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Specializing in Success: Specialized MBA Programs Are Meeting the Demand for Focused Grads

Providing good customer service sometimes means knowing that you can’t serve everyone, says Michael Knetter, dean of the School of Business at the University of Wisconsin–Madison. “A lot of business schools are willing to say, ‘We can do whatever it is you want,’ but we know we can’t and we’re comfortable with that.”

Thanks to some fundamental program changes, which did away with the school’s general management track and focused its MBA curriculum on preparing students for specific business careers, UW–Madison is now limiting who it wants to count as customers. “We know we’re not for everyone,” Knetter says. “The student best suited to our program is one who has a clear idea of what they want to be when they grow up. We think this type of person will get the most out of an MBA degree.”

UW–Madison’s new MBA program is designed to enable students to delve into one of 14 career specializations, ranging from applied corporate finance to real estate and urban economics. Every prospective MBA student must apply directly to one of these specializations.

Along with benefiting a distinct group of business students, the change is intended to help set UW–Madison apart from the growing pack of MBA providers.

“Strategy is all about making choices, and we have made them,” Knetter told UW–Madison’s alumni magazine, Update. “We have made a conscious choice to be the best program available for students with a clear career objective. By making the choice to serve that specific segment of the market, we can serve them better than anyone else.”

UW–Madison isn’t alone. Numerous business schools the world over have changed their programs and curricula in hopes of better serving a specific slice of the management education pie. Some have paired the MBA with another degree, such as engineering, information technology management, or even education. Others have added a wide range of specialized MBA courses and programs to their educational offerings so that now, in addition to marketing, finance, and other traditional business concentrations, students have the option of “majoring” in everything from agribusiness to aviation.

“We’re attracting people to our program who probably wouldn’t enroll in any other MBA program,” says Elaine Seat, director of the new and highly specialized aerospace MBA program at the University of Tennessee–Knoxville’s College of Business Administration. “Twenty percent of our curriculum is unique to the aerospace industry.”

No More “One Size Fits All”

Deviations from the standard two-year MBA program began surfacing more than two decades ago, as business schools began offering part-time, weekend, and accelerated business degree programs. Although different in format, these programs were all built upon similar broad-based management frameworks.

It wasn’t until 1990—when the Association to Advance Collegiate Schools of Business (AACSB International) added more flexibility to its accreditation standards—that true MBA curriculum change began to occur. Encouraged by AACSB International to create their own institutional missions, business schools began using curriculum reform and other changes to distinguish themselves from the competition.

Over time, specialties have emerged. Northwestern University’s Kellogg Graduate School of Management, for instance, is known for its ability to turn out first-rate marketing talent. Its neighbor, the Graduate School of Business at the University of Chicago, has a reputation as a top-notch finance school.

Today, the growing competition in management education, accentuated by the success of for-profit universities and other new players in the MBA field, has made it even more important for a business school to find its niche.

This may be particularly true for smaller regional schools, such as Lehigh University in Bethlehem, Pennsylvania. “We are in a pretty competitive market overall,” says Dick Durand, dean of Lehigh’s College of Business and Economics. “We have Wharton, Temple, Rutgers, Columbia, NYU, and Pitt all near us.”

Rather than attempt to compete “head-to-head” with these larger, better-funded players, Lehigh decided five years ago to focus on providing “niche-type programs,” Durand says. These include graduate certificate programs in project management and supply-chain management. By focusing on timely business topics and using distance-learning technology and flexible course schedules to attract busy working adults, these new programs have enabled Lehigh to compete more effectively, Durand says.

Although it will continue to offer a general management track, the Whitman School of Management at Syracuse University has decided to focus its resources on three content areas—entrepreneurship, accounting, and supply-chain management—in addition to its distance-learning MBA program.

“We used to operate from the position that we could do everything—marketing, finance, accounting, etcetera—equally well,” says Nicholas Wegman, the Whitman School’s executive director of marketing and career development. “But we now understand we can’t. Identifying focus areas has helped us align our priorities. We now know how we want to be perceived and where we should invest our resources.”

In the mid 1990s, Queen’s University School of Business in Kingston, Ontario, Canada, realized it needed to transform its small MBA program or risk extinction. Rather than add a few new courses here and there, the school took a huge gamble: It traded in its longstanding two-year MBA for an intense 12-month program open only to students with a background in science and technology.

