
Elite MBA Programs Report Steep Drop in Applications - drkimball
https://www.wsj.com/articles/elite-m-b-a-programs-report-steep-drop-in-applications-11571130001?mod=rsswn
======
duxup
I was ready to rant about my own experience with MBA students put in pseudo
management situations who can't iron their own shirt or couldn't schedule
people's hours at a Wendy's... but then I realized this article is about Elite
programs.

So I wonder are the Elite programs significantly different than other
programs?

One of my biggest problems encountering MBA students released into the wild is
that so many have limited life experience. It's really hard to explain to a
fresh MBA guy that you can't schedule people only when it is convenient for
him / how to cultivate personal / professional relationships / how to just
theorize customer's responses to various changes (like thinking beyond saving
1%) and etc. It's just so hard to teach folks who haven't the experience these
things that being a good manager isn't just pulling the mechanical leavers of
management because "i'm the boss" and how to really understand what leadership
is when they haven't experienced it much from the other side.

I haven't encountered many from the best programs and I always wonder if they
require some REAL work experience where they had real responsibility first /
etc.

~~~
spamizbad
Not to defend MBAs here, but doesn't a big portion of the blame fall on
organizations that are clearly putting too much weight on their candidate's
degree and placing them in jobs they're not (yet) qualified for?

In an alternate scenario: an MBA gets hired to fill a position below
management and the higher-ups get a clear picture if they're cut out to manage
operations, only awarding the MBA a promotion to management if/when they prove
themselves.

~~~
jcomis
This is true, however typically the people who make that call are from the
same background (MBAs themselves).

------
appleiigs
The same folks here who crap on MBAs, will also get super excited about Y
Combinator Startup School, despite both of them teaching about business.

Lets go through the Y Combinator Startup School curriculum and I'll put the
MBA version in square brackets[].

Startup School 2019 Orientation: How to Talk to Users [ _MBA: Business
Communication, Marketing /Strategy_], How to Evaluate Startup Ideas Pt. 1 [
_MBA: Marketing /Strategy_]

WEEK 2: How to Plan an MVP [ _MBA: Marketing /Strategy_], How to Set KPIs and
Goals [ _MBA: Accounting, Operations, Human Resources /Leadership_], Analytics
for Startups [ _MBA: Statistics_ ],

WEEK 3: Nine Business Models and the Metrics Investors Want [ _MBA: Marketing
/Strategy, Finance_], How Investors Measure Startups Q&A,

WEEK 4: How to Launch (Again and Again) [ _MBA: Marketing /Strategy_], Growth
for Startups [ _MBA: Marketing /Strategy_],

WEEK 5: Startup Finance Pitfalls and How to Avoid Them [ _MBA: Finance_ ], How
to Work Together [ _MBA: Human Resources /Leadership_],

WEEK 6: Building Culture [ _MBA: Human Resources /Leadership_], All About
Pivoting [ _MBA: Marketing /Strategy_],

WEEK 7: How to Improve Conversion Rates [ _MBA: Marketing_ ], Startup Pricing
101 [ _MBA: Marketing /Strategy, Finance_],

WEEK 8: How to Prioritize Your Time [ _MBA: Human Resources /Leadership_], How
to Evaluate Startup Ideas Pt. 2 [ _MBA: Marketing /Strategy_],

WEEK 9: Modern Startup Financing [ _MBA: Finance_ ], Advice for Hard-tech and
Biotech Founders [ _MBA: Case-studies_ ],

WEEK 10: How to Lead [ _MBA: Human Resources /Leadership_], Startup School
2019 by the Numbers, Parting Advice, GRADUATION

~~~
ohazi
I don't see a lot of people crapping on the _content_ presented at MBA
programs. MBA-style case studies are actually pretty fun. The thing they're
crapping on is the average quality of the _people_ that come out of these MBA
programs, _as a group_.

If the people coming into your program are largely pampered, entitled idiots,
and as an institution, you throw away your old work experience requirements so
that you can rake in those sweet sweet MBA loan / trust-fund dollars, then you
shouldn't be surprised when you start to get people who can't tie their own
shoelaces out the other end, and you'll have nobody to blame but yourself when
people start to question the value of an MBA or when enrollment starts to
drop.

Startup School _currently_ appears to self select for a more intelligent and
thoughtful cohort. This may change in the future, and I'll happily update my
heuristics if / when that happens, but for now assuming lower quality from an
MBA grad than from someone who worked through Startup School _without any
additional information_ doesn't seem that unreasonable to me.

