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MARCH 30, 2000 B-SCHOOL Q&A: PLACEMENT Meet Wharton's Placement Director "Job descriptions change fairly dramatically; companies also flip their business model to meet the market. Employees have to be agile to meet those changes. Some graduates are faring well -- they had their minds set on this chaotic nature."
Q: MBA recruiting is ending one of its most publicized academic years. Some schools have seen blocks of students skip their second year of an MBA to work for startup companies. Many of the remaining students are dodging traditional MBA paths into investment banks and consulting firms for the same dot-com allure. What's happening at Wharton? A: We have to help students think about career management. The ones that come back [for the second year], do so because they're thinking about their career, skill sets, and how they're going to improve them. Our students know that if they want to join a dot-com, they could do that tomorrow. We're starting to see the click-and-mortar companies come back. Those companies, as well as the dot-coms, need a depth of business knowledge and talent. It's not enough to have an idea. Companies need to execute marketing and distribution plans. So from a long-term perspective, the folks at business school are doing the right thing, and [dot-com] companies want them. Q: Bob, for the past year and a half, a good percent of Wharton grads have gone to work for startup companies. Any word on how they're faring in the wild workforce? A: Twenty-five Wharton students didn't come back the summer after their first year. Those students wanted to jump on certain opportunities and Wharton has a fairly open policy about that: students can defer up to five years. The new model is mobile recruiting. In 1999, we did ten treks to high-growth regions to help Wharton students connect with dot-coms, because a lot of dot-coms don't visit campuses; they don't have human resources departments with recruiting groups. That has turned the tables on the recruiting process. There's a lot of chaos out there. A lot of these opportunities [in the job market] are new and exciting. But, at the same time, job descriptions change fairly dramatically [at such companies]. The companies also flip their business model to meet the market. Employees have to be agile to meet those changes. So some graduates are faring well. They had their minds set on this chaotic nature. Others weren't necessarily prepared for all that comes with the dot-com world. For instance, there isn't one corporate culture, or a corporate ladder. Q: What skill sets are high-growth companies looking for in an MBA, and are your grads able to deliver? A: The companies are looking for somebody who can hit the ground running. They don't have formal training programs to bring a new hire up to speed. They need immediate action. And since our entering classes have gotten older every year, the majority of our students have between five and seven years of work experience. That experience helps the dot-coms because the MBAs have made marketing plans, and have executed on distribution.
Q: Having an MBA degree isn't enough to land a job for graduates. Admissions officers are paying closer attention to the caliber of work experience that the incoming students bring to the table. The better the work experience, the higher the school's placement stats. The better paid the Wharton alums are, the better the endowment fund could become. If you had your druthers, what would the graduates accomplish before they even set foot at Wharton? A: I like the group that has five to seven years of work experience. When you're talking about managing a career, it takes some time to try out different experiences and to decide what you like and don't like. That [knowledge] comes with the five to seven years of work experience. People have a clearer sense of what their vision is for graduation. Experienced graduates are also less skewed by the heat of the moment. For instance, dot-coms are the exciting companies [to work for] now. Consulting used to be. As a career counselor, I'm able to craft with the experienced students what they want the next phase of their lives to look like. Q: Career management directors walk a tight line between keeping the students happy and serving up qualified talent to corporate recruiters. How has that role matured over the past year, bearing in mind that a lot of students aren't interested in the traditional corporate recruiters? And how is the give-and-take happening on each side of that equation? A: That's a great question. Our role is helping the corporate recruiters decide if Wharton is the place to recruit, what talent they want, and how to go after that talent. Student interest in dot-coms has caused a lot of traditional recruiters to reevaluate the schools they recruit at. They are also questioning their marketing points, as well as the company culture to see if the operation is operating in a way that will attract and retain talent. Recruiters are asking, "Are we offering competitive pay packages? Is our firm offering enough opportunities for promotion?" It's great to recruit 20 people into your firm through a good marketing pitch, but if you can't deliver the opportunities in the fast-paced way that marketing materials promise, then it really doesn't matter. So this year's competition has been very healthy. Q: What's an example of a company that used to come to campus prepared with formal pitches, and returned in 1999, with a chic package? A: Students would answer that question by saying that they're having some trouble defining which companies are really doing e-commerce work, and which will offer opportunities in the new economy. Every firm is pitching that very hard. And