MBA applications: How to beat the drop
Sep 14th 2011, 16:08 by B.R.
The Graduate Management Admission Council's latest report on business-school applications makes for grim reading. According to its 2011 Application Trends Survey (PDF) over two-thirds of schools worldwide say that they have seen applications to their two-year full-time MBA programmes fall over the last year. Meanwhile, 57% also reported a drop in applications to one-year full-time programmes.
There may be several contributing factors. With applications at an all time high the year before (generally applications to business schools rise in tough economic times) there is an element of a return to normality. Still, this doesn't account for all of the collapse.
Dave Wilson, GMAC’s president, says it may not be that there has been a shocking drop in the number of applicants, rather that each candidate is applying to fewer schools. This is interesting because one explanation could be that more students are only applying for local programmes, where there is a limited choice. If true, this fits neatly with the projections of many of those predicting tough times ahead for business schools.
The argument runs thus: the number of business schools is growing, but tuition fees are not falling. Meanwhile, in an uncertain jobs market, an MBA from a mid-ranking school no longer offers a guaranteed return on investment. As a result applications become polarised. The handful of elite, global schools will see applications rise, as their gold-standard brands begin to feel like a safe haven. (According to The Economist’s "Which MBA?" survey, Harvard had 11 applicants for each of its MBA spots this year compared with ten last, for example, while London eight rather than seven.) Meanwhile, programmes which cater to local students also get a fillip as these often have discounted programme fees and have none of the extra costs of upping sticks or, in the case of part-time programmes, leaving a job.
This leaves a whole tranche of reputable schools, which sit just outside the elite, caught in the middle and in search of a survival strategy. They need what was described by Dipak Jain, the marketing professor now president of INSEAD, as a “sandwich strategy”: a way to differentiate themselves from the masses.
As if to confirm this, GMAC’s survey also reveals that specialised business master’s degrees have seen a rise in popularity. Eighty-three percent of schools reported an increase in applications to their Master’s of Finance, while over half saw more interest in Master’s of Accounting degrees. As the fight for a niche becomes keener this trend is likely to continue. Not all can expect to survive.
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Creative destruction? Inefficient ones will be out and good ones will be up and above from the crisis?
But wait, can it also be destructive creation in disguise?
So what if some schools are in search of a survival strategy? It'll give them a chance to practise what they preach... or doesn't Porter's 5 Forces apply outside of biz school?!
When schools offer an MBA in Human Resources, you know "MBA" has been seriously devalued.
MBA? well its just so passe.
All MBA programs are broadly the same. They all teach the same stuff about decision-making, teamwork, finance, etc. etc. MBAs have matured and commoditized. Differentiating MBA programs now is mostly about branding. If you have a famous name in a sexy location, you are elite. If you have an unglamorous name in an unglamorous location, you are screwed.
My advice to second-tier MBA programs caught in no-man's-land? Move your office to a glamorous location and rebrand the program. I am much more likely to take you seriously if your MBA says "London" or "New York", rather than "midsized-town XYZ".
If business schools really understood and could practice their subject matter, this would be viewed as an opportunity. For example, this is a perfect time to extend their brands and appeal to more customers (students, biz community) through joint venture partnerships. TRIUM Global EMBA by NYE, HEC and LSE is an example of a strategic alliance where the product is potentially worth more than the sum of its parts.
In my perspective for this crisis all over the world is professional bodies also included the MBA coverage and more industry based curriculum development to competition with other bodies
even gold plated MBAs are going to suffer when attendees realize that people who went into the MBA from a bulge bracket bank or a brand name private equity model come out with good jobs while people from random walks of life come out with 150k in debt.
To hell with 'career opportunities', get an MBA because you find a general education concerning 'how the world works'. If that's not your goal, getting an MBA is pointless.
To hell with 'career opportunities', get an MBA because you find a general education concerning 'how the world works'. If that's not your goal, getting an MBA is pointless.
P.S. $150,000 in debt ... and DON'T go to an expensive place to get your MBA.
Go to your executive management and ask them like I did if they pay more or higher more MBA's. The answer was no. Enough said.
And so the devaluation of the MBA continues. There are the gold standards and then there is everybody else.
This post-nominal craze will continue until we run out of letters.
Wharton Amos Tuck, AB (failed, Calcutta), D. of Chiropractic (Hon.)
People realized that MBA's are worthless. Middle management are the first to get pruned in a slump. Hard knowledge, technical skills, and science degrees are associated with a much higher degree of job security.
Majority of business's now-a-days do not even give a higher salary for an MBA, its just somehting you can put on your resume. Why worry about less applications? Now only the cream of the crop students are applying and weeding out all the lesser students.
I’m sure that all the out of work architects, civil engineers, mechanical engineers, electrical engineers and master machinists will find cold comfort in having watched middle management get a pink slip a week or two before they did. Unemployment numbers are down in the architectural fields as most of the 80% who lost their jobs have switched profession. A lot of mechanical engineers who took jobs in Asia as a tide-me-over have found that they are a tainted commodity and can’t get work in the states anymore. Electrical engineers who don’t have certification in systems integration, a degree that didn’t exist 10 years ago, or robotics are no longer relevant and they can’t afford to go back to school for another degree as they either still owe on the first degree or are upside down in their house. If you are going to get a technical degree you had better figure on getting another degree every 10 to 12 years if you want to continue in your field. The fresh outs are willing to work for less and they are up to date on the stuff that didn’t exist when you were in school. If you aren’t spending $12G - $20G a year on continuing education you have no career security in most of the tech fields. If you are spending that much time and money on education you probably don’t have much of a life or own a house or a car that doesn’t scare you.
I’m sure that all the out of work architects, civil engineers, mechanical engineers, electrical engineers and master machinists will find cold comfort in having watched middle management get a pink slip a week or two before they did. Unemployment numbers are down in the architectural fields as most of the 80% who lost their jobs have switched profession. A lot of mechanical engineers who took jobs in Asia as a tide-me-over have found that they are a tainted commodity and can’t get work in the states anymore. Electrical engineers who don’t have certification in systems integration, a degree that didn’t exist 10 years ago, or robotics are no longer relevant and they can’t afford to go back to school for another degree as they either still owe on the first degree or are upside down in their house. If you are going to get a technical degree you had better figure on getting another degree every 10 to 12 years if you want to continue in your field. The fresh outs are willing to work for less and they are up to date on the stuff that didn’t exist when you were in school. If you aren’t spending $12G - $20G a year on continuing education you have no career security in most of the tech fields. If you are spending that much time and money on education you probably don’t have much of a life or own a house or a car that doesn’t scare you.