An article in The Star (Toronto)
Taking the MBA plunge
Those who enter program now will be ready and waiting when economy and good jobs come back
When the business world slows down, applications to MBA schools go up.
It's no secret these are difficult times in the business world. Companies are cutting jobs and freezing hiring, and stock markets are way down.
Still, MBA schools say that applications are way, way up. Those who take the plunge into an MBA program, which can cost as much as $65,000 for Canadian students at top-tier schools, hope to acquire skills that will put them at an advantage when the economy rebounds.
MBA schools are doing their best to bring discussion of the latest events into the classroom – whether it's falling stock markets, mass layoffs or directors who were asleep at the controls – as they help educate the next crop of business leaders.
At the Rotman School of Business at the University of Toronto, applications for the full-time MBA program at up by about 10 per cent to 1,500 this year. That's for about 260 spots.
"People are thinking now is a good time to go back to school because it's not a good time to get a job," said Richard Powers, associate dean and executive director. "And they want to be in a better position to find an interesting job in an industry that they want that's being compromised right now."
In the part-time programs, which take three years to complete, the number of applicants is flat. These mid-career recruits would typically get financial support from their companies, as well as flexibility in their work schedules – two things that may feel like big requests these days.
"The companies just don't have the training budgets. MBA programs are expensive," Powers said. "Secondly, people just don't want to be leaving early and arriving late in a time when people are being let go."
MBA classes typically draw from the business world to illustrate management theory. That's especially the case in times like these.
"As a school, we talk about it amongst the faculty in terms of how can we make this real and relevant to the students.
"Then it's up to the faculty members to bring this into their classrooms," said Eric Morse, associate dean at the Richard Ivey School of business at the University of Western Ontario.
Ivey is case-based, meaning that through hundreds of case studies, students are immersed in real problems and challenges faced by real companies at a point when management decisions could make or break the firm.
"We have these live cases. We bring in a business person who might say, `I have to make drastic cuts in my budget. Where should I be doing that?'" Morse said.
The headlines make the education seem more relevant, but it doesn't change the basics, said Scott Carson, director of the Queen's School of Business at Queen's University in Kingston, Ont.
"What it doesn't change is the structure of good management education where it is essential to develop in people a clear understanding of how to formulate strategy or good human resource policy," Carson said. "We're always going to be teaching those kinds of things, but because the context is so dramatic it shapes the way discussions go in class."
This year, Queen's expects to get about 3,700 applications for the one-year program's 75 spots.
That means more competition on the way in – and the way out.
With companies cutting back, students who graduate during the recession will be competing for fewer jobs.
Schools are helping students take the long view.
"It's important for people to recognize that taking an MBA is not like going to plumbing school or being a pipe fitter.
"We're looking for long-range value-added and the aim of the program is to make students better able to move forward in their careers over the long run, not whether they can get a job by July," Carson said.
Joseph Palumbo, executive director career development centre at the Schulich School of Business at York University, puts it this way: "In times of economic slowdown, there's no better time to invest in yourself.
"We're teaching people how to accept and understand various points of view so they can make better decisions; we're teaching listening and flexibility; we're teaching team-building and how to go forward in a very uncertain world."
Regardless of the economy, getting the degree sends a message.
"It tells people that this is somebody who's willing to learn" and to invest in himself "for life," said Palumbo.