As Programs Improve, Foreign Lure Remains

St. Petersburg State University’s Graduate School of Management, Sistema and Sberbank will bring to Russia a pan-European Master’s International Business CEMS program. While the program and other top competitors will increase the standards of Russian business education, they won’t be able to stem the tide of students leaving to study abroad.

Heidi Ohman, a 27-year-old from Finland, is your average young European who has decided to build a career in business. After receiving a bachelor’s degree in international business in 2005, she began working in logistics and then moved to a technology company.

“But I soon realized that I had neither the degree nor the knowledge that would give me an advantage in business,” Ohman said. Last year she enrolled in a two-year master’s program in management at the Helsinki School of Economics, and in September she continued her studies at St. Petersburg State University’s Graduate School of Management.

Ohman and another 19 graduate students were the first to come to St. Petersburg for a one-year CEMS MIM program (ranked third in the Financial Times’ 2008 ratings). This semester they will study with 65 second-year students from the Graduate School of Management’s master’s program, and next semester they will be in another country.

When the program ends, Ohman and another 700 young people studying the same course in various countries will receive degrees from their national management school and from the CEMS MIM program. “The Russian experience should help me build a good career as an expert on Russia,” she said.

The Community of European Management Schools — CEMS — was created more than 20 years ago specially for the Master’s in International Management, or MIM, course of study.

It was something of an experiment at the time. Unlike the U.S. model, the program was designed for people with no work experience, although a minimum 10-week internship at one of the companies in the alliance is a mandatory part of the program.

MIM programs have become popular in recent years, and the Financial Times has begun rating them, said Della Bradshaw, the newspaper’s business education editor. The newspaper has always found that graduates of the CEMS MIM program get better jobs and higher salaries than students who received regular degrees from CEMS universities. The diploma is better received by companies that do international business than one from a national university, said professor Stefano Caselli, academic director of the CEMS MIM program at Bocconi University.

Only one university per country can join the CEMS MIM program, and it is required to bring in two major, local employers. St. Petersburg’s Graduate School of Management became a full-fledged member in December 2008, while Sistema and Sberbank are expected to be chosen as corporate partners by the end of the year.

Sistema spokeswoman Yulia Belous said the company was interested in joining CEMS because it wants to have a team of world-class managers, and the CEMS program gives students a chance to learn the best global management practices. Sberbank was not able to comment on the matter.

Russian management programs are approaching the European level, said Nikolai Filinov, dean of the management department at the Higher School of Economics, a state university. He pointed to their inclusion in dual-degree programs with some of the world’s best business schools and participation in groups like the CEMS MIM.

The department, which has 202 students in 2009, has five dual-degree programs, and about 15 percent of students — or 31, this year — study abroad.

Dual-degree master’s programs are still a rarity in Russia. Demand for them is stable at the Institute of Business Studies, said Yevgenia Pashkevich, director of the master’s program. The school has an average of six or seven students — one-quarter of the class — who choose dual-diploma programs as  part of the international IBSA alliance, while three to five people from alliance schools study each semester in Moscow.

Moscow State University’s Graduate School of Business Administration is planning to open a similar program, which will allow the school to meet students’ interest in opportunities abroad, said Tatyana Kireyeva, director of the master’s program there.

Legal obstacles have made it difficult to attract foreign students, however. “Some of our classes are taught in English, but we are not legally allowed to do everything in English like they are in St. Petersburg,” she said.

St. Petersburg State University received special permission for its program. In two years, the school expects to have about 40 to 50 students from Europe each semester, said Dmitry Volkov, director of the master’s program.

Those numbers are out of reach for other schools, said Alla Zhavoronkova, head of Begin Group, a company that works with business schools.

Valery Katkalo, dean of St. Petersburg’s Graduate School of Management, said the school had been building its business according to international standards since its creation in 1993.

The European mainstream expects a school to have an international brand, classes taught in English and a group of students and professors from around the world, said Jean-Pierre Helfer, dean of the Audencia business school in Nantes (ranked 11th by the FT in 2008).

At HEC Paris — which for four years has led the FT list for best master’s programs — the number of international students has doubled in the past five years to 25 percent, or 121 of 488, said Bernard Ramanantsoa, the school’s dean and CEMS president.

Some 30,000 people from the Commonwealth of Independent States go abroad annually for graduate studies, according to UNESCO.

Zhavoronkova, of Begin Group, said it was hard to break down those figures but that most were on exchange programs. Those who go abroad for their degrees are planning to stay, she said.

Modern programs won’t be able to reduce the outflow of students, but they will create new standards, which is important for the Russian market, where not all business schools even have a career center, she said.