Issue link: http://www.e-digitaleditions.com/i/139946
First, Differentiate As more schools raise tuition rates to make up for reductions in government support, students are expanding their college searches farther field in order to find programs that give them the most value for their money. That makes it more important than ever for business schools to differentiate their offerings from a growing pool of competing programs. That is especially true for universities in the U.K., says Laing, due largely to the 2010 Browne Review of the funding of Britain's higher education institutions. In response to the report's recommendations, the British government raised the tuition cap that the country's higher education institutions could charge annually, from £3,290 to £9,000. By the 2014–2015 academic year, most universities in England will have raised their undergraduate tuition rates to the £9,000 limit to offset the withdrawal of state funds. The government also withdrew its funding of business education, as well as of all subjects other than STEM disciplines (science, technology, engineering, and math). Consequently, undergraduate business 20 July/August 2013 BizEd students now must pay the entire cost of their educations. Loughborough already has adopted the £9,000 tuition rate, which covers the cost of delivering the business school's programs as well as a subsidy it pays to the university to support higher-cost disciplines. But higher rates make students in the U.K. much more willing to consider less expensive business schools in other countries. Such increased student mobility will make it more difficult for schools to differentiate themselves based on the cost of their programs. "The new tuition cap has opened up the prospect of far more competition from English-language business schools in mainland Europe," says Laing. Going forward, business schools will have to find other ways to set themselves apart from competitors, he adds. For instance, a yearlong undergraduate internship program helps distinguish Loughborough's business program from those at other schools. Because relatively few other programs offer similar opportunities, says Laing, the compulsory internship helps Loughborough continue to recruit strong students in spite of greater student mobility. "You must be able to answer the key question that students and parents will ask: What does this degree offer that we can't find elsewhere?" says Laing. Grow Your Profit Centers In the U.S., many business schools at publicly funded universities are finding that they'll need to generate more revenue to make up for dwindling support from state governments. For that reason, business schools will need to do more to bolster their best profit centers, Jessup says. That was Jessup's aim when he was appointed dean at the Eller College in May 2011. At the time, the university president gave him two directives: First, make the business school self-sustaining. Second, do the same for the university as a whole. Enrollment at the college has been on the rise— increasing nearly 20 percent since 2006. At the same time, state support for the university in 2013 had declined close to 40 percent from its peak in 2008, while university tuition doubled. To raise more AN DE R SE N ROSS/G ETTY I MAG ES "The business model for business schools has changed dramatically," says Jessup. "And it's not going back."