The privatization of California’s B-schools...

As California slashes billions from its higher education budget, the state’s premier public business schools have quietly focused its efforts on raising private dollars In the past few years, billions of dollars have been slashed from California’s higher education budget. Some have warned that the cutbacks are impacting the quality of a state university system that has long been considered the crown jewel of public higher education. What has been the impact on the state’s premier public business schools? Surprisingly, there’s been little to no impact, according to the B-school deans. A year ago, faculty and staff endured a “furlough” that led to a one-time average pay cut of 8%. But the prestige and quality of the full-time MBA programs has been protected as state support of the schools has diminished. What has occurred is a quiet privatization of business education. The B-schools have pushed through dramatic increases in MBA tuition and fees, stepped up efforts to increase endowments, and added more non-degree executive programs that produce “revenue surpluses” to offset the cuts. “Basically, all of us have been phasing out our reliance on state funding for many years,” says Steven C. Currall, dean of UC-Davis’ Graduate School of Management. But Currall winces at the notion that he and his fellow deans have “privatized” the business schools. “Some in the UC system see privatization as radioactive,” he concedes. “I prefer the words financial sustainability. We’re reducing our reliance on state funds, which makes our business model much more akin to a private university….”…Read full...

Small Companies: The MBA Road Not Taken

They may lack the prestige of big companies, but in many ways small companies and MBAs have much to offer one another For many students and their schools, an MBA stands for Master of Business Administration during the program and then for McKinsey, Bain, and Accenture once the job search begins. So much is made of return on investment when the subject of MBAs is raised that it seems to be an undisputed truth that these programs naturally lead to positions with large, public companies. In such a context, an MBA program that channels alumni toward small or medium-sized enterprises (SMEs) will probably be seen as unsuccessful or lacking ambition. The same view is likely to be taken of students who choose to take the SME path. Smaller companies are seldom the sort of household name employers usually linked to MBAs and are likely to evolve in sectors whose managers have to get their hands dirty. However, there is a case to be made for SMEs being the best possible fit for an MBA graduate. A classic, high-quality MBA program is a general management curriculum designed to equip participants with all the skills needed to run a business. While the structure rests on specific subjects such as finance, strategy and leadership, the overall logic is to meld these blocks of knowledge together. In the vast majority of cases, MBA students shy away from too much specialization, preferring instead to focus on a well-rounded education. Limited MBA Roles at Multinationals Despite the courting of high-profile, multinational recruiters by MBA programs, their emphasis on preparing graduates for high-level management jobs does not always resonate with bigger employers. While a large company can offer a vast range of posts, these are often...

Use an M.B.A. to Change Careers

So-called “career switchers” look upon the degree as a way to expand international job opportunities, develop the right connections for future employment, and establish the potential for long-term income and financial stability These days, you’d be hard pressed to find someone who stays with one company or even on one job track throughout his or her entire professional life. By some estimates, two thirds or more of graduating M.B.A.s use the degree as a means of switching careers. If you’re looking for the fast track to gain the skills and network to launch your career in a new direction, a popular way to do so is through an M.B.A. program. So-called “career switchers” look upon the degree as a way to expand international job opportunities, develop the right connections for future employment, and establish the potential for long-term income and financial stability. In fact, there’s even an M.B.A. for Career Change offered by Willamette University’s Atkinson Graduate School of Management. I personally went to business school because I wanted to transition from finance to marketing. While I did achieve this, I also found that the M.B.A. experience opened up my mind to an array of new possibilities. I ended up in a career with a marketing focus, but it unfolded in a way I never would have considered before my M.B.A. Since application season is ramping up, I have a few words of advice for those applying to business school now or in the near future. If your undergraduate degree or work experience falls into the nontraditional category, make sure you clearly convey your long-term career goals within your application and essays, and explain in detail how you arrived at the conclusion that an M.B.A. would help you further...