“At that time, all the MBA programs were starting to look the same,” says David Edwards, director of business career services at Queen’s University Business School. “We wanted to differentiate ourselves.”

Lauded for its ability to turn scientists and engineers into well-rounded managers, Queen’s MBA for science and technology was ranked number one in Canada and number two in the world among non-U.S. schools in the 2002 BusinessWeek rankings.

Seeking its own competitive edge, the University of Oklahoma’s Price College of Business recently added a handful of new concentrations, including one in energy management—a logical move for a school located in the heart of the petroleum industry. It also joined forces with the university’s engineering school to create a dual-degree MBA–master of science in industrial engineering program.

“Just as we were telling our students, we had to figure out how to stand out from the competition,” says Mel Penn, MBA corporate relations executive at Price College.

From Agribusiness to Aviation

Business schools have offered specialty business degrees—such as master of science programs in accounting or information technology management—for many years, but the number and range of such programs are expanding as the trend toward specialization grows around the world.

For example, HEC School of Management in France now offers 12 specialized master’s programs in business-related topics for young managers, including law and international management and entrepreneurship. The Cranfield School of Management in England offers master of science degrees in innovation leadership, international human resources management, finance and management, logistics and supply chain management, and strategic marketing. The Hong Kong University of Science and Technology Business School offers master of science degrees in e-commerce management, investment management, and information systems management.

In addition, a growing number of schools are creating MBA programs that cross into health care, agribusiness, sports management, information technology, international business, hotel and leisure management, and other industries.

Determining the exact number of specialty MBA programs out there today is difficult because many of these programs are called an MBA but are marketed to specific groups, such as physicians or lawyers, says Dan LeClair, director of knowledge services at AACSB International.

Still, LeClair says his organization is seeing an increase in the number of schools moving toward offering some type of niche MBA program. “If you look at brochures for schools in Europe and Asia, you see more offering an MBA in a particular subject, such as information technology or agriculture,” LeClair says. “This can make the MBA space fairly confusing because it blurs the distinction between specialized master's programs and an MBA.”

In China, where more than 60 universities have been granted permission to launch MBA programs, business schools are racing to add industry-specific courses to their curricula. Beijing Institute of Technology, for example, now offers MBA programs specifically designed for the manufacturing and government sectors. In 2003, Beijing University of Aeronautics and Astronautics (BUAA) created an aviation MBA, the first of its kind in China.

“It is the age of brand-name competition, and professional MBAs designed for specific sectors are the best approach to brand-name building in China’s MBA schools,” Liu Zhixin, director of the International Trade and Finance Department at BUAA’s Economics and Management Science School told the Business Daily Update in September 2003. “Specialized MBAs are becoming more popular than general MBAs because they are more practical.”

Another factor driving this trend, AACSB International’s LeClair says, is the “heightened realization that management skills are important, regardless of your profession." This certainly seems to be the case with the many health care–related MBA programs on the market.

“Given the mega-changes in the health care industry, there is an increasing number of physicians who want to immerse themselves in the business of health care,” says Michael Stahl, associate dean and director of UT–Knoxville’s physicians EMBA (PEMBA) program.

The program’s students, all of whom are working doctors located around the world, convene on campus for four one-week sessions and meet online every Saturday throughout the course of 12 months. Although built upon a standard MBA curriculum, the program’s content is focused on issues and cases relevant to the health care industry. Says Stahl, “We can talk about the role of government regulation in an industry but then talk specifically about privacy rules surrounding HIPPA,” the Health Insurance Portability and Accountability Act of 1996.

Edward Diamond, a physician in Elk Grove Village, Ill., and founder of the Suburban Lung Association, says he chose the PEMBA program over a more general executive MBA because it allowed him to network with other doctors. He also liked the idea of focusing on content specific to his profession.

“There is a limit to how much you can digest and you simply don’t retain content that you don’t use,” Diamond says. “In the PEMBA program, I was able to apply my learning to my work throughout the course.”

UT–Knoxville’s aerospace MBA is similar to the school’s PEMBA program in that it applies core business principles to a particular industry. Although aerospace executives were involved in the creation of the program, the business school has had to work hard to educate its customer market on the benefit of an MBA degree targeted specifically to the aerospace industry.

