The End of Business Schools?

November, 2002

Students must take a more active learning role, says professor.

BY KATHLEEN O'TOOLE

Professor Jeffrey Pfeffer

IT'S NOT QUITE like predicting the apocalypse, but a GSB faculty member and graduate student speculated recently on some emerging problems that threaten the continued success of business schools as we know them. In the inaugural issue of an academic journal, The Academy of Management Learning and Education, Professor Jeffrey Pfeffer and doctoral student Christina Fong say people want management education more than ever. In the future, however, they may obtain it from alternative suppliers unless academic business schools shore up their curricula and methods of teaching.

Pfeffer and Fong’s analysis of the business education industry generated media reports, most of which focused on the article’s assertion that there is little or no evidence that an MBA degree increases a person’s later earnings. The critique is not specific to any school and partly reflects the vast growth in the number of MBA degrees granted annually in the United States, from around 3,000 in the mid-20th century to more than 100,000 today. The degree also has caught on in Europe and Asia. “It is actually one of the larger U.K. export industries,” Pfeffer noted in a conversation with Business School staff in late July.

Pfeffer, the Thomas D. Dee II Professor of Organizational Behavior, conceded that average post-degree salaries for GSB graduates were substantially larger than pre-degree salaries. “The data are clear that if you are going to go to a business school [to increase earning power], you had better go to a top-10 one,” he said.

But he added that there are other paths to workplace promotions and people should not come to the GSB unless they are prepared to be “active participants” in their education. He summed up years of education research this way: “To the extent you are a passive recipient of information, you don’t retain very much.”

Students too often sit in class “expecting to be entertained” by lecturers, he said, and “the faculty is often extremely complicit in this” passive style of learning, which is associated more with colleges of arts and sciences than it is with other professional schools, such as law and medicine. He praised Business School Dean Bob Joss and Associate Dean David Kreps for taking steps to add clinical or experiential components to the curricula over the next several years. “I think there is a serious effort going on here to broaden, enrich, modify, and change the educational experience to make it more true to what we know it should be.”

Pfeffer noted that much of what he and Fong concluded about teaching in business schools is not new. In 1989, Professor Emeritus Harold Leavitt made similar arguments, he said, and the Association to Advance Collegiate Schools of Business, the accrediting group, has said similar things in reports dating back to the early eighties. Business schools may have more incentive to change now, he added, partly because “the MBA market has overexpanded, and there are many more competitive providers of management education and research than there used to be.”