2005_JCRIGB International Business

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The Journal of Current Research in Global Business, 2005, 8 (12), 1-8

INTERNATIONAL BUSINESS EDUCATION: HOW

MUCH DO OUR STUDENTS KNOW?

R. Earl Thomas Richard T. Mpoyi Toto Sutarso

The paper attempted to assess student knowledge of international business topics. The research was based on a survey

given to graduating seniors in the College of Business at Middle Tennessee State University. The survey was

administered twice, before and after the students took the international competencies exam. The statistical analysis

resulted in two main findings. First, after taking the international competencies exam, they students thought that they

knew managerial topics better than they did before taking the exam. Second, the level of knowledge of international

business topics of male students was higher than that of female students.

Introduction

College is the beginning of the stairway leading to a career. Each step leads the student from a solid foundation of

generalized knowledge to more specialized knowledge in a chosen field of study. For most undergraduate majors, the

first two years of collegiate study are devoted to a generalized liberal arts education. The knowledge gained in the areas

of critical thinking and writing is probably the most important skills developed here. Typically the last two years of a

bachelors degree program provide important specific skills necessary to begin a career.

At Schools and Colleges of Business, there are a variety of courses aimed at providing students with the necessary

skills to perform successfully in the business environment. Course areas and concentrations that a student may pursue

include: accounting, finance, economics, marketing, management, human resources, business law, business

administration, computer information systems, and an international business component. A basic understanding of each

of these components is necessary for functioning in an entry-level position and is vital for managerial positions. Whilethe bachelors degree is divided into two components (two years of general knowledge and two years of concentrated

study), the Masters Degree in a business area is a general overview of all the components with a concentration in one

specific area (i.e., marketing or management). Since the mid-1970s, the growing role of globalization has becomeincreasingly important in business education.

In 1974, the American Assembly of Collegiate Schools of Business (AACSB) mandated that curriculum of all

member institutions have an international component. Though it was a topic of discussion in business schools prior to

the 1974 mandate, serious consideration of the internationalization of the curriculum was generally a peripheral process

at best. Have significant strides been made in the last three decades? The paper is an attempt to answer the question. The

purpose of this research is to evaluate student perception about their knowledge of international business topics.

Theoretical background

The debate over the quality of business schools has attracted much attention (e.g. Bradshaw, 2005; Ghoshal, 2005;

Pfeffer & Fong, 2002, 2004). A review of the business literature indicates quite clearly that internationalization of the

curriculum has become a key component of business school quality. As the flow of resources to business schools isimpacted by the perception of quality (Corley & Gioia, 2000), international business education is now a central theme

for publication and research (e.g. Mpoyi & Thomas, 2003). A preponderance of articles and books has been written on

the topic generally and specifically. Dozens of studies have looked at various aspects of the internationalization process

(Kwok, Arpan & Folks, 1994). Some have looked at functional areas of the curriculum; others have examined topic

coverage of either undergraduate, master, or doctoral level programs. A few of the studies have focused on specific

geographical regions, others have sought input from leaders in business and industry, and a minimal number have been

global and comprehensive in scope (Kwok, Arpan & Folks, 1994).


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Today the AACSB, (now more aptly called The Association to Advance Collegiate Schools of Business) with its

399 graduate and undergraduate management programs in the United States and 38 leading European and Australian

collegiate schools of business continues to push for a stronger role of the international component in business curricula.

Indeed, though it has a strong foothold on business accreditation, its efforts have intensified as various competing

business schools accreditation organizations have emerged (i.e. the European Foundation for Management

Developments EQUIS quality standards accreditation program), (Hazeld ine & Munilla, 2004).

Beyond mandates such as those discussed above, a need to strengthen the internationalization component of thecurriculum has been spawned in other ways. Technological advances have had a major impact. The technology boom of

the 1990s, specifically the internet, has increased the role of international business in daily operations. With access to

anyone, anywhere, and at any time, the internet has transformed the business environment from a geo-specific operation

to a multi-cultural, international environment with virtually no geographic boundaries.

With the ever-expanding global marketplace, an understanding of the importance of culture on management has

become vastly more important. Studies like those by Hofstede (1983) and various others point to the value of an

understanding of culture coupled with business operations in developing appropriate international strategies. Most

research staunchly supports the need for continued enhancement of international concepts into the courses and total

curriculum of business schools. Its merit and worthiness in todays business world seem to be a given. Globalization

serves as a linkage and provides facilitation for competitive advantage. The decade of the 1980s saw an increase of

8.8% for multinational companies (Steinburg, 1992). Today, more than 60,000 multinational corporations exist, a

number that is 8.5 times greater than some twenty-five years prior (Miller, 2002).

