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Business schools are catching flak from all sides. Corporate America has put them on notice that their MBAs aren't equipped to function in the business world. An older generation of students with work experience is demanding more practical courses for the $30,000 or more it will plunk down in tuition fees. And this year's crop of 75,00 MBAs faces a job market slimmed by recession and management layoffs.

Business school deans are well aware they have to change their product. But to do that, they must first shake up tenured faculties.

"They haven't necessarily been interested in the issues of corporate America, and now we have to say, Can you retool yourselves?'" says Richard West, 52, dean of New York University's

It's a formidable task, and one in which the ends largely justify the means, says the outspoken West, who adds, "You work leverage wherever you can get it." For years, West pushed unsuccessfully to make superior teaching as important as superior research in determining rewards and penalties for faculty. But it was only after Stern received a less-than-stellar rating in a survey of MBA programs by Business Week that faculty voted in the plan.

"It's frustrating that a silly survey got us to do what we should have been doing," West says.

His renovation program will gain momentum next Fall when the ribbon is cut on the Stern School's new $68 million building on NYU's Washington Square campus. There, 200 faculty and 1,000 full-time students - now scattered among three buildings - will meet under one roof.

"Structure can drive strategy," West emphasizes, describing how the new facility will reinforce his insistence on more classroom teaching time and more interdisciplinary thinking. "The faculty won't he able to avoid interaction."

Another disciple of change is William Mayer, 50, the short-lived dean of the William Simon Graduate School of Business at the University of Rochester in upstate New York. A rarity among B-school deans, Mayer is an investment banking veteran who served as president and CEO of CS First Boston Merchant Bank. He heads a research-driven faculty of 50 at Simon that has a star reputation in academia - but a decidedly low profile in the business world.

But Simon saw outsider Mayer as the right person to recast that image. For his part, Mayer found an ambitious makeover project hard to resist.

Mayer's ideas of what most needs to be changed in MBA education come from personal experience at the hiring end. "At First Boston, we paid top dollar for MBAs who could crunch numbers but couldn't manage people," he says. "I was amazed at how bright some were, but they had no common sense."

After eight months as dean, Mayer's sudden resignation illustrates the hazards of the profession during this era of re-examination and retrenchment. "When I accepted the position, I did so with the understanding that the Simon School was committed to making resources available to meet their expectations of going from the top 25 to the top 15," he says. "Unfortunately that isn't the case."

Mayer says that the issue wasn't the $1 million difference between his business plan for the current year and Simon's budget, but the long-term commitment to spend what it takes to, in effect, restructure the school. For example, Mayer says, four basic elements of an MBA program for the 1990s should include: more emphasis on leadership training; greater interpersonal skills; teamwork orientation; and international perspective. Getting from one level to another in these areas, he argues, requires changes in curriculum, hiring the right personnel (the case method and role playing require smaller classes), and using financial aid to lure top students.

"Many don't realize the magnitude of the competition," says Mayer. "My predecessor also ran into this."

Less focused on such concerns, it would seem, is Donald Jacobs, Dean of Northwestern University's Kellogg Graduate School of Management in Evanston, IL. Jacobs, 64, has a head start on most of his fellow business school deans, having begun to modernize Kellogg in 1979 when the doors opened on a pet project, the James L. Allen Center for executive education.

Nearly 4,000 senior executives from such companies as IBM, Hewlett-Packard and Motorola pass through Allen's programs each year. Together, they inject real-world business issues into the Kellogg curriculum. The school's faculty of 120 teaches both executives and some 1,000 full-time students. Its practical approach wins kudos both from the school's graduates and the corporations where they end up.

"We've remolded the faculty," says Jacobs, who has headed Kellogg for 17 years, an unusually long tenure for a B-school dean. "We hire young PhDs in a discipline and have them interact with executives from the Allen Center." Rookies don't teach in their first term at Kellogg, but the opportunity to eventually try out their research on business executives is a powerful incentive. "They get their feedback, and it's very rewarding for them," Jacobs says.

Kellogg also has proved that finance is not the only game in town. The school already boasts a top-notch marketing program. But now Jacobs is tackling longstanding complaints from manufacturers that MBAs don't understand their problems by launching a hybrid Master of Manufacturing (MMM) degree program in conjunction with Northwestern's engineering school.

The program aims to transform engineers into managers who are equally at home in the boardroom and on the shop floor. But its creation also offers an object lesson in the complexities of curriculum change. At other B-schools, joint programs often erupt into interdepartmental turf wars. From the start, however, Kellogg's MMM initiative had the support of both Jacobs and Dean Jerome Cohen of the McCormick engineering school.

The program, which includes such new courses as "Simultaneous Engineering" (this covers the integration of product design and manufacturing), was reconfigured four times in the first 18 months. It is still being fine-tuned with practical input from companies like Honeywell and IBM. The first MMM class will graduate this spring, but the results will be slower in coming.

"We look good, but I don't want to claim success yet," Jacobs cautions. "We'll know five years from now."

Perhaps too late to help the Class of '92: West of NYU points out that of the 75,000 MBAs entering the job market right now, only about 9,000 will be from the top business schools. But at Kellogg, the newfangled curriculum may already be brightening prospects somewhat. As of mid-march, half the school's MMM grads had nailed down jobs at salaries ranging from $55,000 to $100,000.

In another innovation, business schools are offering one-year programs as a way to differentiate themselves in the market.

Even so, the long-term implications are clear. Banking and Wall Street will hire fewer MBAS. Kellogg's Jacobs predicts companies doing the hiring will be more middle market - smaller but growing - and more entrepreneurial. "And they'll hire one or two MBAS, not ten or twelve," he adds.

The business schools that successfully meet the challenge, he maintains, will be those that quickly institutionalize change. The Simon School's Mayer predicts a massive shakeout with as few as 75 of an estimated 900 schools making the cut.

Says he: "Only the best will survive."
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Copyright 1992, Gale Group. All rights reserved. Gale Group is a Thomson Corporation Company.

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Title Annotation:business schools urged to upgrade curricula
Author:Rehak, Judith
Publication:Chief Executive (U.S.)
Date:Jun 1, 1992
Words:1196
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