Harvard MBA Students Join Growing Calls For Tuition Refunds

Editor’s note: This story has been updated with a response from Harvard Business School.

As the coronavirus pandemic threatens to push the start of the fall term online, Harvard Business School students have joined the growing groundswell of demands that tuition for MBA classes be discounted. The petition for a tuition refund for the spring term follows similar efforts at Stanford, Wharton, Columbia and other prominent business schools (see The Student Revolt Over MBA Tuition For Online Classes). In the first 18 hours since the HBS petition went live on Change.org, it has received more than 220 signatures.

At many other business schools, similar petitions have received the support of hundreds of students. At Stanford’s Graduate School of Business, for example, 80% of the students are demanding an 80% discount on the spring term in a petition that has garnered more thna 750 signatures. At Wharton, nearly 1,000 people have signed a petition to open up a dialogue with Dean Geoffrey Garrett over the issue of tuition refunds.

Even at schools where petition protests have yet to arise, MBA students have begun to publicly speak out on the issue. MBA students at INSEAD and Northwestern University’s Kellogg School of Management went public over the weekend in the Financial Times. “They have clearly shown that they do not care about us,” an INSEAD MBA student on the school’s Singapore told the FT.  He believes the controversy could discourage future students. “Everything has been derailed on our end and we’re also not sure if we’ll get absorbed back into the workforce upon graduation.” Vyasa Shastry, a first-year MBA at Kellogg, said students felt impotent to challenge the increasing use of online lectures.  “We’re between a rock and a hard place,” he told the FT. “People are disappointed about it but we wish the school would see our point of view and reduce our tuition.”

‘GIVING RISE TO ANTI-DONATION-PLEDGE SENTIMENTS’

The issue of tuition reimbursement is also resulting in differences of opinion among students on some business school campuses. At Yale’s School of Management, an unhappy MBA student posted a change.org petition two weeks ago demanding a 25% cut in MBA tuition that has attracted fewer than 20 signatures. “Our student government has sent a comprehensive survey to students to capture sentiments across the student body and will use that data to put together a comprehensive petition that accurately represents the entire student body,” says Rayan Mansour, an MBA in Yale’s Class of 2020.

Because of the coronavirus pandemic, Harvard Business School shut down its physical classrooms in Aldrich and began delivering classes via remote instruction on March 23, now known on campus as V-Day for the day that everything went virtual (see What Harvard Business School Has Learned From The Coronavirus Crisis). The petition makes clear that HBS Dean Nitin Nohria has already said the school will not refund a portion of the tuition for its spring term. Students are urging him to reconsider his position.

In an email to Poets&Quants on Monday (April 13), Brian C. Kenny, HBS chief marketing and communications officer, noted that the decision against reimbursing for tuition was made at the university level. “The schools have no discretion over that decision,” Kenny says. In areas where HBS does have discretion, he says, the school has done the following:

• Announced on March 3 that it would make a $5,000 tuition adjustment to RC students’ term bills to account for the cancellation of the Field Global Immersion;
• Issued a $500 credit to every student, a sum that covers the estimated cost to print and distribute business cases; and
• Issued a $100 credit to students who belonged to Shad Fitness Center, a prorated return for their membership fees.

UNIVERSITY IMPOSES IMMEDIATE SALARY AND HIRING FREEZE

Student demands for a partial tuition refund come on the heels of the release of the school’s latest financial report which showed that HBS generated an operating surplus of $104 million in fiscal 2019, compared with $90 million in the prior year. The school also ended the year with an unrestricted reserves balance of $129 million, up from $118 million a year earlier, as the value of its endowment hit a record $4 billion, a sum likely diminished in the recent market crash caused by the health crisis.

Today, however, the university put in place an immediate salary and hiring freeze and canceled or defered discretionary spending. University President Lawrence S. Bacow, Executive Vice President Katherine N. Lapp, and University Provost Alan M. Garber are cutting their salaries by 25% and encouraging the deans of Harvard’s 12 schools to reduce their salaries or contribute to a support fund for employees experiencing hardship.

While students who began the petition thanked Dean Nohria for his “sincere leadership” and “honest communication,” they express disappointment in an Easter letter written by the dean to students. “Dean Nohria, in your letter on Easter, you said that everyone needs to pull together,” according to the petition. “By refusing to engage in the discussion of a tuition reimbursement, it seems HBS has unilaterally decided that, from a financial perspective, everyone needs to pull together except HBS itself. Is this how senior HBS faculty would advise CEOs of major corporations to treat their customers in this time of crisis? When a firm’s product and service offerings drastically change, can and should it credibly command the same price for them? If customers prepaid for such products and services in good faith, isn’t a refund expected – and simply the right thing to do?”

