce and Business (NUCB) is mid-30s. Roughly 40% of executive MBA students are over 40, and some are in their late 60s. 

How does the MBA fit in the Japanese market?

Potential MBA students in Japan no longer have to cross the world to study for an MBA; a short hop to a domestic institution offering weekend courses is now available. The power of the MBA is rising in Japan and it is a growing trend.

In the summer of 2017, The Japan Times ran an article that projected the latest findings from the QS World University Rankings Report of 2015-16 and 2016-17. The title of the article summarised its findings: ‘[The] MBA provides better salaries and opportunities.’ 

While the overall salary compensation package for MBAs in the Asia Pacific region had dropped, by contrast Japanese companies were now willing and able to offer higher salaries and bonuses to those with an MBA. The rate at which MBAs are being hired in Japan is on the rise. While the fastest-growing countries in the Asia Pacific region, China and India have Schools listed in the top rankings tables, only one Japanese institute is currently accredited by AMBA. From this, three major trends reflect the demographics and demands of the Japanese employment pool. The increase in MBA students is top-down – executive education courses, including the EMBA, have emerged as the most popular choice, and specialised tracks have been well-received by the market.

When I say that the increase in MBA students is ‘top-down’, I am referring to company presidents, CEOs, directors, founders, and top-level executives enrolling in MBA programmes. 

From this, either during the programme or on their completion of the programme, they establish pathways for their employees to take MBA courses. Although in some cases, a Japanese company may pay for, or subsidise, the occasional non-degree course, they tend to simply recommend or suggest that employees undertake the MBA as a full degree programme. In most cases, students pay for the degree out of their own pocket. Few Japan-based companies cover an employee’s EMBA tuition fees. So, top company executives are dipping their toes into the MBA pool and encouraging their employees to follow them in.

As an extension of the previous trend, in recent years we have also seen the biggest spike in the number of students enrolled in executive education. Executive programmes require extensive work experience, and the market in Japan is drawing on experienced employees who can realistically only attend short intensive courses at weekends or on weeknights. This trend seems to be a natural consequence of the Japanese market.

Specialised courses offered as certificate-bearing tracks are receiving a lot of attention. At NUCB we have just launched two specialised degree pathways: the global MBA and the healthcare MBA. The former includes courses offered only in English and will include a mix of degree and non-degree students, while the latter is focused solely on management in the healthcare industry. 

One of the key aspects, and key value proposition of both, is that they are certificate-bearing. One trend that is certainly not new in Japan is the appeal of official licences, certificates and degrees to Japanese people. 

This specialised track, we hope, will be a way to introduce our university to a larger target audience and define the meaning of the MBA to Japanese employees.

The outlook for the MBA in Japan

There are three changes which I hope to see over the next five to 10 years in Japan. 

First, an increase in the number of younger people taking MBAs, and people increasingly taking more generalised Master degrees. I am hopeful that young entrepreneurs will find Business Schools in Japan an attractive alternative to a lifetime’s employment with a specific organisation. Business Schools could provide the avenue for them to express their creativity and innovation in a way that will generate profits, create jobs and increase personal satisfaction, while fostering a
better society.

This is not a recommendation for all, or even most, Japanese people, but many young people would be well-suited to undertaking a post-graduate programme before turning 30, rather than sticking with one of the ageing business giants of Japan. 

Some of the biggest success stories – and most popular business cases – involve the founders of Apple, Dell, Google and Facebook dropping out of college to pursue the growth of their own companies. 

While I am not advocating that Japan needs young entrepreneurs to follow this route, I am saying that the inflexible educational structure that begins at elementary school age, and continued adherence to rote learning, is in stark contrast to the global teaching methodologies of the 21st century, and the development of soft skills necessary in the modern workplace. Being in a college setting provides a unique sense of ambition, freedom and confidence, allowing students to explore new ideas and develop a business model with resources and opportunities all in one place.

In addition, Business Schools need to attract more women into post-graduate programmes. Japan faces the double threat of an ageing and decreasing population. Women should be able to access the workforce, and leadership roles, irrespective of this, but it is an added reason for the workforce to draw on all available members of the labour pool. 

Women have been vastly under-represented at management and executive level and the MBA could prove a vital resource for women to develop skills and a quantifiable advantage, to help them secure the top spots across all industries and companies in Japan. The MBA alone will not achieve this progression, but it could provide an important step forward and a push in the right direction.

Finally, I am interested to see how the purpose of the MBA in Japan changes. In other words, how will the factors motivating students to take MBAs evolve over time? 

In a conversation I had with President Dr Hiroshi Kurimoto of the NUCB Business School regarding the role of the Asian economy in the next 20 years, he shared with me that the Asian Development Bank has reported that, currently, some 20% of global GDP stems from the Asia-Pacific region; by 2040 that contribution is expected to rise to almost 50%. 

