MBA recommendations: What’s the best approach?

A recent post by mbaMission over at the GMAT Club, " Make sure recommendations are personal",  reinforces the concept that applicants must put time into understanding the commitment level of those who are writing them MBA recommendations. They encourage you to make sure that your recommenders are not writing a single, standard letter to send to all schools.

With this type of standard letter, they say, “your recommender is not really helping you—in fact, this kind of approach could actually hurt you!”

They go as far to say, “If you cannot convince your recommender to write a personalized letter or to respond to your target school’s individual questions using specific examples, you will need to look elsewhere. A well-written personalized letter from an interested party is always far better than a poorly written letter from your supervisor.”

Of course, the more personal and “fitted” a recommendation can be, the better.  But is all this true? Many of us don’t want to hear this. What if such nuance is not possible? How else can you ensure the best MBA recommendations are being written for you?

Accepted.com gives some pretty good additional advice: “Choose someone you know and trust. Do you know about your recommender’s family and what they like to do on the weekends? If not, get to know them well before you ask them to write you a recommendation.”

When you take the time to get to know the people who are writing your MBA recommendations, they are also getting the chance to know you.

“You want your recommender to fight for you and put in the time to write a great application. Make it easy for them by giving them a list of your reasons for wanting to go back to school and your recent accomplishments at work.”

They go on to say that a thank you gift after the fact can’t hurt, either.

If you want your MBA recommendations to MBA programs in DC to be personal, pointed, and influential, make sure you know the people writing them!

The 10 Most Under-Rated Reasons Why You Should Get An MBA

Here’s a list of the top 10 most under-rated aspects of getting your MBA.  These are things you’re probably not even thinking about if you’re in B-School today but will mean something several years from now:

1. The chance to stop and reflect on some big business issues.  Taking two years off to sit in a classroom might seem crazy in today’s deadline-driven world.  How can you possibly forgo two years worth of salary, plus pay the tuition?  Yet, on the other hand, it’s an amazing luxury to be able to get out of the day-to-day grind and actually sit and learn with a little reflection mixed in.  It might seem like a luxury to those who can’t afford to do it, so appreciate it and make the most of that reflection time.

2. The chance to make some lifelong friends who will accomplish great things over their careers in business.  This is probably the big one that most MBA grads talk about several years down the line.  You go through a tough experience like getting your MBA together and it’s hard not to make a few friends along the way.  These friends are more than just good people.  They’re likely to go on to be successful in their speciality of business that they focus in.  They’ll be sounding boards for you in the future.  Friends of their friends will probably be potentially invaluable contacts for you down the line.  Meet as many friends in your class as you can and keep up the relationships.

3. The chance to realize how little you understand about the world.  When you get into B-School, you think you’re the best-of-the-best.  And you are, to some extent.  But you’re probably only in your mid- to late-20s.  Even if you were tops in your high school, went to a great college, and had an amazing job prior to Business School where you were pulling in big bucks, the chances are extremely high that you’re still an idiot.  It’s not your fault.  You’re still the best of the best in your cohort.  It’s just you’re still very green.  You’ve got a ton to still learn about business and the world.  Well, good news. You’ll get a chance to make a dent in that ignorance while getting your MBA.  Go in with your eyes wide open.

4. The chance to learn about how to get a bunch of high-strung, Type-A personalities to work together as a team.  At any good Business School these days, you’re going to get the chance to work on a series of team projects.  This is very important.  All of you best-of-the-best students are keeners.  You all think you’re brilliant.  You all likely want to be the leader when a task presents itself.  It’s a great challenge to learn how to work together and get other Type-A types like you moving in a similar direction.  You may not figure out how to do it perfectly but you will get the chance to learn.

5. The chance to think about the global economy and not just your little world where you used to work.  At most good B-Schools these days, you’ll notice a lot of international students surrounding you.  Some schools will even try to use their international student body as a competitive advantage against other schools.  It is really important these days that you get out of your little perspective of whatever your last job was in your little corner of the USA.  You need to know that their are Chinese, Indians, Russians, Swedes, and Argentinians who are dying to go back to their homelands and eat your lunch.  Better realize there’s a big world out there and you need to figure out how to make some profits in it that will be sustainable.

6. The chance to interact with Professors who will really challenge you. To succeed in your career, you’re going to likely have to find and nurture at least a couple of good mentor relationships.  At B-School, you’ll probably get a handful of professors who really stretch your thinking.  You’ll hear about them from other students.  If you’re lucky, you’ll get into their classes.  If you’re smart, you’ll try to build relationships with the professors and make the most of learning all you can from them.  If you want good mentors later, start by learning how to build a mentor relationship with one of these dynamite profs yourself.

7. The chance to go listen to as many accomplished executives when they come to talk at your school.  I went to Columbia Business School in NYC.  I was fortunate because I could have gone to hear an amazing executive speak every other day if I wanted to.  When it becomes a daily occurrence, you start to take it for granted.  Don’t. If you want to be great, you’ve got to learn what’s made great people great.  You’ve got that chance when these people come through and talk.  And don’t just listen. Sit up at the front of the auditorium. Be the first one to ask a question afterwards.

8. The chance to refocus yourself.  Even though you’re in your mid- to late-20s, the clock is ticking and your career window is closing. You can’t reinvent yourself at 30 and then 35 and then 40.  The people who really go far in their business careers focus.  You’ve got your chance now at B-School.  If you worked in manufacturing before and now you want to focus in on finance, you can do that.  If you did accounting, but want to focus on private equity, you can do that do.  The sooner you pick the area you want to focus on, the more you can focus on the right classes, the right clubs, and the right summer job to go after between 1st and 2nd year.

