Tomás de Villas-Boas Lebreiro 10210911
Business Thesis and Seminar 2013/2014
“Job training needs of business school graduates”
Eloisa Federici Sofija Pajic
Table of Contents
1. Introduction ... 3
2. Literature Review ... 4
a-The knowledge gap: definition and setting the grounds ... 5
b- Predictors of job performance: Personality ... 7
c- Predictors of job performance: Job Experience and Prior Job Knowledge ... 10
d-Predictors of job performance: General Cognitive Ability ... 11
e- Knowledge gap: A threat or an opportunity ... 12
f- Improvements and suggestions for enhanced teaching of business ... 14
g- Literature Review: Conclusion ... 16
III. Conceptual Model ... 17
IV. Methodology ... 19
a- Research design and Data Collection ... 19
b-Data Analysis ... 21
c- Data Reporting ... 21
V. Validity, Generalizability and Reliability ... 22
5.1 Validity ... 22
5.2 Generalizability ... 22
5.3 Reliability ... 23
VI. Results ... 23
a- Preparedness from business school graduates at different levels, when entering the job market ... 23
b- Selection criteria and training needs of business school graduates ... 25
c-Value from a business degree ... 27
d- Suggestions for change in the current ways of teaching business ... 29
VII. Discussion and Conclusion ... 31
VIII. Limitations and suggestions for future research ... 36
IX. References ... 37
X. Appendix ... 41
I - Introduction
As a business school student who is getting close to graduation and enrollment into the labor market it is time to start reflecting on what I have learned these past three academic years. Soon it will be time to start turning the acquired knowledge into practice and the question that arises is: “Do I know what to do and is knowing what to do enough?” Many courses later, which have treated a great variety of subjects in different ways it is time to find out if I’m prepared to conduct business in the real world and the future could look brighter.
As 75 million young people worldwide are unemployed (McKinsey, 2012) and youth unemployment rates in the European union reached 23.5% in the first quarter of 2013, more than twice as high than the general population rates (European Comission,2013), it is relevant to ask and answer these questions. The numbers seem to indicate a mismatch between university graduates’ looking for a job and employers seeking new people to hire. 65% of employers didn’t consider it easy to find qualified new hires (McKinsey, 2012), business school graduates are expected to send, on average, in the EU, 38 applications before finding a job and spend an average of 6 months after graduation searching for a job (The Guardian, 2013). While unemployment rates in the EU are some of the highest ever recorded, due to the economic crisis, there are still over 2 million unfilled job vacancies and the European Commission (2013) speaks of “significant skills mismatches on Europe's labor market”.
One of the reasons for this mismatch on the labor market and for the difficulties of young graduates in finding a job that suits them is the gap that exists between the knowledge they obtain through the education system and the one required by employers; the “knowledge gap” (European Commission, 2013). It is this transition from education to work and from knowledge to practice that will stand centrally in this research, specifically in the case of business school graduates.
Most of the literature, at first glance, appoints the knowledge gap as a problem both for business school graduates looking for a job as well as for companies looking for business graduates to hire. I believe that there is a realistic possibility that it can be seen as an
opportunity and that it might be even in some ways positive for business graduates to have reduced knowledge on practical matters of business because this gives employees the chance to train and mold these new employees into the best possible fit for the requirements. In order to fill this apparent gap in the literature it is necessary to scan the existing one so as to determine what are the most important features in predicting job performance and to analyze the knowing-doing gap (which will be done in the next chapter through a literature review).
Conducting my own research, based on the impressions gained from reviewing the literature, will hopefully help to fill, at least partially, this apparent gap. Therefore the main research question is the following: Do business school graduates face a knowledge gap when entering business in the “real world” and is the level of knowledge on practical matters of business in itself the most important variable considered by employers when hiring a business school graduate? Maybe it is the fact that the candidate has proven himself to be able to do so that weighs the most. The focus will be on the relevance of the possible existence of a knowledge gap. Supposing there is a knowledge gap, does it matter?
II – Literature review
Firstly, it is important to scan the literature so as to understand the full definition of the knowledge gap in business. Based on this definition and the current state of literature it will be possible to assess the importance of this knowledge gap as a factor for youth
unemployment.
In order to determine the importance of the knowledge gap as a factor that leads to youth unemployment and significant skills and employment mismatches it is necessary to determine which factors predict job performance and which of these factors weigh the most both according to previous research and literature and according to employers. This because employers define criteria for personnel selection, based on the expected future job
performance of candidates. Therefore, even though predicting the future is a complicated and impossible process, it is safe to assume that interviews and candidate selection methods used by employers are ways of trying to choose the candidates that are predicted to perform best in the future.