some of them are doing a very good job with e-commerce and technology within their firm, and some are struggling with that. A number of consulting firms have responded aggressively to the changing marketplace. The investment banks, as their world changes and continues to move electronically, are doing the same. Q: Are such companies also looking at different batches of students than they would have considered in the past? A: There has always been an inflation of students looking at the hot areas, and such areas — consulting and banking — are still hot. A few years ago, they were even hotter. Now that bubble has gone away. Thirty percent of our class is going into consulting, but some of the outliers have dropped off. And that's a good thing, because you don't have to do as much weeding through [applicants] to determine how serious a candidate is about working for a particular firm. Still, it's been a cultural adjustment for some firms that are used to having a lot of people apply. Q: Do you expect Wharton's top recruiters to hire as many students in bulk as they did in 1999? A: The top firms are going to do very well this year. We'll start to see some fallout with the firms that haven't responded as aggressively to the changing marketplace. We'll also continue to see the emergence of high-tech and dot-com recruiters that have their recruiting act together. Q: Still, not every company has its recruiting act together. How has Wharton made the link between its grads and the dot-com companies? A: We've been aggressive on that front. This past summer, we hired a person to focus full-time on high-growth companies: technology, private equity, and entrepreneurship. We put that person in charge of the trek programs. The goal was to expose students to these companies and opportunities in different regions. It's one thing to talk about working for a high-growth startup, it's another thing to actually go into their conference room, sit around a ping-pong table, and decide if that atmosphere is where the student wants to be. We've done treks to ten different cities. Q: Are more second-years participating in the treks than first-year MBAs? A: The bulk of participants have been first-year MBAs. About 75% are first-years, 25% are second-years. Since this is our first year [traveling to recruiters], our first trek didn't happen till December. It was targeted at the first-year audience. The breakdown next year will look much different, and the capacity will be amazing. We had over 800 individual students that participated in a trek this year, meeting with over 350 companies. Q: How many hires out of those? A: There were a number of companies that said to students — some jokingly and some not jokingly — "stop going to school right now, we'll hire you immediately." Some companies have interviewed students just over the phone and made them job offers. We'll see, as our data plays out, how many students actually connected with companies that way. Q: And next year, will such treks start earlier? A: We'll bump it up a little bit. But a lot of these dot-coms don't know what they're hiring for. If you visit them in September, it's meaningless, and it's beginning the conversation too early. Q: Have there been complaints from students about services at Wharton that could have been done better? A: Fourteen months ago, some students complained that they wanted more support with [their] targeted job searches, whether it was in private equity, high tech, or small manufacturing companies. As a result, Wharton set up the trek trips and a high-growth job fair was launched for 1,000 students and 60 firms. Given all that chaos, our role is critical. A lot of companies ask, "How could we be more effective at recruiting, how can we compete with these dot-coms?" Dot-coms are asking, "How can we either compete in this marketplace, what do we need to recruit?" So, we set up formal meetings with them. For the first time this year, in April, we're hosting a day for recruiters. We'll bring 150 of our top recruiters and some startup employers to campus to talk about issues and to meet our new dean, Pat Harker. Q: Are any other career center changes being made to keep Wharton's customers happy? A: First, we're moving to a team-based account management system. That means that a team of people will work with each firm, to answer any questions they have, and knows every step that firm takes. Within each team is expertise about the company's specific industry, which makes our approach to companies more customized. The second initiative we're launching is the creation of a state-of-the-art electronic interface for employers: an employer portal. Companies will have a password that lets them view all of their recruiting activities on campus: from monitoring sign-ups and reading resumes, to viewing the different dining options in Philadelphia. Q: Wharton reports that 95% of the class of 1999 was hired by graduation. Do you expect students to hold out this year — affecting the school's high placement average? A: There are a number of people who will wait to sign on with a company [until after graduation]. But a lot of students are straddling both sides of the fence by talking to traditional companies, as well as the dot-coms. The whole recruiting process is shifting a little bit later, which is also a healthy thing. In years past, recruiting was happening earlier and earlier in the year. Q: In the past, it seemed that graduates were signing with the companies they'd interned with between the first and second years of study. What seems to be happening in 2000? A: Some had a great summer, and accepted [offers]. Others confirmed that they don't want certain jobs. But, I haven't seen a dramatic drop off. A few companies have gotten a hit, because their