9. The chance to learn about managing people.  You will get a few classes in managing people.  They might be called leadership or motivation, but they’re about how to manage a group of people working for you.  Prior to B-School, you probably will have had little opportunity to manage big teams.  Therefore, you might blow off these “human relations” classes.  However, post-B-School, you have no idea how important managing people will be to your career. Stop snickering and start opening your ears to what concepts they’re talking about it these classes. You’ll thank me a few years from now.

10. The chance to learn how to get up and string a few sentences together.  It seems silly but a big part of your success in business will depend on how you present.  A lot of people just basically can’t get up and talk.  I went to a Dale Carnegie class in my 20s and they told me that more people are afraid of giving a speech than dying.  It seems crazy that more people would rather die than give a talk.  The MBA student population is more speech-savvy than the general population, but a lot of B-School students stink at speaking too.  Nevertheless, you’re going to get lots of opportunities to improve it.  You might as well take advantage of it and actually get good.  

You’ll be amazed how far it takes you later in life.

Good luck, MBAs.  Enjoy your time in B-School and make the most of it!  You have an incredible opportunity in front of you.

MBA Students Help Find Economic Solutions for the Nation's Capital

When District of Columbia Mayor Vincent Gray enlisted a consortium of the city’s business schools to create a five-year economic development strategy for the nation’s capital, the idea seemed more novel than tactical. After all, it was an unusual assignment, especially because 16 first-year MBA students would do much of the fieldwork.

This week the mayor released The Five-Year Economic Development Strategy for the District of Columbia to praise from the business community. It’s a self-assured vision that looks to generate 100,000 new jobs and $1 billion in new tax revenue by 2017. It reflects Washington’s current economic situation and imagines an even brighter future for the District. It is a strategy that is both thoughtful and achievable.

The MBA students who served as the foot soldiers in this process hailed from The George Washington University, Georgetown University, American University and Howard University. They broke up into teams and studied the city’s seven industry sectors—federal government and federal government contracting, higher education and health care, hospitality, professional services, real estate and construction, retail, and technology.

The report is a testament to this energetic band of student fellows who weren’t afraid to test their skills, forge a new career path (albeit temporarily), and look with new eyes at deeply rooted economic challenges in Washington, D.C. If the report proves to be a success, as I know it will, it will be because of their superior work.

The mayoral fellowship attracted top-of-the-line candidates, all stars in their own right at their various schools. When they came together, the chemistry could be unpredictable but it also was high-spirited and generous. It was a regular reminder that we had recruited a smart, talented and committed group of fellows.
Our team had two Peace Corps volunteers and one Teach for America volunteer, as well as fellows who took more traditional routes to business school, working for Fortune 500 corporations or excelling in consulting companies. We also had public servants who had worked around the globe, from the U.S. Army to The Capital Markets Board in Turkey.

I was pleased to see how international our fellows were. It wasn’t unusual for the group to talk about their adventures overseas, not just because they liked to travel but because their families lived in distant places like India, the Middle East and Russia. In fact one of the fellows, Georgetown’s Sandeep Pillai, who hailed from India, invited everyone to his wedding in India in January.

Pulling a group of ambitious MBA students together could easily turn into a festival of egos, but what was most encouraging was their ability to work in teams and bring the best out in each other. We were especially pleased by the friendships that grew out of the fellowship, as students like Erica Clarke from Howard and Erin Monahan from American explored the city’s arts and culture scene to pull together their chapter on DC’s hospitality sector.

Working all summer long, the fellows interviewed more than 180 key leaders in Washington’s private, public and academic communities, analyzed sector economic data and proposed some 50 initiatives to enhance DC’s current job creation and economic development efforts. When they weren’t fanning out across the city, you could find them haunting the hallways at GWSB and lunching every summer Friday, thanks to the smart catering work of Georgetown fellow Michael Greenwald.

American’s Andrew Olson took on extra duty to guide our efforts on a sophisticated economic impact model we used to evaluate the various initiatives in the report. Other gifted fellows, Eric Igwe from Howard and Chaitanya V. Gopineedi, Julia Robbins and Dmitry Terekhov of Georgetown, matched his work and determination.

I was especially proud of the contributions of GWSB students Kevin Curley, Shruti Garhwal, Omar Hamwi, Stephan Kallus, John McKiel, Dan Roth, Fatih Saglik and Daniel Stoops. I was impressed with their professionalism and dedication to the project. GWSB has worked hard to bring skilled students to our campus, and this group of individuals represents the best in academia.

I welcomed the news that the fellowship has helped at least one of our fellows find a permanent job. Daniel Stoops, who was on the Strategy’s federal government team, has accepted an offer from Deloitte to start as a senior consultant in its Federal Strategy & Operations practice after graduation. When we first envisioned this fellowship, one of our chief goals was to give students the valuable consulting experience that would lead to a career and meaningful work. I am heartened to hear that we have succeeded

The future of The Five-Year Economic Development Strategy for the District of Columbia hasn’t been written yet. It will be discovered over the next five years as the mayor and his staff implement the dozens of initiatives included in the report. As for our 16 student fellows, I have no doubt they will not only excel in their careers but will become the leaders the business community so richly deserves and needs.

