NON-TRADITIONAL MBA PROGRAMS

How Non-traditional MBA Programs Foster an

INCLU Dr Emad Rahim and Dr Amine Ayad

M

any people find the subject of business management to be fascinating, but they often find the context that is used to teach and promote business education intimidating and unapproachable. Based on the authors' experiences, students from low socioeconomic backgrounds and non-traditional adult students who can contribute a great deal to the field are interested in pursuing business education, but they veer away from such an endeavor because they often believe they lack the necessary background to pursue a Master of Business Administration degree (MBA). Moreover, the cost of tuition, entrance exams, professional references and letters of recommendation often serve to further entrench a student's impression of an unachievable goal. To attract more diverse MBA students, the image and language that are used to promote business programs need to be more inclusive. The universities that promote and teach traditional MBA degree programs need to consider the diverse population that is not currently being serviced. The purpose of this article is to review MBA traditions and challenges facing inclusive MBA education.



The universities that promote and teach traditional MBA degree programs need to consider the diverse population that is not currently being serviced.

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The Traditional MBA The history of advance business education started with Dartmouth College. Dartmouth College introduced the first advanced degree in the study of business in 1900 (Hahn, 2006). In 1908 Harvard University followed along Dartmouth’s footsteps by offering the first MBA degree, which was further developed in 1925 by Stanford University. According to Hahn, the MBA program then struggled as a career enhancement alternative for students until the Carnegie Corporation and Ford Foundation concluded that the MBA program required more analytical education after conducting a thorough research investigation. The study supported the application of analytical practices to deal with business problems and they recommended that more academic research projects be introduced into the MBA curriculum. In 1991 AACSB, the business school accreditation organization, revised its standards on required business curriculums, removing management science from its accepted position as part of the canon of the MBA. Many business programs replaced the management science courses with leadership and organizational behavior courses. These changes were correlated to MBA programs trying to adapt to the current business trends and the needs of practitioners. During this time there was also a huge enrollment decline in MBA students throughout universities in the nation. A report issued by the Graduate Management Admission Council (GMAC, 2004) reported that 78 per cent of institutions offering traditional two-year MBA programs experienced a decline in enrollment in 2004/05. CEO MAGAZINE

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There is a strong movement growing in the business world that supports a more individualized business program. Many successful corporate leaders are speaking out against traditional MBA curriculums, pointing out that MBA graduates often lack communication and social skills. They are also emphasizing that many graduates are having difficulty applying theory into practice. Corporate leaders feel that many MBA programs focus too much on functional technicality and not enough on the organizational environment of businesses. They urge for a broader MBA curriculum that allows a diversity of study options. According to an article printed in News Week titled “MBA programs are getting extreme makeovers” (MacDonald, 2005), many respected traditional business schools are developing more well-rounded curriculums that combine soft-skills, such as communication and listening skills, with technical analysis skills. It was only in the last two decades that nontraditional business degree programs started appearing as executive or online options for students.



Corporate leaders feel that many MBA programs focus too much on functional technicality and not enough on the organizational environment of businesses. Tom Peters (2006), CEO and founder of the Tom Peter’s Company, a business solution consulting firm that is recognized and used by large companies such as Trump Corporation and Boeing, believes that the traditional MBA degree is no longer relevant in today’s business market because it is lacking creativity, design and innovation in its teaching delivery and curriculum. Adapting to the current needs and behaviors of businesses and practitioners, many MBA degree programs are now taking on an action (Action MBA, Hardin-Simmons University), practicing (Colorado Technical University) and personal/professional (Personal MBA – Changethis. com, Professional MBA – Cal Poly Pomona College of Business Administration) driven approach in their teaching. Due to the unethical behaviors of corporations like Enron, Tyco and Worldcom, and the downsizing of manufacturing companies, the majority of this generation distrusts corporations and no longer feels secure working until retirement for the same corporation or within the same industry. More students are entering MBA programs with aspirations of starting or running their own business. These students that are often working full-time and have family and community obligations require flexible MBA programs that respond to their needs and non-traditional educational background. Many of the online and Executive MBA (EMBA) programs are focusing their attention on entrepreneurship practices verses traditional business theories. Students entering these programs will participate in workshop-style courses, which require participation in written and verbal

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NON-TRADITIONAL MBA PROGRAMS

presentations, group project management and career planning processes as well as structured experiences that foster time management practices, polish listening, interviewing and interpersonal skills, and address conflict management and the effectiveness of meetings. The lecturing approach to learning is replaced with more of a practice-learning style that is delivered online or in a hybrid format. Contemporary managers require a business program that is compatible with their particular needs; especially their busy time-schedule. Thus, the action-driven MBA program’s approach to management education claims to be more incisively pertinent to the contemporary management of enterprises, irrespective of their geographical location. With the age of the Global Economy, International MBA programs have been developed, allowing diversity and language courses into their curriculum (Thunderbird University, Toronto University, etc.). MBA candidates are expected to diagnose problems, analyze data and situations, apply theory and concepts to gain insight and understanding and make decisions and recommendations without having to relocate to the university’s campus. These new programs use case studies and simulation exercises in an attempt to provide students with “real-world” practical application. The students learn to apply theory to management practices in ways that are analytically rigorous and managerially decisive.

The Executive MBA The goal of every school of management must be to attract and keep the best future managers in order to build the reputation of the school through their alumni base (Garson, 2004). Many of the alumni of these EMBAs already hold major positions in academia, business, consulting, government, healthcare, public health, community settings, research institutes and major universities around the globe. They provide the financial support and networking opportunities that are so important to current students’ success. Universities rely on alumni networks to provide classroom speakers, career mentors and recruiting and networking opportunities that add tremendous value to the classroom experience. Industry professionals lead panel discussions on a range of business issues and teach classes through bringing the “real-world” into the classroom. A business advisory council made up of alumni in various business roles meets with faculty, deans and students quarterly to guide the school to best serve the economic needs of the region. A survey conducted by the University of Minnesota’s Carlson School confirms that alumni are powerful economic partners. Carlson School alumni have founded more than 1,800 Minnesota based businesses that employ more than 110,000 people and generate annual revenues of $21.2 billion. These annual revenues are equivalent to the state’s entire manufacturing industry, and the employee base is about the same as that of the combined legal, accounting, architectural and technology industries in Minnesota (University of Minnesota, 2005). Similarly,

a Massachusetts Institute of Technology alumni survey showed approximately 2,600 alumni-founded active companies in Massachusetts, employing more than 175,000 people and generating approximately $46 billion in annual revenue (MIT, 2006). In schools of business with part-time programs, the part-time and EMBA students make up the bulk of paying students (Winer, 1999). This is because their companies often subsidize their graduate education and these students are not eligible for the scholarships that full-time students are. Therefore, in order to remain financially sound and academically successful, professional business schools must help part-time MBA students improve the abilities they identify as most valuable and in which they require the most improvement. This necessitates, of course, discerning which abilities part-time MBA students perceive as most valuable and as needing improvement. A study conducted at Pace University (Winer, 1999) revealed that less than half of part-time MBA students would recommend the program to friends because they felt core courses were not valuable in helping them to develop interpersonal skills or market themselves. The belief among top graduate schools of business is that in order to maximize prestige and funding, schools must do everything possible to engage MBA students during their matriculation in order to create an active and committed alumni (DePaul, 2004). Many EMBA programs follow the cohort model, where students are grouped into small teams. These cohorts will stay together throughout the lifecycle of their EMBA program. Cohorts provide each other with motivation, support and guidance. During the attendance of classes and residencies they may also be assigned to complete group assignments, presentations and capstone projects. According to Edgar Schein (1999), characteristics of organizational culture are important for group identity. We looked at several of these characteristics that we felt were missing from the part-time program: 1. "Intensity of the group’s experiences of learning together." EMBA and evening classes are scheduled at separate times and are conducted in a separate facility. Not until the final semester do participants mingle with other business students in elective courses. Although the intensity of the learning is high, the feeling of learning together seems to be missing from these groups due to physical separation. 2. "Strength and clarity of assumptions held by founders or leaders." Directors of the evening and EMBA programs have held onto high standards of academic excellence and years of work experience for admission to the program, resulting in high expectations for participants.

Financial burden of MBA education Byrne (2011) illustrated that MBA students at top business schools are borrowing more money than ever to pay for their degrees. Further, Byrne (2011) made two critical points:

School

2010 Average Debt

2009 Average Debt

1

UPenn (Wharton)

$109,836

$105,489

2

Dartmouth (Tuck)

$98,292

$85,917

3

Duke (Fuqua)

$92,827

$88,050

4

Michigan (Ross)

$92,734

$84,798

5

Northwestern (Kellogg)

$87,256

N/A

6

Cornell (Johnson)

$86,900

$83,700

7

Yale School of Management

$86,895

$99,418

8

New York University (Stern)

$85,198

$78,887

9

Georgetown (McDonough)

$82,577

$76,746

10

Vanderbilt (Owen)

$80,857

$76,957

11

Chicago (Booth)

$79,539

$86,758

12

Texas-Austin (McCombs)

$77,644

$69,552

13

North Carolina (Kenan-Flagler)

$77,124

$75,251

14

Carnegie Mellon (Tepper)

$75,570

$87,592

15

California-Berkeley (Haas)

$73,186

$63,748

16

Harvard Business School

$73,110

$76,958

17

Virginia (Darden)

$72,027

$66,272

18

Stanford

$71,403

$80,677

19

George Washington

$68,959

$66,989

20

Pepperdine (Graziado)

$66,242

$71,680

21

Thunderbird

$64,381

N/A

22

Notre Dame (Mendoza)

$62,858

$65,295

23

UCLA (Anderson)

$62,711

$64,030

24

Wake Forest (Babcock)

$61,846

N/A

25

Emory (Goizueta)

$60,435

$58,440

Source: Business schools reported to the U.S. News and World Report’

1. “Conspicuously absent from the list are the debt numbers for Columbia Business School, MIT’s Sloan School of Management, the University of Southern California’s Marshall School, and Washington University’s Olin School. These institutions apparently did not disclose this data to U.S. News. But it’s a sure bet that all of them would be among the top 25 if they had provided the information, given their high tuition rates and similar student pools.” 2. “Once you add an effective interest rate of 7.65 per cent from government loan programs, these debt burdens grow quickly over the years. If a Wharton MBA paid down his $110,000 debt over the next 10 years, the total cumulative payments would come to more than $180,000. With a repayment schedule over 25 years, the debt would balloon to more than $280,000 -- not accounting for any deferrals or penalties for missing a payment.” In personal correspondence with John Byrne, we asked: “Are you aware of any statistics/information that correlate ‘education’ and ‘income’, especially for MBA programs?” Byrne answered: “All of the schools publish starting salary and bonus numbers for their graduates, but whether this is ‘correlated’ to the actual education they received is hard to tell. It may be more of a reflection of the quality of the incoming students along with the brand value of the university that granted the MBA degree. Hard to tell!” Many hiring managers tell us that the reputation of the university that grants the degree is considered in the interviewing process, but it is certainly not the deciding factor in the interviewing process, let alone the hiring process. CEO MAGAZINE

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Benefits of online education Today there is a great deal of interest in online education and the level of quality that non-traditional education provides to students. Online education is still in its infancy stage. However, it offers students the opportunity to expand their awareness of the world and culture and embrace the internet as an instructional tool. For-profit higher education corporations have spent millions on marketing their programs through mass media and some of the most extensive marketing and sales programs. From marketing concept store fronts to television and online advertising, the competition is growing and getting stronger. Whereas traditional education is regarded as professor or research centered, online education is viewed as student centered. This becomes even more important in for-profit education where numbers are critical to success and continuity. In an online environment, the instructor is viewed as a facilitator more than a traditional instructor in a “bricks and mortar” campus. Universities such as Colorado Technical University and the University of Phoenix have an applied approach to their curriculum, requiring students to work on group projects applying theory into practice using scenario type questions and case study assignments. Research has shown that inclusion and participation during the education process tends to produce more active and involved students and alumni, which enhances the prominence of the university (DePaul, 2004).



References `` Anvari, M., Speech to Faculty and Staff of Weatherhead School of Management, Case Western Reserve University, Cleveland, OH (August 2004). `` Byrne, J (2011). 25 B-schools that lead to the most student debt. Retrieved Sep 30, 2012 from: http:// management.fortune.cnn.com/2011/04/26/25-bschools-that-lead-to-the-most-student-debt/ `` DePaul University, Retrieved June 2009 from: http:// www.alumni.depaul.edu/aboutarn.asp `` Hahn, B (2006). The MBA is Far From Dead. Rutland Herald. Retrieved July 5, 2008 from: http://www. rutlandherald.com/apps/pbcs.dll/article?AID=/20040906/ NES 409060303/1011/BUSINESS `` MacDonald, J (2005). MBA Programs are Getting Extreme Makeovers. USA TODAY. Retrieved July 5, 2008 from: http://www.usatoday.com/news/education/200504-19-mba-usat_x.htm `` MIT, Retrieved September 2008 from: http://www. mitadmissions.org/topics/pulse/notable_alumni/ `` Winer, L., “Why Business Schools Need to Know what MBA Students Want to Learn and How to Find Out” (NY: Pace University, 1999).

Contemporary managers require a business program that is compatible with their particular needs; especially their busy time-schedule. Recommendations to universities To advance MBA education, our top three recommendations to universities are: 1. Adopt a flexible hybrid platform that is accessible to diverse and non-traditional students 2. Adopt a program that is action-based and/or responsive to industry needs 3. Include a diverse advisory board made up of industry leaders and hire more professionally qualified faculty who are practitioner-scholars vs. those who only focus on research

Recommendations to students To earn and benefit from your MBA we recommend that you: 1. Get some work experience before enrolling in an MBA program 2. Get the most out of the degree by finding a program that is tailored to your needs 3. Develop your soft skills (communication, critical thinking, emotional intelligence, leadership, etc.) in addition to your hard/technical skills while pursuing your MBA 58

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Biographies ØØ Emad Rahim, DM, PMP is Dean of Business and Management at Colorado Technical University. Follow him on Twitter @CTUBusiness. ØØ Ayad Amine, DM is an established leadership author and currently works as a Divisional Merchandising Director at Wal-Mart.