~~~
ohazi
To add a bit more here:

You should _really_ try to get as much additional information as you can about
someone instead of judging them on a heuristic alone. Just a 20 minute
conversation can be incredibly revealing if you're good at talking to people
(which admittedly, is not a common enough skill).

While MBA programs produce no shortage of head-scratchers, I also know several
MBA grads who are sharp as a tack, who are no-nonsense hard workers, and that
any ambitious company would be lucky to hire. The problem is that all of them
ended up at the big management consultancies.

And this is by design -- the consultancies realized that they can go chumming
for suckers at the top business schools to get respectable looking worker
bees, and business schools used this fact (the "prestige" and the high initial
salaries) to market their programs and to justify tuition increases. This
vicious cycle has completely eaten the elite business schools and now they're
basically just feeders for management consultancies and banks. The success
metric of every elite business school is the number of graduates they manage
to shovel into these jobs.

But you don't need an MBA when all you're doing is parroting back whatever
your employer's client wants you to tell them -- you mostly just need to look
the part and have enough social graces to make the client feel like they're
interacting with "one of their own" (read: someone from their class / social
circle). So it's not too much of a leap to see that letting in a trust-fund
kid with zero skills or experience is totally fine by bank and management
consultancy standards -- they grew up around other rich people! They're
perfect! Even though they're not so great for people like you and me, who
might prefer someone who can think and act strategically over someone with
upper-class social graces.

And the management consultancies really are a sucker's game. It's not
_actually_ "up or out" as is commonly suggested... It's more like "you make
partner, and pay yourself disproportionately more for all the work that
everyone below you produces, or you realize that the 'rainmakers' are taking
advantage of you and you quit." But the realization can sometimes take a
decade or longer as you suppress your gut feelings and get used to a pseudo-
lavish lifestyle that the next-best-option-that-actually-allows-you-to-use-
your-brain might not be able to cover.

It's the same story with big-name law firms. The salary distribution for law
school graduates is bimodal -- $60-70k for grads of lower-tier schools or for
grads who don't make the cut with the big firms or who go into public service,
and $155,000 +/\- ~$500 at all of the prestigious law firms (or whatever it
was last year + 2.5%). But you'll be putting in all the hours and doing all of
the real work for the next 10-20 years while some partner wines and dines and
takes home $20 million a year off of your labor.

This is why I generally don't advise people to go to business school. While I
know plenty of people who would probably gain a lot from a rigorous business
school curriculum, everything about the program -- their classmates, the
faculty, the internship, even the calculus when evaluating their offers --
will push them into making a decision that I think many of them will regret 10
or 20 years later. Most of the people who have asked me about this are quite
smart. When I ask about their motivation, the common factor is that they want
more leverage on their brain power. They want to continue to be the
intelligent person that they are, but they want to magnify their output, or be
taken more seriously. Contrary to some tropes, I haven't found many that just
want to make more money at any cost. They certainly don't want to be "takers"
(from "makers vs. takers"). But the management consultancies and the partners
that run them -- remember, this is the pinnacle of success for these schools!
-- are the massive fat cats of the "taker" world. Not only do they take actual
money that should really be going to the smart people doing the work, they
also take these people away from more productive and more satisfying
opportunities elsewhere in society.

It's been interesting watching the career progression of friends and
acquaintances from my parents' generation who worked at these sort of "make
partner or die trying" pressure cookers. Four or five made the equivalent of
partner at their firm, made obscene amounts of money, neglected their children
(who are now in law school after years of rebellious misbehaving), are now
empty nesters with a 15,000 square foot nest, and are largely miserable.
Basically everybody else who left (after sticking it out for 5-20 years)
wishes that they had left sooner. Sure, they made good money, but in their
environment it was never enough, and they never got to use their skills in a
way that had _any_ sort of outcome, let alone an outsized one. It was all just
extreme busywork.