INSTANT MBA : Stop Being a Perfectionist And Pay Attention To Customers

Today’s advice comes from our interview with Rob Weber, co-Founder of W3i:

“Owners of new products or new businesses really need to guard themselves against over investing themselves in a certain concept. Otherwise they run the risk of really burning too much energy on something that has no real opportunity to succeed.”

When entrepreneurs focus solely on their idea and get too attached, they lose sight of what customers want. If you’re constantly working on perfecting your idea or product, you become disconnected from customers because there’s no time to check in with them for validation that you’re actually meeting their needs.

Instead of being a perfectionist, Weber suggests you accept something that’s minimally viable so you can get it out there. Weber experienced this at W3i  when he worked on a project for over a year only to realize it wouldn’t work.

“We were so worried about getting it perfect that by the time we finally got it released, it might have been perfect for what our vision was, but I don't think our vision was right. That’s the problem with perfectionist thinking."

Want your business advice featured in Instant MBA? Submit your tips to tipoftheday@businessinsider.com.  Be sure to include your name, your job title, and a photo of yourself in your email.

Executive MBA, Is It Worth It?

With passing time, the Executive MBA has gained a lot of popularity, both from corporate employees and employers. A majority view the degree as a critical business investment. Meanwhile, many companies are beginning to track the benefits of the programs as part of a larger strategy to manage talent.

According to a survey conducted by The Wall Street Journal, a full 64% of respondents said sponsoring or allowing employees to attend E.M.B.A. programs was a way to retain talent. And many employers get a quick return on investment. One-quarter of the companies surveyed said they see tangible results immediately from employers who are stronger managers and leaders after completing an E.M.B.A.; another quarter of companies said they see results within a year.

Why do employers prefer Executive MBA?

It is true that all types of companies today are hoarding in fresh MBA graduates from numerous institutions. At the same time, they are all warming up for the executive degree. Companies encourage their high-potential employees, who are typically young and can easily meet criteria for full-time M.B.A. programs, to keep working for their company and to earn a business degree later in an executive program.

“We don’t want them to go away for two years,” says Leif Meneke, a vice president of human-resources development at Deutsche Bank. A major reason why companies are ready to sponsor the Executive MBA program is that they want to retain their talent and they fear they might lose their employees if they move on to attend a two-year full-time program.

Many Executive MBA programs now want employees to continue working and at the same time, take a few days off each month to attend lectures. This proves beneficial to both employees and employers.

Also, there are companies who believe that by allowing employees to mingle with top-flight professors and classmates from a wide range of industries and functions, the MBA degree on the whole provides a varied perspective which is needed in this era of change.

According to The Wall Street Journal’s corporate survey, the following are the most wanted skills an Executive MBA should address:

1. Strategic thinking and planning

2. Ability to work across different domains

3. Ability to drive results

4. General leadership

5. Core financial understanding

Since the students in these Executive MBA programs come with a lot of experience in their hands, they are able to relate to many real-world business issues in a much better way. Even schools have won additional praise from companies for bringing real and current business issues into the classroom.

The reason why this program is growing in popularity each year is because successful Executive MBA graduates strongly support these programs and as they climb the ladder, they encourage other to pursue the same.

According to the WSJ survey, the following are some schools that performed the best job of imparting immediately applicable skills according to students (arranged alphabetically):

1. Columbia University

2. Columbia-London Business School (Global Program)

3. Cornell University (Johnson)

4. Northwestern University (Kellogg)

5. University of North Carolina (Kenan-Flagler)

6. university of Pennsylvania (Wharton)

7. University of Southern California (Marshall)

Conclusion

If you are among those who have a considerable amount of work experience and want to improve their business expertise, an Executive MBA is definitely more worth than quitting your job and pursuing a full-time program. A foreign MBA does not come cheap. Hence, it can’t get any better if your company is ready to sponsor.

Are MBAs nothing more than Barbies and Kens in business look?

Thomas Sattelberger, former Chief Human Resources Officer and a Member of the Management Board of German telecommunications provider Deutsche Telecom, has always been very outspoken about his opinion on MBA graduates. He calls them “Barbies and Kens in business look” and “self-proclaimed high potentials” whose goal it is to solely increase their power and bank account. In a recent interview for the German online portal “Spiegel Online” he said that whoever thought a U.S. American or British MBA degree would give him a career in every German company, had gambled away. He instead would search for talents from different backgrounds and with knowledge of sociology, psychology or history. He said: “Education, reliability and sustainable economic management are more important than shareholder value.” Sattelberger has recently taken on the role of human resources ambassador for the initiative New Quality of Work (INQA) where he will design solutions, recommendations and bills in relation to the work field - a position that will give him more opportunities to realize his ideas about education and management.

Sattelberger is clearly playing the role of the devil’s advocate – something that is precious to have as it instils dialogue and eventually new ways and ideas. MBA Channel has spoken to four German business schools about his views, the Barbie and Ken image, differences in MBA education between the U.S., the UK and Germany and the German competencies they need to teach to make a difference for Europe’s economic powerhouse.

Reading Mr Sattelberger’s opinion - what do you think? Do you agree with his view?

