THE history of business school in Indonesia was started 30 years ago. Three business schools were founded in the early years of 1980’s. Prasetya Mulya (IMPM) was the first to offer MBA degree in 1982. The second is Indonesian Institute for Management Development (IPMI) that was founded in 1984. Then PPM School of Management (IPPM) started to launch their MBA program in July 1985.
During the 80’s, to recruit an MBA graduate became a trend among Indonesia business society. Rahmat Saleh, the Minister of Trade in Soeharto’s administration claimed that Indonesia needs to breed 7.500 new managers every year. This was quite an inviting statement, while the growth of domestic economy was 5% and business were flourishing. Many people know that most of current conglomerates got the opportunity to boost their business during 80’s.
MBA graduates from abroad were quite easy to land a job with a promising career and salary at that era. And Harvard was one among the most popular business school. Perhaps prompted by the increasing needs, many big domestic business entities, including the state owned companies turned to domestic business school. Some of them sent their employee to study in these business schools, while some were simply starting to recruit the graduates. This provided a chance for the business schools to grow.
For IPPM, the tradition of management education was actually started far behind. LPPM, which is the foundation of IPPM, already started The Higher Education for Management in 1967. But the two years long program was failed to continue after the second graduation day. LPPM started another management education program in 1977, a program that was shortened to only 10 months. This time the program was appreciated by domestic business entities, all the student were well accepted. Later, the short courses became the embryo of MBA program in LPPM.
Soeharto’s administration responded to this phenomenon in late 80’s. In 1988, The Minister of Education appointed University of Indonesia and Gadjah Mada University to start offering Magister in Management program. To the government MBA was not known and had no root in domestic education system. They prefer to have the Magister of Management instead. And these state owned universities were considered as having a strong tradition in economic teaching to lead the new trend.
It was the important point of business teaching in Indonesia. Because starting in 90’s there were no longer MBA graduates from domestic business school. Every institution began to use the term of Magister in Management. Bogor University of Agriculture was started their business program in 1991, which was called Magister in Manajemen for Agribusiness (MMA) IPB. Starting from 2005 it is now called Postgraduate Program in Management and Business– MB IPB. With the increasing acceptance among the domestic business society towards domestic business school graduates, many other universities – including private owned – starting to offer MM program. During the 90’s we can hardly find a university that does not offer this program.
Ranking and improvement
Today it is become difficult to choose a business school in Indonesia to attend. It will be easier to find out the best business school in USA or Europe. Because accreditation councils are available in these countries. Such as AACSB (Association to Advance Collegiate Schools of Business) in USA and EQUIS (European Quality Improvement System) in Europe.
Businessweek this year provides information of business school ranks. Where people can easily see that the University of Chicago (Booth) is at the first rank, followed by Harvard University, Northwestern University (Kellogs) and University of Pennsylvania (Wharton). They are the big five. Another ranks allowed people to know the next big ten. People even can easily find out the reasons behind those ranks. Information is abundant and well updated.
Whilst in Indonesia, currently there are limited sources concerning the accreditation of domestic business school, and the data was not updated on regular basis. One of the available study concerning business school in Indonesia was done in October 2003 by SWA magazine.
The study was done mostly among student and only a small number of recruiters were involved. This study tried to rank 13 business schools that were passed National Accreditation Council (BAN, Badan Akreditasi National). The result showed that MM University of Indonesia was at the top rank, followed by Prasetya Mulya (IMPM), Indonesian Institute of management development (IPMI), and Magister Management Gadjah Mada University (MM UGM). The result was merely relied on image and satisfaction study among students and some users. It will give an indication concerning the perception among local people towards domestic business school. But it will be arguable in terms of real facilities and qualities of teaching, because the study did not include these issues.
Currently the business schools already have the Indonesian Association of Magister Management Program/APMMI. Most of the founders are from state owned business school like University of Indonesia, Gadjah Mada University, and Bogor Agricultural University. This Association is aimed to standardized business school teaching in Indonesia so they can survive against global competition. Sure the improvement of business school teaching in Indonesia is promising in terms of quality, people knows that some of the institutions already built their competency in 3 decades. (Eddy P. Kasdiono)
Jakarta Globe, July 22, 2009