I'm hopeful that at least some of the drops in business school applications
are from people seeing this shell game for what it really is. The business
school curriculum is interesting and can be quite valuable. But the big
management consultancies can go die in a fire.

------
ucha
It seems that almost all the comments are about the downfall of MBAs.

The actual article - not the title - says applications rose in Europe, China
and quite dramatically in Canada. If applications rise by 9% in Canada while
they decrease by 9% in the US, it's quite a good argument for the thesis of
the author which is that immigration restrictions are responsible.

It used to be easy to get an MBA in the US then get a job as a foreigner. I
have a friend who got a Masters in the US from an elite uni, worked in New
York for 3 years, applied and lost thrice the H1-B lottery to later move to
London. Many Indian and Chinese nationals leave for Canada instead of waiting
more than a decade to get a Green Card. Getting an education in the US with
the intention to access its job market is less attractive now.

~~~
commandlinefan
Well, I know this sort of sentiment is usually dismissed as xenophobia but…
where’s the evidence that this is a bad thing _for U.S. citizens_?

~~~
SamuelAdams
If it is international students that are applying elsewhere, that could lead
to a drop in diversity at these universities. There have been studies that
confirm students do better when learning with a diverse set of peers [1], but
these studies were on elementary aged students. I'm curious if that applies to
college / master's programs too.

From the article:

Students can learn better how to navigate adulthood in an increasingly diverse
society—a skill that employers value—if they attend diverse schools. Ninety-
six percent of major employers, Wells, Fox, and Cordova-Cobo note, say it is
“important” that employees be “comfortable working with colleagues, customers,
and/or clients from diverse cultural backgrounds.”

[1]: [https://tcf.org/content/report/how-racially-diverse-
schools-...](https://tcf.org/content/report/how-racially-diverse-schools-and-
classrooms-can-benefit-all-students/)

------
luc4sdreyer
Applications are still growing, the highest was Canada with 9.4% growth
between 2018 and 2019:

> Applications to U.S. business schools, including M.B.A. programs, fell
> sharply, while rising in Canada, Europe and China.

just not in the US:

> “There’s perception, which we absolutely pick up in our data, that the U.S.
> is not a welcoming environment,” said Sangeet Chowfla, GMAC’s chief
> executive.

~~~
close04
After working with so many MBAs from prestigious schools I find it very hard
to take this kind of title at face value, before seeing the person in action.
Most had an MBA at 23 years old, basically jumping straight from university
classes to MBA classes with nothing in between. At best the MBA did not bring
anything. At worst it made some feel so entitled that they actually performed
far worse. I fail to see the added value in this and most of them failed to
show it.

Given that this was happening in very large companies and involved studies in
prestigious schools but nothing practical to show for it, in the end I can
only assume many of these are just CV fluff.

~~~
onlyrealcuzzo
CV fluff is the important bit.

I'm willing to bet most MBA students directly from undergrad with no work
experience between are only getting an MBA either because:

1) they couldn't get a good high paying job right out of college.

and/or 2) they read that an MBA is a good investment, and MBA students on
average make $X more per year (without doing their MBA calculations and doing
the time discount and opportunity cost to figure out it's propbably not worth
it).

~~~
ameister14
Well, as to #2, if you get an MBA right out of college it's theoretically more
likely to be worth it, simply because the multiplier effect has more years to
work with

~~~
laurentl
Actually, it was the first exercise we did in my EMBA finance class :D

Even with an EMBA, which happens later in a career, the NPV is quite positive.

~~~
onlyrealcuzzo
Did you use a bell curve to figure out if it's worth it -- on average -- or
did you use a madelbrot curve? Unless you go to an elite school, and the
tuition is cheaper than anywhere I'm aware of, you're either 1) banking on
being on the good side of the curve, 2) imagining there's a gaussian
distribution to salaries (which there isn't), 3) enrolled somewhere very elite
or incredibly cheap, or 4) vastly underestimating how much you could be
earning presently -- which if you got enrolled in an elite school, you
probably could've gotten an elite job...

