Questions and Answers Regarding Penn State Smeal's Intention to Transform the Resident Two-Year MBA Program

PENN STATE SMEAL INTENDS TO TRANSITION ITS TWO-YEAR RESIDENT MBA TO A ONE-YEAR MBA WITH STEM DESIGNATION. WHY?

1. Today’s professional learners are demanding more flexibility, specialization and customization than has been afforded by the traditional two-year resident MBA.

• Aspiring business leaders now expect to acquire new skills on an as-needed basis and within a curriculum that can be customized to the specific needs of their role, company, industry, or life stage.
• Many professionals are looking at their careers with renewed perspective — and they’re asking for convenient alternatives to get the tools they need to pivot quickly.
• Employers are in search of talent that is prepared to make an immediate contribution. 

2. The number of students willing or able to pay full tuition for a traditional two-year resident MBA is decreasing across the country.

•  According to the Graduate Management Admission Council (GMAC):
  • More than half (54 percent) of the top 50 U.S. full-time MBA programs ranked by U.S. News and World Report reported a decline in domestic application volume in 2021 compared to the previous year.
  • For programs ranked 51 and below, 7 in 10 (69%) reported a decline in domestic application volume compared to the previous year.
  • The number of GMAT test-takers declined 30% from 2017 to 2021.
• In the past five years, at least four prominent institutions shuttered their resident MBA programs because of the financial strain of maintaining them.
• Enrollments in Penn State’s Online MBA, which is led by Smeal and offered through the World Campus, has increased by 167% in the past three years. Enrollments in Smeal’s one-year specialty master’s degrees have increased by 87%.

3. It’s time to re-think graduate business education in America, and Penn State Smeal is leading the way.

• In the past six years, Smeal has responded to the changing needs of professional learners by creating a robust portfolio of professional graduate programs and adopted a strategic focus on lifetime learning.
  • The portfolio includes three forms of the MBA, 14 online certificates, and 14 online and resident specialty master’s degrees.
• This year, the college continued its transformation journey by:
  • Introducing a new executive doctorate in business administration (DBA)
  • Introducing a new master’s degree in accounting analytics
  • Redesigning its Executive MBA, which is offered in Philadelphia
  • Introducing two new online graduate certificates: Supply Chain Risk Management & Real Estate Law & Valuation 

WILL SMEAL’S REPUTATION SUFFER BY DROPPING FROM THE MBA RANKINGS IN US NEWS AND OTHER CREDIBLE SOURCES?

• At Smeal, we are confident in the strength of our programs, the caliber of our faculty and research, and the preparedness of our students to make an immediate impact upon graduation. It is by these measures that we gauge our success.
• Although we are humbled by the validation that we often receive from various third-party organizations and publications, we believe rankings tell only part of the story of our professional graduate programs. In fact, most criteria fall short of acknowledging several important key details and aspects of the programs, including:
  • Innovations such as the creative team model and learning analytics
  • Program integration within a diverse portfolio of master’s programs and graduate certificates
  • The explosive growth of the OMBA and other programs in the past five years
• We believe that it is time to think differently about business education. It is our hope that the traditional rankings programs will evolve to take into consideration the changing preferences of professional learners and these new and increasingly popular innovations in the future.
• Anecdotal feedback from new faculty members suggests a strong interest in online teaching and efficient teaching modes that correspond with their research interests. 

WILL THE VALUE OF A SMEAL MBA BE DIMINISHED BECAUSE OF THIS DECISION?

• As an alum of Penn State Smeal, you are a member of the largest, most passionate alumni network in the country. At 740,000 strong, the Penn State community is your greatest asset.
• A degree from Penn State Smeal implies a high caliber of leadership experience, strategic thinking ability and analytical skills that have rendered the college a top destination for leading corporations around the globe. This reputation will only get stronger as we transform our portfolio to meet the changing needs of today’s professional learners.
• The transformation of the resident MBA to a STEM-designated one-year MBA for early-career students opens new possibilities for lifelong learning through Smeal’s diverse PGP portfolio, which will continue to include three forms of the MBA. 

HOW WILL THIS DECISION IMPACT THE FINANCIAL HEALTH OF THE COLLEGE?

• The traditional resident two-year MBA market has been in transition for years as the number of students willing or able to pay full tuition decreases and other, more flexible learning options proliferate across the country.
• When institutions such as University of Iowa, University of Illinois, and Wake Forest University reached this point, they shuttered their programs.
• The transformation of the resident MBA program will allow Smeal to redeploy resources to programs for which there is unmet need, including the Ph.D. program.