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A Strategy of Distinction: McCombs School Unveils New Strategic Plan
by Pam Losefsky
After a year-long process involving peer reviews of all McCombs School programs and disciplines and the convening of a strategic planning committee within the school, Dean George Gau has unveiled his strategic plan for 2003-2010, titled “Leading in the 21st Century.”
The document establishes the roadmap that the McCombs School will follow to become the leading public business school in the nation by the year 2010, and thus has wide-ranging implications for all stakeholders of the school.
Namely, the school will pursue six key strategic initiatives:
- Strengthen programs in finance, management, and marketing, which alongside already strong offerings in accounting and information systems, will win the school national recognition in all five of the core business disciplines.
- Change the emphasis of the MBA program to better align its focus with the placement market for MBA students.
- Increase the rigor of the BBA program to match the capabilities of our undergraduate student body.
- Enhance the school’s research environment.
- Build more strategic partnerships with important firms and industries and strengthen our undergraduate and graduate alumni networks.
- Increase the diversity of our student body.
The plan has been well-received by students, faculty, and advisory council members. “The clarity and focus of this plan are its biggest strengths,” says Lynn Utter, vice chair of the McCombs School Advisory Council. “Our goal to be the best public business school is both aggressive and achievable, and the focus on increasing the rigor in both the BBA and MBA programs goes to the heart of what makes a business school great.”
Like all forward-looking ideas, however, it’s not without its promise of growing pains. For one thing, to implement such significant advances in the school, major new sources of funding will need to be established, and some of the financial burden will fall to the students.
A fundamental hallmark of the plan is the recruitment of 40 new tenure-track faculty, with 30 allocated to the BBA program and 10 to the MBA programs. “Actually, with normal turnover and expected retirements,” points out Gau, “the school will need to hire more than 70 tenure-track faculty during the next seven years.”
Thus, while greater numbers of tenure-track faculty will go a long way toward addressing problems with student-faculty ratios and boosting the rigor of the undergraduate program, recruiting such a large number of faculty will be a significant undertaking with substantial resource implications. Dean Gau projects an increase of about $2,500,000 each year in the instructional and operations budget of the school beginning in the 2004-05 academic year.
“To fund this budget increase,” says Gau in his plan, “the school will propose
to raise the tuition charged on its graduate programs.” As we went to press, the
School and the University were also discussing the possibility of an
undergraduate tuition differential.
While expressing some reservations, business students have generally supported
tuition increases. At a September meeting, members of the Undergraduate Business
Council voted 62-25 in favor of an undergraduate business tuition differential,
which would raise their costs above those of other majors at the university. Gau
was impressed that the students embraced the idea of making the program more
rigorous.
“I do believe that many students are worried about an increase in tuition,” says Sean Paul, president of the Undergraduate Business Council. “But if students see a decrease in the student-faculty ratio and programs being put into place to assist their professional development in the coming years, they will continue to be receptive (to a tuition increase).” He adds, “Whether it’s working more alongside MBAs or increasing our involvement with research faculty, BBA students are always looking for additional ways to enhance our education.”
Red McCombs, patron and namesake of the school, is especially excited about the initiative to strengthen the BBA program. “We owe this to our students,” he says. “They are entitled to the opportunities offered in the strategic plan.”
For McCombs School Advisory Council Chair Marc Myers, one of the biggest assets of the strategic plan is the goal to better align the MBA program with the employment market. Actually, the twin goals of broadening our academic leadership to all five of the core disciplines and better aligning to the MBA placement market work in tandem. Currently, the school is widely known primarily for its outstanding programs in accounting and technology, and a great deal of the school’s resources have been invested in these areas. McCombs MBA placements, however, have predominately been in finance, consulting, and marketing. Indeed, for the past five years, an average of 77% of our MBA placements were in these three fields.
“Pursuing a niche strategy was optimal in the early stages of the development of the school,” says Gau, “but it is now time for us to broaden our strategy.” Instead of trying to differentiate the MBA program on the basis of academic fields that do not relate to the market, the strategy is to build distinction and create recognition for the school in those areas that serve as the primary employment opportunities.
To that end, the plan calls for a high percentage of the new faculty to be hired over the next seven years to go to the management, marketing, and finance disciplines, which would bring our faculty allocations more in line with those at our peer schools. This strategy will make McCombs more congruent with the rest of the top business school market, and Gau believes that the creation of distinctive academic initiatives based on partnerships with industry are what will differentiate McCombs from the rest of the field.
“A notable example of the type of academic initiative we want to foster is the newly created program in supply chain management,” Gau says. “This initiative has brought together faculty in operations management and management science to explore with leading firms how companies should manage suppliers, production, and product sales to minimize costs.”
Another area of critical expansion for the school will be in executive education, believes Chair Myers, as this relates to building more strategic partnerships with important firms and industries. “It is imperative that the McCombs School develop strong relationships with the firms in Dallas and Houston (the 5th and 7th largest metro economies in the country, respectively) and have a dominant executive education presence in both markets,” insists Dean Gau.
The 2002-2003 academic year was the first in which our Dallas Executive MBA Program had open enrollment, and the next priority is to establish a program in Houston. Further development of executive education at UT Austin is all but contingent on the construction of a hotel/conference facility on campus, a University project that the McCombs School backs wholeheartedly and is willing to partially fund provided it has a leading role in determination of the site, building improvements, and operations of the facility.
Again, these and the other initiatives have major budget implications. Aside from the projected increases in the instructional and operations budget, the dean’s discretionary budget (which covers expenses for research support, the Ph.D. program, new academic initiatives, and the alumni network, among other things) will need to grow by about $5.8 million by 2010. To meet these needs, Dean Gau has proposed a new strategy for the McCombs Matching Program (see chart on page 25), which has $35.3 million still to be allocated for endowments as a way to increase the impact of high priority gifts.
With our strategic direction now articulated, it’s full force ahead for the McCombs School. “The plan really gives us a framework within which to operate as we give counsel and support to the dean,” remarks Utter about the Advisory Council’s role going forward. “We now need to have the courage to stay the course: to be disciplined, rigorous and focused when decisions are to be made.”
And as the school embarks on its ambitious journey to become the best public business school by 2010, Myers advises, “Recruit the best faculty, solicit and accept assistance from Advisory Council members and alumni, and think and plan aggressively, in the best tradition of UT and Texas!”
To read the text of the entire strategic plan, visit:
www.mccombs.utexas.edu/
strategicplan/.
For information on specific programs at the McCombs School, consult our contacts page. For media information, contact the Communications Director by phone at 512-471-3314 or by email at CommunicationsDirector@mccombs.utexas.edu.
