OPEN UNIVERSITY

7137 MA (MARKETING) BLUEPRINT

[this is an example of the documentation produced for a new OU programme]

BLUEPRINT

30/7/99

MA (MARKETING)

(interim revised version 30/7/99)

[Note: the latest changes are shown underlined]

INTRODUCTION

This blueprint sets out the processes leading to the establishment of a Masters Degree in Marketing. It positively supports the University's decision to develop a range of named degrees in specialist subjects; where one of the largest, and most accessible, groups of those requiring postgraduate qualifications is that made up of marketers. In particular, the chartered institute in this field - CIM - graduates around 3,000 Post-Graduate Diplomates (PGDip) each year; with around 25,000 in its pool of existing graduates. As a result, in addition to a viable academic case, the financial case is clear cut; not least because the requirements closely parallel parts of the existing MBA programme, and investment costs are correspondingly reduced.

The key design feature is that the programme will be free-standing, dedicated to students of marketing; with no transfers - in either direction - between it and the existing MBA (apart from those already allowed). The first stage, equivalent to the OUBS Diploma in the MBA, accordingly will take the form of the CIM PGDip qualification (or equivalent). Students will, initially at least, take this at other institutions - where there are up to 300 existing providers of this qualification - but, subject to demand, an OUBS entry route may also be provided at a later date.

The second stage of this Masters programme will consist of three compulsory courses, two existing ones (B820 and B825) along with one new course, B82X which will be specific to the programme, together with one elective (chosen from the range of existing MBA electives).

As always, however, the core objective will be to provide a high quality academic offering; which should demonstrably be the best - setting the standard, especially overseas; where a third of PGDip graduates are currently located. It will also be the largest in the field, where the few serious competitive (face-to-face) offerings are available to only limited numbers of students in the UK. The programme is to be launched, and the first courses (from existing MBA offerings) presented, at the end of 2000 - and the only new course will come on stream in 2002 - with the first MAs graduating in that year.

RATIONALE & AIMS

To expand the range of Masters qualifications offered by the addition of the first such OUBS named degree.

Rationale

In recent years, a growing number of business schools have been extending their masters offerings into the area of specialist (named) degrees. At least 50 institutions offer such Masters, either MAs or occasionally MBAs, between them providing more than 70 such qualifications. These developments have been in response to the demand for more functionally oriented subjects from a pool of potential students; of which that in marketing is one of the largest. The starting point for about half these marketing masters is the CIM PGDip (or equivalent), since the  Chartered Institute of Marketing is the lead body in the field; though these institutions typically also provide their own entry level courses.

On the other hand, the CIM itself can have no direct role in running such a masters programme - where this is solely the prerogative of the HE institution - here the OUBS. Even so, it has formally requested that we enter the market, to set the standards by which other face-to-face providers (around the world) are judged. It has also indicated that it will jointly promote our global offering.

The Masters in Marketing, which - in view of its audience of marketing practitioners - will be a practically oriented MA (rather than an MSc) as are almost all the competitive offerings, should therefore be seen as a logical follow-on to these external CIM PGDiploma courses; at least initially, before we can develop our own suite of entry level courses (which match CIM syllabuses). With an existing pool of up to 25,000 CIM PGDip graduates, and 3,000 more graduating each year, such a Masters in Marketing potentially represents one of the largest markets for masters students; and one where OU distance learning may be especially viable, especially for overseas students.

Financial Case

As can be seen from the rule of thumb figures below, even if we assume that only 10% of those graduating each year join our masters programme, and we assume the same revenue and cost structures as those of the exiting MBA, the benefits could be substantial:

The investment costs would be significantly lower than normal - and, following the model of 'low-resource electives', even then would not include any - potentially expensive - additional audio-visual elements. In this way, we would expect the total launch investment to be kept well below £100,000.

