As demand for MBA degrees fade, business colleges look for alternative ways to attract students
- Higher ed business programs – even at the likes of Harvard – are seeing drops in enrollment as students flock to more efficient programs hosted by alternative sources, such as General Assembly, or tech companies like Google, Mike Horn writes in a recent Forbes.com article.
- As the cost of earning an MBA, like other degrees, has soared, Horn says companies soured to hiring graduates at the high salaries required to repay student loans, so they looked for cheaper, more efficient education models. Likewise, students began to question whether an MBA is worth the price tag, unless it comes from a prestigious school.
- The trend leaves business schools considering whether to shutter traditional MBA programs in favor of shorter, more specialized options. Horn notes that in August, the University of Iowa’s Tippie College of Business announced it was ending its full-time MBA program. The University of Wisconsin-Madison is considering a similar move.
Although enrollment in graduate programs throughout the U.S. continues to grow, the growth rate has flattened. According to a recent article in Inside Higher Ed, applications to graduate programs jumped 1.2% in 2016 from the previous year, falling way short of a 5.7% average each year between 2006 and 2016. Demographic changes and a drop in international students may play a part, but increasingly, adult students are attracted to short-term programs, which can train students specifically for the higher-paying jobs or career advancements they seek.
Iowa's Tippie College is a good case study of an institution being responsive to market changes and adjusting their offerings accordingly. Since being launched in 2014, Tippie College's Master of Science in Business Analytics program has expanded to three campuses, growing by 517% in less than three years, as specific courses prepare students for the data economy.
In many cases, however, campus bureaucracies, faculty attachment to programs and concerns over accreditation get in the way of innovation, and leave institutions struggling to come back from behind as the market rapidly passes them by. And poor board-campus relationships can hinder this process even more. In Pennsylvania and other places, leaders are hoping to change this model by shrinking the size of task forces down to only a handful of people, compromising representative groups for a representative and productive process, and setting action items to be completed within 90 days. Many strategic redesigns can take years to complete, but leaders are increasingly finding that by the time proposed changes would be enacted, they are obsolete.