Can “Ted” Snyder Work His Magic On Yale’s School of Management?

by John A. Byrne on

Departing Booth School of Business Dean Ted Snyder

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.

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  • SOMer

    Thank you for this series, John. As a recently accepted, (and matriculating), member of the Class of 2014, I am further encouraged by the level of attention SOM has been getting, and am excited about the general sense that it is on the cusp of big things. Aside from just moving up the rankings, I really believe that Yale is on the verge of revolutionizing the MBA experience. It’s good to hear that reflected from others.

  • JoelCairo

    I too am matriculating at Yale next year, and completely agree with the poster above about SOM being “on the cusp of big things.” The scholarship issue really is a big deal though. I had always thought the relative paucity of scholarship dollars at SOM was a function of their loan-forgiveness program (i.e. subsidizing SOM alum instead of SOM students). Never realized that it’s also a function of SOM simply not loosening the purse strings to make better offers to candidates.

    I can say that there is a real sense that the school is on the up-and-up, and in the process of becoming what it is going to be (vs some other B-schools that pretty much are what they are and always will be). There is a palpable sense of this on campus. I know I passed on three full-scholarship offers from other schools to enroll at SOM, full price, because it has a kind of energy I didn’t feel anywhere else.

  • CL

    This article gives me the sense that much work will be needed, with additional support from the university, to improve the stature of the Yale SOM. However, Dean Snyder is well equiped for this task

  • Clint

    John, would it be possible to have a “print view” for some of these articles? (where everything fits onto one page)

  • http://poetsandquants.com/members/jbyrne/ John A. Byrne

    Clint,

    Yes. We’re in the process of some major updates on the site and that’s on the list. Within the next two weeks I hope!

  • Shg

    What a surprise here – people attending SOM agreeing that SOM is a great school and that it will rise in the rankings.

  • SOMer

    Hi there.  I think you missed the point of what we were trying to say.  I think the other commenter and I were highlighting the palpable sense of excitement we’ve been feeling with all of our exposure to SOM, and how this may be an indicator of good things to come for the school.

    I know they say ‘don’t feed a troll,’ but sometimes it helps to point out the troll hasn’t really been reading in context.

  • Shg

    So if someone misses your point or doesn’t share your opinion or excitement, that classifies him as a troll? Sounds very tolerant.

  • SOMer
  • E$

    That’s some mightily expensive energy…

  • Paid My Loan

    I’m an SOM grad from the MPPM era. The promises and excuses here are the same ones they made 20 years ago. To anyone considering a career on the West Coast, or in technology and entrepreneurship, I’d say, do NOT go to SOM.

    Is it better for Finance in the NYC-Boston corridor? Maybe, but you’re still better off going to an established, larger program, rather than one with eternal “promise.” (Frankly, if you don’t get into a Top-2 school, the full-time MBA is probably not worth it.)

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