Student Numbers

Due to the specific nature of the entry to it, with the first stage specifically comprising the CIM PGDip, the initial market for this MA is tightly defined. Even so, the market for any new radically product is always difficult to judge. In this case our difficulty is not posed by the existence of a market for the MA itself, the experience of the many other institutions making Marketing Masters available clearly shows that the overall market exists, but whether there are sufficient numbers to support a mass-market distance taught offering such as the one we propose. The best estimate that we can currently make is that, following the example of our own Diplomates (and anecdotal evidence from CIM students), up to 40% of the annual cohort of 3,000 PGDip graduates may eventually wish to gain a Masters qualification. This gives a total potential from this source of 1,200 per annum; to which may be added recruits from the historic pool, of 25,000 past graduates. To this may eventually be added the possibility of pulling through a greater proportion of the total of 6,000+ students who start CIM courses each year - and growth in the market (especially overseas) as a postgraduate qualification becomes increasingly necessary for high-flyers to create a career in the field. The minimum is, therefore, likely to be around 1,500 per annum, possibly eventually rising to more than 3,000 potential MA prospects annually.

Based on our experience of the MBA, it would seem possible that we should recruit up to 25% of these potential students; giving us a steady minimum input of at least 300 students per annum. Despite developments in other leading business schools, this market is as yet poorly provided for - with only half the numbers of institutions offering this qualification as offer an MBA, and then only in face-to-face courses (often only offered as full-time courses) teaching cohorts of only 20-30 students in the UK; where a third of PGDip graduates are overseas. If we develop our own entry courses, based on a single credit (B800) model which parallels the PGDip, we may be able to significantly extend these numbers, especially overseas; perhaps to as many as 1,000 students per annum.

If we were ultimately able to also resource development of suitable CD level programmes comparable with our new investment in comparable accounting courses, or undergraduate courses comparable with those in Business Studies, the overall potential could be larger still. Thus, the key finding, by Butler et al  (McKinsey Quarterly 1997 No. 1), is that the share of 'interactive activities' (communication, data gathering & collaborative problem solving - all of which are at the heart of marketing activities) now accounts for half of all activities taking place in developed economies.

Risk Management

In any case, in the inevitable absence of definitive evidence of likely conversion rates, the key to managing any financial risk involved is that the programme will not involve significant resource exposures. This will be achieved by largely using existing courses;  even the one 'new' course will be largely built from existing material. The risk to the OU's reputation is considered to be minimal, since it has already announced that it wishes to expand its scope in this way; and, indeed, this programme offers the lowest risk approach to exploring this objective.

As a result, and as can be seen from the figures in the table above, even at the level of 50 students per annum - a level typically projected for those larger face-to-face courses already running successfully at other UK institutions - the programme would make a reasonable margin. Indeed, in theory only a total of 35 students (over the initial five year life of the programme) would be needed for us to break-even. If, instead, we were able to recruit the more likely numbers, of 300+ students per annum, the School (and the University) could receive net additional income of more than £1 million per annum, due to the benefits of economies of scale which would result from running it in parallel with the MBA. The figures could also be much higher - possibly doubled yet again - if we allow for the global expansion, planned by CIM to match the coverage already achieved by the UK accounting bodies.

In this context, the most important potential limitation might be that of recruiting the 200 students a year needed to allow national coverage of tutor groups for the dedicated new B82X course; and even that limit might be unnecessary where global presentation could be tutored via the Internet.

Potential Cashflow

Assuming, therefore, a likely figure of 300 students per year joining the programme, with an initial lower level of recent PGDip graduates being balanced by greater numbers emerging from the historical pool of graduates, the cashflow model could be:

If these results were achieved, therefore, after a small outflow in year 1 the programme would become a substantial net earner.

Programme Aims

In line with our general objectives, we would aim to provide courses of the highest academic quality for marketing managers and professionals; through the provision of excellent learning materials with comprehensive support through local tutors - based on a workplace centred philosophy that enables concepts and ideas to be applied directly to their job.

