News deans at Harvard, Kellogg, Chicago, and INSEAD.
A boom in MBA admissions consulting.
The debut of a new prestige MBA program at Johns Hopkins University.
The first revamping of Wharton’s MBA curriculum in 17 years.
It has been a big year in graduate business education. After a two-year slide due to an economic implosion that saw Wall Street, big banks and other key recruiters of MBAs scale back their hiring, the MBA began a comeback in 2010. Employment rates for graduating classes improved at almost all the schools, and even salaries began to creep higher.
The comeback of the stock market also helped business school endowments. At Harvard Business School, for example, the endowment rose by $200,000 to $2.3 billion. It is still a far cry from its 2008 peak of $3 billion, but is at last moving in the right direction.
So what’s in store for the new year? Our predictions:
- The MBA Job Market Gets Hot Again. Early indications of job offers for the Class of 2011 show a robust increase that will make next year the best in the past five for graduating MBAs. For one thing, Wall Street firms and banks, which all but disappeared from the recruitment scene for two years, are back in force. For another, a lot of other firms that had scaled back their hiring plans, from the major consulting shops to smaller boutiques, are expanding their entry pools. Boston Consulting Group, one of the world’s largest employers of freshly minted MBAs, is increasing its hiring of the Class of 2011 by 18% over the previous class. “We have gone from having almost no competition (for hiring top MBAs) in the fall of 2008 to a big ramp up this past season,” says Mel Wolfgang, who heads up recruiting for BCG in the Americas. “This past fall, four months ago, the banks really started coming back. We also saw not only a resurgence of consulting but private equity, venture capital, and hedge funds, which had been sleepy for a two-year period, began to push very hard.”
- International Schools Gain Greater Recognition for Their Vast Improvement in Quality. As more companies than ever view their future in global terms, they will become increasingly interested in recruiting MBAs from the prestige non-U.S. business schools. Applicants who in years past would have automatically gone to Harvard, Stanford and other top U.S. schools will increasingly opt for such viable alternatives as London Business School, IE Business School in Spain, and CEIBS in Shanghai. Globally-minded applicants who would have chosen a top 25 U.S. school in the past will instead head for such places as Cheung Kong in Beijing and the Indian School of Business in Hyderabad. The result: many of these schools will become more selective than ever. “Whether you are looking to work there or here in the U.S., you are going to discover that you’ll have to deal with Asia and especially China,” says David Wilson, CEO of the Graduate Management Admission Council which administers the GMAT test. “If I were a young person again, I would go to school outside North America and learn more about other cultures. As we go forward that is going to be mission critical.”
- Death to the Masters of the Universe (At Least for Now). The greed and hubris that led to the global economic meltdown will finally have a greater impact on what students learn in MBA programs. This year, more than any other, expect professors to emphasize integrity and ethics in business decision making. Much of the emphasis on values will appear with little fanfare in already existing classes–and not because of major curriculum reviews or upheavals. “There were plenty of calls from recruiters and others for business schools to take more seriously the unintended consequences of their de facto cultures that pre-dated the crisis,” says Rich Lyons, dean of Berkeley’s Haas School of Business. “But there will be an inflection point in schools taking a more values-centered approach.”
- More B-School Applicants Take the Graduate Record Exam Gains. With a major campaign to establish the GRE as a viable test alternative, the GRE begins to make headway against the GMAT. An increasing number of prestige business schools, including INSEAD, Harvard, Stanford, Wharton and Columbia, now accept GRE scores for admission. A recent Kaplan survey found that 39% of some 288 business schools it surveyed now allow applicants to submit a GRE score, compared to 24% last year. The GRE, administered by Educational Testing Service, is rolling out significant changes to its content, design, scoring and format this year. To introduce the newly revised exam, ETS will be offering the test at a 50% discount for a two-month period starting in August.
- The Rise of Yale University’s School of Management. The most eagerly awaited of all the new deans will begin his tenure at a prestige school that has never fully realized its potential. Edward A. Snyder, who did an extraordinary job as dean of Chicago’s Booth School since 2001, starts his Yale deanship on July 1. Expectations are high based on his record of success as a dean at both Chicago and the University of Virginia’s Darden School. At Chicago, “Ted” Snyder oversaw the move to the school’s new Hyde Park campus, brought in the largest donation to any business school in the world—a $300 million gift from alumnus David Booth and his family—tripled scholarship assistance to students, and more than doubled the school’s endowment. Just as importantly, he oversaw the school’s rise to first place in the all-important BusinessWeek ranking. Chicago has been number one in three consecutive BW surveys from 2006 to 2010. Despite the nearly unrivaled reputation of its university, Yale’s business school rarely cracks top ten lists among MBA rankings. P&Q currently places SOM 14th. Expect Snyder to make an immediate impact here.
- Online MBA Degrees Gain Greater Credibility. The decision by the University of North Carolina’s Kenan-Flagler School of Business to start an online MBA program this year will bring more prestige and stature to online business degrees. It is the first time that a B-school as highly ranked in the U.S. as UNC has entered the market. Until now, the only other highly quality online alternatives have been by Indiana University’s Kelley School of Business and IE Business School in Spain. Many educators at top-ranked schools, however, are watching closely the UNC program. Expect still more prestige schools to get into this market which by and large is the province of unaccredited, for-profit schools.