By Kerry Miller

The PhD shortage facing business schools has the makings of an interesting case study about the laws of supply and demand. The basic problem: Doctoral programs aren't producing enough business PhDs to fill the growing demand for B-school faculty around the world. As the problem worsens, the fear is the quality of business education as a whole could deteriorate, watering down the value of the MBA degree and its economic impact.

An accrediting group said on June 21 that it had come up with at least a partial solution to the problem—a so-called "bridge" program that will train business-world professionals to be classroom teachers. The graduates of the weeklong seminar, the first of which will be offered in the fall, aren't intended to replace PhDs, officials of AACSB International—the Association to Advance Collegiate Schools of Business—say, but will help alleviate the classroom shortage.

"This is not flying blind," says Judy Olian, dean of the UCLA Anderson School of Management and chair of the AACSB's Doctoral Faculty Commission. "Pedagogically, covering basic issues like developing a syllabus, sequencing a course, engaging a class, structuring a lecture—I think you can do it in a week, for the right people."

And just who are the right people? Candidates for the bridge program are required to have a master's degree and a minimum of five to seven years of senior-level experience. Ideally, says University of California, Irvine Dean Andy Pelicano, candidates will also "have been teachers, in one way or another," whether through corporate training programs, mentoring junior executives, or guest lectures at universities.

DEMAND DRIVING UP SALARIES.  The new program has turned into a necessity in recent years as concerns about the growing PhD shortage have intensified, says John Fernandes, president of AACSB. Yet he says it remains an issue that's difficult to get many people—in business, in government, or even within business education—concerned about. ("And we've tried begging," he says.)

Several years ago, AACSB created the Doctoral Faculty Commission to address the problem, and in 2003 the commission's report made four recommendations: attract alternative sources—both "professionally qualified" faculty from the business world and PhDs in related fields, such as economics; increase production of PhDs—primarily through increased government funding; promote business PhDs to prospective students; and foster innovation in PhD delivery, such as by decreasing the length of the degree program from five to six years to four or five.

In the years since the report was issued, AACSB has seen little progress made as a result of the three recommendations that would increase the actual number of business PhDs available to teach. Individual-level incentives to earn a business PhD have increased—AACSB reports that the spike in demand for qualified professors has driven up the average starting salary for new doctorates to $93,780 in 2005, up from $64,000 in 1997, and salaries for PhDs in high-demand specialties like accounting have gone as far as $160,000 (see BusinessWeek.com, 5/30/06, "Puffed-Up Paychecks").Yet the number of new PhDs has remained limited because schools still have little incentive to expand their expensive PhD programs instead of investing their resources in the MBA programs on which their reputations are based. While an outside infusion of cash would certainly help, Fernandes says, government funding isn't going to happen any time soon—it's all earmarked for the sciences.

COSTLY CERTIFICATION.  Now AACSB has turned its attention to the remaining recommendation, to find alternative sources to fill faculty positions through the bridge program. AACSB is also developing a similar program to transition PhDs from related fields, such as economics, sociology, and information systems, into business, that is about a year down the pipeline.

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