Tuesday, May 6, 2008

Want to become a b-school prof?

Every month the Financial Times runs a few articles on business education. For example, today’s e-mail contained an article on a looming shortage of b-school faculty (due in part to retirement demographics) and also plans to convert English literature and math PhDs to become b-school profs.

Depressing stuff — we don’t have enough supply, in part because of the AACSB (and Business Week rankings) assumption that research output is a measure of faculty quality. (AACSB is particularly perverse in that they require faculty both to have a PhD and publish — presumably being smart enough to publish without a PhD doesn’t count).

One solution would be to raise wages, to attract the best and the brightest. At the high end schools (top 10), wages of $150K or $200K for experienced profs is not uncommon, although that goes much further in Ann Arbor or Bloomington than in Palo Alto or NYC. Of course, raising wages means raising prices, which means a wider spread in MBA quality: very expensive MBA programs taught by very expensive faculty, and very cheap MBA programs taught by cheap faculty. (Or worse yet, expensive MBA programs taught by cheap faculty).

Another possibility is to use experienced faculty without a PhD. A lynchpin of our entrepreneurship program is Steve Bennet, our venture finance prof who’s “merely” and adjunct. However, he’s an adjunct who’s been CFO of several startups, has lectured at Berkeley, and is a director of an angel group. But because he only has a UCLA MBA (and a Wharton undergrad), he depresses our “academically qualified” ratio.

In another FT article today, Pete Hahn, a British finance professor emphasized the importance of real world experience

I know that my first suggestion to anyone thinking about an MBA or executive education would be to ask prospective schools: “What percentage of your full-time faculty have experience in what they teach?”

Surely there could not be a better measure. And shouldn’t employers seeking new managers who can quickly make a contribution also be asking this question?

You would probably be scared to death if your surgeon told you she had learnt all her surgery from a book, or only read about your required surgery in a journal.
But of course, top students use the Business Week or FT rankings to pick their programs, not what they’ll learn
I interviewed top business school graduates for almost 20 years and when I asked candidates how they chose their MBA school, the answers were typically league table, senior colleagues had come from the school, salary scales, location and name recognition. Few, if any, knew about the academics beforehand. There was not even a passing thought about the quality of research or teaching, although those are my ambitions as I start my faculty career. A few business PhD students have intellectual curiosity, but they are now mostly trained to produce research (the money can be good) over thought and ideas.

But intellectual curiosity of MBAs themselves? Apparently not: they are investing in or perhaps registering at some of the most exclusive executive search firms. While I have the benefit of career perspective and know what would be of most value later on the job, most prospective students just do not want to make a mistake in their school selection.
Hahn himself had significant experience as Managing Director of Citigroup Corporate Finance in London (with a MBA from NYU).

When I was first on the job market, I got very smug about the value of work experience, but now I’m not so sure. Experience (or at least age) seems to be a negative predictor of “A” level research (which is needed to get tenure at a top 20 school). It seems completely uncorrelated to teaching ability — both to communicate and entertain. It does seem correlated (at least weakly) to the ability to be an administrator and make decisions.

Still, like Hahn, I think every school needs some of its faculty to have this experience. They could be industry types turned PhDs, or adjuncts. Or they could be very smart straight-through PhDs who’ve done consulting for real firms, whether to rake in the big bucks or to help their students launch an actual company. The key is to get your hands dirty.

He started a PhD about 10 years later than I did — with more experience, but less time to get a payoff from the training. In addition to customer disbelief, he found significant ageism among British hiring faculty. I didn’t see that — and when I raised it explicitly once (I’d been warned) it was quickly knocked down. Frankly, a fresh PhD in her late 30s is pretty common; early 40s is not uncommon, although beyond that is probably a risk if you want to work at an elite school.


Steve Bennet said...

Joel, thanks for the kind words. I posted a comment on my blog at http://professorvc.blogspot.com/

Joel West said...

The posting is at “Academically Challenged”