Soapbox: Value of research
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Should MBA students care about academic research? If you ask students, many would shout “no!” But our research* may change their minds.
We have found that when a business school generates more research, its graduating students’ salaries go up. In fact, an increase of three single authored articles per year across the school leads to a graduate’s starting salary going up by $750.
This amount is above the salary graduates would normally receive based on their quality upon entering an MBA programme (as reflected by a high GMAT score or low school acceptance rate) and a business school’s resources.
Plus, the dollar gains are multiplied across hundreds of students in a typical MBA programme. Since companies are paying these higher salaries, they are obviously recognising the value of students educated in a more research-oriented environment. Equally important, we also find that when the number of faculty research publications increases, students’ evaluations of professors also go up.
We believe there are two main causes of these results. First, researchers can teach students state-of-the-art knowledge, including the latest models, findings and frameworks.
A second cause is that research professors can conceptualise problems, generate logically valid hypotheses and then test them with relevant data and appropriate methods. An understanding of this knowledge-discovery process is essential for students who must “learn how to learn”, so that their education remains relevant in a fast-changing world.
Our findings are in contrast with the conclusions of Warren Bennis and James O’Toole, published in Harvard Business Review in 2005. They argue that professors focusing on scientific research have taken over schools to the detriment of students. In their words, “The dirty little secret at most of today’s best business schools is that they chiefly serve the faculty’s research interests and career goals, with too little regard for the needs of other stakeholders.”
They argue that professors without managerial experience “don’t know how to analyse the indirect and long-term implications of complex business decisions”. Their prescription is a dramatic shift back toward hiring more professors who are skilled in, and orientated toward, business practice.
So, which is it? Is research good or bad for MBA students? As more schools jump on the research bandwagon, it is a serious charge that faculty have hijacked their institutions at the expense of students and society.
Our conclusions are supported by 18 years of US News & World Report data on MBA rankings, students’ salaries and other variables such as university endowment and reputation. Our measure of faculty research is the number of annual publications in A-level scientific journals compiled by the University of Texas at Dallas. We analyse our data set using appropriate econometric models.
Since we find a positive relationship between academic research and students’ salaries, as well as higher student evaluations of professors in more research-orientated departments, it does not appear that a school’s non-faculty stakeholders are hurt by investments in academic research.
All-important business problems are complex. We should not denigrate the importance of managerial judgment and experience that accumulate during a career. But neither should we denigrate the value of a systematic, research-based approach to conceptualising and analysing business situations. In business, there are pros and cons to any path but a research approach can help evaluate the validity of these opinions and reach sounder conclusions.
*Debanjan Mitra and Peter N. Golder (2008), Does Academic Research Help or Hurt MBA Programs? Journal of Marketing, 72 (September), 31-49
Peter Golder is associate professor of marketing NYU Stern School of Business. Debanjan Mitra is assistant professor of marketing at Warrington College of Business Administration, University of Florida.
The Soapbox column is open to professors, students and others interested in the future of business schools. To comment on this article go to www.ft.com/soapbox
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