Challenges for business education in the context of globalization(The example of Georgia)

Ia Natsvlishvili Associate Professor

Faculty of Economics and BusinessIvane Javakhishvili Tbilisi State University

(TSU)Tbilisi; Georgia

Competitiveness of graduates in the global market

The competitiveness of business graduates in the global market is defined by the competencies that they acquire in the period of learning.

Labour market characteristics that play an important role in ensuring a country’s competitiveness:

• qualified labour, • financial skills, • international experience,• competent top managers

Tuning business education around the world

Results of research conducted in Georgia, Europe and Latin America within the framework of the Tuning project (mutual agreement of educational structures in Europe) allow the making of significant conclusions about business education challenges in the world.

Tuning business education around the world

Research results answer questions 1.What should be the competencies taught by

business education programs in Latin America and Europe?

2. Does education respond to labour market demands and the expectations of employers?

3.Do the opinions of students, graduates and academic personnel match?

Tuning business education around the world

Research was conducted on two types of competencies - general competencies and

field specific competenciesResearch results were ranked according to• the importance of competencies • the level of their achievement in

educational institutions.

Tuning business education around the world: the sample

• Europe 27 countries in nine fields of education;The number of people surveyed within the framework of business education

is 7087 graduates – 1948, professors – 2041, students – 2219, employers – 879.• Latin Americaabout 200 members of academic societies in 19 Latin American countries ;The number of people surveyed within business education:824 academic personnel, 714 employers, 2939 graduates and 3944 students• Georgia 4 Universities:90 academic personnel, 150 students, 120 graduates, 60 employers.

High priority field specific competencies in Latin America

1. Operational, tactical and strategic planning skills;

2. Skill in interpreting accounting and financial information in the process of investment decision making for a company;

3. Skill in managing a company’s financial resources;

4. Skill in developing and managing the human resources of a company.

Field specific competencies of high-priority across Europe ranked by importance

1. Ability to analyze and structure a problem of an enterprise and design a solution (for instance: entering a new market)

2. Ability to learn, for instance, how, when and where individual development is necessary (e.g. rhetoric, presentation technique, team work, private management)

3. Ability to read, write and speak foreign language (e.g. English as working foreign language). It is not listed in top five competencies chosen by employers.

4. Defining adequate instruments and their usage (e.g. market analysis, statistical analysis, comparative coefficients). Employers say skill in using quantitative analysis in business decision-making is important

Georgia: 3 Common Competencies in top

1.Ability to analyze and structure a problem of an enterprise and design a solution

3.Define criteria according to which an enterprise is defined and link the results with the analysis of the environment to identify perspectives

