'If you don't go full-cost you'll get bounced out of the market'
By Kevin Gale
Canadian business schools are following the money trail.
Western's recent decision to raise the tuition of its masters of business administration program from $3,186 to $18,000 over the next four years is something many other Canadian universities are considering or have already implemented.
At Simon Fraser University in Burnaby, British Columbia, administrators are looking to operate their MBA program on a full-cost recovery program, but have so far been limited by B.C. government legislation which has put a freeze on post-secondary tuition, said Stanley Shapiro, dean of business administration.
Under the SFU plan, the two-year program would cost $16,000 per year, up from the current $8,000, he added.
To compete effectively, programs must specialize and carve their niche in the MBA market, said Dave Jobson, dean of the MBA program at the University of Alberta.
Jobson said the U of A program is still subsidized by the government but plans are being developed to make it full-cost recovery. The only stumbling block is a provincial government freeze on tuition.
The reason for the move is the university can no longer provide the necessary resources to get top-rated faculty, a necessary component to attract top students and corporate sponsorship, he said. "The price is very high and the rest of the university isn't sympathetic." Shapiro said faculty could easily cost the school upwards of $80,000 per year.
Jeffrey Gandz, associate dean at Western's Richard Ivey School of Business Administration, said if students want a first-class education they'll need to pay for more of the cost.
Another competition concern is soliciting corporate funds for the programs, of which U of A has received very little, Jobson said. "Businesses are saying you've got to develop a program that makes us think you're the best," Jobson said. Last year, the Richard Ivey Foundation gave Western $13.5 million, $11 million of which went to the business school.
Mike Maher, dean of management at the University of Calgary, said their program is only being considered now for full-cost recovery to attract research dollars for software development, money he said is not available from the university.
Getting corporate sponsorship is at the very heart of the MBA program at the University of Calgary, said Mike Maher, dean of the faculty of management at U of C. "We're in the business of meeting the needs of the community," he said. Maher added the program is clinical in nature, using ongoing practical work done in 17 local companies as class material.
The cost of a program is beginning to reflect its quality, he said. "If you don't go full-cost you'll get bounced out of the market."