Asymmetrical Information

Jane,

My wife has a kinda-sorta MBA (it is actually a Master's Degree in International Business) from the nation's number one Graduate School for International Business. (10 bonus points to anyone who can name that school.) Anyway, they required a minimum of 5 years of work experience coupled with a minimum 3.5 GPA at your undergraduate University. Well, they have dropped their admission standards.

Okay why? Why would they do that?

Money. They are losing money hand over fist because they don't get enough applicants to fill the school. Why aren't they getting enough applicants? 9-11. September 11th changed everything for higher education in our country. A huge number of Graduate students used to come to the United States to earn a Master's Degree in *something* as it was much easier to get a student Visa before that fateful Tuesday morning. It is not so easy today which is why so many foreign students aren't even bothering to apply to our Graduate Schools.

So, it doesn't surprise me one bit that so many MBA programs are dropping their admission standards. They are probably feeling the same pinch in the pocket and they want to lure as many students (and tuition dollars) as they can into their school.

This is just educational economics.

I'm not sure I can get too exercised about dropping the work experience expectation from 4 years to 3 or even 2. Difference in quantity, not quality, IMHO.

But I agree whole-heartedly that there should be some work experience requirement - probably 2 years minimum. And in fact, I'll go one step further and say that I think there should be a 2 year work experience requirement to go to law school and even to most academic (i.e. PhD) programs. It has always been my hypothesis that law schools are filled with unhappy law students and law firms are filled with unhappy lawyers because law school is the default option for clever liberal arts undergrads who vaguely want an upper middle class lifestyle but are scared shitless of the non-school world. Many of these folks would be much happier as teachers or management consultants or market researchers or journalists but getting one of these jobs right of college is like, work and stuff. You have to do some specific fact gathering on the field you're going in to, wear a scratchy, ill fitting suit to a bunch of interviews (which lead to a bunch of rejections) at 8:00 in the morning, and generally act like a grownup.

Going to law school means taking a standardized test (and clever liberal arts undergrads are nothing if not good at taking standardized tests) and filling out a few applications - which can be done at 3:00 in the morning if those are the hours you keep. In short, its an amazingly tempting path of least resistance. Forcing everyone to go get a job for 2 years would at the very least make it more likely the law school classes would be filled with people who wanted to be lawyers.

I'd advocate the same for most PhD programs for roughly the same reasons. Wouldn't advocate it for medical school though - everyone knows MD programs are hell on earth and none but the serious and committed apply. Besides which, no need to delay doctors' earning years by another 2 years.

MBA admissions policies may have been somewhat affected by 9-11 and fewer foreign applicants, but this trend - the need to expand the eligible pool - has been coming for years.

For the past two decades or more, business schools have been rapidly expanding their MBA programs. They were able to sustain a high rate of expansion in part because there was a backlog. Getting an MBA was less common 20 or 30 years ago, so as the programs grew, there were still plenty of eligible candidates out there.

But business schools had to start running low at some point, because the rate of growth was too high (and they certainly don't want to stop growing, much less cut back!). For the last few years, they've been expanding their executive MBA programs, to capture new clients at the upper end that the schools had missed earlier. But that, too, can't go on indefinitely at the same pace. There are probably plenty of bored retirees looking for something to do, but they're more likely to want to donate money in order to teach a business class, rather than pay to be lectured to.

So what else could the schools do? They had to either drop other standards, or else go younger and younger. I just hope we don't see too many combined undergrad and MBA programs ("with just two extra semesters..."). After that, there's always high school honor students (or posthumous degrees?).

But don't worry, Jane - they won't turn away late bloomers. This trend is about inclusion. Think what diversity our classes would have if everyone got an MBA!

MBAs with even less work experience, eh? That should pretty well finish killing off corporate America. There was a day when management promotions primarily came from within the business -- i.e., persons who had proven their character and commitment, and knew the actual business they would begin managing.

The MBA, by contrast, is more prone to understanding the business only in terms of general principles and numbers. Unfortunately, general principles do not always speak correctly to the corporate culture (see: Fiorina and HP) and numbers can be made to increase in the short term through monumental feats of stupidity (see: Agilent Technologies -- quickly, while you still can).

The solution to people who don't know what they want to do with their life until they are 26 is called the gap year. If I ran the asylum everyone would spend a year in the real world fending for themself in between high school and college.

Paul,

Thunderbird?

