You guys ‘r probably sick of this by now (or if you just stumbled here: this is post #7 of a series asking if there is a bubble in education for demand for the MBA (post #1 of this series here), which the theory goes is why tuition at bschool keeps going up up up). So here’s the (hopefully final) thoughts we’re currently thinking; we’ll just toss this out on a Sunday of a (U.S.) holiday weekend and get it over with.
On this whole bschool bubble thing…
Bubbles are about artificial or unnatural demand, right?
Well the bschools are culpable here too. ‘cuz they’ve been busily adding to the supply. And, we think, suffering for it. But this is a good thing (at least for now) for some of you Brave Supplicants! Read on.
Bschools are often profit centers at universities. Their students do pay more in tuition than probably any other school on campus, and they don’t have those pesky costs from running labs and such (like with medical education). There isn’t even all that much research going on at some bschools, with all their from-industry adjunct faculty which they tout as a really good thing since it means you’re getting a real-world education from industry practitioners. (We don’t take issue with this as a way to provide a relevant education, but isn’t it comparatively cheap to bring on such a professor, in comparison to a tenured faculty dude who wants to do all sorts of research? Probably saves the school some money yet they charge big bucks for the curriculum all the same. Again, we don’t know for sure, we’re just guessing.)
Anyway, some state bschools (UCLA) don’t even offer tuition breaks for residents like they do for their undergrad and other grad programs (Ross though does offer a break to Michigan residents). The schools see the MBA program as a cash-generating machine, good in good times, and even more so in bad. Bschool trends are often countercyclical to the economy: when the economy goes down, many people flock to bschool to ride it out.
Perhaps some schools got a little overeager in this last downturn. Seeing demand go up with increasing applications for their main programs, they have expanded. The problem is, many bschools move slooooowwwwwly. Big bohemoth institutions they are. Carol Scott, Prof of Mktg at UCLA Anderson, said that “changes [are] tortuous. Any potential changes went through many faculty and committee discussions. By the time we thought about it and went through all the machinations, it was often too late for a change to be effective and keep up with the evolving business world.” This is almost universal in bschools (any schools).* So they implement new stuff (like expansion of enrollment) in reaction to what they see going on in the market… but they do it a little late.
Recently, Columbia expanded its EMBA program into two different tracks, offering more “supply” ostensibly in response to the “demand” for its program. (We’re not lumping Columbia into the “lower-ranked programs” category although the EMBA is NOT the same education/experience as the F/T MBA at this school).
We think they may have overextended.
This is purely us reading the tea leaves but it seems they may have been scraping the bottom of the barrel in trying to fill their entering classes for these programs. We definitely know of a couple candidates who got into one of the EMBA tracks who in past years would never have been offered a spot at Columbia. They also were offering up spots in the EMBA program to several applicants who they were accepting to their F/T program. None of them that we know accepted it, since we all know that the F/T MBA is superior than the EMBA in terms of networking opportunities and quality of life. The classroom experience is supposedly the same, but if you’re admitting the less-qualified candidates just in order to get bodies in the classroom, then you can’t expect the same type of high-caliber cohort as a more selective/more competitive process would produce.
We do not think that expanding programs that are already in less demand is all that great for the people who are going through them. Sure, it makes it easier for less-qualified folks to get in — that probably is a good thing, since we’ve already been lamenting that the best educational opportunities are limited to those who have access. So you can get in if you’re less qualified — and if you have the big bucks to pay for it. This expansion is not making education MORE AFFORDABLE. It’s only bringing in more tuition revenue to the schools, and possibly diluting the quality of the classroom experience/cohort (boy we sound snobby there don’t we).
But it seems a little lopsided to us.
Stay tuned. (eek we thought this would the last one and it’s not)
* This is why for some fields — like technology — and digital marketing — we often recommend youngsters thinking about college to seek a practical education OUTSIDE the standard university system. Maybe this is what PayPal man is thinking with offering money to entrepreneurial kids who will forego college. If you want to learn how to program, for example, go take a programming class, but don’t go get a 4-year undergraduate degree in computer science. Unless you want to become a low-level I/O geek doing systems boards or whatever. Because at most mainstream universities, tech change comes to the classroom very late, and you’d graduate with near-obsolete knowledge. This is also true with social media marketing and the like; most bschools are behind the curve on this stuff.