MBAs Chasing Jobs... in Teaching?

With hiring still slow, their ethics and values under scrutiny and the need for paid, real-world experience at a premium, a surprising number of MBAs are turning to education as a means of establishing their leadership credentials in a sector where people skills, quantitative acumen and crisis management ability is in demand. Erin Zlomek reports in Business Week:

"Shani Dowell's credentials differed from those of most Teach For America corp members.

She held an MBA from Stanford and worked a year at the Bridgespan Group, the nonprofit consulting firm spun out of Bain & Co,, before leaving to write lesson plans and teach eighth graders in Houston. The vast majority of Dowell's colleagues joined TFA directly from undergraduate programs and lacked her work experience.

TFA says it has done nothing special to recruit candidates like Dowell, yet applications from MBAs rose sevenfold from 2007 to 2010, while overall applications increased at only a fraction of that rate. Last year, 641 MBAs applied to TFA, up from 91 three years earlier, at a time when overall applications increased to 46,000, from 19,000.

"I get a couple of phone calls a week from folks who either have MBAs or who have been working in careers like investment banking or consulting who are looking to get into the education sector," says Dowell, who is now the executive director of Teach For America in Nashville.

Appeal of Jobs in Education
MBAs, who typically make a beeline for the corporate world after graduation, are increasingly taking a road less traveled. With the latest generation of MBA students embracing social enterprise, interest in education jobs—from assistant principals to finance chiefs to human resource directors—is growing. And K-12 institutions have begun to establish a recruiting foothold at some top MBA programs.

"We knew there were people who were interested in education who had the skills to contribute, but they didn't have a path in. The districts didn't really know how to make use of their talent," says Lynn Liao, a managing director at the Broad Residency. The nonprofit program places executives with graduate degrees into management positions at the top levels of charter school organizations, urban school districts, and state and federal departments of education.

Liao notes that K-12 public schools are primarily focused on recruiting teachers and principals, and districts don't have the budgets to recruit executive talent to their central offices. She calls Broad a "matchmaker."

The residency program started in 2003, and MBAs have glommed on fastest, totaling 61 percent of all applications in 2011, up from 57 percent last year.

Finding Internships
Another intermediary is Education Pioneers, a nonprofit fellowship that matches graduate students with internships at K-12 institutions. The program started in 2004 and has seen applications rise to 330 in 2011, from 109 in 2007, and business school students are its largest source of talent. Many of the program's interns later find jobs through that network.

Business schools say the higher number of job placements via such programs has helped boost interest in their education tracks.

At UC-Berkeley's Haas School of Business (Haas Full-Time MBA Profile), MBAs who selected education as their primary industry preference, although a small fraction of all students, doubled from the class of 2006 to the class of 2012

And with educators with management skills in high demand, Duke's Fuqua School of Business (Fuqua Full-Time MBA Profile) has likely lured education-focused students away from other graduate degree programs, says Matt Nash, executive director of the school's Center for the Advancement of Social Entrepreneurship.

"I think students see these employers are valuing the MBA skill set, so they pursue the MBA or a joint MBA," he says.

MBA Skill Set
With the growing challenges facing public education, more school districts are seeking data-driven thinkers with a background in finance, and fewer teachers are getting promoted to administrative posts, says Ron Skinner, assistant executive director of the Association of School Business Officials (ASBO).

Forty-two percent of ASBO members said in 2010 that they arrived at their jobs from a traditional business background, up from 36 percent in 2005.

While analytical and financial skills aren't exclusive to the business world, Liao notes that MBAs and others with corporate backgrounds tend to have work histories demonstrating those qualities.

Jimmy Henderson, for example, the chief operating officer of E. L. Haynes Public Charter School in Washington, D.C., manages a $17 million budget and oversees human resource decisions—situations into which he previously gained insight while working at Boston Consulting Group. He will soon arrange the purchase of two sites for future schools.

"It's basically real estate development you would see in the corporate arena," says Henderson, who has an MBA and a masters in education from Stanford (Stanford Full-Time MBA Profile) and is an Education Pioneers alumnus.

Accent on Analytics
Graduate business schools see an opportunity to recruit educators who want to gain similar experience.

Rice University's Jones Graduate School of Business (Jones Full-Time MBA Profile) started an MBA program for assistant principals and teachers. The first class of seven students graduated in 2010, and the school expects to graduate 11 in 2013.

Analytical skills are so coveted in the education sector that Education Pioneers started an Analyst Fellowship program last year for people with undergraduate degrees. The group sends private sector consultants and financial analysts to K-12 institutions to evaluate data sets such as student enrollment and retention, attendance patterns, and population estimates, says Education Pioneers CEO Scott Morgan. The program's participants have worked in the private sector for an average of three years.

Financial Hurdles
When it comes to recruiting MBAs for administrative jobs in the educational world, on-campus recruiting really isn't an option for many school districts, which can't afford the expense of travel. So business schools and outfits such as Education Pioneers have stepped in to fill the gap.

Haas, for example, in 2007 started the Education Leadership Case Competition, an event sponsored by Teach For America, the Broad Center, and Education Pioneers, among others. Teams of MBA students come from as far as London to evaluate a problem facing an urban public school district and compete to provide a solution. The event is also a recruiting mechanism for those districts and has placed students in the Washington (D.C.) public schools.

Philanthropic-funded placement programs such as Broad have also helped K-12 institutions overcome pay barriers.

According to an ASBO report, the average salary for an assistant superintendent in 2010-11 was $122,333 and $101,347 for a director of finance.

Broad residents who leave corporate jobs take a 25 percent pay cut, on average, when they are placed at school district central offices. The districts set the residents' salaries at $85,000 to $95,000 a year, and Broad pays another $30,000 each year, for two years.

After that, the districts decide if they want to make up the salary difference. Most of them do, Liao says, noting that 87 percent of the residency's graduates continue working in K-12 education.