26.Understanding principles of project management

IMPORTANCE / ACHIEVEMENT ACADEMICSIMPORTANCE ACHIEVEMENT

variable Competence Mean Std Error Mean Std Error1 Ability to analyse and structure a problem of an enterprise and design a solution (i.e. entering a new market)3,7107 0,07204 3,303 0,083543 Define criteria according to which an enterprise is defined and link the results with the analysis of the environment to identify perspectives (i.e. SWOT, internal and external value chain)3,4394 0,07823 3,131 0,12499 Identify the functional areas of an organisation and their relations (i.e. purchasing, production, logistics, marketing, finance, human resource)3,4394 0,07823 3,2273 0,093616 Identify and use adequate tools (i.e. market research, statistical analysis, comparative ratios)3,4091 0,07778 3,2727 0,0794726 Understanding principles of project management (i.e. objectives, planning, scheduling, budgeting etc.)3,3898 0,1165 3,045 0,102411 Learn-to-learn, i.e. how, when, where – new personal developments is needed (i.e. rhetorics, presentation, working in teams, personal management)3,3493 0,07752 3,187 0,108212 Change management 3,3182 0,09201 3,0349 0,124824 Use the respective instruments for business environment analysis (i.e. industry analysis, market analysis, PEST)3,3093 0,1194 3,1378 0,088648 Identify the constitutional characteristics of an organisation (i.e. goals and objectives, ownership, size, structure)3,303 0,08628 3,1667 0,0852322 Understand und use bookkeeping and financial systems (i.e. profit and loss account, balance sheet)3,303 0,08354 3,2727 0,0794719 Understand the principles of law and link them with business / management knowledge (i.e. competition law, taxation laws etc.)3,3016 0,1944 3,0206 0,138720 Understand the principles of psychology, identify the implications for business organisations, and redesign (i.e. working in groups, teams, behavioural studies)3,2727 0,07947 3,0455 0,092728 Ability to lead the organization 3,2593 0,1889 3,0017 0,19725 Design and implement information systems 3,2546 0,175 2,9949 0,302810 Identify the impact of macro- and microeconomic elements on business organisations (i.e. financial and monetary systems, internal markets)3,2211 0,1416 3,1183 0,17777 Identify related issues such as culture and ethics and understand their impact on business organisations3,1818 0,08612 2,8992 0,127616 Understand existent and new technology and its impact for new / future markets.3,1818 0,09389 2,811 0,149923 Understanding, reading, speaking, writing in a foreign language (i.e. working in English as a foreign language)3,1818 0,07131 2,9732 0,169421 Understand the structure of the foreign language, and develop a vocabulary allowing to work i.e. in English as a foreign language3,1595 0,136 3,1061 0,0839813 Managing a company by planning and controlling by use concepts, methods and tools (i.e. strategy design and implementation, benchmarking, TQM, etc.)3,1577 0,2889 2,9603 0,15552 Audit an organisation and design consultancy plans (i.e. tax law, investment, case studies, project work)3,1515 0,1018 3,0606 0,109815 Understand details of business functions, business enterprises, geographic regions, size of enterprises, business sectors and link them with the basic knowledge and theories3,0606 0,0913 2,8333 0,0879318 Understand the principles of ethics, identify the implications for business organisations, design scenario (i.e. exploitation of human resources, environment)3,0604 0,2027 2,9028 0,158214 On the basis of knowledge acquired in university, identify the impact of culture on business operations. (i.e. the possibility of selling beer worldwide)3,0303 0,09153 2,758 0,205529 Ability to work in national and global economic environment3,0303 0,0807 2,8788 0,082264 Identify and operate adequate software 3 0,08079 2,6972 0,217 Understand the principles of engineering and link them with business / management knowledge (i.e. operations management, Gantt chart, information technology)2,9697 0,0807 2,8939 0,0867125 Work assignments abroad (i.e. work experience in an enterprise for 20 weeks abroad) 2,9053 0,1303 2,5606 0,118527 Understanding principles of environmental protection 2,8636 0,09868 2,6041 0,1916