How will this realisation impact on the value and delivery of the MBA in Japan? Will local programmes launch more domestic-orientated courses and specialised pathways, focused on Japanese business or will programmes begin to cater for an influx of international MBA seekers choosing Japan as their MBA destination of choice within the Asian-Pacific market? 

Will Japanese MBA seekers’ aspirations come into line with those of Western-based MBAs, or will international MBA seekers elect to enroll in Japanese programmes to gain an understanding of the group mentality necessary for success in the traditional Japanese corporate environment?

Only time will tell, but for now, it is an incredibly exciting time to be part of the challenge of the MBA in Japan

Leonard Leiser is Coordinator for International Development at Nagoya University of Commerce and Business (NUCB) Business School

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Meeting India’s demand for business education with responsibility

How Mumbai’s Athena School of Management aims to change the parameters of traditional management education in India

India’s burgeoning young and aspirational population ensures an ‘insatiable’ demand for quality business education, according to Aditya Singh, Director of Athena School of Management in Mumbai.

This underlines the importance of the place held by the country’s Business Schools in society, their responsibility towards it, and their potential to make an impact.

‘A good business programme is not only about a qualification,’ says Singh, cautioning   against the ‘commoditisation of business education’.

In the following interview, with Business Impact’s Content Editor Tim Dhoul, Singh outlines the approach and ambitions of Athena School of Management, encompassing the importance it attaches to internships and experiential learning as well as the value of community work.   

Demand for places at top Business Schools in India is high. Are there any particular qualities Athena looks for among its applicants?   

The phrase we use constantly is ‘marks don’t make a business leader!’. While we do give weightage to academics and scores, we follow a profile-based admissions process.

We evaluate applicants equally on the basis of their extra-curricular achievements, including achievements in sport, social impact projects and volunteering activities, as well as their work experience and any prior international exposure. Most importantly, we evaluate their desire and hunger to succeed in making a positive and sustainable impact both in business and society.

What are some of the biggest challenges facing Business Schools in India and the surrounding region, in your opinion?

Indian Business Schools have to be extremely careful to avoid commoditisation of business education. A good business programme is not only about a qualification!

With a huge young and aspirational population below the age of 25, there is an insatiable demand for good education [in India]. However, it is critical that Business Schools keep their eye on the ball and realise that the final measure of our success is going to be borne out by the number of our graduates that excel in the corporate world and the world of business.

How many entrepreneurs are we truly able to create?! Business Schools have to create actual and tangible management and leadership skills among their students.

What do you think makes Athena’s Post-Graduate Programme in Management (PGPM) programme stand out from others that are available in India?

The Athena PGPM is designed to be an experiential-based pedagogy with a focus on real-world and practical learning. Our goal is to ‘positively impact the world through our students’.

The programme’s key features include: multiple internships with some of India’s top companies and startups; international immersion programmes across Europe, Asia and Canada; a faculty that includes top corporate leaders at CEO, Director and VP levels; a campus in Mumbai, the commercial capital of India; and small class sizes to ensure quality teaching and a keen focus on the students’ personality and soft skills.

Can you tell me how internships are incorporated into Athena’s PGPM programme and why the School places so much importance in them?

Internships are an integral and important part of the Athena PGPM. The programme includes a two-month long internship in each semester, which works out at a total of six to seven months of internships during the whole programme.

Interns are expected to implement their learnings from class, and to improvise and execute on a real-time basis. Each intern has a mentor attached from the company who guides them.

Alternatively, some students choose to pursue an international internship where they work with organisations in different geographies, along with understanding and appreciating different cultures and societies. Athena students have interned in different countries in Europe and Asia, including Italy, Turkey, Germany and Nepal.

Aside from internships, how else does the School facilitate experiential learning?

Experiential learning is a constant form of learning where the student is the ‘centre of gravity’ and the faculty are enablers and facilitators of learning rather disseminators of information. In order to facilitate, we include design thinking, action learning and project-based learning. 

Students pursue live projects with companies and NGOs, case study competitions, multiple internships along with consulting assignments. Students also have to work with projects in the social sector and with non-profits in order to truly understand business impact at all levels of society.

Do you think that PGPM/MBA curricula should be developed in collaboration with employers?

At Athena, we believe that potential employers have an extremely important role to play in the design and implementation of our programme. We follow the end-user process of curriculum design in order to keep our modules relevant and at the cutting edge of business practice and innovation.

Inputs and guidance are taken from senior stakeholders representing potential recruiters along with roundtables and conclaves that are held to discuss the changing and rapidly evolving business environment.

Can you tell me a little bit about Athena’s international immersion modules?

Global exposure and cross-border learning experiences go a long way towards creating future global leaders. While the international immersions are not mandatory, an increasing number of students are embracing the opportunity.

This year, we have students travelling to Singapore, Germany, Canada and the US for modules on topics ranging from leadership and entrepreneurship to analytics and Industrial Revolution 4.0. The experience of studying at these global institutions as well as interacting and living with students from across the world is a truly life-enhancing experience.

