Analytical Paper: Belarusian business education - from a command economy to the market
The Belarusian authorities have recently shown interest in developing business education; evidence of this can be found in the Concept adopted by the Belarusian government in 2015. However, the Ministry of Education has not yet done much to adjust state regulations to match the situation on the ground.
Three key problems exist today. Representatives of the government, the international community, and business educators would do well to focus on them: state regulations, poor integration into the international educational space and lack of affordable business education in the regions of Belarus.
These are some of the conclusions found in a new analytical paper Belarusian Business Education: from a Command Economy to the Market released by the Ostrogorski Centre today.
Business education is probably the education sector most sensitive to the economic climate. Whereas neighbouring countries, such as Poland or Russia, experienced a boom in business education in the early 1990s – due to an increase of the private sector share of the economy – in Belarus the business education sector grew slowly. Belarusian business educators did not have powerful clients, such as Gazprom in Russia, and resembled training centres oriented towards small business.
The rapid growth of the Belarusian economy, accompanied by private sector expansion, was mirrored by growth in the sector of business education, reinforced by business schools at universities and long-term programmes in private business schools. In 2009, economic growth faltered and the business education market shrank correspondingly. This situation was exacerbated by the the current economic crisis.
Conference panel on business education in Belarus (December 2016, mostly in Russian)
This crisis has left Belarusian business education in the lurch, as it is probably here for the long run. Providers of business education, like many others, will have to adjust to life in this ‘new normality’. Nowadays, the clients of business educators are raising their expectations and demand more of a practical outlook from education offerings. This is apparently connected with the maturing of the Belarusian private sector, which currently assesses and oversees its own effectiveness.
Trends in the development of Belarusian business education
At present, four main actors dominate the business education market: the Business School at the Institute of Privatisation and Management, the consulting group ‘Here and Now’, and ‘Business School 21st Century’ (all private institutions), along with the state-run Institute of Business and Management of Technologies at the Belarusian State University. Together, these institutions account for about half of the business education market.
According to representatives of business education, the annual scope of the market of private companies has decreased two-fold since the beginning of the crisis in 2014, when it amounted to $6,5 million –$10,5 million. Currently, the market is starting to revive, as many companies believe improving their effectiveness might be a way out of the crisis. In addition, universities have experienced growth in the number of students enrolled in Master’s programmes in business-related specialties.
However, this growth has not been felt to the same extent in the regions, where prices for business education remain prohibitive for most entrepreneurs, as their salaries are on average one third lower. Generally speaking, according to market actors, only about 10-20% of business education takes place outside Minsk. The few exceptions include state regional universities offering business-related degree programmes, and the IPM business school, which has opened branches in all the regional centres of Belarus and uses distance learning technologies to keep prices for trainings relatively low.
Belarusian authorities have exhibited some interest in developing business education. This is evinced by the adoption of a corresponding Concept by the Belarusian government in 2015. Unfortunately, the targets proposed by the Concept are unrealistic and it is not being properly implemented. For example, it remains unclear how the business education market will grow to $50 million by 2020 in conditions of economic stagnation.
Nevertheless, the authorities have accomplished little in the way of adjusting state regulations to the situation on the ground. More concrete plans for the implementation of the Concept will most likely be hammered out after the establishment of the Republican Council on Development of the Business Education System, planned for 2017.
The main demand of business school representatives (both private and public) for the upcoming Republican Council is that state regulations be made more pragmatic. For example, many methods used by business schools, such as coaching or case-studies, simply do not conform to the regulations of academic universities. Thus, it is quite natural that representatives of private business schools would like to see the market liberalise as much as possible.
Today none of the private providers of business education, apart from the IPM business school, possess the status of ‘educational type-establishments’. This means that they cannot issue state-recognised diplomas in re-skilling and advanced training and they are not eligible for tax benefits enjoyed by state education providers. Obtaining the status of ‘educational type establishment’ is a complicated and labour-intensive procedure.
Basic problems for the business learning sphere
State regulations. Although state officials openly advocate ‘real equality of all actors on the business education market', two key issues remain unsolved. First, private and state business educators are subject to different taxation regimes. Secondly, private companies which do not possesses the status of educational establishments cannot issue state-recognised diplomas on re-skilling and advanced training of specialists.
These regulations harm not only private educators, but state universities as well. For state universities, it remains important that academic programmes be flexible (this means that state-mandated compulsory components of the curriculum should not exceed 50% of academic programmes). Also important is that the status of MBA graduates be reflected in the documents of the Ministry of Labour and Social Protection, and that people with no academic degrees but with practical experience in business could are allowed to become lecturers at university business schools
Poor integration into the international educational space. Belarusian business educators struggle with a lack of international accreditation from such organisations as the Association to Advance Collegiate Schools of Business, the Association of MBAs, or the European Quality Improvement System. This is a significant problem on the world business education market. The only exception is the IPM business-school, which has an accredited programme (AMBA) with the Kozminski University in Poland.
Lack of affordable business education in the regions of Belarus. As prices for business education are set in the capital, many educational programmes are not affordable to regional business structures. One-day seminars, costing $ 70-90, can only attract the wealthiest regional businessmen, even though demand for such seminars could be quite high.
Therefore, the under-representation of business education in the regions creates a situation in which many entrepreneurs are simply unaware of the existence of business schools. According to an analysis conducted by the Research Centre of the IPM, over 40% of surveyed small and medium companies in Belarus do not know of a single business school.
As economic stimuli for market growth are absent, the Belarusian government could free sphere from unnecessary regulations which stand in the way of the development of business education. This would foster healthy competition between business schools. State schools too would benefit from deregulation, as they would no longer need to adjust their programmes to regulations on universities from the Ministry of Education. They would also be able to involve investors.
The international community can play a positive role by supporting the methodological development of business educators in Belarus. Today, Belarusian business schools require methodological training before they can offer long-term educational programmes. This is especially true for blended programmes which need valid methodology for distance learning. Moreover, foreign internships at Western business schools could be an invaluable experience for business educators who have no one to learn from in Belarus. These measures would increase the quality of work and the competence of teachers at business schools.
Given the competition between different business educators, assistance from the international community should be as broad as possible so as not to become a tool in competition. State-run and commercial companies may sometimes fail to meet the requirements of their grantors due to their status. Therefore, associations which bring together various providers of business education are the best fit for receiving foreign funds.
Moreover, foreign funds could be channelled into developing education in the regions of Belarus, where prices for business education remain prohibitive. Besides improving educational programmes, Belarusian business educators could use foreign assets to improve their presence in the regions, which would create a new administrative class for Belarusian companies.
- Read full paper: Belarusian Business Education: from a Command Economy to the Market
- Чытаць аналітычны дакумент: Беларуская бізнес-адукацыя: ад каманднай эканомікі да рынку