Submission: Plan to make Anderson’s daytime MBA program self-supported will benefit UCLA as a whole

By Steven Lippman

The continuing state of California’s budget crisis has led to draconian cuts to public funding for UC.

The days of adequate state funding for public universities are gone, perhaps forever. If we mindlessly muddle along, we are sunk.

We have no choice but to try something new, something that can maintain our excellence and sustain our financial needs.

It’s our belief that converting the Anderson School of Management’s daytime MBA program to a self-supported program, which would replicate the school’s five other self-supporting master’s degree programs, will be good for UCLA in general and Anderson in particular.

It is a conversion that will maintain the excellence of the MBA program despite declining state support, while enabling direction of funds to other parts of UCLA that are starving for resources.

Because it is a professional school with a well-established tradition of self-supporting master’s degree programs, Anderson is one of the campus units in which such a conversion is likely to be successful.

In addition, Anderson has been an educational innovator for more than two decades in its highly successful FEMBA (fully employed MBA) and EMBA (executive MBA) programs, both of them self-supported programs.

It behooves us to quickly dispel three misconceptions.

First, this conversion does not represent movement for privatization: We are not going private. There will be no changes whatsoever in governance, mission and connections across UCLA or the education delivered to our students.

Second, tuition will not skyrocket. Conversion to a self-supported program will not induce tuition increases. Changes to tuition will follow national market forces.

Third, given that five of Anderson’s six masters’ degree programs are already self-supported programs, conversion of the sixth program ““ the daytime MBA ““ will result in a net budget change to Anderson that is relatively small rather than dramatic.

The conversion of the daytime MBA program to a self-supported program means that Anderson will no longer benefit from funds it currently receives from the state of California (with the important exceptions of funding for its undergraduate minor and Ph.D. program).

Instead, funds previously allocated to Anderson will be returned to UCLA to be used to support other campus units with extreme financial needs because of reductions in state funding.

Preparations to convert our daytime MBA program to a self-supported program began three years ago. Since then, the state of California’s budget deficit has ballooned and financial support for UCLA has declined markedly. These developments strongly underscore the need to find innovative ways to address campus-wide financial challenges. The conversion to a self-supported program is a small but vital step in that direction.

As states across the nation have slashed funding to public universities over the past decade, many have not fared well. Two notable exceptions are the University of Michigan and the University of Virginia that have converted their MBA programs to self-supported institutions. This conversion has permitted these two business schools to thrive while remaining deeply embedded within their universities and financially benefiting those universities.

A large majority of Anderson faculty is convinced that the conversion to a self-supported program will strengthen the academic stature of Anderson, including the quality of its teaching programs, and will enhance our school’s ability to deploy its resources across programs in the most effective and efficient ways possible.

Educational innovation at Anderson has emanated from its self-supported programs, particularly its EMBA and FEMBA programs. Conversion will also enable Anderson to more readily experiment with and bring new innovations, such as team teaching and international study trips, to the daytime MBA program. Our MBA students are on record as strongly supporting this conversion precisely because it will enhance the excellence of the MBA program.

Following extensive, laborious discussion and debate, numerous reports and many presentations, the Anderson faculty voted several times to consider various versions of the self-supported program. The most recent final vote was 61 in favor and 22 opposed to conversion. This 70-plus percent favorable vote is a testament to the faculty’s strong desire to proceed with the proposed conversion.

Through no fault of its own, the UCLA we all love and admire is now at a crossroads, one that requires bold action rather than further study. The situation is urgent. Given the increasingly uncertain financial times facing us all, we emphatically recommend that UCLA acts now. This conversion will benefit the campus as a whole.

Steven Lippman is a Distinguished Professor and George Robbins Chair in Management at the Anderson School.