Microsoft AI Move Is Exactly What MBA Students Need, Employers Want And Slumping B-Schools Dread

Microsoft shares rose 12.4% last week on word of the release of Copilot, a generative artificial intelligence tool to be integrated into its Office suite.

That’s huge news from the tech giant because it hands AI to the masses via highly familiar, everyday interfaces such as Word, Excel, PowerPoint and Outlook. Copilot will swiftly bring significant efficiencies and improvements to common tasks including email, analyses, business cases, presentations and performance reviews.

With streamlined workflows and automated administrative functions, companies will be challenged to rethink business models, talent needs and resource usage. Very quickly, it will spur creativity, shorten work timelines and improve results.

Yet, not all will benefit. Down the pipeline, that disruption may be more than many b-schools can handle — especially those burdened with antiquated curriculum, outdated delivery models, strained budgets, misaligned incentives, low student satisfaction, administrative bloat and workplace cultures not apt for innovation.

From a hiring perspective, employers may soon grow frustrated overpaying for a credential unaccompanied by skills that tomorrow’s competitive edge requires.

Into the void

The bifurcated MBA market faces an existential crisis. Top schools and their graduates remain in high demand. For instance, Northwestern’s Kellogg MBA reported 99% of its 2022 MBA graduates received job offers — with a median base salary of $165,000, up nearly 20% from 2019. Pay packages included hefty signing bonuses with consulting, tech and finance firms hiring nearly 80% of their graduates. That’s because Kellogg’s curriculum is built on applied learning, leading-edge technologies and meaningful corporate and executive partnerships.

Similarly, Stanford has deep, longstanding ties to the entrepreneurial tech community. Wharton leverages its elite executive programs in digital transformation, strategic finance and leadership for contemporary classroom experiences.

Many other programs are stuck, slumping or spiraling. In its 2022 Trends Report, the Graduate Management Admission Council found that 60% of MBA programs received fewer applications, with part-time programs seeing the most severe declines.

According to GMAC, post-pandemic interest in online, modern-day “correspondence course” offerings has been tepid, at best, with one-third of schools experiencing sizable application drops. Nearly 80% of surveyed respondents agreed that online programs lack adequate networking, educational value and career opportunities.

Those trends were before generative AI becomes mainstream. AI applications will heighten student expectations and end term papers, memorization and Industrial Revolution-style classroom lectures. Who can command tuition premiums without delivering more than what’s available for free? Is there any demand for hollow credentials? Are b-schools ready for such abrupt and transcendent change?

The clairvoyant

ChatGPT offered a first glance at that future, responding, “Generative AI has the potential to significantly impact MBA education in a number of ways:

• Customized learning: Generative AI can be used to create personalized learning experiences for MBA students. By analyzing data on students’ learning styles, preferences and performance, AI algorithms can generate customized content and activities to help each student learn more effectively.
• Real-world simulations: AI can be used to generate realistic simulations of real-world business scenarios, allowing MBA students to practice decision-making and problem-solving in a safe and controlled environment.
• Data analysis: AI can be used to analyze large datasets, allowing MBA students to gain insights into business trends and patterns that would be difficult or impossible to identify manually.
• New teaching tools: AI-powered tools such as chatbots, virtual assistants, and intelligent tutors can provide MBA students with on-demand assistance and feedback, helping them to learn more efficiently and effectively.
• Improved decision-making: By leveraging AI-powered analytics and insights, MBA graduates can make more informed and data-driven business decisions, leading to improved outcomes for themselves and their organizations.

Overall, generative AI has the potential to revolutionize MBA education by providing students with more personalized, data-driven and immersive learning experiences.”

How many schools can substantively address any of those five expectations? Very few. Kellogg has its Analytical Consulting Lab which enables students to solve real client problems such as guiding an NFL team’s concession pricing and formulating a a pharmaceutical firm’s sales plan. Lagging, legacy programs have wider gaps as they often rely on textbooks, yellowed lecture notes, obtuse theories and stale case studies (i.e. Enron) — quite the mismatch for an AI co-piloted world.

Weak hand

Innovative MBA curricula require difficult investment/divestment choices. Each is complicated by cash burn, rigid infrastructure, poor governance, tenured faculty, inflexible learning management systems, inexperienced academic leaders and competing campus priorities. That mix yields a worrisome, starting list of concerns:

• Sages off stage. Universities traditionally struggle to incentivize faculty to undertake curriculum innovation. Junior faculty have research aims to ensure tenure. Established professors leverage tenure to self-determine work priorities. Pressure to adapt decades-old teaching methods to the expectations of an AI world may speed many faculty to retirement, leaving b-schools with a sizable educational excellence talent deficit.
• New horizons. Market entrants are often underestimated by legacy enterprises. Emerging entities such as Section, Udemy and open-source learning platforms may now have the impetus to build coalitions, broaden educational offerings, develop innovative delivery methods and establish meaningful credentials. Whether partnering or competing with traditional schools, upstarts will shatter the status quo of business education.
• More co-pilots. To address data analytics demand, many graduate business programs teach coding. What will happen when popular software interfaces (i.e. Tableau, R, SAS, Power BI, Alteryx) embed AI? How will curricula cultivate the critical thinking and communication skills far beyond computations? Self-solving software upends credentialing-focused courses.
• Poor appetite. AI is far more than a new technology — it’s a monumental, transformational market force — the type that requires strategic agility, compelling leadership and novel solutions. That’s a particularly bad match for bureaucratic universities lacking meaningful incentives, curricular governance, unified stakeholders and novel tech teaching platforms.

MBA program futures rest on swift and substantive action to address these hurdles. In the next 1-3 years, AI will change education at all levels. The innovative will seize the spotlight and usher in a new era that readies students for dynamic futures. Laggards will grapple for relevance and existence. Who’s ready to take off the tweed and deal with the market reckoning?