Wednesday, November 23, 2011

We're Hiring Many business schools have trouble filling faculty positions

Reprint from the WSJ:

When it comes to hiring, business schools are running up against one of their most basic classroom lessons—the law of supply and demand.

While thousands of new schools have opened around the world in recent years, the number of new Ph.D.s in business subjects has held relatively steady, and many schools are now facing a serious shortage of well-qualified faculty.

For top institutions in the U.S. and Western Europe, it has mostly meant a jump in the salaries that professors with strong research records can command. But some less-wealthy schools in the West, and many B-schools in the developing world, are having real trouble filling teaching posts. Often, the jobs remain vacant or are filled by visiting or part-time faculty, or by moonlighting businesspeople without doctorates.

"Every year we have about eight to 10 posts to fill in accounting and finance," two areas where the shortage is most severe, says Sue Cox, dean of Lancaster University Management School in England. Three senior posts have been vacant for years, she adds. "It seems to me that we're perpetually advertising" to fill top positions. "It's always the first thing on your mind."

Visiting schools around the world in work for two of the big accreditation bodies, Ms. Cox says she hears about the dearth of academically trained teachers constantly. "It's a universal problem," she says.

At Brunel Business School in London, about 10 faculty posts are empty at any given time, says Zahir Irani, the school's head. Those with the right qualifications know their value, and often pit potential employers against one another.

"I've had many cases where people will sign the contract and then never turn up" because they've gotten a better offer, he says. "Three weeks before you expect them to arrive, you get an e-mail saying 'Thank you, but I'm not coming.' "

For a school to maintain accreditation with the Association to Advance Collegiate Schools of Business, at least half of its courses must be taught by Ph.D.-holding faculty who are active researchers. Widely publicized rankings also use professors' research output to help measure a school's quality.

While many deans say students can learn much in courses taught by businesspeople without Ph.D.s, advocates of the traditional academic model say that without a critical mass of professors who are pushing forward the boundaries of business thinking, institutions can't give students the intellectual skills to thrive in a fast-changing economy.

In many places, "the balance is out of whack," and B-schools with too few research-minded faculty have become little more than trade schools, says AACSB President John Fernandes.

But he says the mismatch between the dribbling Ph.D. pipeline and the burgeoning hiring needs of new B-schools is so great, particularly in emerging economies, that it will be near impossible for the sector to sustain the old approach of relying on teachers who are deeply engaged in business research.

"Is this model doable in the U.S., never mind the global context?" he asks. "The answer is definitely no."

Instead, he argues, the schools will have to find ways to expose greater numbers of students to each research-oriented professor. That is likely to mean increasing class sizes, using less academically minded teachers as intermediaries between students and Ph.D.-holding faculty, or connecting students and professors electronically.

Increasing the number of business Ph.D.s is also crucial, he says, but it won't be enough.

The AACSB estimates there are now 14,000 business schools in the world, thousands of them new institutions in regions like Asia, Latin America and Eastern Europe. Only a few run doctoral programs, which are expensive and require intensive involvement by senior faculty.

More than half of the 2,000 or so business Ph.D.s who graduate each year come from American schools, and many are hired abroad. Under tough budget pressures, some U.S. universities have reduced their production of Ph.D.s, says Richard Sorensen, dean of the Pamplin College of Business at Virginia Tech. And most business students just don't seem interested in forgoing private-sector salaries to pursue academic careers, many deans say.

A wave of retirements of faculty hired as business schools expanded in the 1970s and '80s is exacerbating the problem, Mr. Sorensen says.

In fast-growing economies like India's, the gap between the need for solid management training and the supply of qualified teachers is particularly large.

The Indian School of Business in Hyderabad, one of the country's top B-schools, relies heavily on visiting faculty from Europe and the U.S. because it is unable to hire enough professors with doctorates, says Senior Associate Dean Sanjay Kallapur.

The school has only been able to attract professors of Indian origin, and that pool is far too small, Mr. Kallapur says. And ISB cannot compete with the salaries offered by B-schools in richer countries.

If it had the faculty, Mr. Kallapur says, his school could easily attract enough students to double in size.

The shortage also limits ISB's research reach. "There are so many problems here waiting to be studied," he says. "There are so many things that people are even willing to fund us to do but we have to say no because we don't have the faculty."

It's international growth that has made the market so tight. The China Europe International Business School in Shanghai wants to expand its faculty by 30 in the next three years, says Dean John Quelch, who himself came from Harvard Business School.

CEIBS hired a London headhunting firm to approach 150 European business professors about applying for jobs, Mr. Quelch says. And this year, the school helped sponsor a professors' conference in Texas, emblazoning its logo on attendees' hotel room card keys to raise its profile. That's led to a surge in job applications.

But most of China's scores of new business schools don't have CEIBS's resources, and they are struggling to hire quality faculty, Mr. Fernandes says.

Working with the AACSB, a handful of American B-schools have begun training professors with degrees in nonbusiness fields like psychology, sociology and economics to teach in business schools.

The effort is producing about 60 new business professors a year, says Mr. Sorensen, whose school trains about 10.

In the meantime, salaries are skyrocketing. For a nine-month-a-year job, Virginia Tech offers between $140,000 and $160,000 to new business Ph.D.s, two to three times what it pays starting professors in other fields, Mr. Sorensen says.

For universities unable to pay that premium, attracting good faculty is a struggle, says Brunel's Mr. Irani. And with the Ph.D. pipeline so small, he sees little hope of things easing. "If you take a long-term view, it's a bleak picture."

Ms. Gardiner is a writer in London. She can be reached at

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