Why Business Schools are obsessed with Diversity?

If you have researched about Business Schools, you might have noticed how they stress about class diversity. Maintaining class diversity is not just about attracting a talented pool of applicants but there are many practical value of picking candidates from diverse backgrounds.

1) Business School Reputation

Most top publications, like US News (read US News MBA Ranking), have ranking based on specialities like Finance, Accounting, Entrepreneurship, Marketing etc. Most schools didn’t plan to be specialist in these fields. It happened over a period of time, when applicants selected for the MBA program had post-MBA goals in these areas. For example, an IT applicant would most likely be a career switcher and chose Finance or Management Consulting. You might wonder if the MBA admissions committee had the knowledge on the post-MBA goals, they could easily skew the class composition in one direction. But most admission committee didn’t factor one thing – Economic Downturn.

2) Economic Downturn

If you have read F1GMAT’s analysis of GMAC Report –Switching Industries after MBA - Not Easy, you might have realized how post-MBA goals change during the course of the MBA program, due to economic condition and job market. Career switchers are more open to the idea of exploring other industries, which they have not planned earlier. With change in industry, the job functions also changes in many cases. For example, women MBAs are most likely to choose Healthcare and Pharmaceuticals and to change their post-MBA role to Human Resources.

3) Post-MBA Recruitment

Although Business Schools promote ranking in specialities, the reality is that they don’t want to be labelled as an MBA for Finance or MBA for Entrepreneurship. The Masters programs are intended to fill this void. Business Schools want to invite and maintain relationship with recruiters from diverse industries. This would reduce the risk of being dependent on one industry.  The 2008 Financial Meltdown was a case in point when recruiters lost interest in MBAs specialising in Finance. The percentage employed after 3 months during 2008-09 was in the mid-80s when compared to mid-90s during positive job market.

4) Growing Economies - Diversity in Nationality

Business Schools have been focusing on BRIC countries for the past 5 years. Two countries to dominate the International MBA Application pool are India and China. This can also be due to population of the two countries. But we have noticed that more Business Schools are admitting candidates from BRIC countries. There might be a strategy behind this. Like Businesses, schools also have realized that the next stage of growth will be fuelled by BRIC countries (BRIC focussed MBA program like SKOLKOVO MBA and China Focussed program like HKUST are two such examples. Business Schools have also included modules specific to Asian markets). By building a strong Alumni Base in BRIC countries, Business Schools want to ensure that they diversify the recruiters by nationality, inviting companies based in emerging economies to the recruitment process.

5) Long-Term Alumni Value

Another reason to maintain diversity is to have a strong and wide reaching alumni network. Although alumni cannot guarantee jobs for students (read Zach’s advice for MBA Aspirants about Post-MBA Job Opportunities), they can connect students to the right people. Depending on short-term market opportunities for fulfilling post-MBA goals is a bad strategy. MBA has one goal – help students reach their post-MBA goals.  If the goals are not met, you will have a group of unsatisfied alumni. They will not endorse the brand and would eventually not help current MBA students. By inviting and diversifying the recruitment from various industries, MBA Career Service team wants to maximize the opportunities available for MBA students.

Recommended Download

1) Business School Reports (Select 3 Business School Reports from Chicago Booth, Columbia Business School, Fuqua School of Business, Haas School of Business, Harvard Business School, INSEAD, Kellogg, MIT Sloan, NYU Stern, Ross School of Business, Stanford GSB, The Wharton School, Tuck School of Business, UCLA Anderson and Yale SOM)

2) Designing Your Business School Brand (Successful business school applicants know how to effectively market themselves to admissions committees. This guide provides insight into how an admissions committee operates and helps you construct a marketing campaign that will resonate. Chock full of brainstorming exercises and practical tips, the branding guide is a perfect first step in developing a winning application strategy)