In the literature there are a few predictors of future job performance that seem to be transversal and widely accepted, such as: Personality, experience or pre-job knowledge, general mental ability and specific traits, aptitudes or skills (Schmidt & Hunter, 2004) (Hunter & Hunter, 1984) (Hough and Oswald, 2000). It is important to keep in mind that for this research the predictors of job performance named are those that predict performance in a future job and not in a current job. It is very relevant to make this distinction because there are many very different factors that have an impact on current job performance, such as motivation, job satisfaction and overall working environment that are inherent to the job on itself and therefore cannot be fully taken into account in predicting future job performance.
After assessing the importance of the knowledge gap in business graduates’ start in the world of business, we can assess whether this gap is a threat or an opportunity and analyze what has been done so far to try and improve the teaching of business. The
previously mentioned predictors of job performance will also be more extensively tackled in the literature review.
a. The knowledge gap: definition and setting the grounds
There is a great deal of discussion on the future of universities in general, and business schools in particular, in the near 21st century (Friga, Bettis & Sullivan, 2003). Many
academics see not so bright of a future for universities unless they make a big effort to change themselves as to accommodate the needs of a changing world. Peter Drucker, one of the most famous and respected authors in business and a leader in the development of management education even went as far as to state: “Thirty years from now the big university campuses will be relics. Universities won’t survive” (1997). So it seems that in this rapidly-changing world universities can’t afford to stay behind and need to keep developing and updating themselves; business schools are no exception. The “real world” of business is a world that is under the constant pressure of changing market forces such as globalization, technological developments, competition and job requirements. Due to the close relationship between business education and the business world, one might say that business schools need to constantly be on the edge of new developments so as not to educate their students in outdated matters (Friga, Bettis & Sullivan, 2003).
Modern higher education in business, until the 1950’s, quite resembled business training as most of the teachers were practicing or retired corporate managers, the education was very much based on their own professional practice based experience and the focus was on very functional matters (Friga, Bettis & Sullivan, 2003). This way of realizing higher education led to many different types of criticism, starting in the 1950’s, when Gordon and Howell (1959) stated them to be “a collection of trade schools lacking a strong scientific foundation”. It was also in the 1950’s that, in the U.S, a massive reform effort sponsored by the Ford foundation took place (Friga, Bettis & Sullivan, 2003). This reform effort, as well as the report by Gordon and Howell got business schools in the U.S (and subsequently in other countries as well) started in the direction of trying to become respectable, academic and transparent institutes of applied social sciences, taking on the customs and ways of regular
academic institutes (Pfeffer & Fong, 2002). As business schools became more and more about scientifical authority and academic distinction; the emphasis shifted from very practice oriented know-how to quantitative, empirical analysis and the study of decision making processes (Pfeffer & Fong, 2002). This period where the focus was shifted from a vocational practical approach to a knowledge creation and assimilation approach was defined by Friga, Bettis & Sullivan (2003), as the “Faculty-based era” (Table 1) and this adopting of ways from other social science areas has led to other criticisms of business schools. Namely that matters taught are too academic and therefore distant from the world the students should be prepared to face: the world of management, business and actual decision-making (Shipper, F., 1999).
b. Table 1: The development of higher business education (Friga, Bettis & Sullivan, 2003). Youth unemployment rates keep rising, university graduates struggle to get a job, business schools have a history of being criticized and there are significant skills mismatches on the job market, partially linked to the knowledge gap. These are indicators that there is an apparent managerial problem in the linkage between business schools and businesses themselves. So what skills do employers want to see in their future employees? According to Banta, T. (2001) employers would like colleges to put more emphasis on transferrable skills such as leadership, communication, quantification, adaptability to change and interpersonal skills. In addition students need to be exposed to “real world messy problems that defy neat solutions” (Banta, T. 2001). Gardner, (1998) reviewed findings from various studies on the subject and concluded that: “College students show strength in their content or academic skills base but lack competencies to handle successfully the principal complex issues of work: interpersonal communication, teamwork, applied problem solving, time management, setting priorities and taking initiative”. So, it seems that the main components of the
knowledge gap between studying business and practicing it, are not related to the theoretic or academic knowledge taught at business schools but more related to the variety of skills and competencies necessary in the business world. The knowledge gap appears to be more of a skills gap than a knowledge one. Although business schools are preparing students for a wide variety of possible careers and lifelong learning (Clinebell & Clinebell, 2008) the previously mentioned transferrable skills seem to be transversally useful to, at least, the majority of these possible careers (Clinebell & Clinebell, 2008) (Banta, 2001).
