BUSINESSWEEK ONLINE : AUGUST 28, 2000 ISSUE
MANAGEMENT Stanford High-Hats Its Way onto a Blacklist Many companies halt recruiting of its MBAs after years of snubs For Melissa Thompson, it was another tough year of recruiting at Stanford University's Graduate School of Business. As head of MBA recruiting for Dell Computer Corp. (DELL), she was frustrated by empty interview slots, student no-shows, and a growing arrogance among candidates who did show up. Thompson decided she had had enough. ''I can tell you it doesn't happen like this at other places,'' says Thompson, whose recruiting team snared only two Stanford grads out of a total of 160 MBA hires this year. ''It says something about Stanford, and I'm sure it's something they don't want said.'' Thompson is among a growing group of disgruntled recruiters who are dumping the top business school from their on-campus recruiting rosters. Powerhouse tech companies such as Dell, Intel (INTC), and Amgen (AMGN) are walking away from Stanford's business school, along with retail giants such as Toys 'R' Us (TOY) and Circuit City (CC). The problem: Stanford students, among the best and the brightest with compensation packages topping $130,000 this year, seem to feel they're too good for jobs at these companies. For Stanford grads, the lure is Silicon Valley. So many grads are spurning traditional offers in favor of starting their own companies or joining Silicon Valley outfits that nearly two-thirds of its MBAs now remain in California. That's nearly double the number who stay close to campus at most other top-tier business schools. The result: One of the world's most highly regarded graduate business schools is in danger of becoming marginalized as a regional player. That's no small irony. Herbert Hoover founded Stanford's business program in 1925 to curtail the brain drain to East Coast schools. And for decades, countless Stanford grads scattered to prestigious jobs all over the globe. TECH OVEREXPOSURE. How times have changed. Now top companies, such as Goldman Sachs Group Inc. (GS) and McKinsey & Co., often resort to cold-calling students just to fill up an interview schedule. For such high-powered corporations, the students' snub amounts to little more than a minor irritation. The likes of Dell and Intel will have little trouble filling their choice openings with MBAs from other elite B-schools. But the students' attitudes pose a real dilemma for the school and for its dean, Robert Joss, 57, a banker and Stanford alum, who took over the job 10 months ago. The school's presence in the epicenter of the New Economy is its greatest advantage. But Stanford's dependence on the Valley to place its students makes the school vulnerable in the event of a tech downturn. That's because recruiters leaving now aren't likely to be back soon. Says Dell's Thompson: ''It's too much of a hassle when there are other schools where you can get some really great candidates.'' Stanford's Joss isn't concerned that so few of the school's graduates leave the Valley. Still, he acknowledges the school has a serious issue on its hands. ''It's a problem if we have students generating this feeling with their selfishness,'' says Joss. ''It impacts everyone else, and everyone has a stake in figuring out how to solve that.'' Some professors, moreover, point out that it's not just recruiters who have a problem with Stanford students. Students are showing up for class less and ignoring assignments more, preferring to trade on Stanford's name rather than make the most of its rigorous scholarly program. Says Jeffrey Pfeffer, a highly regarded Stanford professor: ''As long as our students feel they can show up at a venture firm with a smile and a half-assed idea and get $6 million, this is going to continue.'' LAST STRAWS. Students report going to company presentations where only two classmates showed up. ''I went to one with three people, and one left in the middle,'' said Scott Smith, a new Stanford MBA. After a turnout of four students at an Intel presentation in 1998, the company stopped trying, says Lisa Weathersby, head of MBA recruiting for the company. Intel usually draws upwards of 200 students to its events--and hires about 275 MBAs each year. Now, after years of recruiting Stanford MBAs with little success, the company Andy Grove built is walking away from on-campus visits, taking with it jobs many top MBAs would die for. Almost as infuriating for recruiters as student arrogance has been the nonchalant attitude of Stanford's administration. Other top schools are quick to ask why they've been dropped from a recruiter's list. Not Stanford, Intel's Weathersby says. ''There was no outreach.'' Ditto for Circuit City. After the company informed Stanford it would no longer recruit for its selective, fast-track executive program, no one from Stanford bothered to ask what the problem was. That's not an issue for Sherrie G. Taguchi, head of Stanford's Career Management Center, who believes it's not her place to second-guess recruiters. Says Taguchi: ''Do you really want to try to talk someone out of something?'' Stanford administrators say that if companies want to lure the school's MBAs, they've got to offer the jobs and locations that students really want most. General Motors Corp.'s (GM) Maury Dieterich, general director of business strategy for international products, says he asked the school to help him figure out how to market jobs in the auto maker's e-commerce and international offices after he realized few grads would be willing to move to Detroit. Working with Taguchi's staff, Dieterich managed to hire a few Stanford MBAs this year. Still, the lure of getting in on the ground floor of GM's big e-commerce push didn't make hiring at Stanford any easier. Says Dieterich: ''Recruiting there, it's a tough job.'' Truth is, the West Coast's most elite B-school could do a little more hand-holding of major corporations. Joss insists he doesn't want to lose the Dells and Intels of the world, but he argues there's no quick fix for an attitude fostered by the Valley's boom. Still, he has one idea to help address the problem. He wants to make the most selective business school in the country even more choosy by admitting more ''emotionally mature'' students less prone to blowing off recruiters from top-notch companies. ''When you have something this coveted,'' says Joss, ''you have an obligation to give that privilege only to the right people.'' But he has another big obligation as well: to mend fences with frustrated corporate recruiters. By Jennifer Merritt in Palo Alto, Calif. _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ BACK TO TOP					RELATED ITEMS Stanford High-Hats Its Way onto a Blacklist CHART: Valley-Centric? TABLE: So Long, Stanford INTERACT E-Mail to Business Week Online

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