UNDERSTANDING AND SELECTING THE APPROPRIATE MBA
By Dominic Basulto
In the past five years, the MBA credential has acquired
the reputation of being the magical passport to untold riches and a
comfortable life with banks, consulting firms, and multinationals. Top
MBA graduates are in demand on a global basis, forcing leading business
schools to revamp their programs to include the all-important "international"
component as part of the curriculum in order to prepare their students
for positions in America, Europe, Asia- even Russia. Whereas a young
Russian professional attending a top Western business school would have
once been considered "exotic," many MBA programs now boast
a growing number of Russian bankers, consultants, accountants, and marketing
professionals who began their careers in the late 1990s. As part of
this trend to attract and woo the Russian talent pool, three European
schools (INSEAD, IESE, London Business School) and one American school
(Michigan) now offer a special MBA financing program coordinated through
ABN AMRO Bank and the European Bank for Reconstruction and Development.
Some schools have extended recruiting efforts to include Moscow, while
others (such as Yale) have developed an innovative emerging markets
curriculum in order to train this new source of potential international
While the number of Russians who have graduated from
the most prestigious business schools in the US and Europe is increasing,
the current economic situation in Russia will likely accelerate the
process. For those young Russians on the proverbial fast-track, taking
a 2-year time-out from job uncertainty and continued economic stagnation
makes sense. While the real sector and the financial markets in Russia
continue the trajectory from recession to depression and even deep-pocketed
Western businesses reassess their commitment to the Russian market,
the simple fact is that an investment in a Western-style MBA offers
a low-risk, high-reward payoff for those young Russian professionals
intent on a corporate career. A graduate of a "Top 10" business
school in the US can expect a starting annual salary package easily
in excess of $100,000- if the typical investment banking or consulting
route is selected.
The one caveat, however, is that only a relatively
few business schools act as a consistent conduit for such lucrative
post-business school careers. Picking the wrong school could mean the
difference between working in the back-office of a corporate "cost
center" and being the member of a high-profile "profit center"-
with all the perks that such a position entails (e.g. jet-setting between
London, Frankfurt, and Hong Kong for client meetings). Some firms that
recruit on campus are so eager to hire the "best and brightest"
that they are willing to interview every single student who requests
an interview from proven recruiting grounds such as Harvard Business
School, despite the fact that each entering class at Harvard has over
800 students. As a policy, some firms only recruit at a few key schools,
essentially cherry-picking the best from those schools that have a track
record for producing individuals with the necessary skill set and initiative
to become a member of senior management. Schools with strong alumni
links also have an advantage in both recruiting new students and in
keeping these students "happy" with visions of lucrative careers
afterwards. Yale School of Management, while lacking the alumni base
of a business school like Harvard or Wharton, is able to draw on the
alumni base of Yale University, which historically has boasted the highest
number of graduates who are CEOs of Fortune 500 companies.
Given the premise that choosing the correct school
is critical, it becomes essential to understand how admissions officers,
recruiters and potential students appraise the respective business school
programs. The knee-jerk reaction for some applicants is simply to consult
a recently-published ranking such as those routinely published in Business
Week, U.S. News & World Report, or the Financial Times- and then
submit applications to the top 5 schools. Or the top 10 schools. Or
maybe schools 15 through 20. It's exactly that kind of strategy, however,
which targets applications to the wrong schools. Without visiting the
actual campus or consulting a knowledgeable resource, it's difficult
to understand what supposedly objective measures such as "student
selectivity" mean and close to impossible to make sense of what
purely subjective measures, such as "recruiter satisfaction,"
It's critical to think of each school as a "brand,"
since the schools themselves think of their respective MBA programs
as "brands." The key to moving up or down in any of the popular
rankings is a savvy game of "brand management" played by the
admissions staff, recruiters, and students. What exactly does this notion
of brand management entail?
First, that each school, while giving lip service
to such hackneyed notions as "international business," "general
management" and "preparing global leaders" has a much
more real stake in preserving its brand identity. Schools such as Wharton
carefully cultivate the image of finance powerhouse, while others might
choose to emphasize strong programs in strategy, general management,
or entrepreneurship. Schools with a strong core competency in "strategy"
inevitably receive the greatest attention from the top consulting firms.
Similarly, schools with strong marketing programs can attract the leading
multinational companies such as Proctor & Gamble, who require brand
managers for a vast array of products. It is only a limited number of
schools- those with large endowments, large faculty, and large student
size- which can develop niches in a number of areas. Thus, institutions
such as Harvard Business School and INSEAD have the attention of any
recruiter and can attract top candidates from all career sectors.
Second, there are several established ways to move
up in the rankings, such that the rankings can change significantly
over a period of 2-3 years. The rankings that use quantitative data
(GMAT, average salary upon graduation, admissions selectivity) can produce
vastly different results than rankings that rely upon subjective poll
data. Schools that are perceived to have a weak finance faculty can
simply poach professors from strong finance programs such as MIT Sloan
or Chicago. Schools with low GMAT scores can adjust the admissions process
to select higher-scoring candidates. Schools receiving weak results
in the area of "career placement" can hire a new career development
staff. Every year, the top business schools attempt to "fine tune"
their programs in order to advance in the polls.
Third, that potentially unsuspecting consumers (i.e.
the Russian business school applicant) can be the purchaser of a "brand"
that is not appropriate. A Russian banking professional expecting to
work in a major financial market (say, New York) should apply to a school
with a top-rate finance program and proven "placing power"
in New York. Dartmouth Amos Tuck, while perfect for preparing Boston-based
consultants, does not offer the competitive advantage of Columbia Business
School, which is located in New York City and traditionally has leading
names from Wall Street on its faculty. Likewise, individuals expecting
to take advantage of growth in the Internet/high-tech sector would be
advised to apply to Stanford (which has significant placing power in
Silicon Valley) or to MIT Sloan rather than schools such as Kellogg,
which offers the most competitive marketing program.
From the Russian perspective, the most desirable schools
are those that stress the international management aspect of business
school- and can back it up with substantial course offerings and access
to multinational corporations. While schools such as Emory may enter
the Financial Times Top 20, its graduates are far more likely to work
in Atlanta than in Moscow, while a lower-ranked school such as Thunderbird
may have considerably more "placing power," affording its
graduates the option to work for a multinational company anywhere in
the world. Moreover, the high cost of an MBA program in Europe or America
and the opportunity cost of foregoing 18-to-24 months of salary means
that opportunities offered within Russia (specifically, Moscow) may
make sense. Schools such as the American Institute of Business and Economics
(AIBEc) in Moscow offer a selection of courses taught by top Western
professors and may provide all the necessary training to advance in
the Russian business sector without having to relocate to Paris, London,
Barcelona, or America.
From the above, it can be seen that the various business
school programs are essentially "brands" that need to be researched.
Would you pay $80,000 (the two-year all-in cost for a top American business
school) for anything without investing significant time and effort into
understanding just exactly what it is that you are purchasing? For those
potential Russian applicants with internet access, there are a number
of sites with "inside" information (www.bschool.com, www.mba.us.com).
Moreover, each business school maintains an active web site. For those
applicants without Internet access, the American Center in Moscow maintains
a reference center for Western educational institutions.
Dominic Basulto is a 1998 graduate of Yale School
of Management and currently works as a consultant for Pericles ABLE
(American Business & Legal Education) in Moscow. Pericles offers
a full MBA advising program. For contact information, please call: 292-5188/6463.