I note that community service and personal development initiatives are actively encouraged at the School. Can you tell me of any programme requirements here and/or what options are available to students during the programme?

While prior experience in community and/or social development is not mandatory, it is preferred. At the School itself, we actively partner with organisations such as Rotary International, AIESEC, Rotaract and other NGOs to make a positive impact on society.

Athena is also an academic partner of the United Nations Global Compact which reinforces our vision to contribute towards the Sustainable Development Goals (SDGs).

It is mandatory for all Athena students to complete at least one live project towards community/social development.

What are your hopes for the School in the next five years – what do you want to see happen?

Our vision is to challenge the limits and change the parameters of what traditional management education has been in India. We see trending areas in business education that include entrepreneurship, analytics and design thinking, and we wish to establish a centre of excellence in each of these.

We also hope to increase the trend of international students studying with us in Mumbai. The hope is that, in the next five years, an Athena business graduate can create value for their organisations or create their own venture anywhere in the world equipped with experiential and innovative learning, international exposure, and a desire to excel and contribute to society.

Is there anything you’d like to see change among Business Schools both in India and in the rest of the world?

In a rapidly changing socioeconomic context, we have to become nimbler and more flexible in delivering solutions to our students which are relevant to the business environment.

We need to be able to predict change effectively and stay ahead of the curve rather than playing catch up. Business Schools also need to shift focus from extremely theory-centric learning to practical and real-world learning while encouraging students to become change agents in their future organisations. We have to harness new technologies so that they can complement and, in some cases, supplement current learning methodologies.

Aditya Singh is the Director of Athena School of Management in Mumbai, where he currently teaches leadership and differential thinking. He has more than 15 years of experience across the corporate sector, consulting, entrepreneurship and academia. Aditya is a graduate of the Wharton School’s Accelerated Development Program (ADP) and holds an MBA (PGP-FMB) from the SP Jain Institute of Management and Research in Mumbai.

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Focus on business education in Latin America

Heads of Business Schools from Latin America discuss Business School programmes in their region and how these are developing and interacting with business. Interviews by Jack Villanueva and Kevin Lee-Simion

Jorge Talavera 
President, ESAN Graduate School of Business, Peru


What does a ‘great’ MBA programme look like?

Great MBA programmes support the best product – students. To support them, we need to provide them with the key factors for success which include knowledge, soft skills, leadership and team work.

How has international business developed in Latin America? 

To develop international business, we developed our students. We established very good connections with the business sector. We provided them with the leaders, and they told us what we have to teach in order to be relevant. 

How are MBA programmes similar across the world, and how do they differ?

In the past they were quite similar. People in developing countries followed the programmes in the US and Europe, but MBA programmers try to solve the problems in the region. So now we have to adapt programmes and develop our own, to give our students the ability to solve problems in our society. 

Do you think the MBA mindset has changed?

I don’t think so. People have always studied for MBAs because they want to lead institutions, and Schools have provided students with knowledge to lead institutions.

What are the main challenges Business Schools face? 

Coping with change in terms of technology, and dealing with competition due to globalisation. We have to compete to provide solutions for society, and good quality professionals.

Should there still be a focus on local businesses and local economies as well as the international business economy?

You have to be good in your own country first. Then you can take your success abroad and provide other societies with solutions.

How important is it for Business Schools to continue to innovate in order to compete with businesses around the globe?

Innovation is important but sometimes innovation is confused with change. Organisations change and say they are innovative because they changed – but then go bankrupt. You need to innovate and it needs to be successful, otherwise it doesn’t mean anything.

Xavier Gimbert
General Director of the Graduate Business School of Universidad del Pacifico, Professor of the GBS of Universidad del Pacifico and Professor of ESADE Business School 


How do you see the decision-making process changing over the next few years?

The decision-making process has to be strategically ongoing, because the environment is changing every day. Also, decision making is becoming more collaborative.

Decision making is the most important process in managing an organisation. If you don’t have the best people and a good process, it will be a disaster.

How are strategic models beneficial to a business?

Models are guides and their objective is to help you to think, reflect, and make decisions. In a decision process, a model gives you different steps you have to think about in order to make decisions.

How important is innovation in strategic management? 

Innovation is one of the key elements of strategic management. But do you have to innovate in order to be successful? Innovation is something a company should have the option of doing, but doesn’t always have to do. 

Do you think MBAs are learning the skills required to succeed in the future? Or do Business Schools need to evolve?

I think the content of the MBA is evolving as there are more soft skills, which are fundamental to getting a good job, managing companies, reading changes in the environment, making fast decisions, and adapting to change. These areas can’t be taught though ‘real’ content.

Why is it arguably more important than ever to create alliances?