From these numbers, one can easily surmise that international businesses are more prosperous and apt to remain

viable in an ever dynamic business environment than purely domestic businesses. Several reasons explain why

international businesses are more prosperous (Daniels, Radebaugh, & Sullivan, 2004). First, by going international,

multinational enterprises (MNEs) can expand their sales and achieve substantial economies of scale. Second, MNEs can

have easy access to critical resources (e.g. cheap labor, better components, foreign capital and technologies). Third,

operating in several national markets will help to minimize risks, as MNEs can take advantage of business cycles for

products and/or services in different markets, and/or diversify among international markets.

But why is international business knowledge so important? More importantly to ask is, why do businesses not go

global? The answer is shocking. One major reason that more U.S. companies do not go global is that they do not have

internationally skilled workforces (Steinburg, 1992). How can that possibly be in an environment perhaps best summed

up by Edwin Artzt, president of Proctor and Gamble who says, Virtually every business in the U.S. today is touched in

some way by global competition (Proctor and Gamble, 1990).

Of 108 executives surveyed by Allen Morrison and two colleagues for their book, Global Explorers: The Next

Generation of Leaders, 75% felt their companies did not have nearly enough global leaders, but fewer than 8% had

programs to address the shortage (Lancaster 1998). Equally astonishing is a 1998 study, Developing Leaders for the

Global Frontier, by Gregersen, Morrison and Black, which showed that 67% of responding organizations lacked

capable global leaders or had leaders that had less capability than needed (Wellins & Rioux 2001). As companies

express a need for leaders with global skills, business programs should enhance their international curriculum so they

can have practical payoffs as evaluated by corporate managers (Bennis & OToole, 2005).

As our graduates enter the workforce, they will learn international aspects of business on the job; some 80% of the

CEOs of Forbes 100 Largest Multinational Firms and Fortunes 50 Americans Biggest Exporters attest to that

(Ball & McCulloch, 1993). And a number of exemplary programs abound. The Gillette Company, with 51

manufacturing facilities in 21 countries employs more than 39,000 people worldwide, has a competency-based globalleadership development initiative built upon a common global language that helps to reinforce an organizational

culture (Wellins and Rioux 2001).

Another organization leading the way in addressing the global leadership shortage is Whirlpool. The major

appliance manufacturer has implemented Protg, a comprehensive, culturally sensitive global leadership development

process that incorporates intensive mentoring by senior executives. The process, which also includes 360-degree

assessment surveys, day-in-the-life behavioral simulations, and multiple personality and business skills-focused


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inventories, is built around competencies that have been identified as crucial for global leadership success (Wellins and

Rioux, 2001).

The South Korean conglomerate Samsung has become quite well-known for its commitment to global leadership

training. Samsungs Leadership Development Program, founded in 1990, was designed to truly integrate global

management know-how into the heart of the organization and thereby stimulate cultural and intellectual diversity. A

part of this program, the Global Management Institute, is an in-depth research and training facility that educates an

average of 220 people daily on global, regional, and national trends (Shin, 1997).

Yet, despite the training that graduates will get on the job, the role of academicians is to train their students with a

background/ a foundation for that further intensive individualized corporate training. We must not get bogged down in

the minutiae of such thoughts as optimal approaches and detailed functional area processes. Our challenge is to strive

for inclusiveness across curriculum areas to expand learning opportunities for students in the international arena.

For any curriculum in international business there are some vital courses that should be emphasized and

implemented. Understanding the cultural values and norms of other countries as well as at least a minimal foundational

knowledge of the language are necessary for success. Without these it is impossible to interact with other countries with

regard to international laws affecting business and negotiations. Since so much business is now international in scope,

collegiate schools of business are placing increased emphasis on international studies (Martin & Chaney, 1992).

Internationalization of business education seems to be not a trend but rather a necessity for the future. With increased

globalization of business and advances made in global information systems to aid in globalization, this appears bothunavoidable and necessary. Succinctly stated, academicians are responsible for obliterating ethnocentric views and

multicultural ignorance and are responsible for training future managers to become globally literate leaders.

While the authors of this paper believe that input from business leaders, business deans, faculty, and international

specialists is immensely valuable, it is also of paramount importance to gauge the perceptions of students with regard to

curriculum evaluation. With an arguable, broad-based consensus that some business schools simply strive to create a

general awareness of international issues, it is imperative that we pay clos e regard to student perception. This study

was based on a survey conducted to evaluate student perception of their knowledge of international business.

Data collection

Graduating seniors at Middle Tennessee State Universitys Jennings A. Jones College of Business are required to

take the International Competencies Exam. This exam assesses students preparation in 15 international business

topics. The results of the exam are used to evaluate whether the undergraduate program in the college of business

effectively cover international business topics. To assess student knowledge of international business, the authors of this

research adopted a student perception prospective. Graduating seniors were given a survey questionnaire in which they

were asked to indicate the level of their knowledge in each of the 15 international business topics. The students took the

survey twice. They first completed the questionnaire before taking the international competencies exam (pre-exam

questionnaire). They again completed the same questionnaire right after taking the international competencies exam

(post-exam questionnaire).

