Hult IBS Goes Global: A study of entry strategy in the MBA market
Abstract: The purpose of this thesis is to examine the structure and dynamics of the Master of Business Administration (MBA) industry and analyze how a new competitor can enter and establish itself in this market. The study is based on an inductive research method and a qualitative research approach. The research strategy used is a case study of Hult International Business School (Hult IBS). Starting in Boston in 2002, Hult IBS has rapidly opened campuses in three additional locations: Dubai, London and Shanghai, and has succeeded in being ranked number 31 globally in the Economist’s Intelligence Unit’s MBA ranking 2008. The analysis is derived from the theory of Industrial Organization and the Resource Based View on strategy. The study concludes that the MBA market is dominated by a few very strong brands and barriers to entry into the market of top tier business schools are very high whilst moderate for the rest of the market. The fact that many schools have goals that go beyond economic performance intensifies the competition and makes it hard for a school to earn profits. The results suggest that Hult IBS successfully entered the market by adapting a global approach to the market, bringing the one-year MBA model to the US and by using a proactive marketing and sales approach. However, many of the school’s resources and capabilities are highly imitable and therefore not sustainable in the long run. Finally, recommendations are presented including that Hult IBS should focus on establishing stable quality of education through hiring full-time academic staff. This will in turn attract higher quality students and generate a more favourable and sustainable position in the rankings. The various efforts of Hult IBS should primarily focus on building the brand.
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