Tuesday, April 10, 2012

Composing the MBA Class of '14

Tuck: Over 2,700 applications for just 250 spots
At top business schools, including the Consortium 17, this is the time of the year  admissions offices fine-tune and compose a new class that will start in the fall.  Many schools have rolling admissions, while most schools notify applicants during the spring. The Consortium, too, notifies those who will be invited for membership and those who will have earned full fellowships.

How will the Class of '14 be different? How will it be like others? What do members of the class hope to achieve from two years on campus?

The application numbers and statistics are likely similar to those in recent years.  At selective schools from Harvard to Haas at Berkeley and from Chicago to Carnegie Mellon, gaining an acceptance letter for a spot in the first-year class is still a hard task and the result of perhaps a half-year process of securing recommendations, writing essays, taking tests, visiting campuses, expressing interest and trying hard to be patient and hopeful. In recent years, NYU-Stern and UC-Berkeley have accepted just 15% of all applicants for full-time programs. Over 4,000 apply to Stern; over 2,700 each to Michigan and Dartmouth-Tuck,  which accept fewer than 18%. 

Total applications across the country fluctuate somewhat from year to year. A dismal economy or financial crisis, such as what we've endured, with irony sometimes sustains the aggregate applications number.  Young professionals may choose to wait for a recovery while in the classroom or to transition from areas with little opportunity to areas of growth.

Market conditions, the economic environment, past personal experiences, the general outlook and total costs: All are factors that influence who return for the MBA, where they choose to attend, and what they hope to get from a rigorous, grinding experience.

Is this year's class more interested in unconventional segments, start-up situations or small boutiques, or do they prefer the formal tracks from an experience at Goldman Sachs or McKinsey?

This year's class, just as those who matriculated in the past three years, is familiar with volatility.  They know volatile markets, but they are also acquainted with volatile opportunities and even a volatile, teasing, uncertain recovery.  Thus, they will approach the business-school experience, knowing they must be flexible, realistic and willing to explore something new and different.

They may write in admissions essays they hope to pursue consulting, investment research or brand management, but they know the environment may force them or even encourage them to change their minds and pursue start-ups, community activities, or even industrial management. They may tell admissions officers they hope to work in New York, Chicago, or San Francisco, but two years later may accept job offers in Indonesia, Ghana, or Boston (as even some recent Consortium graduates have done).

A current student may have her eyes on an associate position at Morgan Stanley in M&A, but she won't be close-minded and will consider opportunities at General Motors, Google, Pfizer or even the World Bank or Zynga. 

Those who went to business school until the late 2000s to study finance, especially those who attended known, reputable institutions, could almost chart and measure their ambitions. They could make a conscious decision to go into consulting, investment- or private-banking, trading, research, venture capital or private equity; they could proceed through a check-list of to-do's to get from school to a cubicle at Carlyle, Blackstone, Wells Fargo, New York Life, Goldman Sachs, Bank of America or a hedge fund in Chicago or Greenwich.  They could expect to stay put for about 5-10 years, or at least until a vice-president promotion.

In 2012, the current classes approach the finance landscape differently. Someone just admitted to the business school at UNC, UVA or USC may visualize and dream of being in private banking at UBS or in investment management at Aetna , but won't slam the door if a San Francisco-based start-up turns him on to a role in corporate strategy or if a pharmaceutical firm invites him to work in its venture-investments unit.

Business school in 2002 might have been a springboard to a lucrative spot at Morgan Stanley or McKinsey, if the student studied hard, learned a lot, kept up with markets and played the recruiting and networking games astutely and unrelentingly.  In 2012, business school still provides an entry into the most coveted spots in banking, finance and investing, but this crop of students will be happy to explore something they never considered, if the opportunity makes sense, allows for rapid personal growth, and offers something on the long-term horizon.

Thus, within the ranks of the Class of '14, there will still be large numbers interested in corporate finance, interested in spots at Goldman, UBS, Barclays, Paribas or JPMorgan, and willing to pursue investment banking, equity research or bond trading in the new, highly regulated environment. There will still be more than a few interested in consulting at McKinsey, BCG and Deloitte.

Yet there will be quite a few who will change their minds in school, will discover a pursuit more pleasing, will choose not to  to go through marathon-like motions to chase a Wall Street dream job, or will learn they prefer strategy, operations, marketing, product innovation, and distribution  more than investment analysis, corporate finance and capital markets. The top banks, firms and funds won't have trouble finding attractive candidates, but a coveted offer from Citi, Booz, or Merrill  won't be the be-all or end-all.

Tracy Williams

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