“There has been a huge educational curve,” Seat says. “When you start a niche program, the big job is educating the target audience about how the degree can be life changing.”

Tapping into the University

The University of Michigan Business School is taking a somewhat different approach. Rather than creating specialized MBA programs, the school now allows students to customize their MBA education on the basis of their career and personal goals. So, in addition to standard core courses, Michigan MBA students are able to pick from a long list of electives, including some taught outside the business school. They also have the option of choosing from 20 programs that combine an MBA degree with one in education, architecture, urban planning, social work, health care, engineering, and a host of other disciplines.

“This is one of the things we talk about when we reach out to prospective students,” says Kris Nebel, Michigan Business School’s director of admissions. “Michigan sits in an amazing position because of the strength of the university’s many graduate programs.”

Other business schools are also working to tap into the resources of their university systems. The University of Pittsburgh’s Katz Graduate School of Business, for instance, recently teamed up with the university’s schools of medicine and engineering to create an MBA–master of science in bioengineering dual-degree program for managers interested in the intersection of business, medicine, and engineering.

“We are looking to the future with bioengineering and feel we are uniquely positioned to offer this program,” says Barry Kukovich, director of communications at the Katz School. “Not every university in the country has a medical school, and those that do, don’t have one as renowned as our medical school and hospital system.”

The Tepper School of Business is changing its full-time MBA program to better leverage Carnegie Mellon University’s reputation as a technology powerhouse.

Starting in the fall, the school’s full-time MBA students will have the option of engaging in one of eight in-depth “tracks” that are taught in tandem with other schools on the Carnegie Mellon campus. Among the choices to explore are asset management, biotechnology, e-business technologies, and computer science.

“We wanted to improve the content of our MBA program and came up with the idea of creating a collaborative space between business and technology,” says John Mather, the Tepper School’s executive director of master's programs.

“A lot of schools will dial up the engineering school and ask a professor to come over to the business school to teach a course, and they will call that a technology track,” Mather adds. “We send students outside of the business building to become fully engaged with the faculty and students of other schools.”

Wanted: Career Focus

Preparing students for the post-MBA job market was a main impetus for UW–Madison’s 14 career specializations. “The industry has been producing too many generalists relative to what is needed,” Knetter says.

Although UW–Madison has offered specialized MBA programs for many years, students have had the option of earning a general management degree—until now.

“The student satisfaction ratings and placement outcomes that we saw out of our specialized programs were far superior to what we found in our general management program,” Knetter says. “So we are doing more of what we did well and getting rid of what we weren’t doing as well.”

Increasingly, recruiters are looking for MBA students who can fill specific roles within their organizations, says Price College’s Mel Penn. “As more companies convert to ‘just in time’ hiring, they are hiring for a particular job or need as opposed to hiring a class of students.”

This has made it even more important for business schools to offer students the opportunity to specialize, says Queen’s University’s Edwards: “Overall, the recruiters we speak to seem to be looking for people who have a deep understanding of a specific industry or product because, compared to a generalist, these people can add more immediate value when they start working.”

Boston University’s (BU) School of Management has watched the students in its dual-degree MS-MBA program—which integrates business and technology fundamentals—excel in the job market. Jennifer Lawrence, the school’s assistant dean for career services, uses two MS-MBA graduates recently hired by Citigroup as an example of how BU’s new dual-degree program is resonating with recruiters. Looking for managers with broad-based management training and strong technical skills, Citigroup reviewed the résumés of 200 MBA students from 15 business schools. In the end, the company hired only two people, and both were from BU’s MS-MBA program.

“We have many companies tell us that they can find MBAs easily and technology folks easily, but it is extremely difficult to find potential business leaders who also have a strong grasp of information technology,” Lawrence says.

Becoming an expert in a specific industry or job function seems to be helping students land a job after business school, but many would argue that being well versed in core business principles is just as important—at least in the long run.

“A broad-based general management education will enable MBA graduates to one day be able to rise to the top of their organizations,” says Al Cotrone, director of the office of career development at Michigan Business School. “But they do have to get into the field first, and that is where if you can combine a strong general management education with the ability to focus your learning, you can provide students with what they need to get into the field and hit the ground running.”

Carlotta Mast

GMAC
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