The story behind a B-school textbook fortune

How one retired professor made a fortune by co-authoring a textbook that would shape how generations of MBA students learned finance When Eugene Brigham was asked by his boss to help co-author a revision of a finance textbook, he jumped at the chance. It was 1966 and Brigham was all of 35 and an assistant professor of finance at UCLA’s business school. Soon enough, his byline would follow legendary financial whiz J. Fred Weston on the second edition of Essentials of Managerial Finance, which then sold for all of $7.95. Some 45 years later, Brigham is still the best-selling author of the most durable finance textbook for MBAs ever written: Financial Management: Theory & Practice, the successor to Weston and Brigham’s revision. It is often required reading in the core MBA curriculum at many business schools — and it has made Brigham, now a sprightly, golf-playing retiree of 80 years, one of the wealthiest B-school teachers ever. His 10 textbooks on finance have been translated into a dozen languages and used at more than 1,000 universities. They’ve sold more than 5 million copies. This past year, Brigham’s last two editions of Financial Management are the first and third best selling textbooks for MBAs, according to Bowker, which tracks book sales. In some years, Financial Management can garner as high as a 40% share of the estimated 100,000 students who annually use an introductory textbook on finance. For Brigham, the books have been a constant part of his life for more than 40 years. Sometimes, he concedes, the endless revisions have been an albatross. But his income from textbook writing has far exceeded all the paychecks he ever received as a teacher at Berkeley, UCLA, the University of Wisconsin, and...

B-Schools Embrace China

Western Schools Capitalize on Huge Demand for Managers. And Their China Programs Also Pay Dividends at Home.. Just like large companies eager to get a foothold in one of the world’s most important markets, international business schools are moving into China in a big way. Eager to capitalize on demand in a fast-growing economy that has a huge need for well-trained managers, big name B-schools from Europe and the U.S. are launching and expanding M.B.A.-program collaborations with Chinese universities or going it alone with courses aimed at mid-career executives. Experience in China is also a selling point at home, since Western students increasingly see the benefits of studying at an institution whose faculty have close-up experience of the country. Such links can also give M.B.A. students the chance to study in China for a module or a semester. “The lure is to go and learn about what’s happening, and be in the middle of the action in one of the most dynamic economies in the world,” says Krishna Palepu, senior associate dean for international development at Harvard Business School. The school has had a faculty research base in China for about 20 years but now shares a new Shanghai classroom with other Harvard schools. “In the last four or five years we have ramped it up to a much larger scale,” he says. A flurry of deans from top international institutions who have moved recently to run programs in Asia shows the influence the continent’s institutions now wield in the B-school world, says Matt Symonds, whose company, Symonds GSB, does consulting for business schools…Read full...

MBA Pay: The $3.6 Million Degree

New research into long-term MBA pay suggests you get what you pay for. Top schools like Harvard, Wharton, and Stanford leave the rest of the pack in the dust News flash: Grads from the top MBA programs make more money over the course of their careers than peers from lower-ranked B-schools. That’s not much of a surprise, considering MBAs from programs like Harvard, Wharton, and Stanford command the highest salaries”$126,000, on average”upon earning the business credential. But what is surprising is how much more grads from these highly ranked programs will make over a 20-year career compared with grads from lesser-ranked programs. According to new research commissioned by Bloomberg Businessweek, the difference is more than $1 million. Executive compensation expert Ken Hugessen isn’t shocked at the disparity in MBA earnings. “The differences in salary at the beginning are hugely predictive of the 20-year accumulation,” he says. “If you’re at a top school, you must be pretty smart to get in. You’re a stronger breed of cat from day one. That will follow you throughout your career.” For the third year, Bloomberg Businessweek asked PayScale, a company that collects salary data from individuals through online pay comparison tools, to use its database of MBA graduates at the top U.S. business schools to calculate their median cash compensation”salaries and bonuses”around graduation and after they have an average of 5, 10, 15, and 20 years of pre- and post-MBA work experience in the same industry. We then used those data to calculate an estimate of median cash earnings over the entire 20-year span. Overall, grads from the 57 top programs earned an estimated $2.4 million in base pay and bonuses over the course of a 20-year career, according to the data. On...

Got an MBA? Great, but I Prefer Uncommon Sense...