More directly, we would aim to address the strategic skills and knowledge demanded of senior managers and professionals in the field of marketing. Due to the considerable overlap between these and those demanded of the corporate strategy elements delivered by the MBA, there will be significant overlap between the two programmes - as there is with many of the competitive offerings - with students' initial levels of knowledge also being comparable. The main difference will be found in the workplace application of these skills. In addition, the narrower focus is reflected in the reduced number of electives - only one elective being offered in stage 2 - with three courses being compulsory.

As secondary objectives, the programme would be used to enhance OUBS coverage of the marketplace; and would be used to test the viability of using this (MA) model in other OU discipline areas.

STUDENT CHARACTERISTICS

In many respects the profile of students entering the programme may be very similar to that of our own diplomates entering stage 2 of the MBA. Their age would typically be in the late 20s, and the gender profile spilt 50/50. In particular, the proportion of those already holding degrees would be high; not least as the CIM PGDip qualification is clearly seen as post-graduate - which is taken as a professional qualification by graduates entering the profession. The major difference would be their experience of distance learning, and this would be allowed for by the introductory induction package (coupled to B820).

About a third of the numbers are overseas - and CIM wants to increase this proportion.

The key difference is that these students are clearly embedded in marketing operations; where - at least in theory - our MBA students are 'general' managers. This means, therefore, that we will have a cohort of students with more clearly defined needs; albeit that they too will be focused on strategic considerations.

STRUCTURE

Based on our external discussions with CIM, along with our internal ones with MBA Board and the Academic Marketing Group, the various elements of the three credit (180 point) MA (Marketing) will be:

STAGE 1 (60 points)

This would be by the CIM Post-Graduate Diploma or equivalent. Initially, this entry qualification would indeed be exclusively in the form of CIM PGDip qualifications (or equivalent) provided by other institutions. Depending upon other negotiations taking place with the CIM, this could eventually also be provided by our own equivalents; possibly in the form of a (single credit) version of the next level replacement for B800 (which, in turn, would follow on from the CDNext material now being developed)..

STAGE 2 (120 points)

The core position is that CIM have stated that they will support a programme built from the existing MBA courses. To meet possible AMBA requirements, however, the MBA Board wish to offer a clearly differentiated path (with the CIM PGDip as the first stage and three compulsory courses in the second stage) and at least one different, dedicated course in the second stage (B82X).

Accordingly, the second stage would take the form of four 30 point courses, three compulsory and one elective, as follows:

* available in 2001 ** available in 2002 ***not available before 2003

Based on our previous experience with direct entrants into Stage 2, at least some of these students - with no prior experience of distance learning - might be likely to experience some problems entering directly into B820. Accordingly, a short - 1 month - induction package would be provided ahead of this. This would be based on existing CD/MBA packs, supported by day-schools and tutorials. In addition, the MA/B820 tutors would also positively counsel students throughout the course - if necessary with extra tutorials.

The MA (Marketing) would, initially at least, be governed through the MBA programme board - by the existing MBA Director (but with additional programme manager support).

CONTENT - EXISTING COURSES

B820 - as marketing and corporate strategy very closely parallel each other, and marketers are inevitably involved in discussions with senior management about such strategies, this course (the core course for the MBA) will also be an essential ingredient for the MA. Students will, therefore, follow exactly the same syllabus - for this element - as those on the MBA. The B820 course itself will be unchanged; though the new induction package would also be provided.

B825 - clearly the new marketing course in the MBA will be directly relevant. The students will again follow exactly the same syllabus as the MBA, with the (administered) exception that they will be restricted to taking one selected from the range of three focused on different industry sectors, instead of any one of the whole range on offer. Otherwise, the material in this course will be unchanged from that already agreed for the MBA

Electives - the whole range of MBA electives will be available - unchanged by any special requirements posed by the MA.

POSSIBLE INDICATIVE CONTENT - NEW COURSE

B82X ('Long-Range Marketing') - the final compulsory element will be a new course. This course will only be available on the MA (Marketing).  The PLANET form for this new course will be submitted early in 2000; by the interest group (based upon a core of all the existing academic marketing group staff) currently working on it.

