A Decade Of Graduate Management Education: ‘I Love You, You’re Perfect, Now Change’

graduate management education

Sangeet Chowfla, former president and CEO of the Graduate Management Admission Council, reflects on the business of business education

It’s been 10 years since I joined the world of graduate management education (GME) as the President and CEO of the Graduate Management Admission Council (GMAC). This role has been the capstone of a somewhat eclectic career that has spanned residence in six countries and work in multiple industries. It has been the best of times as I have thoroughly enjoyed working with so many people committed to bringing the benefits of management education to individuals and societies around the world.

After ten years, stepping down as GMAC’s President and CEO offers me the opportunity to look back at GME through a series of monthly columns the first of which – this one – is just general musings about the state of the business of business education with subsequent columns delving into some of the themes in more detail. Much of this is about the intersection of the student/candidate and the schools that deliver master’s degrees in business. I trust that you, the reader, will find something in this series that causes you to stop and think. You may not agree with me on all points, so just take them as the opinions of an interested participant as we continue our shared endeavor.

I have titled this first column after an old ‘90’s musical as it strikes me how apt the title is to how some interpret today’s state of graduate management education: High alumni satisfaction, employer demand across diverse industry sectors and business types, record high starting salaries for MBAs, and tremendous growth in quality business schools around the world that continue to grow in popularity with international and domestic students. These indicators of value and relevance don’t always come out in the headlines. In fact, news coverage at times gives the impression that business degrees are on the way out. 


No industry is perfect, of course, and change is constant. Amid high graduate satisfaction and employer demand there are real challenges. They include the high cost of the degree, changes in global supply and demand, technological disruption, the need for a model that provides lifelong education rather than a once-and-done one. These, and others, need to be – in fact, must be – addressed as we continue to change and innovate.

As we do so, GME has tremendous strengths but also challenges that stem from a successful legacy of greatness.

The demise of Graduate Management Education has been greatly exaggerated. We tend to obsess over small changes and sometimes miss the bigger picture. Much was made about the decision by the University of Iowa’s Tippie School of Business to phase out its full-time MBA program (not in the Financial Times 100, USNWR #69 in 2017) with an enrollment of around 100. However, not much was written that Oxford University’s Said Business School (FT #31) expanded its full-time MBA enrollment by almost an equivalent number, or that the Fudan School of Management (FT #32) opened a new campus and a collaboration with MIT Sloan (FT #11) for a full-time MBA program enrolling roughly 100 students or that the Indian School of Business (FT #33) opened its campus in Mohali, enrolling some 200 full-time students.

Student demand is remarkably constant. GMAC data shows that overall applications to business schools worldwide have been within a +/- 3% band over the last three years. That is no mean feat given the tremendous disruptions that we have been through.

Global student mobility is rapidly changing, creating winners and losers. We seem to be in the third wave of management education. The first, GME 1.0 if you will, saw schools in the industrialized west largely educating students within their regions. The second, GME 2.0, was the result of the great globalization wave of the ‘90s and ‘00s – the World Trade Organization (WTO), the rise of China and India. This created a new middle class hungry for the benefits of higher education and a demand for talent within these economies. More liberal immigration policies also played a part. Demand from prospective students became global, but supply in the form of quality business schools largely remained in the West. Western schools responded to this demand signal by increasing programs and capacity.

GME 3.0 is now the globalization of supply. Quality business education is available around the world. In the year 2000, 42 of the top 50 MBA programs ranked by the Financial Times were domiciled in the U.S., eight were in Europe and none in Asia. In 2022, 30 are in the U.S., 11 in Europe, and nine in Asia. It’s not that U.S.-based schools have gotten worse; it’s just that everyone else has caught up. The quintessential aspirant in India can now consider the great U.S. business schools but also their counterparts in Europe (which happen to be shorter, cheaper, closer to home and often equivalently ranked) along with options in Singapore, Hong Kong and within their own country. Her counterpart in China – often considering a career with the likes of Tencent and Alibaba at home – would rightly worry whether if it is worth studying at a mid-tier U.S. university and dropping out of the local network rather than studying at one of the globally recognized schools within China itself.


And lately, students in the West who are looking at the future growth of economies are considering study in Asia. Some 40% of the Fudan/MIT MBA class is not Chinese.

What was once a one-way East to West dynamic is now multi-polar and these shifts will only accelerate.

In the U.S., Hispanic enrollment will drive future enrollments. The U.S. has long been the largest and most visible location for quality management education. Many schools expanded capacity during the go-go years of GME 2.0. All it took was a new master’s program in accounting or finance for it to be flooded with applications from Asia. This has dried up, and taken with a softening in domestic applications, supply for the first time exceeds demand.

Outside of the premier global brands, it is unlikely that international demand will return to the old days. The genie is out of the bottle and students have found that they can get equivalent outcomes from studying in Europe, their own region, or their own country. The answer, particularly for a mid-tier regional school, can only lie with domestic demand. Here we are seeing big demographic changes. The white American population, traditional consumers of GME, are declining as a share of the demographic mix. Even if they keep consuming GME at historical rates (itself a big assumption given recent data) the addressable domestic market for GME will decline. Bringing African Americans up to their fair participation rate is important, happening, and will help, but the reality is that the population base is not growing. Hispanic Americans, on the other hand, constitute the fastest-growing segment of the U.S. school-going population. They currently participate in GME at rates even lower than African Americans. An analysis of the data shows that, by 2030, bringing Hispanic participation in GME to the U.S. mean would add 400,000 domestic candidates annually to the pool.  Increasing their participation rate to White American levels would add another 80,000. 

There is no single segment of the population that can have a bigger impact. Hispanics also tend to be more tied to their community, and less willing to relocate. With effective programming, outreach, and messaging, this could be the answer for well-situated, more regionally-oriented, schools. 