~~~
laurentl
Nothing that fancy, we just looked at the average case using a conservative
estimate of salary increase after an MBA (something like + 30% 3 years after,
so way below what the FT figures show for instance), and a conservative
starting salary.

Note that this was an executive MBA, so the base assumptions are a little
different; in particular, attendees have a pretty good idea of what they're
worth on the market and the effect of the EMBA is pretty well quantified: most
EMBA participants change jobs/companies after the program, usually with a nice
salary bump (although of course signing up for an EMBA in the first place is a
good indication that you're willing to invest in your career, so at least part
of that progress would have happened in some way or another even without the
EMBA).

In my personal case, the salary increase is close to 100% 5 years after
enrollment - so the investment was well worth it.

To answer the rest of your questions, the program was in the FT top 10 (now at
#12 or so) and tuition was around 50k€. Yay for European business schools :D

------
breitling
Hasn't there always been an inverse correlation to people going back to school
and the economy?

Currently, the economy is doing very well, so people are less inclined to go
back to school. Once the economy turns and unemployment rises, then I'm sure
the MBA applications will rise.

~~~
dpflan
This seems like a good point; ( _speculating_ ) especially if an MBA is viewed
asa means to earn more in a declining economy. I don't know much about the
programs and the expected increase in salary upon completion.

~~~
brixon
MBA or other Master's degrees are ways to buy time to wait out a bad economy.

------
aoveri
Having started my own company and done everything from doing coffee runs for
my team to writing investment briefs, I'm not sure what an MBA would teach me?

Not being snarky, genuinely curious as to what benefit I could derive as I've
always seen as something that I'd eventually pursue.

~~~
pastor_elm
MBAs are a gatekeeping mechanism for the rich

~~~
thehappypm
This is pretty damn false. Most state schools offer online MBAs for extremely
affordable tuition rates.

------
mikeryan
I'm a Software Engineer by trade but now run an interactive agency. I got a
night MBA at a local state school (actually got tuition covered by my company)
while still working as a Software Engineer and wondering if I wanted to stay
on that path indefinitely.

Did my MBA qualify me to run a business? No but that being said I found a lot
of what I was taught really valuable in providing a baseline of getting me
past not knowing what I didn't know. Marketing and Accounting classes were
really interesting and provided some value. Innovation classes also provided
value.

Its a strange degree because of its broad nature it doesn't provide a singular
skill (sans specialization) to lean into but it does provide a lot of valuable
knowledge and while it's not something that will "get me a particular job I
did find the experience valuable.

~~~
bredren
I have a computer engineering BS and got my MBA from a full time, two year
program without financial assistance.

The price of the program has been a very difficult burden in retrospect. I
would have financed it differently and made different spending decisions if i
could go back.

But the education was as parent describes, offering a very useful set of
skills, from business presentation, teamwork, research and finance.

Things that inherently are not a part of YC startup school, (I just graduated
from that with EasyALPR)

Startups require a whole other set of skills, but what they teach in MBA is
valuable—-so long as it is financed carefully.

------
gringoDan
This is a good thing. People are realizing that a $500,000+ upfront cost
(tuition + 2 years' lost income) had better have an an astronomical ROI. In
many cases, it doesn't.

Anecdotally, I went to undergrad at a school with an elite MBA program. It
seemed to me that the only hard part of the MBA program was getting in; the
MBA students were essentially paying to have a 2 year networking party. Their
experience was like being in college, except they had money to spend and
grades didn't matter (due to a grade non-disclosure policy for MBAs).

Because of this grade non-disclosure, the MBA was significantly easier than
the undergraduate degree. Many classes had an undergraduate section and a MBA
section - the same material taught by the same professor. After the midterm
and final, the professor would post the median test score and standard
distribution in order to establish the grading curve. The median score for the
MBA section was consistently 1.5-2 standard deviations below the undergrad
median.

Sometimes a class would be offered to mainly MBAs, but a few undergrads were
able to enroll...this was always great for your GPA.