‘ZOOM CLASSES ARE A POOR SUBSTITUTE FOR WHAT WE EXPERIENCE IN ALDRICH’

In his letter, Nohria raised the possibility that HBS classes in the fall could also be vulnerable to disruption from the pandemic. “We will need more ingenuity yet to bring back the in-person interactions we are all missing and on which so much of our economy and society depend,” he wrote. “In that spirit, many of our colleagues are engaging in creative scenario planning to envision how we might resume classes in the Fall.”

The writers of the petition also reference a recent decision by Harvard Business School’s online operation to slash the cost of its best-selling online program of three courses called CORe by 80% to more than 50,000 undergraduate students at 30 different collaborating colleges and universities (see HBS Online Slashes Price Of CORe For Undergrads To $450 & Offers Free Lessons). They say the decision created “conflicting messaging.”

“HBS is clearly willing to reduce by 80% the tuition of a program that was already online, and consider students that have yet to enter the HBS ecosystem,” according to the petition. “We are perplexed as to why, as HBS admits, we have not yet been offered something similar. The financial onus that the classes of 2020 and 2021 are facing with the uncertain economy and their high student loans have given rise to anti-donation-pledge sentiments, ones that would be detrimental to HBS’s continued growth. We hope that the alumni relationship we establish through this crisis is stronger – and not soured – by HBS’s unilateral decision on this topic.”

‘THE SECTION EXPERIENCE AT HBS IS NOW DIMINISHED’

In common with other petitions at rival schools, the students believe that remote instruction is no substitute for a fully immersive on-campus experience that requires them to pay $73,440 in annual tuition, especially a program so heavily based in case study teaching. “Many of us made the decision to attend HBS precisely because of this unique case method experience,” wrote the students. “While it is helpful that Zoom has enabled students to participate in classes, and although professors have attempted to transition the unique learning model into a Zoom-setting, students and professors alike have freely acknowledged that it is a poor substitute for what we experience in Aldrich. By not providing a partial refund to its in-person MBA students, HBS is signaling that, contrary to student and professor experience, HBS believes the product is equivalent to its in-person classroom offering.

“Of course, classes are not the only reason we chose to attend HBS. The section experience – central to the HBS value proposition in its marketing and a principal differentiator vs. other MBA programs – is now diminished, and we have been foreclosed from many aspects of community building. HBS’s unwillingness to provide a refund also sends the message that the school attributes no monetary value to the aforementioned. In other words, we have understood the message delivered by the administration’s hard-line against tuition adjustment to be one which only recognizes the value of our printed diploma upon graduation, and disregards both the quality of our education and the on-campus intangibles we were promised as part of the ‘HBS experience.'”

The students aren’t the only ones missing their physical classrooms, of course. Srikant Datar, senior associate dean for University Affairs at HBS, acknowledged the loss in a recent podcast. “We all miss the classroom,” he said. “We all miss the human connection. We miss the engagement that comes with it and the energy that comes with it because it is not physically there. It’s hard to say that we don’t miss the classroom.”

The full petition follows:

Dear Dean Nohria,

We thank you for all of the time, effort, and sincere leadership you have shown navigating the COVID-19 crisis. We recognize that the transition the school has experienced in the past weeks has not been an easy one, and we are grateful for Harvard Business School’s careful planning, effort, and ingenuity. We are also sincerely grateful for the honest communication we have received from you.

While we understand that considerable work was required to transition the school to an online-only model, we also recognize that the experience is nowhere near that of the in-person case method. Many of us made the decision to attend HBS precisely because of this unique case method experience. While it is helpful that Zoom has enabled students to participate in classes, and although professors have attempted to transition the unique learning model into a Zoom-setting, students and professors alike have freely acknowledged that it is a poor substitute for what we experience in Aldrich. By not providing a partial refund to its in-person MBA students, HBS is signaling that, contrary to student and professor experience, HBS believes the product is equivalent to its in-person classroom offering.

