Are business schools imparting the skills employers need most? In 2003, soon after GBSN was launched, one of the first things we did was question how companies/employers in developing countries rated local business school MBAs. I was then working at the World Bank’s International Finance Corporation, and we leveraged IFC’s extensive network of developing world companies in order to find out. Looking back at the survey results, how do they compare with the most recent data? Azam Chaudhry, then at IFC’s Economics Department, conducted the survey and published a research paper based on the findings. [1] I am delighted to say that today he is Dean of the Business School at the Lahore School of Economics, a dynamic GBSN member institution. Some 300 company managers from Africa, East Asia, Latin America, Middle East, South Asia and “transition Europe” expressed their views, representing a wide range of industries. Some 70 percent found the technical skills of locally trained MBAs good or adequate. Employers also reported, however, that they lacked work experience, practical knowledge and communications/interpersonal skills. Similar results came out of a 1994 survey about US MBAs of major corporations [2] – US respondents found that most MBA graduates lacked communication skills and were very unprepared in the area of written communication.
Unfortunately, there are, so far as I know, no recent multicountry surveys of the strengths and weaknesses of developing world business school graduates. Two Indian surveys suggest that only a small number of local business schools meet employer expectations. One survey based on graduates’ responses to simple professional quizzes found that only the very top business schools teach their students basic skills like communication, which are essential for securing management jobs.[3] The second, a survey of 2,264 MBA students based on marks they scored in recruiting company tests suggests that only one-fifth were considered suitable for employment. [4]
At the global level, a recent worldwide survey of MBA employers echoes these findings: “Employers are, broadly, satisfied with the technical skills acquired by MBA students, and this result seems to be independent of the business schools from which the employers recruit. Whether it’s academic achievement, computer skills, languages or skills acquired in finance, marketing, e-business, or risk management, employers seem to have few qualms about the quality of MBA graduates. On the other hand, business school graduates are still not meeting expectations in terms of their soft skills such as communication, interpersonal skills and strategic thinking, which are at a premium. Soft skills are far and away the most important skills employers are looking for from new MBA recruits. Communications, interpersonal, strategic thinking and leadership skills make up four of the five most important skills for new hires to possess. Relevant work experience is the fifth criteria (sic). There has been a long-standing shortfall in terms of leadership and interpersonal skills, which is apparent year after year in this research.” [5]
The message comes across that even today one of the main challenges for business schools, including those in the developing world, is to narrow the remaining gap between academia and employers’ expectations, at a time when they are under huge pressures to lower costs. The various ways in which schools are responding to these daunting challenges will be central to the discussions at GBSN’s 10th annual conference in Manila on November 4-6, 2015.
[1] Chaudrhy,A., “The International Finance Corporation’s MBA Survey: How Developing Country Firms Rate Local Business School Training”, World Bank Policy Research Working Paper 3182, December 2003.
[2] Neelankavil, J., “Corporate America’s Quest for an Ideal MBA”, Journal of Management Development ,1994, Vol. 13, No. 5, page 38-52.
[3]http://www.aspiringminds.in/researchcell/articles/national_employability_report_mba_graduates_2012.html
[4] http://articles.economictimes.indiatimes.com/2012-08-07/news/33083692_1_quantitative-ability-employability-verbal-ability
[5] http://www.slideshare.net/parosu/2015-topmbacom-jobssalarytrendsreportv1?from_action=save
Guy Pfeffermann is the Founder and CEO of the Global Business School Network