We are in a global world and can’t do everything alone. In Latin America, it’s a way to improve, in terms of businesses and Business Schools. Alliances provide knowledge from abroad. It’s a very powerful tool. Nowadays, alliances are key and we have to see others not just as competitors, but as potential allies.

Martin Santana
Professor of Information Systems, ESAN Graduate School of Business, Peru

Should there be a greater emphasis on technology in MBA programmes?

I think there is an emphasis but it’s not significant. We are dealing with millennials, 75% of whom interact through technology. Our MBA programmes are not prepared for that, as technology is used more as a learning platform. But this is a different dimension we are talking about with the technologicalically savvy guys from the millennial generation.

How important is the role technology for Schools? 

I think technology is key and Schools are using it to gain connections around the world, to provide a leaning environment, create alliances, and persuade prospective MBAs and faculty to come to their School. 

What innovations have you seen in the world of digital business?

Change in the learning environment. It’s now an open environment with different technologies, but they are converging into one purpose for Business Schools – enhancing learning opportunities
for students. We are under pressure to create a learning environment for the millennial generation.

What are your thoughts on e-learning? How beneficial do you think it is to an MBA?

It’s very important, but I believe in a more blended methodology. A 100% online programme is not yet well accepted in Latin America as employers believe these are low-quality programmes. I believe blended programmes will be the solution but I’m not against having a 100% virtual programme.

In what ways could Business Schools use technology to
their advantage?

I think technology should be used to attract, retain, and train our students, and change the mindset of professors who are using technology for basic things.  Technology is a key component of being successful.

Do you think technology and millennials are essential for Peruvian Business?

I believe so because more than 40% of the population is made up of millennials. In the near future, the majority of the workforce will be millennials, they will be future entrepreneurs and will be running most companies.

How will millennial leadership compare to traditional leadership?

Millennials care about a lot more than just being managers. For one, they expect to have good mentors, and this will be the model they use in the companies of the future. They will become mentors and transformational leaders – focused on the person rather than the activity.

Do you think millennials lack soft skills when you compare them to previous students?

Yes, remember we are still talking about young people and they are in the process of developing. They lack social skills but it’s our job to teach them these. We can change their mindsets and help shape them so they can be successful. 

What do you think the future holds for the MBA?

There will be many different varieties of MBA programme, and they will come together with a blended methodology. This means you will be able to connect with anybody around the world, but we will have to change our methods of teaching, and our professors. 

Matthew Bird
Professor, Universidad del Pacífico Graduate School, Peru

Is there a big difference between how businesses are run and how the government is run?

There is in Latin America. There is a distrust between the government and the private sector. I believe many countries’ societies understand that they need one another, but the hard thing to do is to build the foundation for trust and identify those shared spaces for collaboration.

How important is innovation in solving social challenges?

Very important: innovation can be anything that is different and creates value. Understanding social systems creates opportunities to identify those small interventions where the government and private sector can work together.

To solve social challenges, do you think it is a one-size-fits-all solution all or is it case-by-case?

There are elements that are cross-cutting, and once you know how to tackle social issues, it’s down to harvesting local solutions to shared problems. This is one of the reasons I believe in design thinking because it really focuses people to listen, empathising first. Through that empathy, you can understand where the gaps are, and what people want, so you can collaborate better to deliver that.

In what ways will harvesting local innovative interventions solve common social challenges?

People look at social issues as problems, but people should see them as solutions. Take the informal economy. People originally viewed the informal economy as a problem. However, people were working in the informal economy. This means they were creating value through jobs, and therefore creating  income. It was a solution.

How do you think the rise in digital technologies is affecting Business Schools?

Digital technologies are already transforming the way we teach and interact with students. Technologies are creating challenges, but also opportunities. For example, with virtual education, you are creating competition between Schools, but there are also opportunities for people to overcome historical geographic barriers and push education into areas that have been traditionally harder to reach.

What are some of the biggest challenges facing Business Schools in Latin America?

The biggest challenge for Business Schools in the region is to move away from a strong focus on teaching, as there are opportunities for research. Research can still contribute to value creation, but its potential has still not been tapped.

How much of an impact does cultural influence play in economic decisions?

You define decisions and use certain frames – influenced by social cultural backgrounds – to justify them. Then you identify decision criteria, and then the choices. These choices are permeated by your culture.

Oscar Muartua de Romaña
Director de la Escuela de RR.II. y Gobierno de la UTP en Universidad Tecnologica del Peru (UTP)

How important is it for countries to work together?

It is an obligation and we have always demanded that the international community resolve these problems. The UN means there is an international community of 200 nations, and stability has a path through hard times.

Do you think volatility makes collaboration more difficult?

It is more challenging, but we can provide more effective reactions. One of the biggest challenges, but also the most fundamental aspect, is to have dialogue, because only through this will countries understand each other. Also, science and technology are providing us with enough arguments to build our future to benefit all humanity.

Do you think international relations impact business education?