Regards,

Gil

If I'm not mistaken, that 4-year work requirement was an unofficial rule only at a relatively small number of elite MBA programs. Most programs are more than willing to take people straight out of college.

Thunderbird?

(music)
Yes that's the name
It's the first new taste in a long long time,
A fresh new taste in the world of wine
Thunderbird
Yes that's the name
It's the first new taste,
Since champagne
(/music)

"So what else could the schools do?"

Er, continue on with the same standards as before, and accept a somewhat smaller enrollment? I know, I know...

There is no shortage of people who wish to enter the MBA programs at the schools described as "leading."

However, having recently graduated from one of these "leading" schools (after working for 5 years first), I can say that the work experience makes a huge difference. First, unless one is headed for banking, consulting, or general management rotation programs, the extra 2-3 years of work experience are of interest to employers, if not to schools themselves. Second, students who have outside experience have much more to contribute to the class and to each other. We had a few folks who were very recent college graduates (eg, after 2 years at McKinsey), and while they were smart, I was more often impressed by my classmates who had held several jobs first.

For people with 10+ years of experience, the Executive MBA program is probably a better choice, but I believe based on my experience that 4-5 years of post-college work is about right for a full-time MBA.

Gil is correct. He gets 10 points.

You did your research.

Yeah, the last thing we need right now is an even bigger (and less experienced) mass of MBAs descending on corporate America each and every year. I hope these schools reconsider.

If I ran the asylum everyone would spend a year in the real world fending for themself in between high school and college.

Yup. I did that, and it made me a much more focused student in college than I was in high school.

Yeah, I think undergrad education would be far more productive if they had had a minimum requirement of work experience, or at least years out of high school. And not living at home.

I swear, the idiocy of the behavior of my fellow students because it was the first time they were out from under their parents' thumbs... of course, I had gone to a boarding school and already had that "FREEDOM! PARTY! WOO!" impulse out of my system.

I think it's an unfortunate trend, primarily because it lessens the program itself. When I went to law school at UVA, only about 25% of the law students had come straight from undergraduate school, so the life experience of the rest of us contributed highly to the class discussions. I understand that the percentage is around 35% now, which perhaps reflects the same trend as is happening in MBA programs, but the programs themselves are the poorer for it.

I think that a great solution to the gap year is to join the military--there are tons of interesting jobs that don't lead you into combat, if that's what you prefer. And if you choose (or are assigned) the sort of job where you have to lead people, the leadership skills are invaluable for any other job in life.

I sometimes think that Dr Victor Hanson reads Jane's blog.

On the fifth-year anniversary of September 11, 15,000 Saudi Arabian students are supposedly on their way to the United States. The State Department, and cash-hungry universities eager for premium out-of-state tuition payments, are understandably delighted at the return of such openness.

The idea in theory is commendable: Five years after 15 Saudi Arabians, some here on student and flight-school visas, blew up four planes and killed 3,000 Americans, we apparently have let bygones be bygones, and are looking to reestablish old ties.

Coincidence Dr Hanson?

If I ran the asylum everyone would spend a year in the real world fending for themself in between high school and college.

I heartily agree, as someone that spent 6-1/2 years to an undergraduate degree: 2-1/2 wasted going to college straight out of high school, and then 2-1/2 when I went back later for a degree that was actually worth completing. I also endorse Rex's comment; for those who can take it, a term as an enlisted military member is very good experience coupled with a forced process of growing up, and it may give you valuable training and money for college, too. (In my case, a free ride, with a salary plus tuition and books - although I had to stay in for over 9 years total to earn it.)

The only problem is, aren't all enlistments 4 year minimum now? With the amount of training needed nowadays, not even the Army can put a man into his real job fast enough to be worth training him for a shorter term. That makes it a pretty big committment, and military living comes in two varieties:
-Peacetime: Boring, long hours alternating hard work and standing around waiting, lots of mickey mouse bulls**t, lousy pay.
-Wartime: You find out how good you had it in peacetime - and you might get killed, too. (At least so I hear; I enlisted when Carter was President and got out in 1987, and that was 9 years of peace for all but a very few servicemen.)

Meh. As another one of those guys at a leading institution (and one who just turned 32), I must submit that the 26 year olds "get it," on average, far better than do those three years their junior.

And unless those really young kids go into banking or consulting, they'll probably have a tough go of it.