What Harvard Business School Online Means for the Future of Education

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HBS Online: A Milestone for Distance-Based Education

First, there is only one Harvard Business School. In all of graduate management education, no university brand commands the power, respect, and prestige of the Harvard Business School brand. To that extent, Harvard Business School’s rebranding heralds a significant milestone that acknowledges the legitimacy of online education.

“Harvard Business School just signaled a huge shift in online education with a simple name change,” wrote Business Insider. “The name change, and Harvard’s willingness to lend its name to the platform, signals that online learning is entering the mainstream.”

Dr. Joshua Kim, the director of digital learning initiatives at Dartmouth College’s Center for the Advancement of Learning (DCAL), wrote “the rebranding of HBX to Harvard Business School Online is a signal that online education has well and truly arrived. For those of us in the online education game, Harvard Business School rebranding to embrace online is a great development.”

Inside Higher Ed added that “online education is now so widely accepted by faculty members and prospective students that there is ‘little risk associated with extending the Harvard Business School name to the online offering,’” quoting Jason Simon, a partner with higher education marketing consultants SimpsonScarborough. Indeed, HBS may have concluded that they no longer had much choice. Simon told the publication that if HBS didn’t attach its brand name to their online courses, the school might risk losing prospective online students who perceive HBS might not be “active and engaged in the online learning space.”

Career Advantages of the Harvard Business School Online Courses

A second, underreported aspect concerns controversy over surprising the results of a study commissioned by HBS disclosing the career benefits their students attribute to the school’s online courses.

By taking the equivalent of only three undergraduate business courses marketed under Harvard’s brand, a significant percentage of the HBS Online students appear to have achieved career results typically obtainable only through entire graduate management degree programs. Such results include:

25 percent of the respondents said they received a promotion or a change in their job title
53 percent said they received more responsibility in their jobs
30 percent said they transitioned to a new field
Half received more attention from recruiters

These are the very results that applicants to most MBA’s, specialized business master’s degrees, and non-degree executive programs want to attain through their enrollment. Such curricula require a minimum of at least a year of graduate management education—not merely three undergraduate courses.

CORe: Harvard Business School’s Credential of Readiness

At the time of this writing, HBS had not yet made the complete course of study available online. So, it could not be precisely identified which HBX courses the 1,000 students polled for the sample actually took. However, more than half of HBX’s 40,000 online students were enrolled in their Credential of Readiness (CORe) program, meaning that accurate random sampling should have resulted in at least half of the sample’s completion of the same three courses.

About a third of each Harvard MBA class typically has not taken college courses in principles of economics, economic statistics, or financial accounting. Harvard’s program traditionally required such incoming MBAs to take all three undergraduate courses in-person during a special late-summer seminar series at HBS. Completion earned students the school’s Credential of Readiness: the CORe certification. In 2014, Harvard repackaged the three CORe seminars into courses available online and shortly afterward, the school placed this online package on sale to the public as a certificate program.

CORe is Harvard’s version of the pre-MBA undergraduate courses most business schools call “foundation” courses. Most schools require students to complete several such courses—sometimes at substantial extra costs—before they permit entry into some or all of their MBA curriculum’s business core courses.

Will HBS Online’s CORe Curriculum Reduce Management Degree Program Enrollments?

Some observers have expressed concern that the public would perceive an alternative credential from an institution with one of the world’s most powerful university brands to have a higher value than degrees from some graduate programs. They suggest that Harvard’s online CORe program could diminish enrollment at tier-2 and tier-3 MBA and MM (specialized masters in management) programs below those ranked among the top 50.

In summary, their argument asks why anyone would commit to at least a year of study, in some cases costing $30,000 or more, from one of those MBA programs given Harvard Business School Online’s alternative. This alternative allows the student to take the equivalent of three undergraduate courses for only $3,600, receive career benefits comparable to an MBA degree, and display the Harvard Business School brand on their resume and LinkedIn profile. When students could pursue the latter option, they ask, who would bother with the former?