~~~
slap_shot
I have several friends with top tier MBAs. They all got them in an effort to
jump from the sell-side to the buy side, and most saw salary increases from
300-400k to 600k-1M+. The ROI on that specific career move is pretty clear and
is really the only path I would personally justify for an MBA.

They all say the course load and work is a joke. It's mostly an accreditation
to the buy side hiring process and networking.

~~~
arcturus17
I don't know about your friends but the average salary out of an elite
b-school is something like 160k in the best of cases [1], not the ranges you
mention...

Either they're total outliers, or you're talking about something like an exec
MBA, or something else altogether.

[1] [https://www.usnews.com/education/best-graduate-
schools/top-b...](https://www.usnews.com/education/best-graduate-schools/top-
business-schools/articles/mba-salary-jobs)

~~~
formercoder
Who cares about average salary?

The two most popular post-mba paths are investment banking and consulting, I
know exactly what the post-mba IB comp is:

1st full year associate: 150k base, 70-100% bonus

VP comp is easily above 400k

Consultants make $165k+ base with slightly smaller bonuses out of school

The numbers schools put out are not contextualized. The high paying roles out
of the top ~20 MBA programs command total comp that is almost totally
unacheivable as an employee, even in tech, especially if you don't want to
count on equity appreciation.

~~~
arcturus17
The article does say "salary and bonus" though... So if the figures are true
there must be a good number of people not getting close to this.

And regardless, still a far cry from what OP was claiming.

------
bedhead
I have an MBA from on of these schools and I can tell you that it's virtually
worthless. I went at night because my boss made me and paid for it. (Yes,
doing classes from 6-9pm a couple nights per week for two years was miserable)
People who quit their jobs and forgo income and instead take on debt to go
full-time are insane, the only point is to basically relive college and party
4-5 nights/week. Frankly, I don't see the point of any post-graduate degree in
something that's neither specific nor complex.

~~~
jayalpha
"Frankly, I don't see the point of any post-graduate degree in something
that's neither specific nor complex."

This is a useless metric. I have a PhD in something that is specific and
complex and never could find a job.

MBA is generic. It may not pay off but you can play in many fields.

------
mathattack
It’s easy to hate on MBAs, but unethical people are unethical no matter the
degree.

My general observation is most people aren’t good with finance or the numbers
behind their business. Having a 2nd tier MBA Doesn’t help. People who list MBA
after their name rarely have it either. People from top tier MBA programs have
a fighting chance. They may not have technical or leadership skills but they
can talk the language of business. That helps to get into the C Suite, or sell
to the C suite. (If that’s not the goal, it’s a bad degree)

~~~
chadcmulligan
I've met a lot of jerks with MBA's, its not the MBA though, it's just that
they're jerks. Unfortunately there's no check for that on the entrance exam.

------
ChuckMcM
One of the more interesting (to me) effects of the dot com crash was the
evaporation of all the hot shot MBAs looking to find a technical co-founder
who could make their lead-into-gold business plan work. Perhaps the dying of
the unicorns has taken the shine off "making it big in Silicon Valley" once
again. That and the softening housing market might almost make you think we
were headed into the next 'down' cycle.

I also learned from that experience that understanding value chains,
organizational dynamics, and market positioning were in fact a very real and
solid component of company success. There are good MBAs and there are bad
ones, just like there are good and bad engineers, or chefs or lawyers.

If the drop in applications mean that it isn't considered the next "get rich
quick" exit then I think that is a good thing.

------
mrwebmaster
Isn't this old news?

[https://www.wsj.com/articles/SB10001424053111903532804576566...](https://www.wsj.com/articles/SB10001424053111903532804576566611053380594)
(2011)

[https://www.wsj.com/articles/SB10000872396390444433504577651...](https://www.wsj.com/articles/SB10000872396390444433504577651962999932518)
(2012)

[https://www.wsj.com/articles/wharton-applications-
drop-12-ov...](https://www.wsj.com/articles/wharton-applications-drop-12-over-
four-years-1380238730) (2013)

[https://www.wsj.com/articles/m-b-a-applications-decline-
for-...](https://www.wsj.com/articles/m-b-a-applications-decline-for-third-
year-in-a-row-1505727000) (2017)

[https://www.wsj.com/articles/red-flag-for-u-s-business-
schoo...](https://www.wsj.com/articles/red-flag-for-u-s-business-schools-
foreign-students-are-staying-away-1493819949) (2017)

[https://www.wsj.com/articles/m-b-a-applications-keep-
falling...](https://www.wsj.com/articles/m-b-a-applications-keep-falling-in-u-
s-this-year-hitting-even-elite-schools-1538366461) (2018)

------
m23khan
Frankly speaking, I don't have MBA nor am I in Management. Infact, I can't
afford to get MBA. But as a Developer, even I recognize the need for MBA grads
from elite schools especially as Company scales in size. You can definitely
have CEOs / founders who are like Mark Zuckerberg or Bill Gates but reality
is, once your corporation gets big enough, even if the CEO doesn't have MBA,
they will probably hire army of elite MBA grads to formulate and execute
successful business plans.

------
tinyhouse
Good news. These programs are cash cows and the vast majority who apply for
MBA do it for the wrong reasons (networking and a big name school on their
resume). There are lots of MBAs from elite schools in my company and the gap
is huge. Some are great but some are completely useless. Anyone can have an
MBA from an elite school. You just need the money and be willing to spend it
on a degree. (sorry MBA graduates, I know you gonna downvote this comment :))

