NEARLY 300 ONLINE MBA PROGRAMS IN THE U.S. ALONE
“Technology is changing in ways that have affected many other industries and it’s now starting to affect education,” says Robert Dammon, dean of Carnegie Mellon’s Tepper School of Business. “It’s my belief that at some point — and that point is not too far in the future — people will be able to customize their education for what fits their lifestyle best. They may do some online learning. They may do some on-campus learning. They may do an internship on the West Coast and take courses online. They will mix and match what’s best for them at that particular time.”
Already, there are nearly 300 online MBA programs in the U.S. alone at nearly every price point, from the University of Illinois’ highly disruptive $22,000 online offering with Coursera to Carnegie Mellon’s $133,680. “The number of institutions who are going into this marketplace is increasing every day,” says Jim Parrish, director of full-time and online MBAs at Auburn’s Harbert School. “There is a lot of red ocean right now and we need to figure out what the blue ocean strategy is.”
Many of the soon-to-launch online options at big-brand schools will comfortably reach into the six figures, with the University of Michigan expected to price its program at $123,000 for out-of-state students. Scott DeRue, dean of the Ross School of Business, is promising a compelling hybrid offering that will lean heavily on experiential learning, just as its full-time residential MBA. “If you’re an online MBA student at Ross, you’re going to engage in a number of residencies, whether it be in Ann Arbor or some place in the world, where you will be working in globally diverse teams, with real companies like Google and Facebook on real problems,” he says. “And you are going to be merging your education with the hands-on, action-based learning that defines a Michigan Ross MBA.”
USC’S DEBUT PROGRAM BUILT FROM VISITING OTHER TOP PROGRAMS
Just about every dean is predicting still more competitors in the marketplace. “The online MBA is only going to improve and increase,” according to Sandra Chrystal, the vice dean for online learning at USC Marshall. “More and more students realize that they can get a high-quality education online. The technology and pedagogy have come together in a way that was not possible ten years ago.”
With a total cost of $105,542, USC’s newfangled online MBA is one of the pricier long-distance options. But with a completion time of 21 months, it’s also one of the shorter programs. Chrystal says the genesis of the program goes back about five years. In 2013, the school started experimenting with online learning, offering some electives to full-time MBA students. And by 2015, the school had its full-fledged online MBA curriculum, developed by a team of top professors from the full-time MBA.
The idea for an online MBA came from Marshall Dean James Ellis. “He felt the time was right and it was important strategically to enter the online MBA space,” says Phil Griego, assistant dean of online learning. The team began having conversations with the online programs already established at USC as well as a few other top online MBA programs. Chrystal visited the administrators of Indiana Kelley’s online program and UNC’s Kenan-Flagler Business School.
SOME BIG DIFFERENCES IN ONLINE VS. RESIDENTIAL MBA STUDENTS
Kelley does its production in-house, while Kenan-Flagler uses third-party production service 2U. Seeing the difference was influential in the creation of USC’s program. “I really felt the quality of IU Kelley’s production people and working with support of the faculty was very important,” Chrystal recalls. Plus, USC is in the heart of global production. “We already have the video production folks at USC,” Griego points out. The result is an innovative program where data analytics and strategy is incorporated into every class.
While USC’s program is new and built with a Hollywood-esque production standard, second-place Auburn’s online MBA has roots going back nearly 30 years. In 1989, Auburn’s Harbert School began filming full-time MBA courses and sending the videos out via VHS tape, evolving to DVDs before going exclusively online in 2010. According to Stan Harris, associate dean of graduate and international programs at Auburn Harbert, online MBAs in general have surged in popularity over the past five years. “When you first heard ‘online,’ the thought was it was watered-down,” Harris says. “You weren’t getting real faculty or content. It just wasn’t real.” That is no longer true. Today, many programs put their best faculty in their online programs, the same professors who teach in their residential programs.
There are at least two major differences in online MBAs versus full-time residential MBAs. One is the age and work experience of the students, and the second is admissions standards and competitiveness. Consider No. 1-ranked USC Marshall. The acceptance rate for the school’s full-time MBA progrm is 28%; for the online MBA option, it’s 53%. Meantime, average work experience upon entering the program is 11 years for the online version but just five for the full-time residential program. Plus, the average GMAT for the full-time program is 705, but it is more than 50 points lower for the online program at 648.
‘THERE WAS A TIME WHEN THE TERM ONLINE MBA WOULDN’T BE USED DUE TO NEGATIVE CONNOTATIONS’
It’s similar for UNC’s Kenan-Flagler Business School. The average work experience for the UNC online program is about 10 years versus the five years for the full-time program. The average GMAT for the full-time program is 702; for the online program, it’s 649.
Schools say that because online MBAs typically boast more work experience — often similar to candidates in executive MBA programs — standardized test scores should be less influential in their admissions policies. “The quality of the students we are getting is unquestionable,” Chrystal says, noting that about a quarter of the enrolled students already have advanced degrees. “The students are learning from one another in the classroom as well as from the faculty. The discussions in the classes are rich.”
One thing is certain. Every year, would-be students are likely to have more online options from which to choose and more brand name business schools are expected to enter the space.
“There was a time early on that the term online MBA wouldn’t be used because of the negative connotation,” Auburn’s Harris says. But over the past five years that has changed dramatically as more top-ranked business schools have entered the market. That’s a trend that isn’t likely to end anytime soon.
(SEE THE NEXT TWO PAGES FOR RANKINGS SCORES AND ADMISSIONS STANDARDS AT THE TOP 35 SCHOOLS.)