After the release of the 2018 Application Trends Survey Report from GMAC, Liaison International’s Bob Alig talked to Michael Waldhier — admissions director of the Smeal College of Business at Penn State and a member of Liaison’s BusinessCASTM advisory board — about how Penn State had anticipated years ago the trends uncovered by the survey; namely, that international applicant interest in U.S. schools would decrease, that the strengthening U.S. economy would make it less likely for adults to return to school and that top 10 schools in the U.S. would broaden their pool to capture applicants who would otherwise consider going to schools like Penn State. Read on to learn more about how Penn State responded with strategic moves that have led to a stronger, more robust program even as other programs around the country are shrinking.
Bob Alig (BA): When the 2018 trends report from GMAC came out, it stated that “Regionally, most U.S. MBA programs of all types report declines in application volumes this year, including 70% of US full-time two-year MBA programs.” The actual statistics cited for U.S. MBA programs are sobering — for example, 70% of full-time 2-year programs and 53% of 1-year programs reported a decline.
CNBC reported recently that this downward trend has been attributed to factors including a decline in the value of the degree as the economy has strengthened, as well as rising tuition costs and even immigration policies (for international enrollments).
But you and your fellow BusinessCAS advisory board members actually anticipated these trends a long time ago. How did you see this coming?
Michael Waldhier (MW): About five years ago the MBA program here at Penn State did a study looking at the trends overall for education. The results even back then showed that if your program was in the top 10, your pool was growing and the number of applicants was growing. If you were in the top 11-25 or 11-30, you were flat to down in terms of admissions numbers, and if you were below that the results showed you were down significantly.
In other words, to counter the problem of declining enrollment, we recognized early on that top schools would have to start broadening their outreach to bring in prospects they might not have looked at before — and we knew we had to do that, too.
Of course, it makes sense. As the pool of applicants across the board gets smaller, you’re going to start offering incentives such as funds and scholarships to folks who otherwise might have gone to a different program.
I think it’s important to note that this year was one of the first years that all the top 10 schools saw declines in their application pools. I think that trend will continue, and that as applications drop, even the top 10 schools may struggle to keep their current levels of enrollment.
BA: So as the admissions director at Penn State’s MBA program, what did you do when you figured out which way the trends were starting to go?
MW: Because of what we learned from our study, we knew years ago that we had to start looking at ways we could entice top-tier candidates to come to us if we were going to be competitive in what was rapidly becoming an even more competitive marketplace.
We came up with a three-pronged strategy that has proven enormously successful for our program:
- We started offering fellowships. To help make sure students admitted to our program had the best chance possible of graduating and achieving their career goals, we looked at how we might relax other burdens in their lives. One thing we knew we could do right away was to offer financial support options that would allow more students to focus their attention on academics instead of worrying about how they were going to pay for tuition.
- We set an enrollment cap. Our program, which has always been small, used to take up to about 100 students a year. But we decided to limit the cohort down to 60 students. Most MBA programs don’t cap their enrollment, so that was an unusual step, but it’s paid off. For the last four years now we’ve been capped at 60. And each year, we’ve been able to get right up to that number, maximizing our enrollment numbers.
- We launched a specialty master’s program. We wanted to make sure people still came to Penn State and viewed it as a destination for graduate study. We also had to consider how to offset the revenue losses that came from slimming down the MBA and adding fellowships. So we launched a number of these one-year specialty master’s, which have proven to be extraordinarily successful. We had one that we launched two years ago that is almost at full enrollment already — very uncommon for a new program. We have two more resident specialty master’s starting this coming year. On top of all that we also have online programs that are attracting students as well.
BA: Do you recommend that other colleges take the same approach, especially in regard to the specialty master’s programs?
MW: To be clear, a number of other colleges and universities had launched these types of programs before we did. What I think made ours so successful was that we were very strategic about it.
We started by asking ourselves questions like, “How do we launch a program that fills a niche within the Penn State community, within Pennsylvania as a whole and maybe within the local area? How do we launch a program that helps support the goals of faculty who want to teach certain subjects? And finally — since after all we are a business college and we do use revenue as a measure of success in the marketplace — how do we launch a program that increases revenue?”
So if I could offer any advice to other programs, I’d suggest that they look at the portfolio of programs they offer and examine which ones are there because of strategic reasons and which ones were launched for no other reason than maybe there was a faculty member who was championing the idea or they just had the capability so they figured, why not? I think that a lot of schools could take a harder look at the “whys” behind what they’re doing and then fine-tune what they already have.
BA: How do you see BusinessCAS fitting into all this?
MW: As the application process and the prospective pool gets to be more competitive, we want to position ourselves to be able to reach as many of those prospects as we can. I think having BusinessCAS as a single point of communication and data analysis is going to be helpful.
The other thing I think BusinessCAS does really well is provide a wealth of data on people who aren’t necessarily captured in the GMAC annual trends report — for example, people who don’t take the GMAT. It’s not always a program requirement, especially for online programs. So those people typically get overlooked. Then there are the non-traditional students who are coming in with eight to 10 years of work experience into something like an executive program. All of these types of individuals may not be reflected in the GMAC report.
I see BusinessCAS as potentially a way to help us include people who may not be reflected in the GMAC report and to start to pull some interesting data out of that broader set of individuals. In that way, I see BusinessCAS helping us — and helping graduate management education over all — by giving us the ability to look through a wider, better lens at trends, so that we can in turn make more strategically based decisions in our efforts to stay viable and competitive.
If you’re looking to increase your reach, broaden your pool of applicants and attract the right candidates to your graduate management education programs, BusinessCAS can help. Learn more about how BusinessCAS can help you reach your enrollment goals atbusinesscas.org.