~~~
cjf4
>Anyone can have an MBA from an elite school. You just need the money and be
willing to spend it on a degree.

This is not true at all. Regardless of the value of the degree/experience,
elite MBA programs are still difficult to get into and have low acceptance
rates.

~~~
tinyhouse
Yes, saying "everyone can get into" is an exaggeration. However, low
acceptance rate doesn't mean much given the pool of candidates who compete to
get in is limited to people who are able and willing to spend $100K on an MBA.

------
helpPeople
I'm not sure what an "elite" college teaches that a "regular" college doesn't.

Maybe quality of student is better, but the content seems negligible.

Heck I find the personalities of young "elite" grads need additional shaping
in the real world.

~~~
bluedevil2k
Elite schools move much faster and cover more material than a regular school
would. Obviously with the smarter kids at the elite school they can get more
advanced.

~~~
rowanG077
Do you have any examples of this? I don't feel people I have met from elite
schools actually know more material theory then from other schools. If I look
at online courses the content of those from elite schools doesn't differ much
from courses I have taken in a non-elite school.

~~~
bluedevil2k
Not macro, no I don't have examples. Just my personal observation based on
classes I took at an "elite" college vs. the ones taken by a friend at the
state school.

------
himynameisdom
I've taken the route of a "build your own MBA", seeking out various industry
certifications to validate my learning. I flirted with an MBA program for
years, but none offered the flexibility I was seeking in terms of honing a
skillset around what I'm going for in my career.

------
josephdviviano
Is it just me, or is the comment section all about hating on MBAs, when the
article is about how these elite programs are losing out due to changes in US
immigration policies?

~~~
brixon
When an article is behind a pay-wall you will have people commenting based on
the title alone.

------
achow
Appending '?mod=rsswn' to the url is not bypassing pay wall anymore.

[http://archive.is/IpPls](http://archive.is/IpPls)

------
Foobar8568
How bloody surprising.

My own experience:I have an associate degree, I cannot apply to anything
because I don't have a bachelor degree, yet my current stakeholders are CxO,
or I am basically a tech lead. I would love to do a MBA or a master degree but
continous education is out of reality.

And mooc are useless in this regard : sorry but even if you pass our Mooc
"degree", you still need a bachelor to register to the master through the mooc
pathway, screw that.

------
rswail
Good. The rise of the MBA has seen the downfall of quality.

"Business Administration" is not something that can be taught in such a
generic way that an MBA qualifies you to actually run a business.

In particular, the rise of Financial "Engineering" has led to huge inequality
and the total disconnection of "Wall St" from "Main St" such that their
relationship has been completely inverted.

~~~
airstrike
It's not really that generalized as you can pick 1 or more majors and focus on
what you want to learn most. Not to mention each MBA school has different
characteristics, attracting different candidates and campus recruiters.
Stanford and Booth couldn't be more different if they tried.