Interview with Byron Lewis Sr., the chairman and chief executive of the UniWorld Group Q. How do you hire? What qualities are you looking for? A. I’m looking for entrepreneurial capabilities. I’m looking for integrity. Q. How do you tell if somebody has integrity? A. We ask them for references, but it’s also an intuition you need to have. Many people who come to us don’t have traditional backgrounds. I’m looking for people who have ideas. I’m looking for people who can move the agency forward. I am looking for people who are different but different within the context of a business. Q. Can you elaborate on that last point? A. I’m looking for people who are not siloed. You have to know how to work with the creative people. You have to know how to bring the best out of them. Q. What’s your advice for getting the most out of creative people? A. Creative people never know when or where the inspiration will come from, and leaders should understand that. The best way to build a team is to let the creative people feel that you understand them, and if they want to go off strategy, let them have their commercial or two, but make sure you have what the client asks for. The best creative also comes from good strategic planning and staying on point. Q. Let’s say you just hired me, and I ask you, “What’s it like to work for you?” A. Well, I’m a piece of work. You have to understand that I never worked for an advertising agency or a mainstream marketing company. It might be difficult because I built this company and I’m a nontraditional person. I’m looking for ideas, and...

MBA in Job-Hunting?

Helping new M.B.A.s find jobs upon graduation has now become a central task of the modern business school… but While having an M.B.A. used to be a sure way to move up in the business world, helping new M.B.A.s find jobs upon graduation has now become a central task of the modern business school. Wake Forest University has taken this responsibility to heart, and administrators there have taken extra steps to ensure career success — practically making getting a job a course requirement. The school’s dean, Steve Reinemund, has made improving job placement rates for all students, but particularly full-time M.B.A. students, a top priority. He has hired an army of career counselors, integrated “career management” into the curriculum, and aggressively sought out mentors to work with students. And that effort has paid off for graduates, with the school’s job placement rate – measured by the number of students employed within three months of graduation – jumping from about 77 percent to about 92 percent in three years. That jump comes at a time when many business schools, particularly those that, like Wake Forest, aren’t at the very top of the list for employers or students, have struggled with job placement rates. For comparison, a recent survey by the Graduate Management Admissions Council found that 54 percent of full-time M.B.A. students in the U.S. had job offers at graduation in 2011, up from only 40 percent the year before. The decision to focus on ensuring that students find jobs has paid dividends for the school, which is making headlines, moving up in rankings, and seeing a stronger applicant pool. But it also raises questions about how central a role career services should play in a business education, particularly at...

School Gave US News Inaccurate MBA Ranking Data...

University of Florida Warrington College of Business supplied the magazine with inaccurate job-placement data, resulting in a higher ranking Less than four months after learning that Villanova law school tried to game its rankings, U.S. News & World Report is confronting another ranking scandal, this one involving its b-school list. The Gainesville Sun last night reported that the University of Florida Warrington College of Business supplied the magazine with inaccurate job-placement data, resulting in a higher ranking. An anonymous complaint made through the university’s ethics hotline in August alleged that 37 percent of UF’s 2009 MBA graduating class had jobs at graduation, while 53 percent had jobs three months later. The figures supplied to USNWR indicated 53 percent placement at graduation and 79 percent three months later. UF was ranked 39th in 2009, falling two spots from the year before; in 2010 it fell to 47th. A report of an internal investigation [investigation report.pdf] obtained by Bloomberg Businessweek found no evidence of collusion or deliberate intent to distort the data. But the report, authored by Angel Kwolek-Folland, associate provost for academic affairs, found that several graduates were listed as employed based on questionable documentation, and several more were listed as “not seeking employment” when in fact they were. “In this case, the principals appear to have used a looser interpretation of the data than would a reasonable person using the same standards,” Kwolek-Folland wrote, referring to the standards for placement statistics created by the MBA Career Services Council. “Whether this was the result of poor judgment or inexperience, the end result is an inaccurate portrait of the employment profile of 2009 WCBA MBA graduates.” In a memo by Warrington Dean John Kraft [Dean’s response.pdf], the school maintains that it...