Student Uprising

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THE COMING B-SCHOOL SHAKEOUT

Does the growing demand for entrepreneurial education spell trouble for the big-name business schools -- and opportunity for programs trying to overtake them?

Our business is no different from any other," says Joseph Morone, dean of the Lally School of Management and Technology at Rensselaer Polytechnic Institute, in Troy, N.Y. "You've got entrenched players, and once the environment starts to change, that creates opportunities for other players. There's a big opportunity out there right now. We're at the front end of a major period of shakeout. Some business schools, as in any industry shakeout, are changing faster than others."

And as in any industry shakeout, change may be toughest at the top. Despite widespread shifts in the economy, the elite schools still see their reputations as being tied to the traditional goal of turning out graduates who go on to Wall Street, nationally known consultancies, and large corporations at which they are paid high beginning salaries. Many of the better-known rankings of business schools reinforce those old values. The median starting salaries of graduates, for instance, weigh in strongly on some rankings, as do the opinions of recruiters from large corporations -- hardly measures of any relevance to the increasing number of students looking to start companies, not careers.

While many deans and faculty members quibble with the details of the methodology used in the rankings, few deny their eagerness to have their schools be among the chosen. Even the most prestigious schools are not immune. "Over the last five years there's been a great deal of anguish and ferment at Harvard because of its declining ranking," says Jeffry A. Timmons, who formerly held a joint appointment at the Harvard Business School and Babson College, in Wellesley, Mass. (Timmons left Harvard in 1994 and is currently the Franklin W. Olin Distinguished Professor of Entrepreneurship at Babson.) "The bottom line," says Timmons, "is that the marketplace does pay attention [to the rankings]." Unfortunately, that means schools may give entrepreneurial education -- and the goal of sending grads into businesses of their own -- short shrift.

That's not to say that the brand-name business schools have ignored the growing interest in entrepreneurship -- it's just that there are established institutional forces stacked against serving it well. Though you'd be hard-pressed, for instance, to find a major school that hasn't started an entrepreneurship program of one sort or another, the programs and their champions are treated like second-class citizens. "The response to student demand has been to staff entrepreneurship programs with seasoned practitioners -- individuals who generally are not given academic recognition and certainly do not have substantial influence on defining a broader curriculum in response to student needs," says Robert S. Sullivan, who left the deanship at Carnegie Mellon University's Graduate School of Industrial Administration in May 1995 to take over the helm of the much smaller IC2 Institute at the University of Texas. "Existing curricula," Sullivan says, "represent the interests of tenure-track faculty."

Morone agrees, citing "the tyranny of disciplines." He explains: "The way you get ahead in academia is by establishing yourself in a network of professionals in your discipline. When a field or a problem area comes along that cuts across disciplines, as entrepreneurship does, there's no natural home for it in the university. It runs against the grain of the very well entrenched disciplinary reward structures."

With the elite business schools tied to tradition, the slack is being taken up by schools that don't have the high rank or Wall Street feeder system that a dramatically new educational approach might jeopardize. They see an opportunity to focus scholarship on the real-world problems of new businesses. "That requires stepping out of the box," says Sullivan, "admitting what we don't know, and creating new learning methodologies for understanding start-ups."

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