Business Schools need international relations to prepare future professionals. MBAs have a moral function – they are embodying the values of society while trying to benefit society.

will it be difficult for Schools to implement the UN’s sustainable development goals?

It will be difficult to adapt to reform. But these principles are nothing new. So it is about doing as much as we can through investment in education and generalised development.

How do international relations impact Latin America? 

International relations have helped us create Schools, bring in faculty, and establish MBAs. We’ve learned how development can create good results for a country, and we made this into a reality. International relations have also helped us become aware of innovation and entrepreneurship. Business has played an important role in the growth of Latin America. 

How are Schools in Latin America preparing MBAs for the future? 

Business Schools are preparing MBAs for an open economy, and everything that has been done by Business Schools is an investment in Latin America. MBAs are also learning about the linkage between the Business School, industry, and government, and the importance of moral values.

Racheli Gabel Shemueli
Research Fellow and Professor in the Graduate School of Business of the Pacific University in Lima, Peru

What do you look for in a prospective MBA student?

We want people who are different and who acquire knowledge and implement it. They have to be responsible leaders who want to create change. We are looking to the kind of person that makes a difference. 

What are the challenges in attracting these students?

The challenge is to state that our Business School is different. We say we are looking for quality, and we are very demanding.

How important is it for MBAs to have cross-cultural experience?

When we think about inter-cultural experience, we also think about local experience because Peru is very diverse. Cross-cultural experience is not just about travelling the world, but about working with diverse people. For an MBA to be exposed to cross-cultural experiences, and know how to work with this is important, in order for them to lead.

In what ways can cross-cultural issues be addressed in the future?

In-house learning is important so we can see what our students understand. Then it is a matter of doing the exercise, and doing it in your own life.

Why is innovation important?

Learning is interactive. I am learning from my students and they are learning from me. 

Professors are now just facilitators of limited information, and as a result, knowledge comes from both sides, the students and the professor.

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Enhancing social innovation in Africa

With Africa’s population projected to grow to 2.4 billion by 2050, there is an urgent need for the emergence of more social innovators, operating at scale, to address pressing problems in sectors from education and healthcare to employment and housing, writes Ndidi Okonkwo Nwuneli

Oiginally labelled the ‘dark continent’ and largely unknown to the rest of the world, Africa is now being described as the ‘last frontier’. 

Following decades of slow and uneven economic growth, the average growth rate across African countries is estimated at 5%, and more than two-thirds of the countries in the region have enjoyed 10 or more years of uninterrupted growth. 

The majority of the countries are recognised as democracies and internal and cross-border strife has diminished significantly. An average African woman’s life expectancy rate has risen from 41 in 1960 to 57 years in 2017, and more than 70% of children are in school, compared to around 40% in 1970. Many of these advances can be linked to the work of a growing number of passionate and committed social innovators: individuals who have identified novel solutions to the continent’s most pressing problems that are affecting the masses. These innovators operate in the public, private and non-profit sectors and are concentrated in the health, education and energy landscapes, with a growing number emerging in financial services, agriculture and sanitation. 

Their work is being propelled by the rapid advances in mobile technology, which facilitates mobile health, mobile education, payment systems and mobile money. In addition, they are gradually being supported by a range of initiatives including innovation accelerators, hubs, prizes, and fellowships. 

The most popular Africa-based social enterprises include the African Leadership Academy and African Leadership University, Ashesi University, Bridge International Academies, One Acre Fund, Riders for Health and Sanergy. These organisations have received numerous local and global awards and prizes for their pioneering efforts, and have strong links to the international community, which has provided funding and support for their work. 

There is also a growing number of organisations operating on the African Continent, which are essentially home-grown initiatives with minimal global recognition. They include:

  • Action Health Incorporated established by Dr Uwem and Nike Esiet in 1999, to address the rising incidence of HIV / AIDS and teenage pregnancies in Lagos, Nigeria. Over a 10-year period, they designed and introduced sexuality and reproductive health curricula into public schools, fighting against the odds in a deeply religious society. Today, this curricula and its delivery has been adopted across the majority of the public schools in the country, and have played a key role in reducing HIV/AIDs and teenage pregnancies.
  • CLEEN Foundation founded by Innocent Chukwuma, was established in 1998 to address rising crime rates in Nigeria’s major cities and create bridges between the police and citizens. Faced with stiff resistance from both sides of the divide from the onset, CLEEN worked with the Nigerian Police Force to revive and strengthen its internal accountability mechanisms such as the Police Public Complaints Bureau (PCB) in six Nigerian states. It also encouraged the police force to make its processes open and transparent, which ultimately exposed the gross misconduct of many police officers, leading to the dismissal of more than 5,000.
  • IkamvaYouth in South Africa was established in 2003 by Joy Olivier and Makhosi Gogwana. The organisation equips students in grades 9, 10 and 11, from disadvantaged communities, with the knowledge, skills, networks and resources to access tertiary education and / or employment opportunities. These ‘learners’ eventually become volunteers and ultimately continue the cycle of giving back to the next generation of ‘learners’. IkamvaYouth operates in the Western Cape, Gauteng, KwaZulu-Natal, North West, and the Eastern Cape, reaching thousands of young people.
  • The Ethiopia Commodity Exchange (ECX), was initiated in 2008 as a marketplace or platform that facilitates the trading of agricultural produce between buyers and sellers. It provides transparent price information for both farmers and buyers, and protects both farmers and traders from price drops and price hikes, respectively. ECX harnesses innovation, technology, and storage infrastructures to mobilise products from smallholder farmers and ensures product quality, delivery, and payment.

