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Tuesday, December 2, 2008

Bring me a bucket of bankers: Dispelling myths about the MBA Admissions process

For the past 5 years, I have been helping friends, clients, and on-line characters with their MBA essays for the top 30 MBA programs in the world. A combination of writing and social work skills help me understand what MBA admissions programs want and how to explain it to people. Some very smart people have paid me to shred their essays and occasionally their self-esteem. This has put me in a position to see how difficult the MBA admission process can be for some people and how many stories and myths are perpetuated year after year as applicants try to make sense out of it.

I can understand why the MBA admission process can be difficult. For the engineers, tech workers, and bankers that make up the bulk of the MBA application pool, the most complicated thing that they have had to write since college was their Match.com dating site profile. Or they never had to take writing classes in college. Applicants also have to figure out what information MBA programs think is relevant compared to what they want to share. There are so many paths to take that I can understand how it can be a daunting process.

Your average MBA applicant doesn’t help themselves by tending to over think the whole application process and look for data when there is really just noise, look for trends and causality when it’s just correlation, or ultimately rationalize their own fate.

There is one myth that MBA applicants tend to evangelize the most that has the least amount of data or rationality to support it. For that reason, it befuddles me the most because it should so obviously be dispelled years ago but it continues to live on, like that rash that you thought finally went away last summer.

That myth is that MBA admissions programs carefully segment and slice applicants into distinct categories or buckets and than use a careful predetermined quota system to select the top applicant from each bucket. These buckets that contain the most applicants are the most competitive and thus, one should position themselves in comparison to others in their bucket, try to change buckets, or apply to a lower ranked set of schools because they are not competitive in their bucket. Popular examples are the male Asian technology worker bucket or the white male banker bucket. Here are the reasons why this makes as much sense as intelligent design theories.

How do you define a bucket? Does the Asian category include: Asian-americans, Asians living in Africa, or Asians just born in Asia? Any difference between Indian, Pakistani, Bhutan, or Nepali candidates? How about tech worker? Does an IT consultant go into the tech bucket or the consulting bucket? What if they worked in both IT consulting and management consulting? How about the network administrator for a yak herding co-op? Does he go into the technology bucket or animal husbandry bucket?

Admissions offices could spend the whole year arguing in which bucket they should put the Asian orphan who was raised by Guatemalan nuns who then became an investment banker, left banking to become a monk, started a non-profit milk co-op, then decided to be a brand manager for the organic milk line of an Icelandic consumer products company.

This is a lot of work. MBA admissions staff are usually 5-6 people with degrees in higher education. There is no database administrators or SAS trained analysts who can do all the statistical crunching of these buckets to determine the class that will best maximize value. The staff just tries to fully read all the applications, let alone spend all this time categorizing them in ways that they can slice and dice the data.

What’s the point? Even if you could put everyone into these buckets with a powerful database to do all kinds of meaningful analysis, how many bankers, tech workers, or religious yak herders do you really need in a class? If you picked two Olympic curlers last year do you need any Olympians this year or do you think that bob sledder will add a 0.3 additional r squared of diversity?

All right smart guy, what do you think admissions staff really do then? I think that after the admissions staff has read and rated all the applications and picked enough people to fill the projected seats, they look at the demographic stats. They make sure they have accepted enough woman so it’s not a big frat party and don’t have an overbalance of any career category based on historical trends. That’s only after all the decisions have been made and as a double check on the class composition. It’s not done beforehand to socially engineer a class. All decisions are made on the basis of the individual application alone. Now, I did hear that admissions have seen enough applicants form certain banks or consulting firms that they can tell how the applicant ranked in their class. But the applicant is still judged on their individual merits and the class ranking at their firm is an added piece of information.

So why does this bucket theory still exist? MBA applicants are an analytical group and at their jobs are always looking at data for some insight or arbitrage opportunity. They see some data mining opportunities and assume that admissions are doing it too.

I also think that it’s a helpful reason for explaining why despite a GMAT of 750 and all kinds of promotions, that someone did not get accepted at a school. No reason from stats emerge so they look for other reasons like being in a competitive segment. However, I have read the essays of some of those folks who believe that they are in these competitive buckets. The essays are absolutely terrible. They don’t answer the questions completely or spend lots of time on irrelevant details about their companies phase gate product development improvement process. It’s the most subjective part of the application that completely destroy their chances. For applicants who thrive on analysis and quantitative rigor, that’s a difficult lesson to understand.

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