Yale SOM’s Ted Snyder On The Durability Of The M7, MBA Application Declines & More

‘THE SET OF HIGHLY CREDIBLE B-SCHOOLS IS PROBABLY NOT MUCH MORE THAN 20’

Another seven U.S. schools, Darden (Virginia), Fuqua (Duke), Haas (Berkeley), Stern (NYU), Tuck (Dartmouth), and Yale SOM, have been ranked with the so-called “M7” schools but none has established itself consistently in the top seven. Meanwhile, he believes several schools outside the U.S. have established themselves in the top tier globally. These include London Business School, HEC Paris, INSEAD, and Hong Kong University of Science & Technology.

But none of them have been able to dislodge any of the M7 schools which to Snyder appear entrenched at the top. “The consistencies in the long-term rankings have contributed to a durable hierarchy of top business schools,” he believes. “As the set of schools that can credibly pursue the highest of aspirations in terms of people, programs, and impact shrinks, the observed rigidities in the rankings are becoming more relevant.”

Snyder estimates that more than 50 schools have pursued what he calls ‘multi-brass ring’ strategies in the early 1990s. Yet with the increased intensity of competition among schools for faculty and students, “the set of highly credible U.S. and non-U.S. schools is probably not much more than 20,” he maintains. “Several schools that were once attractive do not appear to be viable competitors for top full-time students and world-class faculty going forward.”

BELIEVES TWO SCHOOLS COULD CRASH THE M7 PARTY: YALE & BERKELEY

He remains somewhat optimistic that two schools have an opportunity to crash the M7 party. “I think the schools that have the best chance outside the top seven are Berkeley and Yale,” says Snyder. “Those are the two I would watch for different reasons. Berkeley is in the Bay Area (where the tech firms have led the world economy), and it’s a magical name. (Former Dean) Rich (Lyons) has done a great job. And then Yale, if we can get a few more things in place.”

Snyder believes Yale still has upside given its home university, the quality of its people, its large endowment per capita, and a well-crafted program portfolio. Student quality in the full-time MBA program is in the top five based on objective measures, he says, noting that growth in applications to the program has outpaced peer institutions over the last eight years. Applications have fallen in the past two years due to what he calls “global frictions that reduce the appeal of a two -year residential program in the U.S.”

Truth is, Snyder is leaving the deanship with the School of Management in its best position ever. The number of students across the school’s programs has increased by 83% to 972 from 532 just before he became dean. MBA enrollment is up by 43% to 666 from 465, while Executive MBA enrollment jumped 272% to 134 students from a mere 36. Applications to Yale’s MBA program are up 28% to 3,785 for 347 seats from 2,960 for 231 seats.

ALUMNI ENGAGEMENT AT A 30-PLUS YEAR HIGH

Snyder, moreover, was able to achieve those growth numbers while increasing the quality of incoming students whose average GMAT score is now 724, up from 722, and whose undergraduate GPA is now 3.67 versus 3.52. The percentage of women in last year’s entering class reached 43%, up seven percentage points from 36% in 2010, while the percentage of international passport holders is now 45%, up from 33%.

The school’s full-time faculty has grown from 68, with 32 tenured, to 90, with 42 tenured professors, with senior faculty hired in operations, economics, marketing, and finance. The number of tenured women faculty doubled and the number of ladder-track women faculty increased by 50%. One result of the increase in faculty: elective course sections offered increased by 56% from 99 to 154.

He also points out that SOM’s 8,692 living alumni, whose median age is 45, are successful, loyal, engaged, and supportive. In the last fiscal year, 54.8% of alumni made gifts, a 30-plus year high, averaging about $900. Total giving to the alumni fund more than doubled to $3.9 million from $1.65 million during his term as dean. While Dartmouth Tuck boasts a higher participation rate of just over 70% and some peer schools receive larger average gifts from their alumni, no school in North America is better on both of these critically important dimensions, says Snyder.

YIELD REMAINS A CHALLENGE

One challenge, however, continues to be yield, the percentage of admits who end up enrolling at the school. “We haven’t gotten our yield up to over 50%,” says Snyder. “We hit 49.5% one year, and I wanted to round up but couldn’t do it. Getting over 50% is hard. I experienced that at Chicago and when you get there it just makes it so much easier. But more importantly, we are just not winning against these peer schools when people are jointly admitted.”

Asked what he has learned over the course of his nearly two dozen years in senior leadership jobs at leading business schools, Snyder answers without hesitation: teamwork. At Yale SOM, he quickly recruited two leaders from Wharton and IE Business School in Spain who could rightly assume deanship roles themselves. Snyder poached Wharton’s Anjani Jain and IE’s David Bach as his two top lieutenants. Jain has overseen the flagship MBA program, while Bach’s purview has been Yale’s executive MBA and global programs.

“I’ve become a much better manager or team player,” says Snyder. “Strategy is super important. So is being crystal clear at where you are and where you need to go. Sometimes, I skipped that when I wasn’t clear on the status and focused on the destination.”