Leading Through COVID: A B-School Dean Tells It Like It Is

UNC Kenan-Flagler Business School Dean Doug Shackelford

The pandemic has tested leadership like few other crises. And in higher education, where social interaction is crucial to learning, the challenge for business school deans and other administrators may well be the single biggest obstacle they have ever faced. Everything, from the safety and health of students, staff and faculty to school budgets, has been impacted.

Just ask UNC Kenan-Flagler Business School Dean Doug Shackelford who is more candid than most about the difficulties posed by COVID 19. “When I’m sitting around in a nursing home talking about the good old days, I’m not going to be talking about 2020,” says Shackelford flatly. “As far as I’m concerned, you can take 2020 and stuff it in your wastebasket. It’s been hard, hard on all of us.”

Like many other business schools, Kenan-Flagler pushed all its in-person classes online early after announcing intentions for a hybrid approach for the fall semester. But several clusters of COVID cases on the UNC campus led to the decision to go fully virtual. The school does not expect to return to an on-campus format until June of this year if then, depending on the state of the pandemic. Admissions is now accepting alternate test scores, including SAT and ACT results, along with the LSAT and MCAT, in lieu of a GMAT or a GRE as long as the test has been taken during the past seven years.

‘I WOULDN’T KID YOU, THIS HAS BEEN TOUGH’

“It has been like nothing I have ever experienced,” concedes Shackelford, who has largely worked from home in a recreated office from a bedroom. At best, he goes on campus once or twice a week. “But the campus is so deserted it’s just depressing. I go into a building and no one is there. I thrive on the chaos of the students. And I go in and it’s like going to a funeral.I think it is going as well as it could go. But I wouldn’t kid you, this has been tough.

“On Monday the job is to get to Friday and hope on the weekend that people can regroup and do it again. The mental health issues are rough. People are working from home with little people underfoot concerned about their health and their jobs. Students are not able to be here. I was talking to one of our undergraduates in the spring and he was driving 25 miles each way to sit in the McDonald’s parking lot so he could get internet connectivity. That’s where the ground level is for students who come from remote areas. It’s not just North Carolina. It’s all over the country.”

As business schools continue to grapple with surging cases of COVID-19 in the U.S., most students can expect to largely attend Zoom classes this spring with the hope of a return to normal in the fall. Meantime, faculty, staff and students are trying to make the best of it. “Everybody realizes we are all in this together,” says Shackelford. “This pandemic didn’t strike Chapel Hill. The whole world is in it together. Nobody likes where we’re at, but I’ve been really pleased with the way people have stepped up. When hard times set in, really good people do good things. But it’s hard to be a hero forever.”

A DEAN WHO SPEAKS WITH REFRESHING CANDOR

In a wide-ranging interview with Poets&Quants, Kenan-Flagler’s dean spoke about the enduring value of the MBA degree, his school’s early entry into the online MBA market, and the future of business education. In higher education, where leaders are too often scripted, rehearsed and politically correct, Shackelford speaks with refreshing candor about the challenges of running a business school when an unprecedented health crisis has upended his school, the country and the world.

On Feb. 1, Shackelford will have been dean of the school for seven years. On the UNC faculty since 1990, he had been instrumental in leading Kenan-Flagler’s online MBA initiative as the associate dean of MBA@UNC. The university is in his DNA. After he graduated from UNC with a B.S. in business in 1980, he worked as a senior tax consultant for Arthur Andersen & Co. in Boston and Greensboro, N.C., from 1981-1985. Shackelford then earned his Ph.D. from the University of Michigan and joined the UNC faculty. He was senior associate dean for academic affairs from 2003-2007, and associate dean of the Master of Accounting (MAC) Program from 1998-2002.

As dean, he is well on his way toward raising $150 million for a new building that will allow the school to double the size of its undergraduate program. Shackelford expects to break ground for it by the summer of 2022, with the intention to open in the fall of 2024. And he has continued to expand the school’s online MBA enrollment, also launching an online master’s in accounting, with 2U Inc., Kenan-Flagler’s corporate partner in both online degree programs.

A 43% RISE IN APPLICATIONS TO THE SCHOOL’S FULL-TIME MBA PROGRAM

While the pandemic has posed major challenges for him, it also led to a massive 43% rise in MBA applications to 1,903 applicants from 1,324 a year earlier, a windfall that has resulted in a much larger incoming class of full-time MBAs. The class that started in the fall totals 344 students, up 37% over last year’s 252. Shackelford thinks it is too early to say whether the current surge of applicants will last, but he also doesn’t believe anyone should be writing an obituary for full-time MBA programs, either.