In the meantime, to indicate the likely viability of such a course, one indicative framework is illustrated in the appendix. This particular version would be based (approximately 50:50) on the long range (marketing) planning elements of 'The Challenge of the External Environment' (B885) and the remaining electives from B825; but - depending upon the deliberations of the interest group - another framework may eventually be offered. In essence, this indicative framework includes:

B885 ELEMENTS (6 units)

Based on initial discussions between the interest group and the MBA Board - the structure could be made up partly from B885 Book 1 (comprising the long-range planning elements), which - in this version - would be largely unchanged in coverage; though updated and rewritten for the new audience. Added to this might be the Sociology material (Book 3 parts 1 & 2); rewritten by the original (external) author, to incorporate the lessons learned from B885.

[Note: the Economics units have already been transferred to B825]

B825 ELEMENTS (6 units)

It is similarly suggested that the other half would be derived from the remaining electives commissioned for B825.

TEACHING OBJECTIVES

The teaching strategy would, similar to B825, be to reinforce the students management ability within their chosen marketing field, using the reflective practitioner model to build on their work-place experiences. In particular, this would be achieved through scenario based TMAs as in B885, during the first half of the course, and through development of strategic plans, in the second half.

In view of the compulsory nature of the other elements of the MA (Marketing), it is - at this stage - suggested that the assessment strategy for this course could be by TMAs alone, with no examination, possibly supported by PC-based CMAs.

As this course would be the one facing the main problems of scale (especially overseas), where the other elements could ride on the audiences generated by the MBA, an Internet tutoring model could be developed; in addition to the existing (B885) use of conferencing for group work. Following the model for 'low resource electives', no audio visual (or CDROM) material would be developed.

Following initial delivery of the course, it would be modularised to create a range of short-courses; to meet the new objectives of the OU. As far as possible, earlier development work will bear this in mind. In view of its antecedents, the course will not be co-published (unless the existing Sage book is updated to take account of the new requirements).

The more detailed (unit by unit) list of possible content is indicated in the appendix.

CREDIT TRANSFER & RELATIONSHIP TO OTHER OUBS PROGRAMMES

Due to the specialised entry conditions, and the specific nature of the courses, there will be no direct transfer to other OUBS, or OU, courses possible - other than those already available.

In particular, upon completion of an MBA, a graduate would be required to obtain a PGDip or equivalent from another institution (since, due to excluded combinations, this would be unlikely to be available in the form of future OUBS courses), as well as completing one further elective, before becoming eligible for an MA (Marketing).

In the other direction, upon completion of an MA (Marketing), a graduate would have to complete the B800 course (or replacement or equivalent parts of CDNext), and another elective, before qualifying for an MBA.

In view of the amount of additional study needed, we believe it is unlikely that many students would follow any of these routes.

PROMOTIONAL ACTIVITIES

One benefit of the tightly focused target audience will be that a very focused promotional campaign will be possible; and this will accordingly be especially cost-effective. Even though the usual OUBS model (used in the cashflow table earlier) would allow up to £250,000 per annum, we are likely to limit the initial spend to less than £50,000. The most closely focused elements of this will include closely targeted direct mail, using the CIM membership lists, and limited trade press (especially the CIM's own journal). The wider audience will initially be addressed by PR (jointly undertaken by OUBS and CIM), backed up by shared (OUBS) brand advertising.

Only if an OUBS entry route also came available would a larger spend be justified, and even then only as part of the overall OUBS brand advertising.

TIMINGS

Ideally, the proposed launch timings would be:

Note: the lag of a year between the launch of B825 and B82X is to allow time for the lessons learned in the launch of the former to be transferred to the latter (and for the marketing group resources to be scheduled most effectively to each). Subsequently, students will be expected to take B82X after B825 and before the MBA elective.

It is possible, however, that OUBS financial considerations might demand a launch six months earlier than this: