You might be tempted to think so given the rash of stories in the WSJ and higher education publications describing dwindling applications and the closing of full-time MBA programs. What gives?
To be sure, higher education institutions are wrestling with competitive, cyclical, and secular issues that are coalescing to form the perfect storm. HBS Professor and best selling author Clay Christensen predicts that 50% of colleges and universities will close or merge within the next decade. A quick Google search yields a parade of private and public closure and merger announcements over the last three years. In December, Albright College, Reading, Pa., announced a 45% tuition cut, ending a decade of 4% annual tuition hikes. In February, Concordia University, a small historically black private college in Selma, Ala., announced its closing two years shy of its centennial celebration. You don’t need a business degree to see that declining demographics, excess capacity, and rising prices spell trouble for Higher Ed.
Full-time MBA programs are not immune to the changing landscape. While applications to MBA programs have always been countercyclical, about a dozen full-time programs have announced closures in the last three years, and more are likely to follow. All but the elite full-time programs are feeling the sting of too much student debt, rising demand for cheaper online programs, and the unwillingness of workers to commit to a two-year absence from a rapidly changing marketplace. International applicants, once a stable source of demand, no longer flood admissions offices as they once did, due in large part to the uncertainty over the Trump Administration’s immigration policy. Many experts believe that it may be some time before these full-tuition-paying students return to the US in large numbers.
Today’s MBA is not your mother or father’s degree. Businesses are increasingly being challenged by marketplace disruption and innovation, global competition, and artificial intelligence’s potential to displace millions of jobs. To manage these challenges, employers are looking for individuals with creativity, empathy, agility, and soft skills that were until very recently, not part of an MBAcurriculum. Corporate social and environmental responsibility is no longer an aspirational goal and is instead driving everyday decisions.
New delivery platforms have emerged to offer business professionals greater flexibility and better work-life balance. Stackable micro credentialing and online programs provide applicants with a cheaper and faster alternative to acquiring needed skills. Business schools are redesigning their programs to align with a world of big data, block-chain technology, real-time analysis, and matrix organizational structures. MBA curriculums are embracing these marketplace advances, just like any business must do to remain competitive.
While all of this makes for dramatic headlines, the value of an MBA remains the gold standard for business professionals; its standing as the quintessential continuous learning degree for business professionals is unbowed. MBA graduates are thought to be more resilient and self-motivated, and they possess what all companies desire in their employees – critical thinking skills and a growth mindset. So important are these markers for success that they often trump prior experience when it comes to the hiring process. Moreover, in a world where nonlinear career paths are the new norm, an MBA degree is the gateway to opportunity and advancement. That aspect of an MBA remains the same, no matter what the future holds.
There’s been a rash of articles recently talking about the demise of an MBA degree but before removing those hallowed letters from your resume or enrolling in a Master’s of Fine Arts program instead, read this.
To be clear, much is happening in the MBA world, and not all of it is good news for higher education providers. It’s true that a half dozen or so programs have either closed or are considering closing their full-time MBA programs. Wake Forrest and Virginia Tech shook the industry years ago with closure announcements and, more recently, the University of Wisconsin unveiled plans to end its full-time MBA program only to retreat from its decision after an uproar from their alumni. Many other schools are no longer planning for the growth of their full-time MBA programs.
What’s missing from the headlines is that schools aren’t getting out of the MBA business altogether, they’re merely reallocating scarce resources to their most productive use. Business schools are practicing what they preach and managing their programs like a portfolio manager maximizing returns on their investments. Many are shifting resources to flex, online and part-time MBA programs and focusing on new opportunities like Data Analytics, which is now the fastest growing graduate business degree.
What the authors fail to consider is that much of what is ailing full-time programs is not all that surprising. What is clear, however, is that not everyone is feeling the pain. The top-ranked MBA programs are quite profitable and experiencing application growth along with rising GMAT scores, but they are the exception. And there seems to be no end to the all-in cost of attending an elite school, which now tops $200,000.
According to a survey by the Association to Advance Collegiate Schools of Business (AACSB), enrollment in full-time US MBA programs fell by a third between 2010 and 2016. While the decline is dramatic, it’s important to note that full-time MBA applications are countercyclical, rising as the recession unfolds and declining as the economy and job prospects improve.
The drop in US enrollments was masked by a rise in international applicants, which has been the only bright spot in an otherwise bleak picture for US business schools. But in the last year, interest from overseas has declined sharply due to a wave of uncertainty following the inauguration of President Trump. The scrimmage for student visas led many to seek enrollment outside the US. The loss of this large pool of full-paying students has been particularly problematic for full-time programs.
Another cyclical development comes courtesy of the Financial Crisis and the muted recovery. Facing a bleak job market, many college graduates opted to stay in school to complete a Master’s degree in finance or management – programs that typically do not require work experience. This thinking fueled a wave of enrollments into one year Master’s programs, pulling forward demand that might have otherwise opted for a full-time program two or four years hence. According to a 2017 survey by the Graduate Management Admissions Council (GMAC), “Three in four prospective graduate business school candidates who hold a prior Master’s degree are considering enrolling in MBA programs.” It’s unclear how many of them will choose a full-time program.
At some point, the US will experience another recession and a future US President may ease restrictions on international students wishing to pursue a US education but until then it will be tough sledding for full-time MBA programs. However, the ebb and flow of demand doesn’t diminish the long-held view that an MBA is one of the most versatile and coveted business graduate degrees. It conveys to its holder a set of skills, knowledge, and stature that is without equal in the world of business.
There’s no fake news there.
Unplugging is a familiar refrain among today’s professionals, yet few know how to accomplish it or why it’s so important. When disconnecting isn’t an option, many professionals substitute small respites with friends and family. Millennials maintain that work-life balance is non-negotiable when considering a new job but then struggle to balance the demands of their budding careers with their desires for a standard of living nurtured in a period of economic prosperity. While work-at-home jobs are the poster child of family-friendly HR policies, finding the right work-life balance has long been key to personal and professional fulfillment.
To understand the depth of our quiet-time starved nation one needs to look no further than the rise of meditation and mindfulness centers on corporate campuses. Today, it is not uncommon for Fortune 500 companies to include a Director of Wellness among their executive ranks and to offer daily meditation sessions. Don’t have time for meditation? No worries. You can download a smartphone application like Headspace that provides guided meditation sessions and mindfulness training for people on the go. So, the very device that is stealing our downtime is now able to help people slow down without slowing down. Amazing!
Our cognitive ability – thinking, reading, learning, remembering, reasoning, processing – is most productive when each skill is exercised and working in concert. Weakness in one area may impede our overall ability. A recent WSJ article, How Smartphones Hijack Our Minds, makes the case that as our brains become more dependent on mobile gadgets, our intellect weakens, our concentration suffers, and our ability to reason diminishes. Just the opposite of what you might have expected from having unfettered access to information.
There’s plenty of research supporting the physiological and psychological benefits of self-reflection, contemplation, meditation and the simple act of deep thinking. Think of it as a kind of REM sleep for your psyche. But don’t count on knowing when it’s time to get off the treadmill. We’ve all worked with someone who sets off on a much-needed two-week vacation only to find an increase in the frequency of their work-related emails. Is this the type of behavior employees should be emulating?
There’s no doubt that success in any endeavor results from hard work and dedication, but there’s more to it than just adding another rep to your routine. Uninterrupted myopic regimens stifle creativity and innovation and limit our ability to see the big picture. What’s needed to achieve peak performance is a type of cross-training for the mind. Many corporations rotate their most promising managers every few years for this very reason.
So the next time you’re seeking answers to life’s challenges or scrambling for a creative solution, don’t underestimate the benefit of slowing down, getting lost in your thoughts or embarking on something new and different. Oh. And don’t bring your phone.
Among the most valued credential for today’s aspiring business professional is feeling comfortable in your own skin. And yet when you look at the core courses of an MBA program, you’re hard-pressed to find a required class on emotional intelligence, collaboration, creativity, or leadership. To be sure, soft skill courses have long been a staple of second-year electives, but their importance has never been greater.
There are five factors that I believe are fueling the rise of soft skills:
- Horizontal organizational structures are replacing traditional hierarchical models and installing more decision-making authority at a local level. Much of that authority rests within teams where collaboration and leadership are essential.
- Artificial Intelligence and advances in computing are consuming more of the rote tasks that once employed legions of back-office personnel, pushing employees towards the front office where good communication and interpersonal skills are prerequisites.
- An increase in the complexities of our fast-paced, dynamic global economy demands new ideas and approaches. Today’s problem solvers must be creative, open-minded thinkers willing to embrace a diversity of thought as well as gender and cultural diversity.
- A move towards corporate outsourcing and a rise in the number of contingent workers, aka independent consultants. The Bureau of Labor Statistics (BLS) estimates that by 2020 40% of the workforce will be defined as contingent workers. Most independent contractors operate as small business owners who rely on a multitude of skills to win their next assignment, not the least of which include sales, communication and collaboration.
- An increase in “job hoppers.” Long gone are the days when workers enjoyed lifetime employment. The BLS predicts today’s workers will have 14 jobs over the course of their careers, nearly half of them occurring before age 30. In an attempt to attain more career options and greater financial certainty, today’s new entrants, particularly Millennial, are changing jobs more frequently and amassing technical skills at a much faster rate than previous generations. Along the way, they are also perfecting their soft skills and leapfrogging those without them.
Professional recruiters, like athletic scouts, scour the landscape in search of the next superstar – someone whose natural ability reveals itself upon first sight. Not too long ago, the prototypical central casting CEO was a six foot two male. But ever since Michael Lewis’ 2004 book, Money Ball, and the 2011 movie by the same name, we’ve come to accept that our eyes are not always the best judge of one’s potential. The genius revealed by Lewis is the idea that talent comes in many different shapes and sizes.
Regardless of our innate abilities, studies have shown that when it comes to executive presence and soft skills, much can be learned. So, don’t let poor interpersonal or communications skills keep you from joining a winning team. The corner office may be closer than you think.
When students returned to campus this fall they were greeted by the news that Ramapo College ranked as the top Public College in NJ and third among all colleges and universities in the state, behind Princeton University and Stevens Institute of Technology. While this news is no surprise to our alumni, it’s nice to have the official designation, courtesy of College Choice’s 2017 annual survey of the Best Colleges in NJ.
The news follows the 2016 reaccreditation of the Anisfield School of Business by the Association to Advance Collegiate Schools of Business (AACSB), a recognition that continues Ramapo’s membership among an elite group of business schools worldwide. And more recently, the business school was selected for the second time as the Headquarters of the Eastern Economic Association – a scholarly nonprofit that’s been home to many Nobel Prize winners in economics.
Among the many attributes that distinguish Ramapo College, is our relatively small size, low tuition costs and an attractive student-to-faculty ratio. And, because Ramapo is a college, our faculty’s first order of business is teaching, not research. But being among the smaller institutions in NJ has another advantage; it permits us to be responsive to the needs of our students as well as the community. Being nimble is particularly important to our corporate neighbors who are looking for professionals capable of navigating in an increasingly complex marketplace.
An investment in your education is an important decision. But thanks to the survey, you no longer need an MBA to figure out where to find the best return for your money.
News of Nokia’s foray into digital bathroom scales is a stark reminder of the difficulties of staying on top. For those with fond memories of Nokia’s iconic mobile “brick” phones, the image of this former superpower embarking on a consumer electronics comeback is evidence of what economists call capitalism’s creative destruction.
Many of today’s Millenials remember little of Nokia’s 14-year run as the market leader. In 2000, Nokia was the largest handset company in the world with a market cap of $250 billion compared with Apple at just $15 billion. In 2014, shortly after the sale of its mobile devices division to Microsoft, the slumping company stopped selling phones altogether. Today, Apple tips the scales at approximately a $770 billion market cap while Nokia, in its latest incarnation as a provider of telecom equipment and fledgling consumer electronics, is valued around $32 billion. What happened?
The road to and from corporate stardom is littered with casualties, but it’s especially treacherous for tech companies whose fortunes are tied to the latest industry innovations. In hindsight, Nokia was too slow to migrate to one of the new smartphone operating systems that dominated after Apple’s 2007 introduction of the iPhone. They were blinded by their previous success and too wedded to their Symbian platform. The same can be said of RIMM’s allegiance to Blackberry OS. Almost overnight, Samsung and Apple, with their feature rich Android & iOS platforms, dominated the smartphone market, sending competitors into the history books.
It’s hard to imagine this former heavyweight making a comeback in consumer electronics but history has a funny way of repeating itself. The company’s roots date back to 1865 when it began as a Finland-based pulp company and produced toilet paper – it’s first entry into bathroom products. Over the years, Nokia has operated in a variety of industries including rubber, forestry, cable, electricity, and electronics. More recently, a company operating under a license from Nokia started selling an updated smartphone based on the classic Nokia 3310. Early China sales have been robust but only time will tell whether there’s more to it than just nostalgia.
Evidence of capitalism’s “incessant industrial mutation” appears regularly in the financial press but contrary to early Marxist predictions, this creative destruction process has not led to capitalism’s demise. Instead, it leads the world in producing ever-higher living standards and operating efficiencies. However, while innovation has the potential to address some of the world’s most pressing problems, we cannot dismiss the burdens placed on those upended by today’s accelerating pace of creative disruption.
Thankfully, the proliferation of online education, graduate business degrees and professional certifications means workers have more options than simply relying on government-sponsored retraining programs. However, the key is accepting responsibility for a career of life-long learning. Adding to your skillset won’t eliminate economic uncertainty, but it will ensure that the journey is far more enjoyable and rewarding.
By now most everyone has seen the video of a 69-year-old man being dragged from his United flight by terminal police officers – the result of an overbooked flight and an algorithm that selected his seat number. Can you think of any other industry that treats law abiding and non-threatening customers the same way? Imagine the furor if, say, Macy’s summoned mall security to retrieve a previously purchased garment from a customer and then proceeded to drag them out of the store because a Macy’s employee wanted the same size.
United’s CEO was quick to apologize and promised to investigate the ordeal. But in a memo to employees immediately after the news broke, he commended the crew for following established procedures when dealing with “situations like this.” No such commendation was offered to the aviation security officer that dragged the passenger through the aisle – he was suspended from his position pending further review. Who was it then that acted inappropriately?
United’s multiple attempts at an apology were too little and too late to stem the public outrage over the incident. The U.S. Department of Transportation is now investigating the incident.
United, in need of four additional seats, reportedly offered up to a thousand dollars in compensation but found only found three willing sellers. My guess is that when the compensation policy was first established that amount was more than enough to arrive at the desired outcome. But surely the cost of the current brouhaha is going to cost United thousands of dollars more in damage to its reputation, lost business, potential legal bills, as well as the cost of the passenger’s medical bills. I have no doubt that plenty of passengers on that Chicago flight would have gladly sold their seats at prices well in excess of a thousand dollars had it been offered.
Stop and think how you might have reacted under those same circumstances. If you were a passenger, would you have offered your seat to prevent the injustice? Forgetting about the legal merits of the overbooking policy, when does human decency come into play? Should employees be required to check their judgment, instincts and morals at the door when they enter their place of work each day? Didn’t we learn that the financial crisis was a tale of countless individuals dutifully following the rules, knowing full well that it did not pass the smell test?
It’s hard to imagine running an airline or any business without rules. And quite often, the rules work pretty well. But the world doesn’t always fit neatly into our preset designs. When things go awry, we rely on individuals to exercise their skills and to make a split-second decision based on experience and judgment. We need to look no further than the Miracle on the Hudson to underscore the importance of exercising good judgment. Though most of us will never know the magnitude of that drama, we are no less responsible for the countless decisions we make each day and the actions we take, regardless of what our employer’s policies dictate.
