For many students, the quality of the student body, both current and former, is a primary consideration when choosing a business school. Potential MBA candidates are snowed under with marketing materials promoting the scale and scope of those who have graduated. Business-school watchers buy into the power of this network, too: The Economist’s MBA rankings assess schools on three criteria relating to the quality of their alumni.
The importance of business school alumni networks
But how important is the business school alumni network really? On one hand it provides evidence that those who complete a certain business school’s MBA programme can find a profitable job in the real world. Indeed, at their best, alumni can help their students to find work, often at their own firms. However, this is not always the case, as a new research paper, by Jason Greenberg of NYU Stern School of Business and Roberto Fernandez of MIT Sloan School of Management, suggests. Mr Greenberg says:
Alumni networks are one of the great untapped resources of all universities, including business schools
How can business schools improve alumni visibility
Presently, business schools crow about their credentials but do little to support students who want to take advantage of the connections the network offers. Greenberg continues explaining:
It’s not as efficient as could be imagined, given the technology. Schools should “institutionalise” their alumni networks, for example, by setting up a bespoke LinkedIn-style website that more easily connects current students with graduates. Currently only a few MBAs work hard to broker connections; those that do benefit from a broader range of job offers. Many of the remainder are passive in their pursuit of alumni, and don’t reap the benefits of meetings with well-placed but weakly-connected individuals.
Mr Greenberg also looked at how much MBAs who tapped their network earned. It is estimated that job offers from connections brokered through alumni paid $15,000 lower in starting salary than those arising from an on-campus recruitment event. On the other hand, job offers from closer connections—friends and family—were even more miserly, unfortunately putting paid to the concept that it’s who you know, not what you know.
Yet MBAs are still more likely to take up such offers. That is because they believe they represent better long-term prospects for their students. According to a research study, one third of those who accepted an offer said that they did so because of the growth potential of the career, not exactly the most popular reason. This is where the value of the business school alumni network comes into its own. On-campus events can be little more than sales pitches. The inside knowledge from a current employee, and the connections he can bring, allow new employees to work their way up the career ladder. Students are not thinking about their initial income, but assessing their long-term prospects—precisely what MBAs are taught to do. Based on these facts you can make up your own mind about how important the business school alumni network is for you really and whether its power is overestimated or not.
Source: The Economist