Challenges faced by social innovators

Social innovators operating on the African continent face challenges that are not unique to Africa, but are often more severe, with higher stakes. My interviews with more than 80 African social innovators have raised four critical shared challenges:

  • lack of credible data for local communities, countries, and regions, which slows down the processes for planning, piloting, and scaling social innovations and hinders the ability of key stakeholders to measure their impact on society. 
  • heterogeneity within and across countries, which includes significant diversity in colonial histories, language, religion, culture, community assets, and social development, essentially means that there is ‘no single story’. Innovations must be tweaked or significantly altered to enable scaling from one community to another, which is not only more expensive, but also slows the scaling process. 
  • fragmented ecosystems, in almost every sector, especially the agricultural, education and health landscapes, limit the ability of innovators to reach large numbers of people in record time. Consider the agriculture sector, where 85% of arable land in Africa is cultivated by farmers with less than two hectares. This essentially means that any intervention that wants to scale up in this sector can only do so by working with farmer clusters as opposed to individual farmers. The process of creating clusters of farmers, hospitals, schools, small and medium-sized enterprises, and other sectors, and building trust among
  • these groups, takes time and requires financial resources. 
  • significant talent, infrastructure and financing gaps which limit scaling. For example, only one-third of Africans living in rural areas are within two kilometres of an all-season road, compared with two-thirds of the population in other developing regions. This, in turn, makes it extremely difficult and expensive to extend healthcare, education, and agriculture innovations to communities in rural areas. Sadly, with underdeveloped distribution and marketing systems, social innovators essentially work along all aspects of the value chain, filling gaps that ordinarily would not exist in other markets to reach people.

Prerequisites for success

All social innovators need to invest in critical building blocks for success – rooted in sound management principles: clear missions, visions, and values. However, there are at least four prerequisites to establishing successful social innovations in the African context which deserve significant attention.

1 Compelling business models: Social innovators need to develop compelling business models, defined by six critical components: demand driven, measurable impact, simple, engages the community, leverages technology and low-cost. These six components differentiate initiatives which die at the pilot phase or when the donor funding ends, from initiatives that are sustainable and able to achieve scale, spanning communities and even countries. Innovations that are demand driven essentially meet the needs of individuals, who value the product or service and are willing to contribute their time and financial resources, regardless of how minimal, to obtain them. In addition, the innovators have determined the most cost-effective approaches to deliver at scale and developed effective systems and structures to support their scaling effort. They often use simple payment mechanisms using mobile technology and support from microfinance partners, where applicable. These tools are highly dependent on a robust data – tracking system to gauge impact and usage. Two examples from the energy sector that demonstrate the power of demand-driven and sustainable business models are M-KOPA Solar and Off Grid Electric, which both operate in East Africa. They provide solar solutions to more than 550,000 households using a pay-as-you go model, and have demonstrated the tremendous potential at the bottom of pyramid

2 Talent for scaling: Talent on the African Continent remains a huge constraint for all growth sectors given the weak education systems and the global opportunities that are available to the best and brightest. As a result, every social innovator needs to invest in attracting and retaining a dream team composed of mission-driven high achievers. They also need to invest in recruiting a committed and independent board of directors, and engage volunteers, short-term consultants, and fellows. Organisations such as EDUCATE! In Uganda and Sanergy in Kenya, have designed and implemented creative strategies for attracting, retaining, and developing talent. They have also invested in building a culture of innovation and excellence, which attracts individuals from the private sector to their organisations. 

They offer tailored training programmes, travel fellowships and significant job responsibilities for their team members and have also developed modular approaches for scaling talent. 

3 Funding for Innovation: There is a broad range of financing options available to social innovators in Africa, depending on whether they operate for-profit, nonprofit or hybrid organisations. These financing options range from fee-for-service and cross subsidisation to externally generated funds such as grants, awards, fellowships, challenge funds, crowdfunding, impact investments and loans. In addition, the funding landscape, especially for impact investments, has expanded dramatically over the past 10 years, with cities such as Nairobi hosting more than 60 impact investment funds and other investment vehicles, where only a few existed 15 years ago. In-spite of the plethora of funds, most local social innovators struggle to obtain financing for their ventures, while funders complain that they cannot find initiatives that are investment ready. Indeed, external funders are only interested in engaging with organisations that have strong credibility, governance structures, financial management systems and controls and can demonstrate the ability to use the funds to achieve results.