IMPORTANCE & ACHIEVEMENT – ACADEMICS

Georgia

IMPORTANCE / ACHIEVEMENT EMPLOYERSIMPORTANCE ACHIEVEMENT

variable Competence Mean Std Error Mean Std Error1 Ability to analyse and structure a problem of an enterprise and design a solution (i.e. entering a new market)3,6774 0,09677 3,3226 0,225826 Understanding principles of project management (i.e. objectives, planning, scheduling, budgeting etc.)3,629 0,06988 3,3065 0,0964411 Learn-to-learn, i.e. how, when, where – new personal developments is needed (i.e. rhetorics, presentation, working in teams, personal management)3,5161 0,08209 3,2581 0,12913 Managing a company by planning and controlling by use concepts, methods and tools (i.e. strategy design and implementation, benchmarking, TQM, etc.)3,4839 0,07537 3,3226 0,1296 Identify and use adequate tools (i.e. market research, statistical analysis, comparative ratios)3,4516 0,1613 3,2903 0,25819 Identify the functional areas of an organisation and their relations (i.e. purchasing, production, logistics, marketing, finance, human resource)3,4516 0,08505 3,2742 0,092473 Define criteria according to which an enterprise is defined and link the results with the analysis of the environment to identify perspectives (i.e. SWOT, internal and external value chain)3,3871 0,07749 3,2097 0,0923822 Understand und use bookkeeping and financial systems (i.e. profit and loss account, balance sheet)3,371 0,08366 3,3226 0,0967728 Ability to lead the organization 3,371 0,09265 3,0161 0,24198 Identify the constitutional characteristics of an organisation (i.e. goals and objectives, ownership, size, structure)3,3387 0,07607 3,0323 0,161320 Understand the principles of psychology, identify the implications for business organisations, and redesign (i.e. working in groups, teams, behavioural studies)3,3387 0,1129 3,0968 0,104719 Understand the principles of law and link them with business / management knowledge (i.e. competition law, taxation laws etc.)3,3226 0,09964 3,0968 0,225812 Change management 3,2903 0,1013 3,0645 0,161310 Identify the impact of macro- and microeconomic elements on business organisations (i.e. financial and monetary systems, internal markets)3,2742 0,1129 3,1774 0,112918 Understand the principles of ethics, identify the implications for business organisations, design scenario (i.e. exploitation of human resources, environment)3,2419 0,08507 2,9839 0,145223 Understanding, reading, speaking, writing in a foreign language (i.e. working in English as a foreign language)3,2419 0,1129 3,1935 0,088582 Audit an organisation and design consultancy plans (i.e. tax law, investment, case studies, project work)3,1774 0,08138 3,0968 0,1295 Design and implement information systems 3,1774 0,2742 2,8871 0,338716 Understand existent and new technology and its impact for new / future markets.3,1774 0,4032 3,1129 0,467717 Understand the principles of engineering and link them with business / management knowledge (i.e. operations management, Gantt chart, information technology)3,129 0,3871 3,0323 0,193521 Understand the structure of the foreign language, and develop a vocabulary allowing to work i.e. in English as a foreign language3,129 0,08444 3,0968 0,099477 Identify related issues such as culture and ethics and understand their impact on business organisations3,0484 0,2097 3,0161 0,274224 Use the respective instruments for business environment analysis (i.e. industry analysis, market analysis, PEST)3,0484 0,09032 3 0,0975615 Understand details of business functions, business enterprises, geographic regions, size of enterprises, business sectors and link them with the basic knowledge and theories2,9839 0,3387 2,871 0,35484 Identify and operate adequate software 2,9677 0,2258 2,7742 0,354825 Work assignments abroad (i.e. work experience in an enterprise for 20 weeks abroad) 2,9194 0,09837 2,6774 0,123414 On the basis of knowledge acquired in university, identify the impact of culture on business operations. (i.e. the possibility of selling beer worldwide)2,8548 0,08861 2,7581 0,145229 Ability to work in national and global economic environment2,8548 0,08861 2,7903 0,274227 Understanding principles of environmental protection 2,5806 0,1935 2,6452 0,2258