Of course, classes are not the only reason we chose to attend HBS. The section experience – central to the HBS value proposition in its marketing and a principal differentiator vs. other MBA programs – is now diminished, and we have been foreclosed from many aspects of community building. HBS’s unwillingness to provide a refund also sends the message that the school attributes no monetary value to the aforementioned. In other words, we have understood the message delivered by the administration’s hard line against tuition adjustment to be one which only recognizes the value of our printed diploma upon graduation, and disregards both the quality of our education and the on-campus intangibles we were promised as part of the “HBS experience.”

As such, we formally request a tuition reduction for the portion of the term after spring break, in line with what our peers at other graduate schools of business are requesting. You have made your position clear that a tuition reimbursement will not happen – we urge you to reconsider.

Indeed, we urge you to reconsider in light of the current crisis, considering the portion of the student body that underwent significant financial difficulty to attend this institution in the first place. RCs spent this week in LCA learning about how well businesses should treat employees and customers while in a crisis. We have studied numerous cases of businesses that have built lasting value by prioritizing transparency in dialogue and fairness towards their customers and employees. As your customers, we are disappointed by HBS’s complete refusal to even entertain the discussion surrounding a tuition reimbursement. As MBAs who bought into a promise of an institution focused on creating leaders who effect positive change in the world, we feel constricted by a future employment market that is highly uncertain, burdened by a highly levered level of personal wealth incurred by our belief in our MBA’s potential, and disheartened by our perceived deviation of values espoused by this institution in its refusal to address this topic.

Dean Nohria, in your letter on Easter, you said that everyone needs to pull together. By refusing to engage in the discussion of a tuition reimbursement, it seems HBS has unilaterally decided that, from a financial perspective, everyone needs to pull together except HBS itself. Is this how senior HBS faculty would advise CEOs of major corporations to treat their customers in this time of crisis? When a firm’s product and service offerings drastically change, can and should it credibly command the same price for them? If customers prepaid for such products and services in good faith, isn’t a refund expected – and simply the right thing to do?

Furthermore, the school’s recent announcement of the 80% tuition reduction for its summer CORe Program in light of the Coronavirus generated resentment, as it created conflicting messaging. Valerie Krempus, an HBS Online administrator, said, “We know that economic uncertainty can be scary and that individuals’ financial situations may have drastically changed in the last few weeks…We wanted to do what we could to make it more affordable and to allow more people to have a meaningful summer experience.” HBS is clearly willing to reduce by 80% the tuition of a program that was already online, and consider students that have yet to enter the HBS ecosystem. We are perplexed as to why, as HBS admits, we have not yet been offered something similar. The financial onus that the classes of 2020 and 2021 are facing with the uncertain economy and their high student loans have given rise to anti-donation-pledge sentiments, ones that would be detrimental to HBS’s continued growth. We hope that the alumni relationship we establish through this crisis is stronger – and not soured – by HBS’s unilateral decision on this topic.

We praise the university’s decision to retain employees, especially low-earning support staff during this time of crisis. As customers of HBS, we are simply asking for the same consideration. We can all agree that many lessons will be transcribed in HBS cases in the coming years – cases about crisis management, leadership effectiveness, and fairness to employees and customers. We ask you to consider our request through that academic lens such that, in retrospect, HBS will be proud of its decisions, ones that will hopefully preserve the long-term health and reputation of the institution as a whole.

Sincerely,
The HBS MBA Classes of 2020 and 2021

A Sample Of MBA Petitions Asking For Tuition Refunds

School	Petition Signatures*	Petition
Stanford GSB	741	Tuition discount for spring quarter at Stanford Graduate School of Business
Harvard Business School	123	Partial tuition refund for spring term at Harvard Business School
Wharton	956	Wharton MBA Community: Petition for Dialogue on Tuition Relief and/or Other Assistance
Columbia Business School	345	Petition for Tuition Refunds at Columbia Business School
Yale School of Management	15	Reimbursement of 1/4th the annual cost of Yale SOM tuition
IE Business School	586	IE IMBA Partial Refund for Online Classes
Hult International Business School	625	Get A Refund Of The Tuition Fee Or Compensation Due To Online Classes
UCLA Anderson	122	Reduce tuition for Spring Quarter – UCLA ANDERSON

*As of April 12, 2020

DON’T MISS: WHY B-SCHOOLS SHOULD CUT MBA TUITION FOR ONLINE CLASSES or THE STUDENT REVOLT OVER MBA TUITION FOR ONLINE CLASSES