Demand for new Online MBA is soaring—and bucking national trends.
By Andrew Thurston
The full-time MBA has been in trouble for some time. Applications were down at more than half of schools in the United States in 2019, according to the Graduate Management Admission Council. A growing number of lower-tier programs have even been closing due to lack of demand: some businesses no longer insist on an MBA, while lower-priced offerings from schools in Europe, Canada, and Asia have stiffened competition for overseas students. And that was before the COVID-19 pandemic shuttered campuses, grounded international flights, and sent the global economy into a tailspin.
But Questrom’s newest MBA is disrupting the crisis narrative and defying the bleak national outlook.
Questrom’s Online MBA, launching this fall in partnership with global online education platform edX, is in demand; it’s also on course to have the most experienced students of any of the school’s programs. Even before BU announced the new MBA in July 2019, edX had already received 10,000 requests for an online MBA, according to Susan Fournier, Allen Questrom Professor and Dean. In May 2020, the school increased the initial cohort from 200 to 400 students to “capitalize on the quality of applicants and levels of demand,” says Fournier; even with the increased number of spots, the waiting list is in the hundreds. Fournier predicts admitting a similar number next spring. By 2023, she says, Questrom hopes to have more than 1,000 Online MBA students—more than in its on-campus MBA programs.
Although online MBAs have been around for a while, says Fournier, most are simply digital versions of existing residential programs, with similar courses and price tags. Questrom’s Online MBA is different, she says. The school is building a completely new curriculum, for a new target audience—and offering it at a significantly lower price than its on-campus MBAs.
“The residential MBA has a 50-year history,” Fournier says. “It’s steeped; it’s a ship you can only move so much at a time. Every school wants to reboot—but when you look at all those reboots, they’re largely incremental. That’s reality: it’s way easier to completely reimagine something when you start from zero and nobody has a vested history.”
The Questrom Online MBA dispenses with subject-specific courses like finance and marketing in favor of six interdisciplinary modules focused on business problems, such as managing performance with data, leading with integrity, fostering innovation, and managing risk—a module that Fournier says is “particularly relevant for the managerial toolkit as we are learning from the COVID-19 crisis.” Each module takes about 15 to 20 hours of work per week, which includes virtual office hours and team assignments; the MBA can be completed in as little as two years. Unlike Questrom’s residential MBA, there are no in-depth specializations, no on-the-ground internships. And then there’s the cost: $24,000. Fournier calls it a paradigm shift.
“We are targeting a different consumer segment,” she says, “so the product also has to be different to meet their experiences and needs.”
Fournier says the Online MBA is targeted to midlevel career advancers and global learners who can benefit from an interdisciplinary curriculum. That’s different from the existing on-campus programs, which tend to attract young professionals aiming to switch careers or jobs: those students are more likely to want tailored degrees with specializations such as health or digital technology and electives focused on different functional areas. “The full- and part-time MBAs also want to be on campus,” says Fournier, “and seek the benefits of in-person networking, personalized career support, deep engagement with faculty, and more hands-on, integrated project work.”
That’s why, she says, the Online MBA hasn’t diverted applicants from Questrom’s on-campus degree programs. The average age of admitted Online MBA students is 37, compared to 28 for the full-time program; they have 12 years of work experience compared to 6 for full-time MBA students. Less than 5 percent expect to use the Online MBA to change careers.
In fact, despite the COVID pandemic placing a giant question mark around fall college admissions—and the troubles plaguing the US MBA before the coronavirus crisis—applications to Questrom’s full-time program, which typically has a class size around 130, are up 17 percent over last year. Historically, tough economic times have tended to push MBA applications higher as people reassess their career paths and position themselves to take advantage of a future recovery. Fournier says the work-from-home and remote learning experiences forced by COVID lockdowns have also thrown the pros and cons of online and in-person learning into perspective.
“Learning online is a very different experience,” says Fournier. “We all now understand that it can be good and it can be efficient, but for many of our students—notably those in the residential programs—they have come to realize that in an online-only program, there are things missing. The crisis has helped to refine and educate consumers as to what the value propositions are in the different approaches: everyone has a reservation price that they’re willing to pay for that value proposition.”
She says the crisis has also helped the school consider ways to further improve, evolve, and differentiate its on-campus curriculum, career support, and teaching methods to better fit the needs of the career switchers it attracts.
“I suspect that the Questrom $24K MBA will end up improving BU’s place in the global MBA rankings,” wrote Kim, director of online programs and strategy at Dartmouth College and a senior fellow at Georgetown University’s Center for New Designs in Learning & Scholarship. “By offering a high-priced and small-scale residential MBA alongside an unbundled online MBA, BU is experimenting with brand segmentation.”
Kim made his prediction before the coronavirus crisis, and before the United States embarked on the biggest, and largely improvised, remote education experiment in history. Back then, many pundits described Questrom’s Online MBA as a bold gamble.
“Yes, we took a big risk, but we did our best analyses and really believed in our segmentation—and, per the data we now have, we were right on our bet,” says Fournier. “Because of the coronavirus, many consumers are also more comfortable with online, as are our faculty, and this has helped as well.”
Questrom has seen demand for the Online MBA tick higher during the crisis—it’s one of the reasons the school decided to increase the number of available spots. According to Paul R. Carlile, senior associate dean of online learning, there’s only one other “low-cost, high-scale MBA in the world”—at the University of Illinois—“so there’s a lot of pent-up demand.” And, says Barbara Bickart, senior associate dean of graduate programs, expanding the class size hasn’t come at the expense of student quality.
“The applicant pool is highly, highly qualified and accomplished,” she says. “They’re people who have a real need in terms of the flexibility and how an academic program fits into their life, who are thoughtful and smart—they’re people you would want to have in your alumni network.”
“BU has a very strong brand globally,” adds Fournier. “There are people all around the world that would love to engage as members of our community but, for whatever reason, cannot. If they otherwise wouldn’t be coming at all and we have an offering that works for them, then we are doing our job understanding the marketplace and creating value for the world.
“This is part of a product portfolio of MBAs and we want all prospective students to look at all of them and find the one that’s right for them.”