The boom, the bust -- the B-school application? As the telecommunications industry continues to shake out, the shock waves are beginning to hit B-school admissions offices. Even with the down economy having boosted applications from practically every industry by record numbers, admissions directors from Los Angeles to Lausanne in Switzerland are reporting a relative bulge in those submitted by downsized, defecting, or opportunistic former telecom employees.
MBA programs generally fill 5% to 10% of their classes with telecom representatives. But with the current cycle being "predicated by layoffs," says Linda Baldwin, MBA admissions director at UCLA's Anderson School, B-schools this year have read up to twice as many applications from the telecom sector as in the past. They've poured in to North American and European B-schools from such companies as the U.S.'s Lucent Technologies, European giant Vodafone, and Japanese equipment maker NTT DoCoMo. "If anyone has had a bad hangover, it has definitely been telecom," laments one refugee now in B-school.
That doesn't mean the MBA class of 2004 will be flush with WorldCom or AT&T alumni. Katty Ooms Suter, admissions director at IMD in Lausanne, says she won't give extra seats to phone-company types just because of an increase in applications. "I don't want more than 5% of the class to be from more than one industry," she says. John Mapes of the Cranfield (Britain) School of Management, where 12% of MBA students already are from telecoms, agrees: "I don't want to sacrifice class diversity."
Still, B-school officials welcome the influx of applicants with interesting -- if depressing -- stories to tell. "Their strategies, what didn't work, will provide very interesting insights [in the classroom]," says Baldwin.
That former telecommers have sought refuge from the front lines in the friendly confines of academe seems logical enough. The strange thing, perhaps, is how many of them want to go back to telecom after they pick up their parchments. "We don't see a lot of career-changers in those applicants," says Linda Meehan, associate dean for admissions at Columbia University.
Instead, they seem to be interested in tweaking their careers. Wiser for the wear, many telecom employees have decided that now is the time to sharpen their skills for a return to the industry "in a position that's perhaps not as expendable," says Baldwin.
Saurabh Mahajan, who spent the past five years working for Motorola, readily concedes that the down market prompted his decision to travel from Sydney, Australia, to begin the MBA program this fall at the University of Pennsylvania's Wharton School. Mahajan, 26, says he's committed to returning to telecom -- as an entrepreneur. Having spent the past couple of years working on third-generation mobile-phone technology in Britain and Australia, Mahajan wants to round out his skills in finance and marketing. "By the time I graduate, the infrastructure will exist for anyone who wants to launch a company," he predicts.
Many telecom veterans prefer to watch from the B-school sidelines as the industry figures out how to consolidate and reorganize. They're betting two years' worth of tuition and lost income on the idea that it's better to observe than participate. "It's a perfect time to unplug," says an eight-year telecom professional who'll start work this fall on his MBA at Rice University's Jones Graduate School of Management.
He says he's "90% certain" of returning to telecom after his two years at Rice, anticipating that the industry will then be leaner, meaner, and ready for its next growth spurt. Adds Mahajan: "Anyone who has worked in telecom has realized the potential for growth in this industry." Maybe, by the time he graduates, the telecom wagon will no longer be spinning its wheels.
By Brian Hindo in New York