summer program wasn't what [the students] wanted it to be. It won't be an extreme drop-off this year. Q: Compare this year's group of first years with the people who are graduating now. Were their hopes and their expectations very different? A: When the class of 2000 arrived, they had a lot of opportunities in front of them. For the class of 2001, the opportunities have grown even further. So the new students are walking into the recruiting process feeling very strong about their chances. Indeed, we have seen a lot of first-year students struggling with what they want to do, because they do have so many options in front of them. Q: What advice can you give in that scenario? A: We have them do self-assessment before they get colored by what other people think they should do. So when they come in later on in the year and are struggling, we pull them back to their self-assessment to look at their goals. MBAs have a tendency to overanalyze things, so they tend to look at the spreadsheet when they need to step back and listen to their gut. Q: Where is the majority of the first-year MBAs going to intern this summer? Are they staying along the northeast corridor, or is California the place to be? A: A growing number are going west. Last year, that number jumped dramatically. It was about 8% [in 1998], and rose to 13% [in 1999]. Close to 18% should go west this summer. But there are terrific companies in Philadelphia, New York, and Washington, D.C. Q: Are any going abroad? A: We're expecting that number to spike. There's been a steady decline over the last few years because the strong U.S. economy created great opportunities. But, as Europe, India, and other areas begin to move into the digital economy, we're going to see a dramatic rise in the number of people that are going abroad. Anybody with competitive experience abroad will go. As those markets take off, they're going to look for experienced business people that have done work here in the U.S., especially in e-commerce. Anybody, whether they're a national of that country or not, will be in high demand. We already see that. We see that right now with traditional companies. Foreign nationals are in high demand now. Q: Yet many non-U.S. applicants to B-school say they fear that they won't be able to grab the lucrative compensation packages their U.S. counterparts have. So what options do the Wharton internationals have? A: We have our own international guru to work with our international students. We're not seeing that level of frustration with our foreign nationals. We provide a comprehensive career development program for them, whether they're a U.S. citizen or a non-U.S. citizen. We have individualized counseling; we have workshops and programs that start as early as pre-term. We teach them about visa issues, where they may want to work, and how they're going to have to present themselves in whatever market they go after. Q: Wharton reported in 1999, that its graduating class of full-time MBAs began with an average salary of $84,000. The average signing bonus was $25,000. How do the compensation packages of International MBA graduates compare to their U.S. counterparts'? A: The packages were comparable abroad. The median salary outside of the U.S. is $80,000. That varied on what region you were in. Firms have taken a close look at that to be able to compete. Most firms have come to recognize that they can't pay somebody a local salary when they're getting a U.S.-based MBA. Q: Speaking of compensation, how has the office had to adjust to deal with evaluating compensation packages that are loaded with options and potential pay-offs? A: We're always reading to get up to speed on that. Our ten treks helped us with that. We got to talk to hundreds of companies about their compensation packages. A lot of the startup companies know the score of the MBA side, and they're willing to step up to the plate and make compensation real. And a lot of those firms have been funded so well over the last few years, and know that they need to pay $70,000 or $80,000 to get somebody to be in charge of their marketing program. 1999 was the first year we started tracking stock options. It was almost 17% of the class. It's going to jump up again this year in terms of number of stock options. We're bringing in a labor attorney who works with a lot of these dot-coms to talk about compensation issues with our staff. Q: What are the big issues? Are students overlooking fine print that they should pay better attention to? A: If they've never worked for a startup, they may not know what the difference is between 10,000 options with firm X versus 5,000 options with firm Y. They can do the math, but how do you evaluate what the best opportunity is? Students are being forced to act like private equity professionals, and evaluate the companies, their management team, product, when they're going to go public, etc. Students have to be savvier consumers than they've ever been. Q: Is there anything I've missed, Bob? A: We're trying to provide as many opportunities as we can for students and help them think critically about them. From a competitive standpoint, we're doing a very good job providing access to traditional opportunities [at companies] and access to growth opportunities. There's no other school that has ten treks to high-growth regions. Get BusinessWeek directly on your desktop with our RSS feeds.  Add BusinessWeek news to your Web site with our headline feed. Click to buy an e-print or reprint of a BusinessWeek or BusinessWeek Online story or video. To subscribe online to BusinessWeek magazine, please click here. Learn more, go to the BusinessWeekOnline home page  | | MARCH Learn about your online education options |
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