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May 2, 2002, 12:00 p.m. Bad Business UT-Austin hurts a prized asset.

he academic world occupies its own universe, with its own logic. It is useless to ask "Why?" when Princeton and Harvard fight over who gets to keep Cornel West or U.C. Berkeley students receive credit for visiting strip clubs.

But even veterans of academia will find themselves flummoxed by a recent decision by the business school at the University of Texas at Austin to pull the rug out from under one of its most successful programs. The McCombs business school has watered down its prized entrepreneurship program, and with it, lessened the overall experience of students at the school. The school plans to replace highly popular adjunct professors who double as businessmen with research faculty without requiring these new tenure-track hires to follow the strict practices that made the entrepreneurship program a success.

It may not sound earth-shattering, but students and alumni — not to mention the entrepreneurs who teach in the program and have dedicated considerable time and hundreds of thousands of their own dollars to the program — are up in arms, and for good reason.

The entrepreneurship program is one of three McCombs programs ranked among the top-ten business-school programs in the United States. The program, which brings in entrepreneurs to teach students, is the brainchild of Jeff Sandefer, CEO of Sandefer Capital Partners and a member of the board of National Review. Twelve years ago, at the request of the dean, he developed the program with private funding, and the five elective courses now offered are among the most popular at the school.

Recently, the school raised $8 million for a new entrepreneurship center. Part of that $8 million came as a result of Sandefer's success. But now they're using the money to phase out the elements that made the program so successful. In response, five of the professors who have been active in the program have resigned, including Jack Long, CEO of Lone Star Overnight, a thriving overnight-delivery service in Texas that he founded ten years ago.

For the past three years, Long has taken time away from his company to teach entrepreneurship courses at UT. He estimates that he has taught about 200 students. "The experience has been the most intrinsically rewarding thing I've ever done," he says. "The students are highly motivated. I get a lot out of it."

It's people like Long — entrepreneurs committed to educating and passing on to students their practical wisdom and love of business — who are being replaced by tenure-track academics. While not all of the adjuncts have resigned, the program has been dealt a powerful blow. Long is bewildered by the administration's actions: "I don't understand the logic. It's just not there. The students don't see the logic. It doesn't make sense."

This local problem points up the larger conflict in the academic world between research and teaching. The question is: Whom does the university exist to serve? All too often, universities spend huge amounts of money, time, and energy attracting professors whose first priority is their own research, shortchanging students.

UT's entrepreneurship program was a breath of fresh air in this regard. Sandefer is unashamed of its departure from academic norms: "The entrepreneurship program's customer is the student. And we're accountable to them. Our goal is to turn out entrepreneurs who are strong, moral people. The business school's customer is the research faculty."

What is at stake here is whether demand for accountability threatens universities. When it comes to hiring professors who are great teachers and are willing to stake their jobs on their teaching and hiring academics who will produce books and research articles, universities always choose the latter.

The entrepreneurship program established by Sandefer and his cohorts was decidedly unorthodox. For one thing, the professors teaching in the program are not academics: They are successful businessmen, bona fide entrepreneurs who are passionate about training the next generation of entrepreneurs. All of them run their own companies — some several at a time — while they are involved in the program. This was an entrepreneurship program run with true entrepreneurial spirit.

But even more unorthodox is the pledge these adjunct professors signed in order to teach in the entrepreneurship program. In addition to promising to fight grade inflation and show up to class on time, at the end of the semester, unless all of the entrepreneurship professors are in the top 25 percent of UT business-school professors in student ratings, the lowest-ranked entrepreneur must resign.

This courageous pledge makes sense to people who have spent their lives working in the free market, as the entrepreneurship professors have. The way they see it, their client is the student; if they are not serving the students, they have no right to teach.

The pledge ensures strict discipline and accountability and is responsible for the success of the program. UT's entrepreneurship program is ranked seventh in the nation by U.S. News (and fifth by Success magazine), and it is often mentioned alongside Harvard, Stanford, and MIT, according to Sandefer.

The university knows that the academics they seek to attract — those whose first priority is research — would never agree to such a pledge, and so they have dropped it as a requirement for the new professors.

The students also take a pledge in which they promise to show up to class on time, to maintain strict attendance, and to prepare adequately for each and every class. Jeff Johns, the president of the Entrepreneurship Society, a student group at McCombs, described the workload: "For each class meeting, students spend 6-8 hours preparing. This compares to the hour spent on preparation for other courses."

The courses are challenging and rigorous. A lot is demanded of the students, and as a result they learn more in these courses than in their other classes. Jeff Johns explains, "You don't walk into an e-ship course unprepared. You may get called on to open a class — you never know when, so you always have to be prepared. In these courses, we challenge each other constantly. In a regular class, there's no challenging going on. The teacher lectures, there's not much dialogue." Many students testify that the vast majority of what they learn at McCombs is from their involvement in the entrepreneurship program.

The outcry from students and alumni has been loud and angry. Mostly, they are enraged by the sheer illogic of the whole thing. They cannot understand why the "one shining jewel" — as one student put it — of the MBA program is being destroyed. Entrepreneurship classes are always oversubscribed, with twice as many students queuing up on registration day to take the courses as there are slots for them. It is one of the highest ranked programs at McCombs, and is, according to Sandefer, "instrumental to the McCombs school maintaining its top-20 ranking overall."

This can be seen in the reaction of one student, who said, "I would not have even applied to McCombs if it were not for the entrepreneurship program."

The dean of the McCombs school has not returned phone calls for comment on his decision. As the wheels of the academic bureaucracy grind away, UT-Austin risks losing a sterling program, and the loyalty of donors, students, and alumni.

— Sarah Maserati is an NR associate editor.