“I was never on the ‘MBA is dying’ story,” he says. “People would tell me, ‘it’s dead, Doug. Give it up.’ The unemployment rate is 3.5%. I’ve got my own kids saying they would be fools to get an MBA because they were already making too much money and getting promoted. I remain very bullish on an MBA, whatever version you want to get. If you are 20-something and look out 40 years in the future, tell me if you can find something you can get a better return on? I do think we were going through a period of low unemployment. We weren’t willing to lower our standards to fill up our classes. If COVID hadn’t struck, we would have had a record low number for this class. From May 1 to July 1, the applications just poured in. Nothing like that will ever happen again. My phone was ringing off the hook. One person called me saying, ‘I am 34. I’ve been intending to get an MBA for the last six years. Am I too old? And then 24 hours later, a 22-year-old asked if he was too young. ‘Send in your applications,’ I said. We admitted both of them and they both came.”

The dean says that just about anyone could simply read a set of books or take a bunch of MOOCs to get the equivalent of an MBA. “I could go to the library and read books and get a Ph.D. in biochemistry,” he says. “It is sitting right there for me and it has been sitting there for 40 years. I can get it all free off the internet right now. But the things I have accomplished have all been done in a social setting. When I talk to alums, my first question is, ‘Tell me about your experience at North Carolina?’ They never tell me that their first accounting class changed their life. But what they all tell you is that ‘I went through the class with Jim and he was in my wedding and I don’t make any decisions without calling him.’ It is something that happens during a formative period in life. In many ways, they get the confidence and courage to be more than they thought they could be before they went into that experience. And most of us have a professor or two who took an interest in us and drove us to a point where you started a business or did something special. That is the magic. There are some people who are so self-driven that they can go to the library and get a Ph.D. in biochemistry. The bulk of us doesn’t have that kind of self-discipline.”

WHAT UNC LEARNED WITH ITS ONLINE MBA WHICH WILL BE TEN YEARS OLD THIS YEAR

When Shackelford led the initiative to launch the school’s online MBA in 2011, Kenan-Flagler became the highest-ranked business school with an online degree offering. Today, competition abounds, with the University of Michigan, Carnegie Mellon University’s Tepper School of Business, and many more schools competing in an increasingly crowded market. What has the school learned by being in the online space for what will be ten years this summer?

“We learned there was a market for great students out there who were not being served,” he says. “They are really an unserved market of great students because they need certain flexibility in their lives that we don’t provide with our full, part-time or weekend programs. We also learned that they will pay high tuition if they get a great program. So we found a market and a way to serve that market.

“We also found out it’s really hard to do. It’s hard to develop courses and hard to teach. I remember when we put it together, we said it will take 100 hours to create a course. And it took about four times that. We also have not found a way to do a world-class education cheaply. How can we just expand this thing and slash the price point? Our traditional teaching had a lot of useless stuff in it. Because when you convert, you have to question every joke and every example. When you are working with instructional designers, they will ask, ‘how does that connect to the point you are trying to make?'”

Kenan-Flagler Business School at UNC Chapel Hill

‘THAT PROGRAM SCARES ME TO DEATH ALL THE TIME’

He welcomes the increased competition from universities offering high-quality online MBAs at much lower prices at the University of Illinois’ Gies College of Business and at Boston University’s Questrom School. “They are great for the market and clientele they are serving,” insists Shackelford. “It’s just a different one from what we are serving. I was giving a presentation and the dean of BU was in the audience. A person spoke up and said, ‘You know BU is going to take you down.’ I tried to say there is totally a place for BU. We are looking at a different customer. We have very small classes, with no more than 20 students. We spend a lot of time in synchronous classes. The BU dean got up and said, ‘We studied everything. We are not trying to be like them.’ There is never going to be a student who says he can’t decide between BU and us.”

Even so, he concedes the competition in the market is challenging. “That program scares me to death all the time because we have to be constantly open to thinking about what kind of program would we have if we built it today? So if we are sitting here saying that what we are doing has worked for a decade, it might not be working six months from now. What scares me is someone comes in with technology that is better than ours. We rebuild the classes regularly, and we try to rethink everything all the time.”

As for the school’s relationship with 2U, which takes a considerable amount of revenue for every online student enrolled, the dean believes their partnership has been helpful. “Hopefully, we are both sufficiently irritating each other. I am forever saying to them if you aren’t pushing us to the limits at all times, we’re going to fail. And we irritate each other well enough to have a good relationship.”

‘IT’S BETTER TO BE GOOD AT A FEW THINGS THAN TO BE OKAY AT A NUMBER OF THINGS’

The success of that relationship led him to expand the partnership with 2U to a master’s in accounting in 2015. Are more options underway? “We have looked at a lot of variations of master’s of management type programs,” he explains. “But my approach has always been I don’t want to be involved in any program that I would not be delighted if my own child went there. The standard of excellence has got to be very high. Using that standard, I wouldn’t say there is no program we would consider but we are picky and choosy. It’s better to be good at a few things than to be okay at a number of things, and we are not a large enough school to be good at a lot of things. But that is not to say we would never do anything. Almost at any time, there is someone in my office with the next great thing.”

