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Why Veterans Are Saluting Business Schools


Stacy Poindexter Owen, dean of admissions at the Wake Forest Schools of Business (Wake Forest MBA Profile), has been on a mission for the last decade to get more applicants with a military background to apply to her school. When the Graduate Management Admissions Council (GMAC) launched Operation MBA in 2005, Wake Forest was one of the first schools to sign up for the program, which deems a school military-friendly if it offers scholarships and deferment flexibility to military candidates. Owen also recently hired a former lieutenant colonel for a job on her admissions team; his primary responsibility is to develop a formal military recruiting program for the school.

But perhaps her biggest opportunity yet to recruit veterans came this summer when the school decided to participate in the Yellow Ribbon program, an initiative created by the Post-9/11 Veterans Educational Assistance Act of 2008. Under the program, the federal government matches, dollar for dollar, any financial aid that participating schools commit, essentially providing eligible student veterans with free or reduced-cost tuition. It's designed to make out-of-state public colleges, private institutions, and graduate programs more affordable for veterans.

More than 1,100 colleges and universities signed up with the Veteran Affairs Dept. for the Yellow Ribbon initiative, which involves some 3,400 schools and programs within those institutions. While the VA is still compiling data from all the schools on how many veterans have enrolled, it is pleased with the institutions’ response, says Keith Wilson, the VA's education service director. In addition to undergraduate programs, law, business, medical, and other professional schools are participating. The Post-9/11 bill, which was signed into law on June 30, is expected to cost about $62 billion over 10 years.

Dozens of business schools like Wake Forest have signed up for the Yellow Ribbon program this school year, hoping to encourage more veterans of the wars in Iraq and Afghanistan to apply. Wake Forest's business school signed on this summer, committing $6,000 per student of tuition reimbursement for qualified applicants—$12,000 with the government match. "It was really a no-brainer for us," says Owen. "We have always been happy with military candidates. The recruiters like our students, so we said, 'Absolutely we will sign on.' "

surge in participants expected With the Yellow Ribbon program, graduate schools are aiming to take advantage of what they anticipate will be a flood of interest from qualified applicants. According to the VA, there will be an estimated 440,000 participants this year in the new Post-9/11 GI Bill, which is aimed at veterans of conflicts since the terrorist attacks of September 11. That’s nearly 40% higher than the number of veterans last year who used the Montgomery GI Bill, previously the standard way for veterans to get education benefits. Many also will be eligible for the Yellow Ribbon program, which requires that veterans have served active duty for 36 months, among other stipulations. In addition, more veterans than ever will be eligible for education benefits, including those ROTC and Service Academy officers and Reserve and National Guard members who didn't qualify previously under the Montgomery GI bill.

Under that bill, the base educational benefit that veterans received was a fixed $1,321 per month, no matter what college the veteran attended or his or her subject of study. The new GI bill benefits are based on a much more complex set of factors, including eligibility, the state where a veteran chooses to study, and whether or not he or she decides to study at a public or private institution. It is available for service members who were on active duty for 90 days or more since Sept. 10, 2001, as well as members of the Air Force, Navy, Army, and Marines on active duty. It offers veterans up to 100% tuition and fee coverage, a monthly housing stipend, up to $1,000 a year for books and supplies, as well as the option to transfer benefits to one or more dependents.

Business schools, in particular, are hoping the new program will help them draw more veterans, for the most part a large and untapped market of students, and by some estimates, a scant 4% of the MBA population. Applicants with experience in the military have always been valued by business school admissions officers because of their years of leadership experience, decision-making skills, and team orientation. Job recruiters are drawn to them as well, and some companies have set up formal programs to encourage veterans with MBAs to join their industry. In recent years business schools have boosted their efforts to recruit veterans, and many see the Yellow Ribbon program as another opportunity to reach this population, says Derek Blumke, executive director of Student Veterans of America, an advocacy group for student veterans.

veterans seen as an asset to business "Business schools especially have been targeting veterans because they have realized these individuals are a real asset in both the business and corporate world," Blumke says. "They know how to get a job done, how to follow directions, and get a task accomplished. They don't really know what it means to fail, and the business world loves that."

Given how new the Yellow Ribbon Program is, the response from business schools has been encouraging, says Melissa Knueven, associate director of global citizenship initiatives at GMAC, which administers the Graduate Management Admission Exam. There are currently 92 schools deemed military-friendly by GMAC, and of those, 54 signed up for the Yellow Ribbon program this summer, says Knueven, who helps oversee GMAC's Operation MBA program, which connects military applicants with MBA schools. She anticipates that more institutions may enroll next year, especially if the program is considered a success by participating schools.

"The Yellow Ribbon program is one way of helping to bring people who may not otherwise have had the means to come into an MBA programs," Knueven says. "The military is full of incredibly qualified people who bring so much to these programs, but cost can be a real issue."