Felix Müller, Director Henley Business School Deutschland, Frankfurt
Mr Sattelberger has always been very provocative in his statements which helped him getting heard and stimulating the debate around MBA education. I appreciate this since the MBA and its benefits are still quite far away from being understood. You will find all types of personalities among MBA graduates and some may show the behaviours described by Mr Sattelberger. For us at Henley Business School, these behaviours are clearly against our beliefs and what we have been teaching our students in the past 66 years: We are strong proponents of responsible management and leadership and we pride ourselves by the fact that Mr Sattelberger’s former company Deutsche Telekom is working with Henley on three professional programmes developing leaders and managers supporting the transformation skills Deutsche Telekom requires. 
US companies – and the US culture in general - are much more capital market driven than European ones and this also shows in the MBA programmes. If we like it or not, publicly listed and globally active companies like Deutsche Telekom have to understand this way of thinking and making business and an American MBA helps you in doing so, following the idea of “know your enemy well!”.

Are MBA graduates Barbies and Kens in business look that are only after power and money?

Heidrun Hoffmann, Senior Program Manager, MBA Program, WHU – Otto Beisheim School of Management, Vallendar, Germany
The WHU answers this question with a clear No. The application process for the MBA programme encompasses an extensive application form, a minimum of one reference and the TOEFL- and GMAT-tests (TOEFL: min. 100; GMAT: mind. 600). Apart from these formal criteria we lead two personal interviews with applicants where we pay attention to personality, social competency and the ability to work in a team. Our method of teaching and learning is based on interaction and group dynamic, Barbies and Kens would be outcasts. That’s something we try to rule out during the application and enrolment process.

Mr Sattelberger is especially critical towards MBA graduates from U.S. American or British MBA programmes. Is there a big difference between MBA graduates from these countries and Germany for example?

Professor Dr Udo Steffens, President of the Frankfurt School of Finance & Management 
Each school has, of course, its own spirit or ethos which is reflected in the curricula or its way of teaching. Through site visits, MBA students will experience the distinct local or national management culture of their school’s home country. The US corporate culture is highly shareholder-value driven. In Germany, on the contrary, workers’ participation has led to a consensus-oriented corporate culture. All this is echoed in the MBA programmes and has an impact on MBA graduates. Ger-man companies across all industries recruit from us. Our graduates work in management consulting, IT and the manufacturing industry, banking and finance, for NGOs and development banks. We are extremely proud that we also see more and more entrepreneurs among our students and graduates. Thus, we initiated our own venture capital fund. Here, Frankfurt School Family members can seek advice as well as financial resources to start their own business.

As the American and European markets differ in quite a few aspects - which competencies do you teach especially for the German market for example?

Volker Stößel, Head of Communication, HHL Leipzig Graduate School of Management
We are teaching a General Management approach added by soft skill and entrepreneurship classes. Our MBA education aims at preparing the students to later on work in different functions for national as well as international companies or to set up their own business. Besides the official curriculum we offer German language courses to our students. Additionally, international students have the opportunity to experience the German corporate culture by taking so called field projects. In such a consultancy project up to four students solve real-life questions posed by companies. During the field projects the MBA students are involved into the culture and processes of the companies.

Link to Thomas Sattelberger’s interview on Spiegel Online

When does it make sense to earn your MBA?

From a young age, we’re taught that education is the vehicle that can take you wherever you need to go in your career. While increasing your level of education is never a bad thing, it requires more critical thinking and tough decision-making with each additional level you pursue.

Many professionals are faced with a tough question once they enter the workforce: Is a graduate degree necessary to pursue my career goals? For many, the question is whether to pursue a master’s of business administration degree. MBA programs are one of the most common graduate degree programs for professionals, because this type of graduate degree can be applied to so many professions.

So how do you determine if earning an MBA is what’s best for you and your career? Here are four reasons getting an MBA could make sense for you.

* If your employer will cover part or all of the costs. Many employers want their employees to grow with the company and be able to transition easily into a management role when the time is right. Obtaining your MBA is one of the best ways to prepare yourself for a management role, so your employer may be happy to assist you in that venture. Online MBA programs are becoming more and more popular, and usually offer the flexibility to learn while you remain in your current job – a bonus for you and your employer.

* You find yourself needing another marketable skill. You may find that your resume falls a little flat for the types of careers you want to pursue. Obtaining an MBA is an effective way to bolster your qualifications, and you’ll be able to market what you’ve learned in your master’s program when the time comes for an interview – and then apply that extra knowledge once you’re on the job.

* You know you want to be in management. It’s possible to advance to the ranks of management without earning a graduate degree, but an MBA can improve your chances. Not only can it help you get a job in management, it can give you the managerial skills to excel in your role once you get the job.

* You have time to do it. Even if earning an MBA makes sense on other levels, you should have the time you need to commit to a graduate program. Finding flexible online MBA programs with course options that fit perfectly into your schedule might be exactly what you need to successfully obtain your degree.

MBA startups at Stanford reach all-time high

A record-breaking 16% of Stanford B-school's class of 2011 chose to start their own companies at graduation, exceeding the school's 12% peak during the dot-com boom.

By John A. Byrne

(Poets&Quants) -- During the dot-com era, MBAs at many business schools rushed off campus to start all kinds of e-commerce companies. The frenzy to get in on the Internet action back then led to many well-funded, but ultimately failed, businesses. For most business schools, the years 1999 and 2000 saw record numbers of graduating MBAs start their own companies.

For the first time since then, the percentage of MBAs who are shunning traditional corporate jobs in favor of going out on their own is hitting new records once again. At Stanford's Graduate School of Business, an all-time high of 16% of the class of 2011 chose to start their own companies at graduation. The school says the percentage of MBA students who decided against traditional MBA jobs in favor of the start-up world reflects a three-fold increase from only 5% in the early 1990s and is a third higher than the 12% peak during the dot-com bubble.