Surprisingly, perhaps, the school’s two online degree programs did not necessarily ease the transition to virtual learning in its other programs when COVID struck. “We had one week to shift over when COVID hit. We probably had an advantage over some schools but it still wasn’t easy. The students we have in the online program want a virtual teaching world. The ones we have in other programs, that’s not what they wanted. It’s better than having no shoes, but if you ask me would I rather wear my shoes than someone else’s shoes, you know the answer. We were able to pull stuff out of those MBA@UNC classes. But we didn’t just say to our students, ‘You are now MBA@UNC students. The online MBA is not designed for a career switcher or for more specialized training with electives in our full-time program.”

In the near term, the dean sees a convergence between online and residential programs. “There is really no such thing as an online program and a residential program,” he says. “They are already converging. Everything will be technology-enhanced learning at some point. Competition is going to get stiffer and stiffer. Geography is going to become less and less important. There were times when we owned our little turf, and maybe we had to share a bit with Duke and Virginia but nobody has got anything now. What happens when big tech gets involved and people would rather have a degree from Facebook rather than Chapel Hill? It might outlive me but the next 10 to 15 years are going to be very disruptive. It starts with the economic tightening and then innovation is going to break out because people are going to say we can’t continue what we are doing.

‘WE HAVEN’T DONE A VERY GOOD JOB AT CREATING A BUSINESS MODEL THAT IS SUSTAINABLE’

“For state universities like ours, funds are just drying up. We don’t get much state funding to begin with so we are pretty much privatized. But the drying up of state funds is going to affect a lot of state universities. We have the baby bust coming and I hope we will recover on the international front. That is just a place we ruled forever and we need to get that back. We have research faculty that we can’t justify paying at current levels. We haven’t done a very good job in creating a business model that is sustainable. So I think a lot of structural changes will have to occur.”

A future business model, he suggests, might well be a adopted from successful Internet companies like Netflix or Amazon Prime for lifelong, on-demand learning, “Can we go to subscription model in the future?” he asks aloud. “I use Spotify on a monthly subscription, and I can listen to whatever I want whenever I want. If I could get world class business knowledge, maybe there could be a consortium of schools to make it possible for on-demand learning. I think people will pay a lot of money for that. I don’t think we have been very student centric.”

Nevertheless, he says he is “totally bullish” on business education in the future and believes innovation is the way forward. “Nobody can out Harvard Harvard. So you have to find some way for your school to thrive and prosper and we are seeing that in spots. But we haven’t seen a breakout coming.”

LEVERAGING VIRTUAL REALITY IN MBA CLASSES

Four years ago, the school took a stab at bringing virtual reality into its MBA program. Kenan-Flagler professors David Hofmann and Steven King traveled with then MBA student Tanyi Fuoching to his home country of Cameroon to create a novel simulation. The assignment for students using the VR simulation was to set up a new health-care outpost in a foreign country. Leveraging VR technology, the simulation allowed Kenan-Flagler to gain global experience without leaving campus.

Shackelford says he is looking for an ed tech partner to help it pioneer more VR simulations. “The cost of us developing it on our own is prohibitivie,” says the dean, noting that the Cameroon simulation cost about $50,000. “We have done little things but for us with our budget it’s not possible to build this out in a big way. You can spend a half million dollars pretty quickly in an international immersion opportunity. So I would say it’s about three-quarters baked.”

Another simulation is based on British explorer Ernest Shackleton’s famous expedition to Antarctica where his team endured entrapment, hunger, frigid weather, angry seas—and near madness.”We are studying making decisions under stress. We put together a virtual reality situation where when you are experiencing it you need to put a coat on because it is so cold on that ship. That is stressful. Even though it’s not real, your palms are getting sweaty because you are struggling with what to do. I want us to be on the forefront of that but we need a partner. Ten years from now we are not going to be teaching in a classroom on how to deal with stress. We’ll be teaching this by virtual reality. Imagine that we have the technology in gamification or the technology Hollywood has today in making movies. Give me 1% of that.”

PREFERS A CONSUMER REPORTS APPROACH TO CURRENT RANKINGS

Like many business school deans, Shackelford would prefer rankings that do not place numerical positions on MBA programs. “With this COVID year, it’s kind of hard to figure out what’s what,” he believes. “But I think we would be better off with a Consumer Reports approach than the rankings to begin with. We need more than some number attached to a school. We’re not playing football here. Walk into Darden (at the University of Virginia) and then you walk into our building. If you can’t tell the difference in those two places in 15 minutes, your senses aren’t very good. Some people should definitely be at Darden and some should should come here and somebody should probably go somewhere else.”

For now, the job is delivering an exceptional educational experience when it is obviously compromised by COVID. “I have been doing town halls every Friday since COVID broke out for about a half-hour with all our faculty and staff. Add to COVID the racial issues we are having these days and the political divisions and it is hard to hold a culture together under all the stuff that is happening right now. A lot of it is trying to talk to people and hold everything together. I try to end it with the message to be kind, be compassionate, and be safe. I recognize people are going through hard times, and we don’t need anybody getting sick. It’s those kinds of things that I think are more important now.”

DON’T MISS: MEET KENAN-FLAGLER’S MBA CLASS OF 2022

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