Can “Ted” Snyder Work His Magic On Yale’s School of Management?
Ever since Yale University launched its School of Organization and Management in 1976, the place has been something of an unconventional business school. Its founders envisioned a school that would be small, communal, unorthodox, and steeped in theory and research, able to groom leaders for both business as well as the public and non-profit sectors.
But the decision to create not another me-too business school has had some unintended consequences. For years, Yale’s School of Management has unsuccessfully battled the misperception that it is merely a school of non-profit management, a haven for do-gooders outside the MBA mainstream. And despite basking in the halo of one of the world’s most valuable educational brands, the school has never been able to develop the stature of any of its Ivy League rivals.
Enter Edward “Ted” Snyder, the 58-year-old veteran dean who signed on as SOM’s new leader last fall. He arrived with extraordinarily high expectations. “I like what I do so I don’t feel pressure,” says the soft-spoken Snyder. “I feel really good about the prospects here. I’ve been at business school deaning for awhile so it gives me the credibility to say, ‘Folks, this is what we face.’”
Snyder is more than just another dean in a hot seat. Having served as dean at two other major business schools—the University of Chicago and the University of Virginia–he’s something of a business school physician. He worked magic at Chicago’s Booth School of Business, bringing in the largest gift to any business school ever–$300 million—nearly doubling the school’s endowed professorships, tripling scholarship assistance, and moving Chicago to number one in BusinessWeek’s influential rankings.
THE SCHOOL IS UNDER-FUNDED AND UNDER-MARKETED
After seven months at Yale, what’s his diagnosis? Snyder believes the school has been under-funded and under-marketed. There’s been too little effort devoted to leveraging the university’s formidable brand, no advertising budget, and mediocre scholarship support to get the best students. The small size of the school has made it difficult to gain critical mass, so that its alumni network isn’t as strong as it should be and many corporate recruiters find the MBA pool too small to fish in. And like most other U.S. schools, SOM lags in getting up to speed on globalization.
A good comparison is with Cornell University’s Johnson School, a similarly sized Ivy League institution. Although SOM’s $536 million endowment is more than three times the size of the endowment at the Johnson School, its annual operating budget is roughly the same: about $60 million. If Yale spent at the same ratio of endowment to budget as Cornell, SOM’s operating budget would be more than triple its current outlays. That money could be spent to improve the quality and the size of its faculty, to provide a more sizable support staff, to fund more scholarships to entice the best applicants, and to more aggressively promote Yale’s positioning via marketing and advertising.
Cornell’s money, moreover, has been put to better use over the years. Both the school’s faculty and career services office regularly outperform Yale’s in student satisfaction surveys. And Cornell has consistently outperformed Yale in several key MBA rankings, especially the BusinessWeek list, which currently places Yale at a rank of 21st vs. Cornell at 13th.
‘WE’RE PLAYING WITH A BB GUN WHEN SOME SCHOOLS HAVE BAZOOKAS.’
Another problem. Yale is woefully behind in scholarship funds to get the best talent in the door. Currently, SOM has a scholarship kitty equal to 6% of its gross tuition. That comes to less than $1.5 million. Harvard Business School, by comparison, doles out $28 million annually in scholarships, accounting for 30% of its gross tuition. Vanderbilt University’s Owen School, with nearly 100 fewer full-time MBAs than Yale, is providing $3.9 million in scholarship support this year, equivalent to 26% of its gross tuition. Concedes Bruce DelMonico, head of admissions, “We’re playing with a BB gun when some schools have bazookas.” The result: more than half of the applicants accepted to SOM turn it down, partly because they are also applying to more higher ranked schools that accept them.
All that said, Snyder is starting off with some very strong assets, including the Yale brand, a modern MBA curriculum launched four years ago, a new $222 million home for the school that will open late this year, as well as a handful of faculty stars and exceptional students who come to SOM with highly impressive credentials not all that dissimilar from the MBA candidates at Harvard, Columbia, Wharton, Dartmouth and Cornell.