MBA graduates are also not fit for running literally any business. The only
thing employers know is that if you come from a top 10 MBA, you probably check
the box on being pretty smart (the GMAT is a tough exam) while also possessing
soft skills, being personable, ready to meet with clients or manage people and
probably well-connected. It's a pedigree that allegedly excludes the dumb rich
kids

Now your claim about Wall Street is just uninformed FUD. Most people on the
street do not have an MBA, let alone one from a top school, particularly on
the Sales & Trading branch of Wall Street that is usually what people
associate with poor ethics and exploiting Main Street

~~~
bertjk
I can accept the pretty smart part (I've never seen the GMAT but I'll accept
it for the sake of argument) but what part of getting an MBA filters for
"possessing soft skills, being personable, ready to meet with clients or
manage people and probably well-connected"?

~~~
stevesimmons
> what part of getting an MBA filters for "possessing soft skills, being
> personable, ready to meet with clients or manage people and probably well-
> connected"?

MBAs at the top schools demand intense team work. Without it, you won't pass.

My MBA experience was INSEAD, in France. For the first 3 terms (of 5), all
work was done in teams of 5. The school chose the teams explicitly to maximise
the chance of conflict (by maximising differences in background, nationality,
prior education, work experience, age and gender). The professors then threw
tons of work on us. A well-functioning team could just about cope. Totally
impossible if working individually.

So we had no option but figure out how to work together, maximise the combined
value of each person's skills, and rely fully on each other.

A few teams exploded spectacularly. But most of us learned how to work as a
team and succeed under intense pressure.

~~~
chrisfinazzo
HBS still does this, as far as I know for first years ("learning teams").
Although you may be evaluated individually, success or failure is a team
effort when everybody brings something to the table.

------
solatic
I'm about to start a non-US MBA with an entrepreneurship/startup focus, night
school so that I can keep working and earning during the degree. Total cost
for me out of pocket, for two years of tuition, after various state (non-
employer) benefits, is roughly $3,500. Full cost for two years is a tad under
$20,000. I have the time, I'll pick up the networking and the skills, I can
pay for it out of pocket and without debt, so for that price - why not?

If I was faced with a six-figure price tag, I'd self-educate. The Internet is
a powerful resource. "Networking" isn't worth the cost of tuition when people
will come banging down your door to work with you after you've developed a
strong and proven track record for results.

------
bitL
Funny that UIUC's online iMBA on Coursera is exploding. I've read they went
from >100 to >2500 students in 4 years. That could have some effect on the
market?

~~~
nimz
In addition, UIUC closed their in-person MBA program not long ago. Maybe a
sign of things to come?

[https://www.insidehighered.com/quicktakes/2019/05/28/illinoi...](https://www.insidehighered.com/quicktakes/2019/05/28/illinois-
will-end-residential-mba)

------
mensetmanusman
A good MBA program will essentially teach people about the anthropology of
complex human organizations.

For example: how do you create or (even harder) change a culture that is
secretive towards one where people share more to improve rates of innovation?

How do you organize people to optimally interact?

How do you determine the potential value of expensive research projects (to
see if it is worth doing)?

Then you go over case studies over the last century and ‘hope’ to learn
something.

------
csmiller
I wonder if this means it’s any easier to get in. I guess that would defeat
the whole “networking” part of it.

------
notadoc
What value does an MBA provide today?

It used to be a way to accelerate a career path, but is that even the case
anymore?

------
thawaway1837
Based on the abstract (paywall), this is the much predicted impact of the
hostile environment being created in the US.

Since MBAs especially are largely network building institutions, this is a
situation where the clear losers are gonna be the educational institutions and
the US, because the Chinese and Indian students who would have otherwise built
an American network when trying to create their own businesses, largely in
their own countries, will now be building a Canadian one instead.

------
victor106
Anybody has link to a non paywall version?

~~~
achow
[http://archive.is/IpPls](http://archive.is/IpPls)

~~~
BlameKaneda
Thank you, sir/madam.