IMPORTANCE & ACHIEVEMENT - EMPLOYERS

IMPORTANCE / ACHIEVEMENT STUDENTSIMPORTANCE ACHIEVEMENT

variable Competence Mean Std Error Mean Std Error1 Ability to analyse and structure a problem of an enterprise and design a solution (i.e. entering a new market)3,7053 0,05962 3,2486 0,138528 Ability to lead the organization 3,5579 0,06474 2,9053 0,0982226 Understanding principles of project management (i.e. objectives, planning, scheduling, budgeting etc.)3,5368 0,07603 3,0597 0,0906916 Understand existent and new technology and its impact for new / future markets.3,4926 0,1532 2,9015 0,307612 Change management 3,4921 0,09638 2,8421 0,086383 Define criteria according to which an enterprise is defined and link the results with the analysis of the environment to identify perspectives (i.e. SWOT, internal and external value chain)3,4917 0,1688 3,3368 0,0786423 Understanding, reading, speaking, writing in a foreign language (i.e. working in English as a foreign language)3,4906 0,07998 3,3368 0,0814413 Managing a company by planning and controlling by use concepts, methods and tools (i.e. strategy design and implementation, benchmarking, TQM, etc.)3,4632 0,07148 3,1158 0,0798 Identify the constitutional characteristics of an organisation (i.e. goals and objectives, ownership, size, structure)3,4559 0,1213 3,1895 0,0796120 Understand the principles of psychology, identify the implications for business organisations, and redesign (i.e. working in groups, teams, behavioural studies)3,4211 0,06952 2,9789 0,092239 Identify the functional areas of an organisation and their relations (i.e. purchasing, production, logistics, marketing, finance, human resource)3,4105 0,07254 3,2 0,088036 Identify and use adequate tools (i.e. market research, statistical analysis, comparative ratios)3,4071 0,1127 3,132 0,0899224 Use the respective instruments for business environment analysis (i.e. industry analysis, market analysis, PEST)3,4 0,06923 3,1727 0,114221 Understand the structure of the foreign language, and develop a vocabulary allowing to work i.e. in English as a foreign language3,3698 0,2091 3,2896 0,162110 Identify the impact of macro- and microeconomic elements on business organisations (i.e. financial and monetary systems, internal markets)3,3603 0,2253 3,262 0,225922 Understand und use bookkeeping and financial systems (i.e. profit and loss account, balance sheet)3,3368 0,08144 3,3684 0,0806611 Learn-to-learn, i.e. how, when, where – new personal developments is needed (i.e. rhetorics, presentation, working in teams, personal management)3,3166 0,1385 3,0632 0,0932319 Understand the principles of law and link them with business / management knowledge (i.e. competition law, taxation laws etc.)3,29 0,2968 3,1305 0,266515 Understand details of business functions, business enterprises, geographic regions, size of enterprises, business sectors and link them with the basic knowledge and theories3,1895 0,07223 2,8146 0,23747 Identify related issues such as culture and ethics and understand their impact on business organisations3,1474 0,07626 2,8065 0,276818 Understand the principles of ethics, identify the implications for business organisations, design scenario (i.e. exploitation of human resources, environment)3,1474 0,07327 2,6105 0,093815 Design and implement information systems 3,1461 0,219 2,7126 0,309114 On the basis of knowledge acquired in university, identify the impact of culture on business operations. (i.e. the possibility of selling beer worldwide)3,1265 0,2032 2,8479 0,394817 Understand the principles of engineering and link them with business / management knowledge (i.e. operations management, Gantt chart, information technology)3,0854 0,148 2,8655 0,108629 Ability to work in national and global economic environment 3,0186 0,1884 2,6103 0,317825 Work assignments abroad (i.e. work experience in an enterprise for 20 weeks abroad) 3,0105 0,09164 2,4959 0,30284 Identify and operate adequate software 2,9684 0,06768 2,5684 0,091832 Audit an organisation and design consultancy plans (i.e. tax law, investment, case studies, project work)2,9474 0,08773 3,0211 0,0922327 Understanding principles of environmental protection 2,5658 0,1679 2,1896 0,2658