More importantly, the 10-year trend data, says Pulin Sanghvi, director of Stanford's Career Management Center, suggests "a generational shift toward entrepreneurship." It's not only showing up in the placement stats that show that greater numbers of graduating MBAs are launching their own companies from scratch. It's also showing up in the number of MBAs who are anxious to work for smaller companies and startups that are, by nature, more entrepreneurial.

At Stanford, MBA entrepreneurs last year pursued a wide diversity of industries and companies. Stanford's Career Management Center found that there wasn't as nearly "as much aggregation in technology-Internet-social media as you might otherwise expect," says Sanghvi. About 30% started companies in Internet services and e-commerce, but 15% ventured into investment and financial services, and 7% each in food and beverages, retail or wholesale, and sport or sports management. Roughly 5% of the Stanford MBA entrepreneurs launched enterprises in healthcare, with another 5% in cleantech and alternative energy.

Sanghvi, who expects the class of 2012 to chose the entrepreneurial route in similar numbers, believes there is a significant difference in this generation's startup intentions. "The difference between now and the late '90s in the dot-com boom is the Internet was an emerging, poorly understood space that seemed very new and risky," says Sanghvi. "There was more of a mentality in the late '90s that 'there is a wave happening and I don't know how long that wave is going to last.' In 2012, we now have 20 years-plus of history where this part of the economy has thrived, and thrived surprisingly well, even against the recent financial crisis."

More MBA grads are gravitating to the startup world than at any time other than the dot-com boom of 2000-2001. The "generational shift" Stanford is referring to raises the prospect that many traditional MBA recruiters in consulting and finance will see a smaller percentage of the best and brightest in any graduating class. That is bound to lead to some frustration by firms that pay among the highest starting MBA salaries. But Sanghvi says they are already adapting, alternating the way they recruit MBAs at top schools.

What's behind the startup spike?

The new entrepreneurial fever is in part due to the heightened attention to tech startups like Facebook (FB) and LinkedIn (LNKD) to Twitter and Zynga (ZNGA), and the ascension of the late Steve Jobs as one of the great entrepreneurial geniuses of our time. Another underlying cause for the shift is that students seem to be more comfortable assuming the risks of starting a business from scratch.

"There is much greater knowledge and understanding on how to start and build and grow a new enterprise," says Sanghvi. "We have dedicated a significant part of our curriculum against this discipline and we now have so many alumni who have blazed a trail. The flip side is there is not as much security in the larger companies, anyway. The financial crisis led many companies to cut down their hiring and layoff large numbers of their workforces."

The swelling interest in startups by graduating MBAs is also due to the encouragement from business schools. The schools have launched business plan competitions, dangling significant cash awards to student winners so they can start their new businesses. They've increased the number of elective classes on entrepreneurship in the course catalog, and they've put startup projects into the basic MBA curriculum.

"It isn't a goal for Harvard Business School to graduate more entrepreneurs, but this will be a side benefit," says Alan MacCormack, a Harvard professor who recently oversaw the school's startup initiative, which assigned an entire class of 900 students to launch micro-businesses as part of six-person teams, with seed capital from the business school. At Harvard, he says about 8% to 10% of the class of 2012 went the entrepreneurial route.

It seems that the trend is even more pronounced at highly ranked schools. A new study by the Graduate Management Admission Council -- based on 5,366 recent or soon-to-be graduates of business schools -- found that only 5% of students plan to own or start their own business after graduation. That's roughly half the percentage at Harvard and just a third of the percentage at Stanford. The study, released on May 21, was conducted between Feb. 15 and March 18, 2012.

Of course, many students are attracted to Stanford because of its location in the heart of Silicon Valley, widely considered the epicenter of American entrepreneurship. "Despite an uncertain economy, more of our students are willing to take the risk of starting up new enterprises," adds Sanghvi.

The school says that its graduates describe the ideal business culture as one that is flat, non-hierarchical, encourages risk-taking and has a strong culture of mentorship. "Growth potential and early responsibility are increasingly priorities for students while money and job security are lower priorities," Sanghvi says. "It's part of a broader generational story that is now taking on clear dimensions."

B-schoolers holding out from traditional MBA jobs?

A greater number of students, says Sanghvi, are less eager to commit to companies during the typical fall recruiting season when the big MBA hirers come to campus. Instead, they're holding out until the spring before graduation to pursue different types of opportunities, often with smaller companies and startups. "They don't want to take themselves off the market so soon," says Sanghvi. "More students feel confident in letting some of the traditional offers go in the fall. We've been seeing this sharply at Stanford for many years. Other schools are also seeing a market shift in this direction."

To satisfy that demand, Stanford's Career Management Center held what it called "The Fewer Than 300 Event," inviting 32 companies with fewer than 300 employees to campus to meet MBA students. Sanghvi took over the main boardroom on the fourth floor of the school's Bass Center last April and brought in couches to create the event.

"Many of the companies had buzz that they might go public over the next year or two," says Sanghvi. "Eight of them were on Goldman Sachs' IPO list. A lot of the companies had no hiring positions open when they came, but after meeting our students, changed their minds."

Traditional corporate recruiters, meanwhile, are adapting their approach to students so that they are in closer alignment with shifting generational motivations, says Sanghvi. For example, some companies are offering opportunities for early responsibility and the flexibility to work on ideas and projects that appeal to the employee. Other sectors have seen shifts in interest that reflect an increased entrepreneurial spirit among graduates. In the financial sector, MBA grads are migrating to jobs in investment management, particularly private equity and venture capital, where they can play principal roles.