Social innovators operating in Africa have obtained financing work diligently to establish and communicate a strong business case and theory of change, backed by sound data that establishes a clear need and sustainable demand. They also amplify their impact work through creative communication strategies to raise broad-based awareness and effectively differentiate themselves. In addition, they demonstrate strong transparent systems and structures, a culture of ethics and accountability, attractive return on investment ratios and exit options for impact investors, where applicable.

4 Partnerships with key stakeholders in the public, private and nonprofit sectors: Social innovators cannot achieve impact and scale without cross-sector collaborations, rooted in shared values and a desire to achieve collective impact. This is especially relevant in highly regulated sectors such as health and education.

Sadly, there are few examples of partnerships in the African context, largely linked to significant distrust among actors, the intense competition for the perceived ‘small pie’ of resources and support structures and the fear of giving up control. Partnerships are also challenging in an environment where there is a high level of bureaucracy and red tape within government institutions which ordinarily should serve as catalysts for collaborations and innovations. In reality, social innovators who successfully collaborate in this context, actively map the ‘ecosystem’, determining which stakeholders can serve as champions, opponents or even beneficiaries. They then develop strategies for interfacing with all key actors, proactively shaping their ecosystems and forming strategic cross-sector collaborations that foster impact and scaling.

Preparing for The future

With Africa’s population projected to grow to 2.4 billion by 2050 – more than 70% under the age of 30 years old, with 60% in cities and towns – there is an increasing need for the emergence of more social innovators, operating at scale. These individuals will essentially need to develop creative and innovative solutions in education, healthcare, employment, sanitation, security, electricity, transportation, and housing to meet the needs of the people.

The social innovators will need also need critical leadership and management skills, as well as the talent, financing and partnerships required to surmount the obstacles they will face to pilot and scale interventions.

Indeed, Business Schools in Africa and around the globe will have to play a critical role in preparing this next generation of social entrepreneurs and innovators. 

The Bertha Centre for Social Entrepreneurship at the University of Cape Town is just one example of the numerous institutions in Africa and across the globe that are working to inspire, empower, and equip the social innovators.

I am convinced that the ability of more social innovators to pilot, establish and scale their initiatives to solve Africa’s most pressing problems will transform the continent and continue to ensure that Africa progresses from the last frontier to the brightest continent over the next decade.

Ndidi Okonkwo Nwuneli, Harvard MBA 1999; Wharton Undergrad 1995 is a serial social entrepreneur based in Lagos Nigeria. She is the founder of LEAP Africa – www.leapafrica.org, co-founder of AACE Foods Processing & Distribution Ltd. – www.aacefoods.com and co-founder of Sahel Consulting & Advisory Ltd – www.sahelcp.com. She is the author of – Social Innovation in Africa: A Practical Guide for Scaling Impact, published by Routledge in 2016.

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Broadening students’ cultural experience

Josep Franch, Dean of ESADE Business School, Barcelona, discusses current differences between Spanish Business Schools and those in Latin America and the opportunities for Latin American Schools to attract more international students. Interview by Andrew Main Wilson

Considering the landscape of the top Spanish Business Schools compared to Latin America, what are your main observations of the differences and the similarities?

I would say that European Business Schools in general, and Spanish Schools in particular, have made significant improvements over the past 10 to 15 years. 

If you take, for example, the Financial Times Global MBA Ranking, in 2000 it was made up of 80% US Schools and 20% European Schools. If you consider the same ranking today, you’ll find 40% US schools, one third European Schools and 20% Asian Schools. 

This improvement didn’t come overnight. It started in the late 1980s and early 1990s, when European Schools began to internationalise. They started to change their reputation to attract international students and faculty. This happened 25-30 years ago and, as a result, the majority of European Schools today are probably at the forefront of internationalisation. 

When I consider Latin America, I still see it as regionally based, attracting regional talent, whereas at the majority of European Business Schools – and in the case of top Spanish Schools – we’re attracting students from all over the world in our MBA. 

We have 30% of students coming from Latin America, 30% from Asia, 25% from Europe and 15% from North America, so it’s a broad profile.

What do you think Latin American Business Schools need to do to attract more students from Spain and Portugal? 

Spain has, traditionally, been seen as the gateway to Europe for many Latin American Schools and countries. But at the same time [as a Latin American School] you need a focus on quality. 

International accreditations are the first step, but you also need to establish your brand. This can be done through publications of your key faculty who can produce and publish research in top journals. 

You need also to be relevant in the corporate world. Here, I believe Latin America has a great opportunity, with corporates coming from the regions expanding abroad. A number of [global multinationals] are seeing opportunities in Latin America. 

