Profile: 2. Stanford’s Graduate School of Business

Many students, he believes, start thinking they will get MBA degrees much earlier in their lives, some even in their undergraduate years. “A lot have done pre-MBA work and they ended up coming here and not learning much. Meanwhile, the poor student without a business background is sitting next to the CPA and at a disadvantage.” Saloner thinks these problems were not unique to Stanford but rather are an outcome of the “maturity of the degree.”

Pretty much every business school admits a student body that is highly diverse by background and experience. “On the one hand, we have students who are very sophisticated,” adds Saloner. “They’ve known for a long time that they wanted to get an MBA. They took an undergraduate business degree or economics degree; they spent four or five years on Wall Street or in a consulting firm; and they’ve come to us essentially pre-MBA. On the other hand, you have a lot of students, some of whom have worked for NGOs in developing countries or have come from Teach for America, who have not been exposed to very much in the way of management fundamentals. MBA programs have traditionally taken this breadth of background and experience and put students through a one-size-fits-all program, and that was not working for us.”

At Stanford, there were other issues as well. Professors came to believe that they were not addressing multi-cultural and multi-national issues as well as they needed to. And then there was the issue of critical thinking skills. “Under the old curriculum, Stanford students were not particularly trained or used to arguing with each other and taking on each other’s ideas while being entirely objective,” says operations professor Sunil Kumar, a senior associate dean. “This cooperative ethic, which is a good thing, led them to be perceived by some potential employers as not intellectually aggressive enough.”

In the fall of 2005, Saloner was asked to lead a committee to take a deep and thoughtful look at Stanford’s MBA program. His panel spent four months, doing extensive interviews with faculty as well as hundreds of students and alumni from around the world. Saloner himself spoke to 10% of the students in the classes of 2006 and 2007, most of them at private dinners at his home. Overall, the committee met with a third of all the MBA students. Some professors favored grade disclosure–at Stanford recruiters cannot ask students their grades–and tighter graduation standards. But the committee opted for a different approach.

The new program, unveiled in the fall of 2007, puts more critical thinking, leadership development, expanded global content, and a global experience requirement into the MBA. It also allows students more flexiblity in customizing their coursework to account for their ability level. The bottom line: while most business schools treat their students as a single, homogeneous class with a fairly rigid, cookie-cutter approach, Stanford now treats every student differently, tailoring the core curriculum to their individual needs.

The program begins with a set of “management perspectives” courses, including one focused on the global context, followed by a set of customizable core courses in 11 “management foundation areas.” Each of the 11 areas offers at least three choices for students based on their background and experience. You can take the base-level course, typically what had been taught in the core. Or you could take an accelerated version of the base-level course offerred for students with a reasonably strong background in the field. That course covered the basic material more quickly before addressing more advanced topics. Or you could take the advanced-applications option for students with very strong backgrounds in the subject.

At Stanford, 47% of the MBA students come from a humanities background, 36% have engineering, math or science undergraduate degrees, while 17% arrive with an undergraduate background in business. How does that mix affect the new three-level course offerings? In microeconomics, for example, about 60% of the students are expected to take the base-level course, 25% the accelerated course, and perhaps 15% the most advanced offering. In marketing, about 55% of the students take the base-level course. Another 25% selected the next course that emphasized business-to-business marketing and extensively used marketing simulation exercises. A further 20% opted for the advanced-applications course.

Of course, a drawback of this approach is that students in a basic class don’t get the insights of a more experienced classmate. To the extent that much of the learning in an MBA program comes from students, some may feel a bit shortchanged. Saloner pooh poohs this notion. “I think that’s vastly overrated,” he says.

The new curriculum also radically changes the flow of the program. Stanford, in common with many other schools, used to start with disciplines, then moved to functions, before ending with integration. But the new MBA program started with perspectives and then moved to discplines before focusing on fuctions. “We decided to build the roof first without the walls and foundations,” says Saloner.

In the first quarter of the new program (11 weeks long rather than the normal 10-week length), the perspectives include accounting information, critical analytical thinking, global context of management, managerial finance, managing groups and teams, organizational behavior, and strategic leadership. The global course is entirely new and aimed to promote a strong understanding of global management. A new global experience requirement, consisting of an international internship, an international service-learning project, or a study trip, is now required of each student prior to the start of the second year. Students have to take their experience in a country in which they have not previously lived or worked.