"It is important to recognize that as the field of opportunity available to graduating MBAs has broadened, it hasn't made the more traditional opportunities like consulting less attractive," adds Sanghvi. "It has made the traditional paths even more attractive because as the field of competition has increased, the traditional firms have put even greater emphasis on early exposure, responsibility, ownership and mentorship. Our students have very good choices in front of them."

Source

Compensation of top school MBA grads continues to rise

The value of the MBA, in terms of the starting salaries of graduates, hasn’t lately served as a ringing endorsement for the degree. According to a report last month by the Graduate Management Admission Council, which publishes the GMAT B-school entrance test, median starting salaries have been more or less stuck at $90,000 since 2008.

What about the degree’s value over the course of an entire career? Exclusive new research suggests that this, too, has stalled. What’s more, while top-ranked programs continue to deliver the greatest returns on the b-school investment, the gap between them and the rest of the B-school pack is growing.

“The effects of the Great Recession on the labor market for MBAs can still be felt today, a full three years after the official end of the recession,” says Katie Bardaro, analytics manager at PayScale, which conducted the research. “Jobs are fewer and further between and wage growth is far below its pre-recession levels. The only MBAs who appear to be escaping these stagnant wages are graduates from top-ranked programs.”

For the fourth year, Bloomberg Businessweek asked PayScale to tap into its database of 100,000 MBA graduates to calculate the median cash compensation—salaries and bonuses—for those with degrees from ourtop-ranked U.S. full-time MBA programs. PayScale, which collects salary data from individuals through online pay-comparison tools, determined the pay for graduates with pre- and post-MBA work experience of less than two years, five years, 10 years, 15 years, and 20 years. We then used those data to calculate a rough estimate ofmedian cash earnings over the 20-year span.

Harvard Business School took the top spot in the ranking, with 20-year pay of $3,639,643, followed by the University of Pennsylvania’s Wharton School($3,460,707) and the Stanford Graduate School of Business ($3,432,013).

On average, graduates of all 57 programs earned about $2.4 million over the two decades, or $122,513 a year. That amounts to a slight increase from last year, when annual pay for the group was $122,146. Graduates of the 10 programs with the highest earnings took home nearly $3.2 million apiece, or $159,122 a year, an increase of 3.6 percent. The remaining 47 schools averaged $2.3 million, or $114,724 a year, virtually no change from last year.

Over the course of the 20-year period, graduates of all 57 programs averaged a 90 percent increase in pay. But numerous factors, from geographic location to the career paths of graduates, resulted in wide differences among schools. Those institutions with the lowest starting salaries typically had the biggest increases. The University of Georgia’s Terry College of Businessexperienced the biggest gain—174 percent, to $139,000 at the 20-year mark. The Massachusetts Institute of Technology Sloan School of Management had the smallest, at 41 percent, to $169,000.

The MIT numbers highlight one of the study’s inherent limitations: Pay data for smaller schools such as MIT may be based on fewer than 50 reports and may not accurately reflect pay for the entire class. The pay figures themselves do not include stock or stock options, which can make up a significant portion of MBA pay, especially in later years. And the study itself is not longitudinal—the pay reports are for groups of people who graduated from the same school at various times, not for one group of people who reported their pay throughout their careers.

Despite those qualifications, however, the PayScale study yields a number of insights. For example, the average compensation for all 57 schools at the 20-year mark is $147,000, about three times the median income for all U.S. households. On average, total compensation for the entire 20-year period for every school except Harvard is two-thirds that of Harvard, ranging from 95.1 percent for Wharton to 49.5 percent for the University at Buffalo. The value of the MBA degree closely correlates to rank. Of the 10 schools with the highest career pay, eight are top-10 schools in the latest Bloomberg BusinessweekBest B-Schools ranking; of the 30 schools with the highest career pay, all but five have a top-30 Best B-Schools ranking.

A key factor in determining how much an MBA degree pays out over time is the career path followed by graduates. Among the 10 schools with the highest career pay, about 28 percent of 2011 graduates went into consulting and 34 percent pursued finance—figures that have been fairly consistent for at least 10 years at schools, like Harvard, that publish historical data. At schools such as George Washington University, where nearly one of four MBA graduates ends up in government or nonprofit service, or Rice University’s Jones Graduate School of Business, where four-fifths get hired by regional employers at graduation, both starting salaries and career pay are far lower.

Source

Managing Energy's Biggest Risk: Leadership

This is a guest article written by Carol Singleton Slade, Trent Aulbaugh and Steve Goodman of Egon ZehnderInternational. The firm specializes in senior-level executive search, board consulting and director search, management appraisals, and talent management.

Just when it seemed that the role of energy CEO couldn’t become any more complex or demanding, it did.  Macondo, Fukushima, Keystone, Iran, the Arab Spring, and the rise of unconventional plays, offer only the sparest shorthand for the risks, regulatory blowback, and geopolitical uncertainties that now dominate the agenda of the energy chief executive.

In the past, driven by a relentless search for value, energy CEOs devoted much of their time to strategy.  Today, CEOs tell us, they spend far more of their time dealing with external stakeholders, making sure the voice of the industry is being heard by governments around the world and managing boards that have become highly risk-averse, short-term focused, and even bureaucratic

Thanks to the relentless focus on risk from a broad array of threats, the CEO role requires extraordinary understanding of many disciplines, from finance to operations to technology.  Meanwhile, with boards preoccupied with risk, many CEOs lack the depth and breadth of advice they formerly received.

