didn't have enough capacity to supply the demand. No wonder we enjoyed a hefty queue of applicants banging on our doors." He stops to sip his red wine. They wait for him to continue, but he doesn't.
Bernard picks up the ball. "So, is what we are witnessing now simply a result of the universities succeeding in building up enough capacity?"
"Probably." Alistair's eyes are fixed on his glass. "But it is not as simple as that. You know how systems tend to react. They almost always undershoot or overshoot. I'm afraid that the rapid decline in the number of surplus applicants indicates that we overshot."
"Judging by the rate at which business schools are still expanding all over the country, it's just a matter of time before we have empty seats," Bernard agrees with him.
Coming here was a good idea. B.J. is pleased. She is also pleased with the two partners she chose for dinner. "So we don't have enough applicants because the capacity of business schools has grown beyond the number of people who want to become managers?" she asks in her soft voice.
"Might be," Alistair succeeds in answering before the waiters start to serve the prime rib.
"This means that we had better restrain our business schools from continuing to grow at their current frantic pace. At least until we find ways to encourage more young people to choose management as a career path," Bernard thoughtfully concludes.
Alistair waits until the overly assertive waiter is satisfied before commenting, "It might be much worse."
"What do you mean?" asks Stanley from across the table. Apparently this conversation is of interest to other presidents as well.
"It might be that we don't have enough applicants because we are already over-supplying the market demand and the word is out that an MBA degree doesn't guarantee a lucrative job anymore."
"If that's the case," Bernard wonders aloud, "then it's not simply a matter of slowing the growth of our business schools. The challenge is how to smoothly shrink them. That's tough."
B.J. concentrates on the meat, evaluating what Bernard has just said. He is actually echoing her own concerns, but when she hears somebody else saying it she has her doubts. It can't be that bad....
"On second thought," Bernard breaks into the silence, "we can boost the demand. All that's needed is to pass a law obliging every manager of a public company to hold an MBA. Make it statutory, like medical doctors or CPAs, or attorneys for that matter."
"Too much, too soon," Stanley objects. "I don't think that we should even think of legislation. It's against the essence of capitalism. And it's not practical, there is no way to enforce it. Besides, I don't think that the whole issue is relevant. Registrations for our school continued to grow this year, exceeding last year."
"I've talked with our friends at Harvard and MIT. They don't see any signs of softening either," Alistair contributes.
"They never do and never will," Bernard comments with a trace of envy. He picks at his prime rib and then pushes it slightly aside. "Their applicant list for everything is longer than my arm. What am I talking about, much longer than that. I've heard they can afford to accept only one applicant out of five. Considering the prices they charge, it's heresy."
"Why?" asks Jerry Preston. By now the individual discussions have died out. Everybody is waiting for Bernard to answer. He is not in a hurry, he likes being the center of attention. First he drinks a little red wine, then he dabs his lips with the white linen napkin.
"Do you want to know why? I can tell you why. Check their business school syllabus. They teach almost exactly the same material that we do. Maybe their professors are better researchers, but I doubt they are better teachers. The only difference between us and them is that graduating from one of the Ivy League schools is like having a license to steal. It's not any difference in substance, it's just the reputation."
"That's good enough," Stanley
Bernard picks up the ball. "So, is what we are witnessing now simply a result of the universities succeeding in building up enough capacity?"
"Probably." Alistair's eyes are fixed on his glass. "But it is not as simple as that. You know how systems tend to react. They almost always undershoot or overshoot. I'm afraid that the rapid decline in the number of surplus applicants indicates that we overshot."
"Judging by the rate at which business schools are still expanding all over the country, it's just a matter of time before we have empty seats," Bernard agrees with him.
Coming here was a good idea. B.J. is pleased. She is also pleased with the two partners she chose for dinner. "So we don't have enough applicants because the capacity of business schools has grown beyond the number of people who want to become managers?" she asks in her soft voice.
"Might be," Alistair succeeds in answering before the waiters start to serve the prime rib.
"This means that we had better restrain our business schools from continuing to grow at their current frantic pace. At least until we find ways to encourage more young people to choose management as a career path," Bernard thoughtfully concludes.
Alistair waits until the overly assertive waiter is satisfied before commenting, "It might be much worse."
"What do you mean?" asks Stanley from across the table. Apparently this conversation is of interest to other presidents as well.
"It might be that we don't have enough applicants because we are already over-supplying the market demand and the word is out that an MBA degree doesn't guarantee a lucrative job anymore."
"If that's the case," Bernard wonders aloud, "then it's not simply a matter of slowing the growth of our business schools. The challenge is how to smoothly shrink them. That's tough."
B.J. concentrates on the meat, evaluating what Bernard has just said. He is actually echoing her own concerns, but when she hears somebody else saying it she has her doubts. It can't be that bad....
"On second thought," Bernard breaks into the silence, "we can boost the demand. All that's needed is to pass a law obliging every manager of a public company to hold an MBA. Make it statutory, like medical doctors or CPAs, or attorneys for that matter."
"Too much, too soon," Stanley objects. "I don't think that we should even think of legislation. It's against the essence of capitalism. And it's not practical, there is no way to enforce it. Besides, I don't think that the whole issue is relevant. Registrations for our school continued to grow this year, exceeding last year."
"I've talked with our friends at Harvard and MIT. They don't see any signs of softening either," Alistair contributes.
"They never do and never will," Bernard comments with a trace of envy. He picks at his prime rib and then pushes it slightly aside. "Their applicant list for everything is longer than my arm. What am I talking about, much longer than that. I've heard they can afford to accept only one applicant out of five. Considering the prices they charge, it's heresy."
"Why?" asks Jerry Preston. By now the individual discussions have died out. Everybody is waiting for Bernard to answer. He is not in a hurry, he likes being the center of attention. First he drinks a little red wine, then he dabs his lips with the white linen napkin.
"Do you want to know why? I can tell you why. Check their business school syllabus. They teach almost exactly the same material that we do. Maybe their professors are better researchers, but I doubt they are better teachers. The only difference between us and them is that graduating from one of the Ivy League schools is like having a license to steal. It's not any difference in substance, it's just the reputation."
"That's good enough," Stanley
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