The irony is that management had a simple and fair alternative that could have been easily implemented – a spontaneous secondary market for airline seats where the price rises until enough passengers offer to “sell” their seats back to the airline. Each passenger would be free to make their own economic decision and all of the sellers would receive the same price.
How high should the airline pay to make room for the United crewmembers heading to staff a flight in Louisville? Whatever it takes to avoid what actually occurred. A more economically sound answer is the cost should rise until it’s equal to the cost of canceling the flight in Louisville. All else being equal, at some price – likely quite high – the airline should be indifferent between the cost of canceling the flight in Louisville and the cost of buying four passenger seats in Chicago.
One of the most remarkable aspects of disruption is that it typically happens under full view of industry participants. New entrants, armed with a good enough and usually cheaper solution, simply wade across the moat into the low end of the market. The incumbents, drunk on their own success, dismiss the interlopers as a nuisance, or worse, decide to concede the low end in order to redeploy capital into higher margin products.
What’s more, incumbents often pave the way for new entrants by overshooting the market with costly product features that far exceed the job to be done. The new players are often more nimble and humble than their larger competitors and any hint of success only fuels their passions. When the counterinsurgency is finally unleashed, it’s usually too late and the market is forever changed.
This very drama is in full view once again in the wake of Gillette’s recent decision to cut blade prices by up to 20%. Not only is it good theater, it should be required reading for all business managers. Gillette, the market share leader with 70% of the shaving market in 2010, saw little to worry about from two fledgling upstarts – The Dollar Shave Club and Harry’s. However, with its market share now at 54%, the price cuts are an ominous sign for Gillette, underscoring the limits of its seemingly endless product improvements and higher price strategy.
Sensitive (skin) consumers finally decided that the cost of a 5-blade, double strip, rotating and vibrating shave was just too much. Not to worry, Gillette has reportedly filed patents on a heated blade technology. Now you’re talking! You might have guessed that something was amiss when a retail store clerk had to be summoned to access replacement cartridges that were kept under lock and key. According to a WSJ article, the cheapest cartridge from Dollar Shave is 20 cents vs. $2-$6 dollars for a single Gillette cartridge.
What strikes me about this story is how quickly this corporate drama unfolded. The Dollar Shave Club was only 5 years old when Unilever purchased it for $1B in 2016. Harry’s, founded in 2013, was estimated to be worth nearly as much. On the heels of the Dollar acquisition, Gillette’s owners admitted that “It was probably on the radar screen but we weren’t necessarily having the right conversation around what might disrupt us.”
Six MBA students and their professor recently returned from Vicenza, Italy, where they toured the manufacturing plant of a leading designer and manufacturer of electric motors used in appliances, electric bikes and scooters. The trip was part of Ramapo’s Capstone program, which is the culmination of the students’ learning experience where small teams of second-year students, along with a faculty advisor, spend the entire spring term working as a corporate consultant.
The challenge? Determining whether there’s a market for electric bikes and scooters in the US. For an Italian company with little American presence, save for a few sales offices, launching a new product in a new market is no small feat.
Attitudes toward alternative means of transportation have been evolving since the introduction of the moped scooter in response to the gasoline shortage of the mid-1970s. Today, Millennials are leading the way with their penchant for the shared economy, social responsibility and having an asset light balance sheet.
Bike sharing programs are taking advantage of this trend and popping up in cities across the country. Increasingly, they appeal to anyone seeking a more active and healthy lifestyle, to say nothing of the convenience and lower cost of transportation. Will we soon see power assisted bikes on the streets of NYC? Might workers and students someday commute on an electric scooter? Stay tuned. The student’s final recommendations are not due until late April. Andiamo!
One of the unique aspects of Ramapo’s Anisfield School of Business is being surrounded by world-class nonprofit and for-profit corporations and the opportunities it offers for experiential learning. It’s one thing to learn from a textbook but it’s quite a different experience to formulate an opinion on a real-world corporate challenge.
