Which MBA?

JUDY OLIAN, the dean of UCLA’s Anderson School of Management, says that the budget cuts recently announced by California’s new governor, Jerry Brown, has made it even more imperative that it withdraws from the University of California system.

The system, which pulls together ten state campuses, including UCLA, Berkeley and Davis, is a cherished Californian tradition. Indeed, Ms Olian accepts that many residents have expressed a fear that the “compact” between the school and the state is under threat. However, according to the dean, the new cuts will mean Anderson’s state support will fall to around 6% of its budget. Although still a significant figure—worth around $5.6m—the dean says that the pluses of withdrawal, such as being able to set its own tuition fees and the right to pay what it wants for top faculty, would more than make up for the decrease in revenue. 

In any case, Ms Olian insists that withdrawing from UC would allow it to make up any shortfall because it would be free to offer new revenue-generating courses and give it greater control over its costs. 

Interestingly, the dean also believes that being more autonomous would make it more attractive to potential donors. Ask UC graduates—particularly those from the 1970s or 80s—what they believe to be the level of state funding for the institution, she says, and they routinely assume it to be around 70%. This misconception dissuades them from making a donation to their alma mater. In contrast, she argues, explaining that it receives no state funding would enthuse them.

The proposal has been passed by the UCLA board and may well be ratified by July. The dean says that Anderson will still offer California residents a discount on their programme fees—which, for full-time MBAs, are currently $42,000 for in-state students and $49,000 for the rest. It will also continue to pay UC for the use of its facilities.

Update: Since posting this piece, UCLA has asked that we clarify two points, which we are happy to do. Firstly, the business school plans to withdraw from direct state funding rather than the entire UC system. Secondly, the proposal has not yet been passed by the board but is currently being considered by UCLA leadership.