The role also requires new leadership skills: the ability to act as the public face of the company in an era of unprecedented “headline” risk, to diplomatically champion upside potential with wary boards that tend to focus on down-side risk, and to engage with governments, policy makers, and regulators around the world to help the public understand energy’s critical role in a growing global economy.  As a result, the industry faces what could the biggest risk of all: a shortage of future chief executives and top leaders who have the requisite competencies for navigating this complex new world.

Many of today’s energy CEOs are acutely aware of the threat.  They tell us that in addition to devoting more time to external stakeholders and to board management, they also spend more time on leadership development than ever before. They know that the typical development path of many of today’s top executives did not take into account the unforeseen changes in the CEO role.  And they know that their companies have to compensate for that gap – and soon, especially given the coming “silver tsunami” of experienced leaders retiring.

The urgency of the issue presents a classic dilemma of talent development: speed versus derailment.  Companies need to develop potential leaders rapidly, while ensuring that they acquire the requisite skills.  Move too fast, however, and you run the risk of putting people in jobs for which they aren’t ready, setting them up for failure, and derailing them.

The complexity of the role presents a second classic development dilemma: depth versus breadth. Traditionally, organizations have taken one of two paths in developing future leaders: the functional and the rotational.  On the functional path, the executives rise primarily through a single function – whether it’s production, operations, projects, exploration, or finance.  They then get broader exposure to other parts of the company as they enter the upper tiers of management or the C-suite.   On the rotational path, promising executives are posted to different functions and areas early on in their careers, gaining broad knowledge of the business.  Both approaches have limitations.  The functional approach imparts depth, but may fall short on breadth.  Rotation provides breadth, but may lack real depth.

There’s no magic formula for instantly resolving the tensions of speed versus derailment and breadth versus depth. But in our experience, there are some concrete steps you can take to significantly mitigate their risks and – with all deliberate speed – identify and produce the kind of leaders that will be needed.  Those steps include:

• Assess for potential. Too often, the identification of “high potentials” is based solely on their experience and past performance, both of which are important, but don’t necessarily predict future behavior.  Potential is the capacity to take on leadership roles that are greater in both size and complexity, and the speed with which someone can do so – precisely what energy companies need to know right now and with great accuracy about possible CEOs.

• Revisit the CEO profile. Take a fresh look at the competencies the next CEO will need – not just in terms of strategic considerations like business drivers, industry trends, markets, and financial goals that will help shape the company’s future, but also in terms of what kind of leadership competencies will be required – especially, the skills to influence external stakeholders, a proven record of developing and mentoring talent, and the ability to build organizational capability and create solid teams.

• Put a stake in the ground. Assess internal candidates against those competencies and then benchmark them against external talent.  By measuring internal CEO talent against best-in-class external talent, you can further determine any shortfalls and use the information along with the assessment for potential to create highly specific and targeted development plans for each promising individual.

• Accelerate integration. When moving a high potential into a major complex role, institute a structured program to accelerate development.  Much like an onboarding program for new hires, it should be designed to rapidly help the executive understand the role, the culture, team dynamics, and the networks he or she will need to develop in order to succeed.

• Provide ongoing support. Create a structured program that continues to provide the executive with behavioral feedback, coaching, and learning – even after the executive becomes CEO.

Many organizations already do some of these things in the normal course of succession planning and talent management. But these practices need to be tightly integrated and deployed in a conscious and concerted effort to address the urgency and complexity of today’s energy leadership issues.  To do anything less is to take a big – and unnecessary – risk.

Source: Forbes

Cities with most global appeal

New York ranks first as a global business centre in a worldwide survey of cities, London, Paris, Tokyo and Hong Kong all trail the Big Apple on the Global Cities Index. But Beijing and Shanghai emerged as potential rivals within 10 to 20 years, according to the index.

The survey - conducted by Bloomberg and consultancy A.T. Kearney - examined 66 of the world's busiest commercial urban centres, judging each on the scope of its business activity, labour force, access to media and information, cultural amenities and political influence. The goal was to find a measure that would help corporate and government decision-makers determine which of the world's cities will best attract and shape the future flow of people, ideas, capital and goods.

New York may be challenged to retain the top spot. Trends that may reduce its influence include "the growing chasm between the very rich and the poor," said James Parrott, chief economist at the Fiscal Policy Institute, a New York-based research and education organization backed by organized labour. "It weakens our consumer base, makes it harder for the city to remain a truly open society with lots of opportunity, and - although it's a national problem - not enough local leadership has been focused upon redressing that."

Polarization over politics in Washington, driven by "backward-looking perspectives held by people who even deny the reality of climate change, presents a risk for the city and the US in competition with the rest of the world in the 21st century," Parrott said.

(03.05.2012) Sources: Bloomberg

Managing energy's biggest risk: leadership

In the past, CEOs in the energy industry devoted much of their time to strategy. Today, CEOs in the sector, tell the executive search consultants from Egon Zehnder International that they spend far more of their time dealing with external stakeholders, making sure the voice of the industry is being heard by governments and managing boards that have become highly risk-averse, short-term focused and bureaucratic. As a result, "the industry faces what could become the biggest risk of all: a shortage of future chief executives and top leaders who have the requisite competencies for navigating this complex new world", write the consultants.