Over the years, Ramapo has amassed an enviable list of corporate partners and challenging assignments, including BMW, Becton Dickinson, Braen Stone, Bergen Volunteer Medical Initiative, dressbarn, Hackensack University Medical Center, Home Depot, Nickelodeon, Pearson Education, Stone Systems, Stryker, Valley Hospital, and the Wyckoff Family YMCA.
Projects have encompassed everything from analyzing the effectiveness of a corporate health and wellness program, to measuring the return on investment of a multi-million dollar training and development program; devising an in-store merchandise restocking program to improving the voice-of-customer scores (VOC) for a big-box retailer; minimizing the impact of revenue leakage for a large hospital network to mitigating patient throughput declines caused by government mandated software deployments.
No matter what the challenge, students are called upon to combine their professional skills with their MBA coursework. The typical assignment begins with an assessment of the company’s corporate vision and competitive position, followed by the collection and analysis of primary and secondary research. Teams then formulate a set of key recommendations – conventional and nonconventional – which they must defend in front of their classmates and MBA faculty before presenting to their business partner. Lastly, each team outlines a change management strategy to ensure that good ideas don’t get lost in a sea of corporate bureaucracy.
Looking to challenge yourself while earning your MBA? Don’t underestimate the benefits of finding a school in a good neighborhood.
“A great leader has more in common with an artist than an economist. Economists drill deep in narrow fields, but the artist’s view is more expansive; he’s [/she’s] more able to grasp the big picture, and see how it is changing.”
The quote is from a recent column by Peggy Noonan who writes weekly for the WSJ. In her piece she takes the new administration to task for, among other things, overplaying an image of darkness and resentment rather than appealing to Americans’ optimistic “can-do spirit.”
Without delving into the politics, what struck me about her piece was the idea that great leadership is more than just having command of the facts – good or bad. Knowing the facts is important but without a sense of the big picture, one’s conclusion may be off the mark, or worse, ill-founded. What’s more, by simply changing the vantage point, the same set of facts may lead to an entirely different view altogether.
Quite often, the lens in use at that moment and the context that surrounds it, colors what we see. It should come as no surprise then that like-minded professionals often arrive at the same conclusion for a given set of facts while the out-of-the-box thinker, who sees the data from a different perspective, arrives at an entirely different solution.
Thinking outside the box has long been the purview of industries where creativity and innovation are critical, e.g., advertising, marketing, design and technology. The “creative types,” or those endowed at birth with their artistic skills, naturally gravitate towards positions where safe spaces allow their creativity to flourish.
But the importance of creativity is much broader than previously thought. Years ago, the Yale School of Medicine introduced an art appreciation class as a requirement for all first-year med students. The rationale was based on research suggesting it was possible to enhance students’ observational skills and reduce misdiagnoses by studying paintings. It seems that simply knowing a patient’s vital signs without some broader context, did not always result in the best outcome.
Only recently have educators concluded that creativity and artistry can be taught regardless of one’s natural ability. Left-brain people tend to find comfort with structure, rows and columns, and logic. But according to Amy Whitiker professor and author of the Art of Thinking, what they learn from art “is how to be productively disoriented – to get lost in the weeds of creativity.” The link between creativity and innovation is not lost on MBA programs, where workshops on creative thinking are on the rise.
No matter where your career takes you, executive recruiters increasingly view creativity on par with one’s mastery of traditional business skills like communications, marketing, finance or economics. Their logic is that sometimes it’s better to be lost in the weeds of creativity than shoehorning old ideas into today’s increasingly complex challenges.
Get the picture?
How Seeing Less is Seeing More
Did you know that Saturday, April 8th is Slow Art Day?
It’s an annual event that encourages museums and art gallery visitors from around the world to stop galloping around venues with the intention of seeing as much art as possible. Organizers say there is something transformative about slowing down and letting the art reveal its secrets. “When people look slowly at a piece of art they make discoveries….it unlocks passion and creativity.”
The next time you’re given a difficult assignment at work, don’t be so quick to come up with an answer. Explore it from different angles for somewhere in the depths of its complexity lies an idea that you may have never thought of before.