At a conference hall in Austin, Texas, hundreds of MBA hopefuls are about to gather and set foot on their path to the American education dream. Young professionals will gather with a bevy of top-ranking business schools and corporate giants.
Inside, incoming 2016 MBA students will chat with alumni, select elective courses and swap admissions stories. It is here that a more diverse generation of MBA students is taking shape.
This week a new breed of business leaders will decamp to Texas from some of the most disadvantaged regions of the US. Since its launch in 1965, the Consortium for Graduate Study in Management, which organizes the event, has become a bastion for diversity at business schools.
The Consortium's annual shindig, now in its 48th year, has grown into a booming business connector. The young MBA candidates, who are set to diversify their classes, are scooping up millions in funding from the organization.
In nearly 50 years, thousands of Consortium alumni have been handed a combined $274 million in support, to help saddle the expensive cost of MBA tuition. Some 400 business leaders, many of whom are from minority backgrounds, are signed up for this month’s Texas bash.
Peter Aranda, executive director and CEO of The Consortium, said that 8,000 of the organization’s alumni have entered the ranks of U.S business management. “When it comes to diversity, everyone talks a good game,” said Peter. “But our 18 member programs and corporate partners are making a demonstrated commitment.”
Shawn Taylor, a local Houston entrepreneur, is playing host. Since graduating from Purdue's Krannert School of Management, his start-up company, Family EATs Limited Partnership, has grown into the largest African-American-owned Taco Bell franchise in the States. Today the firm has 33 locations, sales of nearly $30 million and more than 500 employees.
Shawn grew up on the South side of Chicago and was raised with three siblings by a single mother. After finishing b-school, he worked at a national accounting firm in Dallas, where he led all of the firm’s offices in recruiting and retaining minority employees. He now is president of Zaxby’s Houston, LLC, which owns more than 500 restaurants in 13 different US states.
Companies are placing a great deal more importance on hiring a diverse workforce. And firms are not just hoping to boost the amount of female employees in their ranks.
A recent study has picked apart the diversity initiatives at companies within the S&P 100 index. Calvert Investments, the mutual funds provider which compiled the report, says 95% of S&P 100 companies offer internal diversity initiatives, such as mandatory training or leadership development.
In America’s top firms, 85 companies conduct diversity training, and 63 companies have made it a requirement for all employees.
What’s more, 83% of S&P 100 companies offer recruitment and outreach and supplier diversity programs. In 2012, there was a huge increase in the number of companies recruiting minority employees. The number of S&P 100 companies engaging in outreach efforts rose by 21% from 74 to 90.
“This upward trend demonstrates an awareness of America’s changing workforce demographics as the Baby Boomer generation enters retirement,” said the report. Yet the firm admits there is still a widespread problem in the US.
Barbara J. Krumsiek, CEO of Calvert Investments, said: “While diversity advocates commend this progress, few would argue that equality has been fully achieved… it is critical that companies embed diversity throughout their operations and reflect national trends toward bolstering the status of women, minorities, and the LGBT community.”
Business schools are hoping to follow that path, too.
Admissions officers could have been forgiven for a few moments of triumphalism when official cohort figures were released at the start of the year. European schools have topped the charts.
Oxford’s Saïd Business School posted a 96% internationally diverse MBA class. Spain's ESADE Business School had a similarly high 94%, while IE Business School, based in Madrid, posted a figure of 92%.
Within MBA rankings, employment stats are paramount. But diversity is playing an ever more important role in candidates’ choices.
These diversity sensations are often a source of learning for MBA students. Many argue that you learn just as much from your peers as your professors at business school.
Phil Carter, head of MBA marketing and recruitment at Imperial College Business School, said: “The more diverse experience students have, the richer the learning experience it is for all. Students with experience bring practical problem-solving to the classroom, and they can learn from each other how a theory might apply across many industries.”
Phil said that he tells Imperial candidates they will gain 50% of their new knowledge from the faculty and 50% from fellow classmates.
It is a view shared by MBA students, who often cite diversity as the biggest takeaway from their programs.
Merce Borrull banked a job at Zurich Insurance Group, the Swiss finance firm, because of her international exposure. She studied half her b-school course at ESADE in Barcelona, while studying the other half at the University of St Gallen HSG in Switzerland.
“We should be able to understand different types of people and embrace diversity and languages. For me, it was enriching the class,” Merce said. “I needed to put myself in a different environment, so my degree was key,” she added.
Andrew Lutjens, who graduated from IE’s MBA program last December, reckons he has become a changed man since being exposed to a diverse cohort. Andrew, who spent a term as president the school’s LGBT society, said it forces you to adapt.
He added: “At IE your workgroup isn’t just a group of other Americans. You’re working with people from all over the world, so you gain a lot of soft skills about understanding their particular culture [and] where they’re coming from, that you wouldn’t gain just by working in another start-up in the States.”
Robert Dammon, dean of the Tepper School of Business at Carnegie Mellon University, said he takes pride in working with The Consortium. The organization works with a bevy of leading US schools, including Yale School of Management and the Tuck School of Business.
Leading companies have pledged thousands of dollars to the organization. Bank of America, Johnson & Johnson and Dow Chemical Company have all donated $50,000 or more.
“The Consortium and its corporate partners have pledged to increase diversity within graduate business schools and the world of business… I take great pride and satisfaction in knowing that our efforts are having a meaningful impact on the lives of so many individuals,” added Dean Robert.
Not all US business schools, however, have stunning diversity figures. At the bottom end of the table sits the UCLA Anderson School of Management, with just 31% of their class considered international.
Harvard Business School, whose MBA program is considered the US’s best, has a similarly low 34% figure.
Michelle Millar, a first-generation African American, was the first member of her family to attend college. She started an MBA program at Harvard last year and wants to work in education.
She came from a poor background. “A simple thing like not being able to buy a drink at the vending machine, having to drink a free carton of milk while your friends buy their lunches every day, made me so motivated to want to do so well at school,” said Michelle.
She is in the minority in Harvard’s MBA class. But Michelle remains confident it is the right path to take.
“To be effective I thought that maybe I needed to consider business, to be able to come back to education to make it more effective,” she added. “It was a hard choice, but an MBA is the most important degree for me to get because that skill-set is needed in education.”
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