Crains New York - August 6, 2012 - (Page S8)

THE GUIDE TO HIGHER EDUCATION ADVERTISING SUPPLEMENT Musings on the MBA Market Kellogg’s new Dean restructures its MBA programs to remain effective and influential Margaret Andrews I t’s rare to see a market leader remaking its up-to-thispoint-wildly-successful business model, but this is exactly what the new Dean, Sally Blount, is doing. So what exactly are the folks at Kellogg changing? For starters, they’re shrinking the class size of their traditional two-year MBA program by approximately 20%, and revamping their research program and curriculum to be less discipline-based and more focused on areas they believe to be most important. These areas are markets, customers and growth; architectures of collaboration (organizations, people and interconnectedness); private enterprise/ public policy interface; and innovation and entrepreneurship. These are two huge steps for a school to make, but the restructuring does not stop there. Add to this Kellogg’s plan to introduce new, one-year master’s degrees as alternatives to the traditional MBA, and efforts to launch short, nondegree certificate programs with partner schools in Brazil and China. In one fell swoop, Kellogg is addressing several issues facing U.S. MBA programs: 1. The U.S. is losing its dominance in the MBA market. While the U.S. may still be the top destination for MBA studies, its lead is narrowing. Take, for example, GMAT score-sending patterns: in GMAT test year 2006, U.S. schools received 83% of all GMAT scores sent. In 2010, this number was 78%. 2. Demand for the traditional two-year MBA is decreasing. Again, some GMAC data: in 2011, two-out-of-three GMATusing schools worldwide reported application declines for their two-year MBA programs. This follows drops in the previous two years: in 2010, 49% of two-year MBA programs worldwide noted application volume declines, and in 2009, 32% reported declines. 3. Demand for shorter and more specialized programs is taking up some of the slack. According to similar GMAC figures, in 2011, 51%, 69% and 83% of GMAT-using schools reported increases in applications for (typically one-year) Master’s of Accounting, Master’s in Management and Master’s in Finance programs, respectively. 4. Demand for non-degree programs will also rise. As people now work later in life and expect to have multiple careers over their lifetime—and as education is delivered in a more modular fashion and in shorter bursts—the demand for non-degree certificates and professional development programs will also increase. Business schools have traditionally served the higher end of this market, and are well positioned to GMAT-using schools report increases in applications for typically one-year programs: Masters in Accounting; Management; and Finance programs. continue this trend, particularly if they “go to the customer,” as many of them have increasingly been doing. Although much of the data is for GMAT schools, and a large number of U.S. and non-US schools do not require the GMAT, this looks like a shift. As another data point, consider what prospective graduate management education students are saying about the programs they would consider. (See chart below.) 46% are considering the full-time two-year MBA, while 42% are considering a full-time one-year MBA, 33% a part-time MBA and 24% a Master’s in Management. TYPES OF GRADUATE MANAGEMENT PROGRAMS CONSIDERED FT 2-Year MBA FT 1-Year MBA PT MBA Master in Management Flexible MBA Master in Finance EMBA Master in Accounting Online/Distance MBA Joint-Degree Programs 48% 46% 33% 24% 21% 18% 16% 14% 14% 13% Source: mba.com Prospect Students Survey (2011) This chart was originally created by Mind & Hand Associates PAGE S8 THE GUIDE TO HIGHER EDUCATION http://www.mba.com

Table of Contents for the Digital Edition of Crains New York - August 6, 2012

Crains New York - August 6, 2012
Contents
In the Boroughs
In the Markets
The Insider
Business People
Opinion
Greg David
From Around the City
Report: Business of Sports
Classifieds
Small Business
Real Estate Deals
Helluva Town
Source Lunch
Out and About

Crains New York - August 6, 2012

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