Business Education

PROBLEMS

Following Georgia's independence in 1991, it has, like most other countries of the former Soviet Union, faced severe disruptions in its trade and payments relations and sharply increased energy import costs. In addition, the economy has suffered from civil conflicts, a war in Abkhazia and associated refugee problems, and the disruption of trade routes by conflicts in neighboring countries. By 1994, these shocks had caused economic activity to decline to less than a third of its level in 1990, and severely undermined the Government's capacity to conduct economic policy. Massive financial imbalances had emerged, and the economic situation was deteriorating rapidly. Government revenue fell to less than 3 percent of GDP, and despite very low wages and expenditure compression, government expenditures far exceeded revenues. The resulting large fiscal deficits were financed by central bank credit and the accumulation of domestic and external arrears. The unsustainable fiscal stance and accommodating monetary policy fueled hyperinflation and nearly complete currency substitution. As output declined, the population became dependent on inflows of humanitarian aid. The fall in consumption was mitigated by the use of formal and informal trade credits, which by end-1994 had resulted in the accumulation of an external debt of US$1 billion. (Taken from Republic of Georgia: Policy Framework Paper; 1996-1998; http://www.worldbank.org/html/pic/GEORGIA.html)

ACCOMPLISHMENTS

The Caucasus School of Business (CSB) was formed by Georgia State University (GSU) and three institutions in Tbilisi: Tbilisi State University; Georgian Technical University; and Tbilisi State Institute of Economic Relations. The main purpose was to establish a program for training a new generation of managers to assist Georgia's transition from a planned economy to a free market economy. The program will serve not only Georgia but also the Transcaucasus region and the neighboring countries. The partnership between Robinson College of Business (RCB), Georgia State University (GSU) and the Georgian Universities led to the design and implementation of a Master of Business Administration (MBA) and Bachelor of Business Administration (BBA) and Management Development Programs (MDP) whose purpose was to develop and train faculty and top level administrators, and establish modern library, computer laboratory, and communication and audiovisual facilities.

The MBA and BBA programs are patterned after that of GSU's flexible MBA and BBA programs. The Caucasus School of Business (CSB) was established on October 14th, 1998. An administrative structure was developed and administrators were trained in the areas of student recruitment and selection as well as registration. An MBA and BBA curriculum established and faculty members from the CSB were trained at Georgia State University in designing, conducting and delivering new courses in the area of Business Administration. To date a total 15 faculty members have been trained and are capable of teaching most of the core courses. GSU faculty members have also visited CSB and team-taught with CSB faculty members. Necessary library, computer labs, Internet and audiovisual facilities have been established. Currently 75 MBA students and 130 BBA students are enrolled. The first class of MBA and BBA students will graduate in May 2001.

Initially Health Administration and Hospitality Management concentrations were included, but the experience of the past two and a half years shows that the demand for Health Administration and Hospitality Management concentrations is not as large as predicted. This can be attributed to slow economic development of Georgia and lack of government resources to honor their commitment to support health administration students. As a result, CSB has decided to temporarily suspend both concentrations and offer an additional concentration in International Business. This move requires training of additional faculty in Atlanta and purchase of additional textbooks in International business.

Delivering short-term training programs for various businesses in Georgia has been a small source of income for CSB. CSB believes that there is a growing market for training the employees of foreign and large local companies in areas of Marketing, Management, Finance and Accounting. However, design and delivery of short-term training programs must be tailored to the requirements of individual companies. CSB will need to design and develop a number of mini courses in various areas with instructional materials (most likely in Georgian) and combine them into short-term training programs according to the requirements of individual companies. Delivery of short-term training programs should improve ties with the business community, provide extra financial resources, and provide publicity to attract more MBA students. Moreover, CSB should increase its expertise by providing training in a real business context, preparing business plans, providing market research and consulting.

CSB is planning to gradually improve the research output of its faculty. They realize that CSB cannot achieve academic recognition and accreditation without credible research. They are determined to promote research and publications at CSB and encourage collaborations with researchers from western Universities. In order to encourage such activity, CSB needs to adopt an effective strategy designed to reward, and facilitate faulty research with western faculty. This will only materialize after the Georgian faculty demonstrates that they are indeed capable of producing scholarly work. To establish research at CSB external funding is needed to support faculty research grants, publication of working paper series, subscription to scholarly journals in fields of research, and faculty travel to international conferences.

CSB plans on encouraging the Georgian faculty to write business cases dealing with Georgia. They have also proposed to create a glossary of business terms in Georgian in collaboration with Georgian linguists.

Another area in need of immediate major improvement is access to Internet for faculty and students. The Internet facility at CSB is too slow and expensive. Consequently, Internet is practically unavailable to most students and faculty. However, access to a professional strength Internet is crucial for teaching, learning, and research. The installation of fast Internet system and access to distance learning systems will be a major force in the development of CSB. For example, GSU offers many of the MBA core courses on the Internet; however, CSB cannot take advantage of this resource at GSU. The Internet would allow more CSB faculty members, who may not have the opportunity to visit GSU, to take distance-learning course at GSU. Furthermore, with Internet facilities, GSU faculty can participate as guest lecturers in CSB classes without traveling to Tbilisi. With the Internet set up, even joint conference and seminars can be arranged despite geographic distance.

Additional computers for faculty and students are needed. It is necessary to buy several servers and a number of workstations to meet the new demand. Also, it is necessary to purchase/build software for administrative functions and the library. Currently all records are kept manually.
CSB is in the process of publishing a catalogue and several different brochures. The administrators of CSB have authored the catalogue and GSU experts have provided consultation.

FUNDING

The Eurasia Foundation
Department of State, Bureau of Educational and Cultural Affairs, Grants Division

MORE INFORMATION

Caucasus School of Business: Current Status by Bijan Fazlollahi PhD [pdf file]

Bijan Fazlollahi PhD <bijan@gsu.edu>

Kakha Shengelia MBA <dean_csb@hotmail.com>

LINKS:

Caucasus School of Business [ www.csb.ge]

Robinson College of Business, Georgia State University
[http://www.cba.gsu.edu/robinson/home.asp]

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Last Update: June 7, 2001