The survey was administered in six business policy classes over three semesters (Spring 2004, Fall 2004, and

Spring 2005). The six classes had a total of 156 students. Of those, 114 completed both the pre-exam and the post-exam

questionnaires. This represented a response rate of 73%. 51% of respondents (58 students) were males and 49% (56

students) were females. Most respondents (77 students or 68% of respondents) were below 25 years. White students

represented 84% (96 respondents) of the sample. Finally, 73 students (63%) worked 20 hours or more per week.

Data analysis

To evaluate student knowledge of international business topics, three statistical techniques will be used: factor

analysis, paired samples test, and MANOVA. The section will however start with the analysis of the reliability analysis

of the survey items.

Reliability analysis: The purpose of the reliability analysis is to determine whether the questions in the survey


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consistently and accurately measured student perception about their knowledge of international topics. The Cronbachs

Alpha was .865 for the pre-exam questions and .929 for the post-exam questions. Therefore, the questions were reliable.

Factor analysis: The factor analysis with Maximum Likelihood extraction method and varimax rotation was

performed on the results of the post-exam questionnaire to identify the factors or dimensions to which the international

topics belonged. Each item was represented by factor loadings ranging from .508 to .825. As can be seen in Table 1,

two main dimensions were identified. The first dimension included items 1 through 9. An examination of the dimension

revealed that these items were asking for student knowledge about topics related mostly to macro factors that tend to bebeyond managerial control. For the sake of the analysis, this dimension will be referred to as the macro topics

dimension. Thereafter, macro topics will be numbered topic 1 through topic 9.

Items 10 through 14 formed the second dimension. In general, these questions attempted to assess student

knowledge about topics that tend to be under the control of and/or can be manipulated by managerial decision. The

second dimension will be referred to as the managerial topics dimension. Managerial topics will be numbered topic

10 through topic 14.

One item (student knowledge about newly industrialized countries) did not fit into any both dimensions. The topic

in this question will be numbered topic 15. The discussion of the results will be based on all questions (including topic

15). However, a particular focus will be put on the macro topics dimension and the managerial topics dimension.

Table 1. Factor analysis (Maximum Likelihood with Varimax rotation method was used)Topics Lambda (Factor Loadings)

Factor 1: Macro topics

1. International trade theories

2. Diversity of the global environment

3. Major global political and economic institutions

4. Regional economic integration

5. Laws governing world commerce and extraterritoriality

6. Major financial markets of the world

7. Financial instruments and documentation for world trade

8. Balance of trade/payments & monetary/fiscal policies

9. Government intervention in trade

Factor 2: Managerial topics

10. Strategies for entry into international markets

11. Intl human resource management practices & peculiarities

12. Differences in international markets

13. Motivation and leadership across cultures

14. International communication

.730

.508

.671

.825

.539

.744

.774

.723

.669

.603

.727

.676

.742

.723

Students knowledge of international topics: The overall mean score, the mean score for each dimension, as well as

the mean score for each but one topic were higher after the students took the international competencies exam. Based on

a scale of 1 (poor knowledge) to 5 (excellent knowledge), the overall post-exam mean composite score was 3.20 (see

Table 2). The mean composite score by dimension shows the students perceived that they knew managerial topics (3.49)

better than macro topics (3.04).

The topics that the students said they knew the most were all managerial topics and included strategies for entry

into international markets, international communication, and motivation and leadership across cultures. The topics

they knew the least (all macro topics) were regional economic integration, major laws governing world commerce

and the issue of extraterritoriality, major global political and economic institutions, and balance of payments,

balance of trade and impact of monetary and fiscal policies of governments.

Post-exam and pre-exam perception: A comparative analysis: The post-exam mean scores are mostly higher than


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the pre-exam mean scores. However the significance of the difference between post-exam and pre-exam mean

composite scores on all topics and each topics dimension need to be evaluated. The appropriate statistical technique to

do such evaluation is the Paired Samples Test.