The role of CEO of an energy company requires new leadership skills: the ability to act as the public face of the company in an era of unprecedented "headline" risk, to diplomatically champion upside potential with wary boards that tend to focus on down-side risk, and to engage with policy makers and regulators to help the public understand energy's critical role in a growing global economy.

Many of today's energy CEOs spend more time on leadership development than ever before. They know that the typical development path of many of today?s top executives did not take into account the unforeseen changes in the CEO role. And they know that their companies have to compensate for that gap ? and soon, especially given the coming "silver tsunami" of experienced leaders retiring.

(03.05.2012) Source: Forbes

The multi-talented MBA

ONE argument which is often trotted out in favour of a liberal-arts curriculum, at least for undergraduates, is that being exposed to a variety of subjects leaves the mind supple and agile. Knowledge of accounting, say, is all well and good for standard problems, but to embark on fundamental change it is better to think as a biologist or philosopher would. If this is true, then the fifth of American college students majoring in business would seem to have put themselves at a disadvantage.

Your correspondent was reminded of this while browsing the winter issue of the MIT Sloan Management Review. In one piece, Leonard Berry of Texas A&M University, Ann Mirabito of Baylor University and Gale Adcock of SAS Institute, a software firm, describe how SAS takes care of its employees’ health-care needs on-site:

The SAS Health Care Center, which started modestly in 1984 and now has a staff of 55, including four physicians and 10 nurse practitioners, does not charge for services and collects no copays. Same-day appointments are common, and care is unhurried; clinicians may spend 30 minutes or more with a patient... As its own health insurer, SAS avoids the cost of paying staff to negotiate claims payments with insurance companies, as most private medical practices have to do. And SAS estimates that each on-site patient visit saves two hours of employee work time because the individual remains on campus, resulting in productivity savings of $3.6 million in 2010. 

Thirty years established, SAS’s approach sounds charming and useful. But it would take an enormous amount of work to implement something similar from scratch. The tasks involved might include: designing the facility; hiring doctors, nurses, and other health staff; establishing relationships with hospitals; buying equipment; and explaining to employees how to take advantage of the new service. One would need a background in health economics, or a willingness to learn a great deal, quickly. (Perhaps it’s worth noting that Ms Adcock did not start out with a business background, but as a nurse.)

The Management Review also features an interview with Dave Stangis, vice president of corporate social responsibility and sustainability at Campbell Soup. Mr Stangis has a broad title, but until reading the interview you might not have guessed that his responsibilities include negotiating the installation of solar panels at three different sites (in two countries), educating shipping partners on environmental certification programmes, and worrying about the health of children in Camden, New Jersey. Unlike Ms Adcock, Mr Stangis does have an MBA, from the University of Michigan.

Most likely neither Ms Adcock nor Mr Stangis, if asked at the start of their career, would have been able to predict their current duties with any accuracy. This might well be something for aspiring MBAs, especially those who still have other educational possibilities open, to keep in mind. A broad-minded approach to education now might well make for a much more interesting job in future.

Source

Too old? Too young? What’s the right age for business school?

Barbara Bierach

Typically, business students enter graduate school with a first degree and about five years of work experience, meaning they are generally in their late 20s –an age where change is still part of the lifestyle. People in their 40s and older on the other hand are rather settled in their careers and work at a level where additional skills don’t necessarily guarantee substantial plus on the payback.

For some people, though, business school is right regardless of age. Philip Delves Broughton, an author who graduated from Harvard Business School in 2006 writes: “Overconfidence can occur at any age, but it seems to be rarer among those who have done more between university and business school than spend a couple of years knocking around with like-minded souls on a management or analyst program. But experience also has its risks, notably overbaked assumptions and habits that can be hard to change.”

A graduate degree can increase career options at any age. For people over 35 it can for example help to move from a small entrepreneurial environment to a larger cor-porate one. Or it can assist to acquire the skills for a new start in a different industry.

Nevertheless, today’s GMAT-takers are younger than the degree seekers of the past. According to the Graduate Management Admission Council, 37 per cent of those who took the test were under the age of 25 in 2007. In 2011, this number in-creased to 44 per cent. The percentage of test-takers over the age of 31 in the same timeframe has dropped to 16 per cent.

Some institutions are catering to those who wish to enter graduate programmes sooner. At Harvard Business School for example students can apply for a spot in a so called 2+2 Programme. According to the school’s website, those who are ac-cepted into this track spend two years after college working and then an additional two years taking MBA courses. The Sellinger School of Business and Management at Loyola University Maryland offers an Emerging Leaders MBA. The average age of students enrolled in this 12 months long track is 24, and 6 out of 10 are immediate college graduates.

In many European schools on the other hand, the median age of students entering a full-time programme is considerably higher, at Insead for example it is 28, at IMD it’s 30.

And then there is always the alternative of an Executive MBA where the average age of most candidates is between 30 and 40. A few business schools featured in the QS TopExecutive statistical review have candidates with an average age of 40 plus, including the University of Tennessee, Knoxville and the Helsinki School of Economics, which offers its Executive MBA in Finland, South Korea and Singapore. National University of Singapore, HEC Paris, Athabasca University in Canada, Melbourne Business School in Australia and the Paul Merage School of Business at the University of California, Irvine,he Trium Global Executive MBA from NYU Stern, HEC and London Business School also have an average candidate age of 40.

Sources:

BusinessweekU.S. NewsQS TopMBA