Arizona State University in Talks to Take Over Thunderbird School

"...since both institutions offer full-time, executive and online M.B.A. degrees. The person added Thunderbird's board of trustees has been informed that Arizona State wouldn't offer two competing M.B.A.s., which calls into question the future of Thunderbird's M.B.A."

Source: WSJ

Arizona State University in Talks to Take Over Thunderbird School - WSJ

 

Wow. Interesting story. ASU has proposed some other stuff lately with its law school that make the place look more like a for-profit than a state university. This deal adds to that perception I think.

 

Someone else (Caldog?) noted that ASU accepts 80% of all applicants, but only about 38% graduate with a Bachelors degree in 4-years.

Regardless of the tax status of all colleges and universities, they must make a profit, either politically or financially or both, to continue to exist.

 

The current climate in higher ed is tough on private, standalone professional schools, and so it’s not particularly unusual for such schools to consider mergers with state universities. Look what’s been happening to private standalone law schools in New England, for example:

- Southern New England School of Law became part of the University of Massachusetts system in 2009

- Franklin Pierce Law Center became part of the University of New Hampshire system in 2010

- Vermont Law School is currently talking potential merger with the University of Vermont.

Standalone business schools, like Thunderbird, are less common than standalone law schools, but they are subject to the same pressures. And if Thunderbird can only survive by merging with a larger university, then what options do they have? Thunderbird is an AACSB school – and the only other AACSB institutions in Arizona are the three state universities (U of AZ, AZ State, Northern AZ).

My impression is that "Thunderbird" name is one of top names for international business education -- maybe bigger than the "ASU" name, at least in this specialty. So a merger could be a win-win.

 

This is correct -- but there is nothing particularly unusual about this, because a 38% 4-year graduation rate is basically the same as the national average. Most full-time undergraduates nationwide do not graduate within 4 years.

ASU has a 59% 6-year graduation rate -- and this is also basically the same as the national average. Most full-time undergraduates nationwide (including those at ASU) do graduate within 5 to 6 years.

 

Another way to look at this number: it's one of the highest graduation rates in the state.

Here are the latest 4-year (and 6-year) graduation rates from College Navigator for some well-known schools in Arizona:

40 (61) University of Arizona
38 (59) Arizona State, Tempe
37 (59) Embry-Riddle Aeronautical University, Prescott
30 (49) Northern Arizona University
28 (47) Arizona Christian University
24 (30) Grand Canyon University
23 (38) Prescott College
1 (23) U of Phoenix, Tucson campus
1 (7) U of Phoenix, Online campus
<1 (16) U of Phoenix, Phoenix campus

So a 4-year graduation rate of "only about 38%" is actually quite high, relative to other Arizona schools. I don't think there are any schools in Arizona with 4-year graduation rates above 50%. I doubt that there are any in Nevada or New Mexico either.

 

In theory, another option would have been to cut a deal with a non-AACSB institution. And in fact, Thunderbird actually did consider such a deal before turning to Arizona State. They looked at teaming with Laureate Education, which is one of the biggest for-profit education companies worldwide. In the US, Laureate is best known as the owners of ACBSP-accredited Walden University, although Walden is only a small part of their global operations.

However, the proposed deal with Laureate proved to be extremely unpopular with Thunderbird students and graduates, and was eventually cancelled due to protests:

Thunderbird is ranked as one of the country's top business schools, and their graduates must overwhelmingly work in management positions at for-profit corporations. Yet it appears that they have some doubts about the quality and reputation of for-profit educational companies.