Business schools are chasing the mean, missing opportunities to differentiate themselves. It surprises me how little we practice what we teach. Strategy 101 teaches us that in a mature and competitive market, a clear definition of our customer – the student – and the benefits that we provide is paramount. It’s impossible for any product to be all things to all people and we must segment our customer base and choose. Marketing 101 teaches us that we should speak to the segments that we choose and convey the benefits that they will derive from choosing our product (program or school).

These principals are honored in the breach. In writing this column I went to the “about us” pages of ten randomly selected business schools (I won’t say which ones). Frankly, they will not get an A in our strategy/marketing classes. We talk about creating leaders (whatever that means), that we are life-changing (whatever that means) that we have incredible faculty (I guess I know what that means but does it do anything to me as a student?). None of the schools’ websites told me if the school was a fit for my career aspirations and none spoke of the benefits of a graduate degree in business for me. There were stories about faculty getting awards but none – none! – about student success. Nothing about jobs, careers, and successful alumni that would be my role models.

Some years ago, on a lark, we fed the home pages of the top 50 MBA programs to the IBM Watson personality monitor (an AI tool that measures the personalities of text). Watson returned an 80% match across these 50 home pages. In other words, 80% of the schools in graduate management education were saying the same thing.

Small wonder that rankings continue to gain prominence. If we all say the same thing. If we are unable to choose who exactly we serve, students will inevitably go to external sources for their data.

Some of this comes from a desire to cast as wide a net as possible. That is an understandable reaction to declining demand. But it is a paradox that the more your market shrinks, the more you need to segment and choose. The value proposition and value delivery systems must be optimized for someone if they are to resonate at all. Segmenting and targeting increases the pipeline; being open to all decreases it.


Only two things matter – location and alumni success. Some years ago, we did a study about the factors that make a school attractive to prospective students. Two factors stood out. Employment outcomes (as demonstrated by alumni strength and whether the school actually reports employment data) and ecosystem attractiveness (primarily location). These factors significantly outweighed whether the school was public or private, size, faculty, degree of innovation or online programming (though the study was pre-pandemic, and the last factor may have changed since then). 

There is not much that a school can do about location. A Columbia, NYU, Stanford, Berkeley, or LBS will always have an inherent advantage. But perceived location advantages can be offset by effective positioning. U.S. schools in the south and southwest can create a de facto advantage over others by targeting the Hispanic segment. Michigan State is playing to its locational strengths for being close to the automotive industry and its supply chain expertise. Johns Hopkins is using its university’s preeminence in health care, Cornell in hospitality. Some of these schools are choosing. with positive results.

We all have great alumni networks, but frequently do not talk enough about the success of alumni from graduate management education programs. Business school messaging is more likely to be about a professor who won an award in finance rather than about that first-generation Hispanic student who leads a community organization. This is easy to fix but requires a concerted effort to develop a targeted, benefits-oriented approach. Simply put, it’s about benefits to our students, not our own achievements.

The jury is out on the impact of online programs. I have not spoken much about online programs in this column. Obviously, that is a major change in programming and how our students interact with us. It’s a two-edged sword. At one level online programming allows us to reach more students and further democratizes access to online management education – a good thing. On the other hand, it reduces the scarcity value of our products and associated pricing power. Will online programs in the $20,000 range (as offered by the University of Illinois’ Gies College of Business and Boston University’s Questrom School of Business) change the economics for all? Will we end up with a bi-modal distribution with low-touch/low-cost programs at one end and high-touch/high-cost ones on the other – with the attendant question of what happens to those in the middle?

A bigger question may be about how prospective students will respond. Amazon removed the concept of time (store opening hours) and space (the neighborhood mall) from our shopping life. Netflix did the same to movies. With the removal of time and space, will students gravitate toward a few players? Significantly, in GMAC’s prospective students’ survey of 2021, nearly a third of international students and half of the domestic students said that they would consider an online program from a higher-ranked school over an in-person program from a lower-ranked one.

Lastly, there is the perceptions of recruiters. In 2021, only a third of recruiters from business schools said that their organization values an online and in-person degree equally with an equivalent number on the fence. Only a third agreed that an online degree is equivalent to an in-person one.

We love graduate management education, students, and employers continue to demonstrate its relevance. But nothing stays perfect without change.

Author and former GMAC CEO Sangeet Chowfla

Sangeet Chowfla led the Graduate Management Admissions Council as president and CEO for nearly ten years from 2014 to 2022. A globally recognized and respected executive with deep experience in the technology, telecommunications, and venture capital sectors, he began his career in New Delhi with IBM/IDM. Chowfla went on to spend 18 years with Hewlett-Packard Co. in Europe, the Middle East, Asia Pacific, and the United States. He culminated his tenure with the company as vice president and general manager of the Inkjet Media Division from 1995-2001. He then moved to Timeline Ventures as a partner in the venture capital partnership. In 2007, Chowfla became the chief strategy officer and executive vice president of the Mobile Services and Global Market Units of Comviva Technologies, a leading Indian telecommunications software company. Chowfla joined GMAC during a period of disruption in the organization and industry. During the last three years of his tenure, he helped to stabilize the candidate pipeline, renewed GMAT exam growth, diversified GMAC’s footprint and ensured a strong financial foundation to enable future investment.

Ruminations Columns by Sangeet Chowfla

The Value Of Standardized Testing: Don’t Throw The Baby Out With The Bath Water

Why Students Go To Business School & How They Make Their Choices

The Changing Face Of International Student Mobility

Why Diversity Is Essential To The Health Of The U.S. Domestic Student Pipeline

A Decade Of Graduate Management Education: ‘I Love You, You’re Perfect, Now Change’

Business Casual Podcast: Interview with Sangeet Chowfla




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