Table 2. Mean scores for knowledge of international business topics

Topics Post-exam Pre-exam Difference

Macro topics:

1

2

3

4

5

6

7

8

9

Average mean score for macro topics:

3.05

3.39

2.96

2.87

2.90

3.20

2.97

2.96

3.03

3.04

2.89

3.32

2.95

2.92

2.73

3.16

2.75

2.91

2.92

2.95

0.16

0.07

0.01

(0.05)

0.17

0.04

0.22

0.05

0.11

0.09

Managerial topics:10

11

12

13

14

Average mean score for managerial topics:

3.59

3.32

3.39

3.54

3.61

3.49

3.50

3.05

3.23

3.39

3.48

3.33

0.09

0.27

0.16

0.15

0.13

0.16

Unclassified topic:

15 2.98 2.68 0.30

Average mean score for all topics 3.20 3.09 0.11

Table 3. Results of the Paired Samples Test

Comparisons Mean Std. deviation t Significance

All topics:

- Post-exam

- Pre-exam

Post-Pre difference

3.20

3.09

0.11

.62685

.52387

.50986 2.375 .019

Macro topics:

- Post-exam

- Pre-exam

Post-Pre difference

3.04

2.95

0.09

.68827

.58517

.57139 1.657 .100

Managerial topics:

- Post-exam

- Pre-exam

Post-Pre difference

3.49

3.33

0.16

.70046

.68510

. 72794 2.316 .022


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The results of the paired samples test that are summarized in Table 3 show that the students did change the

perception they had about how much they knew. After taking the exam (i.e. after taking the International Business

course), they said they knew more than they thought they did before taking the course (Table 3). With t = 2.375 (p =

.019), the difference between the post-exam all topics composite mean score and that of the pre-exam mean score of .11

was significant. Therefore, taking the course had a positive impact on students perception a bout their knowledge of

international business.

The significant change in student perception after taking the course was primarily caused by the perception of theirknowledge of managerial topics. The difference between post-exam and pre-exam mean scores for managerial topics

(0.16) was statistically significant (t = 2.316 at p = .022). Taking the exam did not have a meaningful effect on students

perception of their knowledge of macro topics. Though the mean score after taking the exam was higher than before

taking the exam, the difference (0.09) was not statistically significant (t = 1.657 at p = .100).

The impact of demographic factors: MANOVA was performed to determine the influence of demographic factors

on students perception of their knowledge (macro topics and managerial topics).

Table 4. The impact of demographic factors on students perception

Demographic factors Statistics

Gender:

Two groups: male, female F = 3.879 P = .006

Age:

Three groups: below 25, 25-29, above 29 F = 0.625 P = .863

Race:

Three groups: Caucasian, Black, Others F = 1.202 P = .299

Job (work hours per week):

Four groups: below 5, 5-14, 15-19, above 19 F = 0.851 P = .598

As Table 4 suggests, gender was the only factor that affected the perception the students had about their knowledge

of international business. The discussion of the gender effects follows.

Gender effects: Male and female students were significantly different in how they perceived their knowledge of

international topics (see Table 5). Male students had higher mean scores than female students in every group of topics

(macro topics, managerial topics, and all topics). MANOVA provides F values to assess the significance of the genderdifference. For all topics taken together as a composite means scores, there was a statistically significant gender

difference in both the post-exam perception (F = 7.431 and p = .007) and the pre-exam perception (F = 8.298 and p =

.005).

Table 5. The impact of gender on student perception (Macro, Managerial, and All) topics

Gender differences Macro topics Managerial topics All topics

Post-exam comparison:

- Male mean (and std. deviation)

- Female mean (and std. deviation)

- F-value (and p-value)

3.24 (.66908)

2.83 (.65168)

10.668 (p=.001)

3.56 (.67824)

3.41 (.72147)

1.212 (p=.273)

3.35 (.61516)

3.04 (.60408)

7.431 (p=.007)

Pre-exam comparison:

- Male mean (and std. deviation)

- Female mean (and std. deviation)

- F-value

3.12 (.56759)

2.77 (.55309)

11.158 (p=.001)

3.40 (.66963)

3.26 (.70005)

1.121 (.292)

3.22 (.50530)

2.95 (.51024)

8.298 (p=005)

The perception difference between male and female students varied depending on the dimension considered. Table

5 shows that the difference was highly significant in macro topics but non-significant in managerial topics. For macro


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topics, the F values were 10.668 (p = .001) in post-exam mean score difference and 11.158 (p = .001) in pre-exam mean

score difference. This suggests that male students perceived that they knew significantly better macro issues than female

students. In managerial topics however, male knowledge was not statistically different compared with female

knowledge.

Conclusion

The purpose of this research was to assess student knowledge of international business topics. Two major findingscan be highlighted. First, after taking the international business exam, students changed the perception about their

knowledge of international business topics. The change was primarily the result of how much the students said they

knew managerial topics. After the exam, they thought that they knew managerial topics better than they did before

taking the exam. The research did not investigate why the students changed their perception. However, since the exam

covered the material learned in several required courses taken over the course of the undergraduate program and the

students did not prepare for it, an argument can be made that taking the exam helped the students to remember the

concepts that they had forgotten.

The second finding was related to gender differences. The level of knowledge the male students indicated that they

had was higher than that of the female students. This difference in perception between males and females was

significant in macro topics, but not in managerial topics. Also, this difference was noticeable both before and after

taking the international competencies exam.

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