------
neonate
[http://archive.is/IpPls](http://archive.is/IpPls)

------
Havoc
In line with economic cycle. People go to biz school during downturns when
there are no good offers

------
dannykwells
I love these articles opining the end of thr MBA. All grad schools see a drop
in applications during times of low unemployment. Law is the same. This is not
due to any other factor, as much as people would like to believe.

~~~
notfromhere
There are also a number of quality universities shutting down their MBA
programs as well. It's not just because of the unemployment rate.

------
bluedino
They're blaming immigration and not the economy this time?

~~~
phalangion
My graduate program (computer-y, not MBA) has seen a huge drop in
international applications. That was the large majority of our graduate
program, and after 2016 those applications have dropped about 75%.

~~~
mattkrause
Meanwhile in Canada, international applications to McGill have shot up 50%.

The driving factor is pretty obvious....

~~~
mrmuagi
> The driving factor is pretty obvious....

As a Canadian I am stumped, surely people don't like cold weather :)

------
dinodub
This is good news for the planet's health.

Hopefully state legislatures, university administrators, and bankers will get
the signal-- the tuition versus value equation is makes less and less sense.
Especially with many free & low cost self-taught education options online, and
the debt burden facing millennials.

~~~
christiansakai
lmao, care to elaborate?

~~~
dinodub
yep-- The economic ethics and models espoused by business schools focus on an
economic system where companies are expected to maximise short-term gains
regardless of consequences.

A focus on profit over everything else. It's a matter of law as well-- heads
of companies are legally compelled to prioritize shareholder value.

~~~
NeedMoreTea
> It's a matter of law as well

That is simply not true. It's merely cargo culting the Friedman doctrine. It
has no basis in corporate law, and never has.

[https://en.wikipedia.org/wiki/Friedman_doctrine](https://en.wikipedia.org/wiki/Friedman_doctrine)

~~~
dinodub
I think you're right that it is a misconception that there is a legal
obligation to put shareholder value (profit) first. It seems that it's more of
a doctrine.

I was wrong to state it as a claim without any backing to my claim.

From what I am reading online (I am not a lawyer), it stems from a court case
"eBay v. Newmark"

"The Delaware court's decision in eBay v. Newmark has been viewed by many
commentators as a decisive affirmation of shareholder wealth maximization as
the only legally permissible objective of a for‐profit corporation."

[https://onlinelibrary.wiley.com/doi/pdf/10.1111/basr.12108](https://onlinelibrary.wiley.com/doi/pdf/10.1111/basr.12108)

"A 2010 decision, for example, eBay Domestic Holdings Inc. v. Newmark, held
that corporate directors are bound by "fiduciary duties and standards" which
include "acting to promote the value of the corporation for the benefit of its
stockholders.""

[https://www.nytimes.com/roomfordebate/2015/04/16/what-are-
co...](https://www.nytimes.com/roomfordebate/2015/04/16/what-are-corporations-
obligations-to-shareholders/a-duty-to-shareholder-value)

~~~
NeedMoreTea
That's very disturbing as there seems to be no basis in statute (IANAL
either). Course being Wiley I can't read beyond the abstract.

The FT has run frequent articles particularly, but not solely, US and UK
focused that appear to contradict that, including some quite in depth pieces.

Not the most definitive of the many they've run, but from first page of search
a US-centred piece from a US author, who's also a US lawyer:

 _But the controlling legal rule is universal and rock-solid: in every US
jurisdiction, boards are allowed to use their “business judgment” to pursue
ESG (environmental, social, and governance) principles for the purpose of
creating long-term corporate value_

Which is what you'd reasonably expect, as short-term pursuit of shareholder
value can be of extreme detriment to the longer term prospects of the company
- and therefore shareholders.

[https://www.ft.com/content/6e806580-d560-11e9-8d46-8def889b4...](https://www.ft.com/content/6e806580-d560-11e9-8d46-8def889b4137)

------
rajacombinator
I used to think lawyers were the class of people most damaging to society. (As
the political class.) Now after some recent up close and personal exposure to
MBAs, I’m not so sure. It’s a shame because it’s a degree that attracts a lot
of smart people due to its market value...

