The future of management education
The MBA, disrupted
We have obtained a copy of a recent letter to a business dean
On behalf of the trustees of the Gordon Gekko Business School, I write with a helicopter view on our beloved institution. There is good news and bad. First, congratulations are in order. Under your leadership, GorGeBS has again been named by The Economist as one of the world’s top 100 business schools.
The bad news is that our best-of-breed status is in jeopardy because the very business model of our school faces tectonic challenges. Demand is plunging. Our MBA applications are down by a quarter. Across America, applications to business schools have fallen for five years in a row. Even at Harvard, they are down this year by about 6%.
One reason is a drop in international applicants, many of whom are put off by America’s anti-immigration policies. But before you rush to blame all those law graduates staffing up government departments, the bigger factor is that we are charging too much. Our MBA costs nearly twice as much as it did a decade ago, but nobody believes we are delivering twice as much value.
We are also failing to grapple with technological disruption. The time I spent getting my MBA on our leafy campus by the fountainhead of the River Rand constituted two of the best years of my life. Even so, I am beginning to think that your dogged defence of a bricks-and-mortar strategy is wrong-headed. Online business education can deliver world-class thought leadership, too.
Worse, the relevance of our curriculum is being challenged. The students roaming our hallowed halls today are not the red-blooded, Darwinian capitalists who used to strive for business degrees. They are in a very different mind space, demanding that we go beyond our traditional teachings on the primacy of shareholder value to embrace stakeholder value.