The economic crisis that has already laid waste to the endowments and reputations of elite business schools now threatens to transform them yet again, this time by making them, well, a little less elite. A third of the top 30 U.S. business schools became less selective when admitting applicants to their full-time MBA programs in 2010, according to data compiled by Bloomberg Businessweek.
While many schools, including the University of Chicago Booth School of Business (Booth Full-Time MBA Profile), Harvard Business School (Harvard Full-Time MBA Profile), and Northwestern University's Kellogg School of Management (Kellogg Full-Time MBA Profile), became more selective or reported no change, many others did something that top MBA programs rarely do: They became easier to get into. The University of Michigan's Ross School of Business (Ross Full-Time MBA Profile), UCLA's Anderson School of Management (Anderson Full-Time MBA Profile), Indiana University's Kelley School of Business (Kelley Full-Time MBA Profile), and the University of Maryland's Smith School of Business (Smith Full-Time MBA Profile) all admitted a significantly larger percentage of applicants in 2010 than they did in 2008, when the recession-era B-school application boom was at its peak.
Behind the Change
For many, the reason is a decline in applications that's forcing some schools to be less picky. During the recession, applications to business schools grew, but that trend appears to have run its course. Of the 476 MBA programs recently surveyed by the Graduate Management Admissions Council (GMAC), 47 percent reported a decrease in applications, with 9 percent reporting a decline of more than 20 percent over 2009.
And there's fear among admissions directors at top programs that it could get worse, says Joe Fox, associate dean for MBA programs at the Olin Business School (Olin Full-Time MBA Profile) at Washington University in St. Louis, which has bucked the trend by becoming more selective. In 2010, 29 percent of Olin applicants won admission to the MBA program, down from 54 percent in 2006.
"The early expectation is that this will be a tepid year for applications," Fox says. "It's still early, but people are less than enthusiastic, and turnout at admissions events has been lower."
At the University of Michigan, one reason selectivity slipped—from 20 percent in 2008 to 25 percent in 2010—may be Ross's new business-school building, which opened in January 2009, says Soojin Kwon Koh, director of admissions at Ross. The new building allowed the MBA program to grow from 430 to 500 students per class, she says.
"We like to keep selectivity low to make sure we get good people, but selectivity is not something we actively try to bring down," says Koh. "At the end of the day, we need 500 great people. If I get 500 great applications and selectivity is 100 percent, I'm okay with that."
Having gone from accepting 28 percent of applicants in 2008 to 38 percent in 2010, Maryland's Smith School experienced the greatest decrease in selectivity among the top 30. The school sees this change as a positive and attributes its dramatic drop to better marketing of its program, wrote Robert Krapfel, associate dean of MBA and MS programs at Smith, in an e-mail. He added that the school increased its class size by 28 students, or 22 percent, in 2010 while improving its quality, and that the size of the applicant pool has remained constant in recent years, except for a jump from about 1,000 to 1,200 applications in 2008.
"When more high-quality people apply, you can admit a higher proportion of them, and this is what we strive to accomplish," Krapfel wrote.
Bucking the Trend
Not all schools saw selectivity slip in 2010. The University of Notre Dame's Mendoza College of Business (Mendoza Full-Time MBA Profile) accepted 33 percent of applicants in 2010, down from 37 percent in 2009 and 34 percent in 2008. Although he's confident that Mendoza would not lose its selectivity edge, Brian T. Lohr, director of MBA admissions, says the prolonged sluggishness of the economy could mean fewer MBA applicants overall and less selective admissions down the road.
"Anytime the economy struggles and people are let go from their jobs, they have a chance to reevaluate their careers and consider continuing their education," says Lohr. "When the economy is down too long, people hunker down in their jobs. That could mean fewer applications for graduate business schools."
Georgia Institute of Technology's College of Management (Georgia Tech Full-Time MBA Profile) also became choosier about applicants in recent years. Paula Wilson, director of MBA admissions, says Georgia Tech admitted 38 percent of applicants in 2005, but in 2010 only 20 percent landed a spot.
Aligning Goals With the Job Market
Starting in 2004, applicants who wanted admission to the program had to interview with both Wilson and her counterpart in career services. The idea, says Wilson, was to make sure the applicant's career goals were in line with the capabilities of the career services team. The program also decreased its class size from 100 to 75 students per class. Those efforts have become more important since the financial crisis, when the MBA job market deteriorated, she says.
"We want to help them achieve an MBA and their career goals," says Wilson, who adds that the school no longer accepts candidates seeking in careers for which the school has no contacts for job placement, even if their applications are otherwise strong.
At Cornell University's Johnson School (Johnson Full-Time MBA Profile) in Ithaca, N.Y., selectivity has been on a two-year slide, from 19 percent to 22 percent, to 23 percent of applicants in 2008, 2009, and 2010, respectively. Randall Sawyer, assistant dean of admissions, financial aid, and inclusion, notes that it's still a far cry from what it was in 2007, when the Johnson School accepted 26 percent of candidates.
One reason for declining selectivity, says Sawyer, is that candidates are getting smarter about where they apply, giving admissions committees fewer but better choices—candidates who are all a good fit for their programs.
"We always try to be as selective as possible," he says. "There are so many great schools for great candidates. In some ways, this is a competition."