According to Harvard Business School professor Rakesh Khurana, U.S. business schools are fighting to be meaningful on multiple fronts. Khurana is known for his ongoing efforts to chronicle the changes in management education, most recently with his book From Higher Aims to Hired Hands: The Social Transformation of American Business Schools and the Unfulfilled Promise of Management as a Profession (Princeton University Press, 2007). But in 2013, his warnings about the decline of business schools have particular urgency. Most management schools are reporting a decline in the number of applicants for their two-year MBA programs; some students are flocking to one-year specialized degrees, and others are choosing to take courses online or on a part-time basis.
The reason has to do with diminishing relevance, argues Khurana. It is driven in part by the impact of globalization on business success. Aside from the sheer cost of earning a two-year MBA (tuition at Harvard Business School is US$53,500 per year), management school graduates are finding that their skills and training are not ideally matched to the needs of global corporations that have undergone rapid changes. Many of these companies are looking for business leaders who can help them expand in developing markets where the rules of engagement are quite different from what they might be at headquarters. They need leaders who can build coalitions with governments, nongovernmental organizations, and social activists.