IMPORTANCE & ACHIEVEMENT - STUDENTS

IMPORTANCE / ACHIEVEMENT GRADUATESIMPORTANCE ACHIEVEMENT

variable Competence Mean Std Error Mean Std Error1 Ability to analyse and structure a problem of an enterprise and design a solution (i.e. entering a new market)3,6967 0,05059 3,1432 0,0695426 Understanding principles of project management (i.e. objectives, planning, scheduling, budgeting etc.)3,5502 0,1133 3,1803 0,071779 Identify the functional areas of an organisation and their relations (i.e. purchasing, production, logistics, marketing, finance, human resource)3,5492 0,05832 3,1803 0,0717722 Understand und use bookkeeping and financial systems (i.e. profit and loss account, balance sheet)3,4255 0,09527 3,418 0,0568312 Change management 3,4081 0,1275 3,0574 0,074813 Managing a company by planning and controlling by use concepts, methods and tools (i.e. strategy design and implementation, benchmarking, TQM, etc.)3,3742 0,1664 3,1839 0,07486 Identify and use adequate tools (i.e. market research, statistical analysis, comparative ratios)3,3525 0,0626 3,2111 0,0690211 Learn-to-learn, i.e. how, when, where – new personal developments is needed (i.e. rhetorics, presentation, working in teams, personal management)3,3525 0,06039 3,3549 0,174316 Understand existent and new technology and its impact for new / future markets.3,3525 0,1802 3,0135 0,10063 Define criteria according to which an enterprise is defined and link the results with the analysis of the environment to identify perspectives (i.e. SWOT, internal and external value chain)3,3513 0,1383 3,2381 0,192220 Understand the principles of psychology, identify the implications for business organisations, and redesign (i.e. working in groups, teams, behavioural studies)3,3443 0,06243 3,0574 0,075710 Identify the impact of macro- and microeconomic elements on business organisations (i.e. financial and monetary systems, internal markets)3,344 0,2241 3,3134 0,289828 Ability to lead the organization 3,3253 0,286 2,9847 0,22742 Audit an organisation and design consultancy plans (i.e. tax law, investment, case studies, project work)3,3197 0,1415 3,0656 0,0760924 Use the respective instruments for business environment analysis (i.e. industry analysis, market analysis, PEST)3,2951 0,06234 3,1393 0,067188 Identify the constitutional characteristics of an organisation (i.e. goals and objectives, ownership, size, structure)3,2468 0,1187 3,1475 0,0704917 Understand the principles of engineering and link them with business / management knowledge (i.e. operations management, Gantt chart, information technology)3,2273 0,2415 2,9426 0,0774719 Understand the principles of law and link them with business / management knowledge (i.e. competition law, taxation laws etc.)3,1992 0,1708 3,0493 0,149321 Understand the structure of the foreign language, and develop a vocabulary allowing to work i.e. in English as a foreign language3,1967 0,07141 3,1885 0,069195 Design and implement information systems 3,1956 0,1375 2,9665 0,309723 Understanding, reading, speaking, writing in a foreign language (i.e. working in English as a foreign language)3,1847 0,1241 3,1907 0,13627 Identify related issues such as culture and ethics and understand their impact on business organisations3,1212 0,1432 2,7869 0,0791418 Understand the principles of ethics, identify the implications for business organisations, design scenario (i.e. exploitation of human resources, environment)3,117 0,2208 2,9103 0,26664 Identify and operate adequate software 3,0246 0,06733 2,6952 0,0993825 Work assignments abroad (i.e. work experience in an enterprise for 20 weeks abroad) 3,0082 0,07764 2,5246 0,0895715 Understand details of business functions, business enterprises, geographic regions, size of enterprises, business sectors and link them with the basic knowledge and theories2,8649 0,0836 2,7554 0,152414 On the basis of knowledge acquired in university, identify the impact of culture on business operations. (i.e. the possibility of selling beer worldwide)2,8208 0,09589 2,6557 0,0761229 Ability to work in national and global economic environment 2,8142 0,1964 2,6125 0,164827 Understanding principles of environmental protection 2,7436 0,3067 2,5215 0,3363

IMPORTANCE & ACHIEVEMENT - GRADUATES

Academics Employers Students GraduatesAcademics 1Employers 0,82662637 1Students 0,82850858 0,83298644 1Graduates 0,87858383 0,9120367 0,88566481 1

ACHIEVEMENT COMPARISON

1,5

2,0

2,5

3,0

3,5

4,0

1 6 22 9 11 8 24 3 10 21 2 20 26 12 19 28 5 23 13 18 7 17 29 15 16 14 4 27 25

Comparation Achievement beetwen Cycles

Ordered by Academics

Academics Employers Students Graduates

ACHIEVEMENT COMPARISONS BETWEEN GROUPS

Field specific competencies ranked by TSU employers

• Competence #1 – skill to analyse and structure problems of a company and ability to solve them (e.g. entering a market)

83,3 % (importance )66,6 % (achievement)

• Competence #6 - Determining of adequate instruments and using them (e.g. statistical analysis, comparative coefficients)

66,6 % (importance )66,6 % (achievement)

• Competence #13– management of a company by means of planning and controlling and using concepts, methods and instruments

63,3 % (importance )63,3 % (achievement)

Competencies ranked by TSU academic personnel

• Competence #1– skill to analyse and structure problems of a company and ability to solve them (e.g. entering to market)