Among the top business schools participating in the program are: Harvard Business School (Harvard MBA Profile), Columbia Business School (Columbia MBA Profile), University of Pennsylvania's Wharton School (Wharton MBA Profile), Stanford Graduate School of Business (Stanford MBA Profile), and Duke University's Fuqua School of Business (Fuqua MBA Profile). These institutions have committed anywhere from $3,000 to $17,500 per student in Yellow Ribbon funds each year, depending on the school, according to the VA's list of participating schools on its Web site. strong signal to military candidates Dartmouth's Tuck School of Business (Tuck MBA Profile) is one of the more generous participants, committing $19,233 per student. That contribution, when coupled with the matching money from the federal government, covers the full cost of the school's annual $47,835 tuition, as well as $4,691 in mandatory fees, says Diane Bonin, Tuck's director of financial aid. And unlike many schools which have put a cap on how many students can participate in the program, Tuck is allowing an unlimited number of veterans to enroll, Bonin says. This fall there are 11 veterans at Tuck who qualify, she says. She anticipates the school will have even more students who make the grade next fall as word spreads about Tuck's participation. "Hopefully, it will encourage people to apply who may not have done so in the past," she says. "We are really looking to support the military and expand the military presence on campus, so we felt it was important to just go 100% and provide support to everyone who is entitled."

Among the students taking advantage of the Yellow Ribbon initiative at Tuck this fall is Peter Simms, a second-year MBA and West Point graduate who was a special forces detachment commander in the Army for five years. Prior to business school, he served two tours of duty in Iraq between 2005 and 2008, overseeing a unit that conducted commando training for Iraqi armed forces. He paid for his first-year tuition at Tuck out-of-pocket, but was able to get his second year of tuition completely covered because he met the requirements for the new benefits.

"It is a great thing, especially in this economy, not to have that kind of financial burden on my back," he says. "It also sends a really strong signal to military candidates that the schools value what you have to offer."

Another business school helping veterans cover the full cost of tuition through the Yellow Ribbon program is the University of Michigan's Ross School of Business (Ross MBA Profile), which is contributing $15,164 per student. As at Tuck, the benefit is available to an unlimited number of students.

b-schools promote their participation Matthew Swanson, a second-year MBA student at Ross who is president of the school's Armed Forces Club, spent much of the past year lobbying the school to participate. Swanson, a U.S. Naval Academy graduate, served several tours of duty in Iraq and Afghanistan between 2000 and 2007, and wanted to do everything he could to make it easier for veterans like himself to go back to school, he says. His efforts paid off when the Michigan business school joined the program this summer, allowing him and many of his classmates to cover the full cost of their tuition. "It is a pretty difficult decision coming from a career in the military to taking on a lot of financial obligations and loans by going back to business school," he says. "This program really helps in that decision process because it essentially takes the tuition element out of the financial planning."

Ross has been busy promoting its participation in the Yellow Ribbon program at recruiting events this fall through alumni and through the school's Armed Forces Assn., says Ross Admissions Director Soojin Kwon Koh. She's hoping the school's participation will result in an uptick in applications from veterans. The school already has a strong military presence on campus; there are currently 45 students at Ross who qualify for the Yellow Ribbon benefits. "In our experience, we've had many former military folks in our classes, and they do very well and are successful post-graduates as well," Koh says. "We wanted to make it attractive and realistic for them to attend business school."

For some first-year students, the Yellow Ribbon program has proven to be a big motivator behind the decision to go back to business school.

Andre Toman, a first-year MBA student at Wake Forest, got out of the Air Force in October 2008. He served two deployments in Iraq between 2006 and 2009 as a pilot, and was trying to figure out his next step last fall when he heard about the new GI bill. As a U.S. Air Force Academy graduate, he would not have qualified previously for education benefits under the old GI bill, he says. With the new legislation, he not only qualified for the new bill but also for the Yellow Ribbon program. He now receives nearly $1,000 a month for housing and daily living expenses. He also received a scholarship from Wake Forest for his studies, he says.

"sweetened the deal""I was planning on going to business school before I heard about the Yellow Ribbon program, but it just made that decision much easier, with the new GI bill backing me up and that financial security," he says. "For me, it was one of those things that sweetened the deal."

David Mortlock, a consultant at Bain & Co.'s Los Angeles office and founder of the firm's Veterans at Bain affinity group, says he is encouraged that so many business schools have warmed up to the Yellow Ribbon program. The company has a nationwide recruiting program for veterans at top business schools across the country, and works closely with each school's veterans club to help students through the MBA recruiting process and the transition to civilian life. The effort has helped Bain recruit some top MBA talent; veterans made up 10% of its summer intern class last year, Mortlock says. With the advent of the Yellow Ribbon initiative, he is hoping that Bain will be able to reach even more of these students.

"I would expect that there is going to be an increase of veterans on campus, and we are prepared to support them through that transition and through the recruiting process," says Mortlock, a former Marine Corps officer who served in Iraq before attending business school. "Next year, if we can get 15% of our summer class to be veterans, that would be great."

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Damast is a staff writer for Bloomberg Businessweek.

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