What Happened When a Business School Made Tuition Free

The main question admissions personnel heard: Is this for real?



What Happened When a Business School Made Tuition Free
Arizona State University’s W.P. Carey School of Business received a lot…
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What Happened When a Business School Made Tuition Free
Applications at Arizona State’s b-school nearly triple as prospective students from as far away as Uganda, Uzbekistan express interest

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‘I really didn’t understand the extent to which there was a demand for scholarships,’ said Amy Hillman, dean of Arizona State University’s W.P. Carey School of Business. In October, the business school said it would make its two-year M.B.A. program free starting this fall. PHOTO: MARK PETERMAN FOR THE WALL STREET JOURNAL
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LINDSAY GELLMANApril 6, 2016 1:11 p.m. ET
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Arizona State University’s W.P. Carey School of Business received a lot of global attention after saying it would make its two-year M.B.A. program free starting this fall. It also got a lot more applicants than it bargained for.

Since the announcement in October that it would drop the price tag on its full-time business program—which runs from $54,000 for in-state residents to $90,000 for international students—to $0, prospective students have inundated the Tempe, Ariz., school, breaking previous application records and forcing school leaders to man jammed phone lines and respond to email queries.

As of April 4, the full-time M.B.A. program had received 1,165 applications, nearly triple the total number of applications it received during last year’s cycle. The number of calls and emails was much larger than that, school officials say, taking the school by surprise.

ASU’s W.P. Carey sought to attract candidates from nontraditional backgrounds, including people who had never considered business school because of the costs, said Amy Hillman, the school’s dean. To fund the scholarships, the school turned to a $50 million donation given in 2003 by real-estate mogul and philanthropist William Carey, she said.

“I really didn’t understand the extent to which there was a demand for scholarships,” Ms. Hillman said.

EARLIER COVERAGE
The Price of an M.B.A. at Arizona State University’s Business School? Free

Pricing experts say the school’s experience underlines a sometimes painful business truth: offering something free creates a lot of extra work. Because Carey has a finite number of M.B.A. spots to offer, it can be more selective about whom it accepts, which will take more admissions manpower, said Sandeep Baliga,a professor of managerial economics and decision sciences at Northwestern University’s Kellogg School of Management who researches pricing.

“It was pretty much all hands on deck” in the admissions office after the announcement, Ms. Hillman said. The school rounded up staff from other corners of the university and student ambassadors to answer phone calls and respond to emails from freebie-seeking prospective students, some from as far away as Uzbekistan, Bolivia and Uganda—well beyond its usual recruiting regions.

The main question admissions personnel had to answer was whether the free M.B.A. was real. Some callers were “skeptical,” said Kay Keck, director of Carey’s full-time M.B.A. Admissions staff walked prospective applicants through the details and assured them that the school’s free-M.B.A. plan was not a joke, she said.
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So far, the school is succeeding in its goal of attracting nontraditional candidates, Ms. Hillman said. Carey has filled roughly half its class, according to school officials. The school has up to 120 M.B.A. slots for the coming school year.

Ms. Keck said she recently interviewed a qualified applicant—an Arizona entrepreneur and married father of four—who had just taken the Graduate Management Admission Test and was hoping to supplement his self-taught business skills with formal training. Ms Keck said the Arizona entrepreneur told her that a scholarship would make it possible for him to consider business school.

Meanwhile, ASU staff also spent considerable time turning people away. In what Ms. Hillman called the “sad part of responding to the inquiries,” staff spent hours on the phone and online vetting candidates and deterring people who wouldn’t be competitive applicants, Ms. Hillman said. Scores of would-be students hadn’t taken b-school entrance exams, or didn’t realize they would have to quit their jobs to enter the full-time program, administrators said.

Standardized tests including the GMAT are typically required to apply to M.B.A. programs, along with undergraduate transcripts, essay responses and letters of recommendation.
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As of April 4, the full-time M.B.A. program at the Carey business school had received 1,165 applications. PHOTO: MARK PETERMAN FOR THE WALL STREET JOURNAL

Mohannad Shalabi, an entrepreneur in the Palestinian city of Tulkarm, emailed his credentials to the admissions office and requested more information about the scholarship. The 35-year-old, who said he hasn’t taken b-school entrance exams like the GMAT, said Carey staff provided details, but cautioned that competition for the scholarships would be stiff.

“I did not proceed because I did not have a good chance,” Mr. Shalabi said.

Free tuition is unlikely to lure students with Harvard Business School or University of Pennsylvania’s Wharton School in their sights, said Michael Trudeau, an independent business-school admissions consultant.

“I don’t think most students will consider ASU who weren’t already considering [it],” he said.