• 70,0 % (importance)• 43,3 % (achievement)• Competence #19 – knowledge of legal principles and connecting this with business management

knowledge • 60,0 % (importance)• 43,3 % (achievement)• Competence #22 – knowledge of accounting and financial systems and their usage (e.g. profit/loss

balance accounting) • 53,3 % (importance)• 46,6 % (achievement)• Competence #16• – knowledge of existing and new technologies and their influence on new/future markets• 53,3 % (importance)• 46,6 % (achievement)• Competence #5 – development and implementation of information systems• 53,3 % (importance)• 46,6 % (achievement)

Competencies ranked by TSU students• Competence #1– skill to analyse and structure problems of a company and ability to solve them

(e.g. entering to market)76,6 % (importance)56,6 % (achievement)

• Competence #16 – knowledge of existing and new technologies and their influence on new/future markets

76,6 % (importance)43 % (achievement)

• Competence #28 – leadership skills in an organization 73 % (importance)50 % (achievement)

• Competence #23- skill to read, write and speak foreign language 70 % (importance)50 % (achievement)

Competencies ranked by TSU graduates

• Competence #1– skill to analyse and structure problems of a company and ability to solve them (e.g. entering to market)

80 % (importance)7 % (achievement)

• Competence #10 – determining of micro and macroeconomic elements and their influence on business organization (e.g. financial systems, monetary systems, domestic markets)

70 % (importance)63 % (achievement)

• Competence #9 – definition of functional fields of an organization and determining existing connections between them (e.g. purchases, production, logistics, finances, marketing, human resources)

66,6 % (importance)43,3 % (achievement)

• Competence #22– knowledge of accounting and financial systems and their usage (e.g. profit/loss balance accounting)

60% (importance)60 % (achievement)

Results for Tbilisi State University

• Only one competence (competence #1) is common for all four groups of respondents.

• Two competencies (competence #16 and competence #22) are common for two groups of respondents:

• Competence #16 is common for academic personal and students,

• Competence #22 is common for graduates and academic personnel.

Research results around the world indicate that

• Students have a better understanding than academic personel of labour market demands and types of competencies ensuring competitiveness.

• Opinions of students and graduates about the importance of specific competencies are more different from employers’ opinions, than their opinions about general competencies.

• Difference in opinions of employers and students about specific competencies are greater than that of employers and graduates.

• The importance of competencies is higher than the level of their achievements in educational institutions.The difference is especially noticed in the skill of using knowledge in practice and the level of forming this skill.

The main challenge for business education

Main Challenge - development of general and field specific competencies to ensure the competitiveness of graduates in the global market.

Principles of development of competitive Business educational programs:• definition of program profile and competencies formed as a result of learning; • implementation of a learning-teaching-evaluating approach; determining the load

for students: constant ensuring of quality; • encouraging mobility of students and academic personnel for the purpose of

gaining international experience;• taking students’ opinions into consideration in the process of designing the

program;• increasing the role of internships in curriculum; • organization of consultations between academic personnel and employers in

order to bring their opinions closer; • involvement of study courses in curricula necessary for formation of first-priority

competencies in Europe and the whole world.

Contact Information Author : Ia Natsvlishvili Associate ProfessorFaculty of Economics and Business Ivane Javakhishvili Tbilisi State University (TSU); Tbilisi, Georgia ia.natsvlishvili@tsu.ge or ianat777@yahoo.com

Presenter : Zhongyou TanVisiting scholarSchool of BusinessThe George Washington UniversityWashington, DC 20052 Tan.zhongyou@gmail.com

Contact Information Author : Ia Natsvlishvili Associate ProfessorFaculty of Economics and Business Ivane Javakhishvili Tbilisi State University (TSU); Tbilisi, Georgia ia.natsvlishvili@tsu.ge ianat777@yahoo.com

Presenter : Zhongyou TanVisiting scholarSchool of BusinessThe George Washington UniversityWashington, DC 20052 Tan.zhongyou@gmail.com

Presented at the annualWashington Business Research Forum

Washington DCJanuary 8-9, 2010