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Last month, MBA students from Canada’s McGill University travelled to India to investigate business, culture and national competitiveness. Here one of them, Melanie Walsh, says that six-sigma management theory is thriving among the dabbawalas of Mumbai
TEN students stand on the would-be shoulder of a road under construction. “One, two, three…” calls one student. There is a pause, then “four, five, six,” calls a second and everyone laughs at their own hesitation at crossing the street. Who gets priority? Some say the largest vehicle. However, small motorised rickshaws are bypassing trucks, busses move at different paces, and cars and taxis seem to be going where ever they want. Yet, pedestrians still cross between the cars without causing accidents or stopping the flow of traffic. Flow is perhaps the best word I have to describe India; everything is moving and growing in a seemingly chaotic manner, yet there must be some method to the madness because it is growing incredibly.
Some interesting research published by two professors from Milan's SDA Bocconi School of Management looking at the effect of war on stockmarkets. Counterintuitively, it has found that stockmarkets generally become buoyed when a conflict starts. The researchers claim that while markets "don't love war...they undoubtedly hate the uncertainty usually preceding a conflict." When war finally breaks out, says the report, markets "react with a collective sigh of relief, which on average, boosts stock markets".
The researchers, Massimo Guidolin and Eliana La Ferrara studied the effect of 101 conflicts in the 1971-2004 period. Understandably, war had a less benign effect on commodity markets:
As for commodities markets, the evidence is mixed. The reaction of an overall commodities index is positive in 6.9% of the cases and negative in 4.9%...but there are many exceptions, including the strong reaction of oil futures prices at the onset of conflicts in the Middle East, which is negative in 45.5% of the cases and positive in 27.3%.
IT IS worth heading over to our Schumpeter blog, where our management editor has been musing in his notebook about a study done by Virginia's Darden School of Business into the mind of an entrepreneur: "How do entrepreneurs think? This is a question that has produced lots of cliches (they thrive on chaos, embrace risk, break moulds) but very little hard research."
He has also dug out a copy of Saif al-Islam Qaddafi's doctoral thesis, completed while at the London School of Economics. With no apparent sense of irony, the son and heir of Libya's embattled despot gives us his thoughts on "The Role of Civil Society in the Democratisation of Global Governance Institutions".
KNOWLEDGE@WHARTON has recorded a charming interview with Sir Harold Evans, in which he talks about his journey from humble roots in the north of England to becoming editor of the Sunday Times. He says that he realised that he wanted to become a journalist after his father started talking to bedraggled soldiers on a beach, shortly after they had made it back from Dunkirk in 1940:
I was very annoyed with him for spending time talking to them. They told him a story of deprivation and lack of equipment, and their morale was very bad, very low. They just had a terrible time escaping from the Nazis. But the newspapers were giving the completely wrong impression about what had gone on. They were all suggesting that these men, these defeated soldiers, these survivors, wanted to get back to Dunkirk as soon as they could. It wasn't true. It was an epiphany for me.
Indeed, the whole interview is a fascinating insight into a journalist's mind.
THE FINANCIAL services sector is still the biggest employer of recently graduated MBAs, according to the 2011 Alumni Perspectives Survey which is published by the Graduate Management Admission Council. Twenty-two percent of MBAs found their way into finance or accounting last year, compared with 15% who entered consulting, the other traditional draw. What is more, as many others in the economy see their pay squeezed, the salaries of MBA graduates are increasing. The median base salary for students who graduated in 2010 was $78,820. This compares with a median salary of $75,000 in 2009. Students could also expect a bonus of $15,000.
The survey, based on responses from close to 7,000 business-school alumni, also found that 93% of last year’s MBAs are in work, including 7% who are self-employed. The average student submitted 33 CVs, attended six interviews and received two job offers.
Correction: This article originally stated the median salary of MBA graduates to be $94,500 in 2010 and $91,000 in 2009. These figures are, in fact, the median current salaries of all those who graduated between 2000-2010 and 1999-2009.
Eminent professors explain their subjects
ECONOMICS is an important component of the core MBA curriculum because economic principles are behind almost all managerial activity. Economists at business schools research and teach about how markets work (and when they don’t work); how scarce resources get produced, consumed and allocated; and how various participants in the economy make optimal decisions.
News from the schools, February 2011
Rolling news from the business campuses
*Alison Davis-Blake has been named as the new dean of Michigan's Ross School of Business. Ms Davis-Blake, currently in charge of Minnesota's Carlson School of Management, will take up her new position in August.
*The financial services sector is still the biggest employer of recently graduated MBAs, according to the 2011 Alumni Perspectives Survey which is published by the Graduate Management Admission Council. Twenty-two percent of MBAs found their way into finance or accounting last year, compared with 15% who entered consulting, the other traditional draw. What is more, as many others in the economy see their pay squeezed, the salaries of MBA graduates are increasing. The median base salary for students who graduated in 2010 was $78,820. This compares with a median salary of $75,000 in 2009. Students could also expect a bonus of $15,000.
The survey, based on responses from close to 7,000 business-school alumni, also found that 93% of last year’s MBAs are in work, including 7% who are self-employed. The average student submitted 33 CVs, attended six interviews and received two job offers.
*In what seems to be becoming a trend among business schools, future MBAs at the University of California, Berkeley are being given two free days on one of the school’s executive education programmes. The offer will be open for five years after their graduation. The news comes after the Wharton School announced a similar scheme in December, allowing its MBAs to take a free executive education class every seven years.
What the pope’s words imply for corporate social responsibility
IN TOUGH times, many people look to religious authorities for help and guidance; and religious authorities, in turn, rarely miss an opportunity to comment on current events. Pope Benedict XVI released his third encyclical, Caritas in Veritate (Charity in Truth), in July 2009; it was supposed to come out earlier, but the Vatican wanted to be able to respond to the developing economic crisis. Now, business and law academics have had time to mull over Benedict’s words and decide what they imply for corporate governance.
In this video, recorded for The Economist's recent online MBA fair, two students talk through their experiences of applying to business school. Unsurprisingly, they agreed that the GMAT was the most daunting part of the process
Correction: In this video Abdullah Mashuk was introduced as a student of "Holt", rather than "Hult", business school. Apologies.
What does a business school want from you?
In this video, recorded for The Economist's recent online MBA fair, Dot Griffiths, deputy principal of Imperial College Business School, explains what she looks for in prospective MBA students. Top of the list, she says, is that applicants have a clear idea what they intend to do with their degree
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