At ESADE, some students from Europe or Asia take our MBA because they see it as a gateway to Latin America. 

In a global world, there are lots of opportunities, but [success] doesn’t come overnight. It’s based on years of investment, publications, visiting companies, attracting people and placing graduates in
those companies. 

At the end of the day, your graduates and alumni are your best ambassadors. 

Do you think blended and online learning this will be the next step for Schools in Latin America, and will it be a struggle, in terms of investment? 

We’re all facing the same huge challenge. But, at the same time, it’s a huge opportunity. You can develop e-learning programmes anytime and anywhere, so the online revolution allows physical boundaries to disappear. I don’t see a difference between Latin American Business Schools and Schools in other parts of the world, in the sense that blended programmes are not a choice. A blended solution is something you need. It’s a percentage of your curriculum, but all programmes have to be blended. Fully-online degrees are a different issue. Schools across the world are discussing the next steps. How fast they’ll be able to go depends on how many resources they have and how fast a School moves. 

It also depends on how many risks they’re willing to take, because those that move first will bear the greatest risk. Other Schools will be playing the safe route of jumping on the bandwagon, but they’ll not be the first mover. In saying that, top Latin American Schools are coping well with, and addressing this challenge. 

You have partnerships with Schools in Chile, Colombia and Peru. What advice would you give Latin American Schools in building partnerships in Europe? 

We have a joint multinational MBA with Adolfo Ibáñez University in Santiago, Chile, and a double degree with Fundacao Getulio Vargas EAESP in Sao Paulo, Brazil. We are working with Universidad de los Andes in Colombia and Universidad del Pacifico in Peru. In Rio de Janeiro, we’re working with Fundacao Getulio Vargas on some executive education programmes. We’re working with some other universities in the region as well. 

I believe these partnerships are going to grow because they allow Business Schools to combine resources, areas of expertise and the footprint of the different partners in the same programmes. 

Partnerships also allow Schools to launch programmes that maybe they wouldn’t have launched on their own because of [limitations in terms of] size, capability, or lack of influence that they have in a
certain market. 

These partnerships are a good thing, but Business Schools have to be able to find a suitable partner. To me, one of the most important things is that you share the same approach and philosophy. A partnership is like a marriage. When you’re dating, you need to know the person and share
some things. Partnerships based on economic or financial factors are probably not the best partnerships, if you don’t share a vision, values, or if you don’t have the same ideas in terms of the programme and the education proposal for the Business community. 

What would you advise our Schools to do to encourage more Spanish and Portuguese-speaking European students to come and experience a Latin American School? 

Students have different ideas and motivations to go on exchange programmes. I’ve found very often that we might have Spanish students who prioritise going to the US or Asia because they see them as ‘cool’ destinations, rather than opting to go to Latin America. 

Sometimes, students assume – mistakenly in my opinion – that in the majority of Latin American countries, because the same language is spoken there, they cannot improve in a second language, but they can if they go to the US or another destination. 

It’s not just about the language, but also the cultural experience. If we share the same language or similar language, students can still learn different ways of doing business compared to Spain in terms of how international markets are evolving. There are fast-growing markets in Latin America with lots of opportunities. 

Some students want to go to Latin America because they want to pursue an international career and want to spend some years in that region because they will have lots of opportunities to develop themselves. We [as Business School leaders] need to keep insisting that there are plenty of opportunities [in Latin America] that students are failing to identify because they’re looking for the big names of American universities, that are attracting them to a place – rather than what they can learn.  

Josep Franch, Dean of ESADE Business School

Josep Franch has extensive teaching experience in various countries. He is an expert in international marketing and global marketing, and his main area of specialisation is brand management in multinational and global companies. He has also worked on subjects related to digital marketing and relationship marketing. 

From an educational point of view, he is one of the main European experts in the case study method. He has published more than 50 case studies in the fields of marketing and international business, some of which are available through the The Case Centre (formerly the European Case Clearing House). 

He has won the EFMD Case Writing Competition on three occasions (1999, 2001 and 2013) and also has three case writing awards at the North American Case Research Association (NACRA) Annual Conference (2004, 2010 and 2015). He regularly serves as a track chair in several case conferences and as a reviewer for different case journals and case collections, he sits on the Editorial Board of the Case Research Journal and Wine Business Case Research Journal and is one of the Co-Editors of the
Global Jesuit Case Series. He regularly delivers sessions on how to write and teach with case studies, both at
ESADE as well as for other programmes including the International Teachers Programme (ITP).

He has previous experience as marketing manager at Fuji Film and has worked as a consultant for different companies, including FC Barcelona, Interroll, Novartis, Soler & Palau, Sony and Xerox. 

He has also worked in many in-company training programmes with different companies including APM Terminals, Bunge, Desigual, Esteve, Novartis, Roca, Roland DG, Saint-Gobain, Sony, Telefónica and Tenaris.