Of course, these observers fail to acknowledge that the most significant result—a promotion—was not achieved by roughly three-quarters of the sample. This “acid test” outcome involves one of the most compelling drivers of applications to MBA programs, but in the HBS Online sample, most students did not achieve this result. The proportion of promotions seems too small to justify concerns about large numbers of students enrolling at HBS Online instead of MBA programs like these.

Furthermore, any AACSB-accredited MBA program can equip graduates with the knowledge, analytical skills, and professional connections that far exceed what students will receive from the equivalent of these three undergraduate classes. Students who don’t pursue business degrees after the three CORe courses will fail to learn the most crucial concepts taught in management education.

HBS Online’s Unfair Advantage Over Undergraduate Foundation Courses

Harvard Business School Online may exert a competitive threat to enrollment in the three competing undergraduate foundation prerequisites many business schools require due to their use of case instruction. Even within business schools, undergraduate courses in these three subjects don’t apply case method instruction. At this level, these courses strictly teach substantive knowledge and problem-solving. Similar in some respects to case instruction during the first year of law school, business school cases help teach students how to think.

When students are presented with a case, they place themselves in the role of the decision-maker as they read through the situation and identify the problem faced. The next step is to perform the necessary analysis—examining the causes and considering alternative courses of actions in order to come up with a set of recommendations. . .In class—under the questioning and guidance of the professor—students probe underlying issues, compare different alternatives, and finally, suggest courses of action in light of the organization’s objectives.

As a case study unfolds in class, students do 85 percent of the talking, as the professor steers the conversation by making occasional observations and asking questions. This classroom interaction is enriched by 90 classmates from diverse industries, functions, countries, and experiences. At the end of the class, students are often amazed at what they have learned from exchanging ideas with their classmates. Class participation is so important to the learning model at HBS that 50 percent of a student’s grade in many courses is based on the quality of class participation.

The Harvard Business School’s interpretation of these three courses may offer unfair advantages over typical undergraduate courses because the HBS courses may offer them in a more interesting and relevant case-method instruction patterned after their MBA. It may certainly be possible that the online instruction students receive from HBS could be far superior to the in-person instruction they receive from their undergraduate colleges.

More than 50 institutions who have recognized this potentially unfair advantage have already negotiated “collaboration” agreements with HBS. They include 40 institutions, mostly private liberal arts colleges, with scholarship relationships. Under these arrangements, students who take the HBS Online courses for transfer credit towards undergraduate degrees from their colleges may receive need-based scholarships that defray (in some cases) all but $450 of the tuition from HBS.

Three other universities in the United States rank among the 13 worldwide that have licensed the HBS Online courses and offer them inside their schools as course substitutes that permit faculty to devote more time to research. Boise State University was the first U.S. university to do so, followed by the Michigan Colleges Alliance. Boise State augments the online instruction from HBS with a single credit-hour in-person discussion section that adds topics of local relevance, similar to the blended online format offered by some of the best online MBA programs.

HBS may also offer another advantage: access to networking with a more geographically diverse community of fellow learners through social media that isn’t limited to a student’s local college classmates. The way that HBS groups students who take the courses for credit into cohorts that start three times a year and move through the courses together may encourage this kind of networking.

How Harvard Business School Online’s Market Reacted

Despite the controversy, what’s clear is the enthusiasm with which news of the rebranding and employment results were met by enrollees and prospective students. According to an interview with business school dean Dr. Nitin Nohria, during the first quarter after the HBS announcement, enrollment over the previous quarter shot up 70 percent. Nohria also told the paper that applications climbed between 40 and 50 percent and Web traffic also spiked by 40 percent.

While the long-term impact of HBS Online’s offerings remains to be seen, one thing is for sure: this development has transformed the educational landscape and brought greater legitimacy overall to web-based degrees and courses.