The literature suggests that the lack of academic knowledge is not the most important component of the so-called “knowledge gap” if even a component. This can mean that academic knowledge on itself is not of essential importance in the real world of business (or in any case significantly less important than transferrable skills) or that business schools are doing well in preparing their students in these theoretic matters or a combination of both. The importance of prior-job knowledge will be studied in one of the upcoming chapters.
b. Predictors of job performance: Personality
Personality is one of the most commonly mentioned factors affecting job performance. The most widely and generally accepted model for describing human personality is the Five Factor Model, also known as Big Five (Digman, 1990). The Big Five model has been independently defined by several independent sets of researchers who studied known personality traits and analyzed great sets of data collected in different ways (Digman, 1990). Surprisingly or not, depending at how you look at it, all these researchers came up with five factors that, even though having slightly different names and being reached in slightly different ways, are highly inter-correlated (Digman, 1990). This means that the Big Five is a valid construct for measuring dimensions in personality and so it is no surprise to see that the five factors; Extraversion, Openness to Experience, Conscientiousness, Agreeableness and Neuroticism, are indeed used in literature on job performance predictors (Hough and Oswald, 2000).
Barrick and Mount (1991) conducted a meta-analysis on the influence of these five factors on job performance for five different occupations. Job performance was measured through 3 criteria: job proficiency, training proficiency and personnel data. The five occupational groups studied were: professionals, police, managers, sales and skilled/semi-skilled, for this particular research the implications relative to the occupation of manager
might be the most interesting to observe. First of all, it is important to give an overview of the traits frequently associated with each personality dimension included in the “Big Five”:
Traits frequently included in and associated with Extraversion are: “being social, gregarious, assertive, talkative and active” (Barrick and Mount, 1991).
Traits frequently associated with Neuroticism are: “being anxious, depressed, angry, emotional, embarrassed, worried and insecure” (Barrick and Mount, 1991).
Traits frequently associated with Agreeableness include: “being courteous, flexible, trusting, good-natured, cooperative, forgiving, soft hearted and tolerant” (Barrick and Mount, 1991).
Traits frequently associated with Conscientiousness include: “careful, thorough, responsible, organized, planful, hardworking, achievement oriented and persevering” (Barrick and Mount, 1991).
Traits frequently associated with Openness to Experience include: “imaginative, cultural, curious, original, open-minded, intelligent and artistically sensitive (Barrick and Mount, 1991).
The most significant finding from this meta-analysis is related to the
Conscientiousness dimension of personality. Barrick and Mount (1991) found that it was a consistently valid predictor of job performance for all occupational groups and for all criterion types. Specifically Achievement Orientation and Dependability, two of the sub-dimensions from Conscientiousness, were found to have a positive impact on job
performance. This is not surprising if we look at the previously mentioned traits associated with this personality factor (responsible, organized, hardworking etc.) (Barrick and Mount, 1991). This view of Conscientiousness as the most important personality factor in predicting job performance is backed by Schmidt & Hunter (1992), who divided it into the two previously mentioned sub-dimensions (Achievement Orientation and Dependability) and stated: “Dependability was found to have a direct effect on supervisory ratings of job performance”. Not only did people higher on Dependability perform better at their job, they also developed higher levels of job knowledge (independent from ability) and had fewer disciplinary problems (Schmidt & Hunter, 1992). Achievement orientation was also found to have a positive impact on supervisory ratings regarding job performance and people who scored higher on this sub-dimension received more awards and commendations (Schmidt & Hunter, 1992).
Extraversion was found to be a valid predictor of job performance for two
occupations (manager and sales). The authors claim that this is due to the fact that for these two occupations interaction with other people is a big part of the job. Correlation, however, was found to be relatively low, especially when compared to the results for Conscientiousness (Barrick and Mount, 1991).
Openness to Experience was found to be a valid predictor for training proficiency but not for job proficiency or personnel data. One of the likely explanations for this, looking at the specific traits, is that individuals scoring high on openness have, in general, a more positive approach to training and learning experiences. Several researches have proved that one of the key components in the success of a training program is the trainees’ attitude when entering it. Thus, people who score high on openness are more probable to benefit from training, which might an interesting insight for employers hiring business school graduates. It must be stated, though, that this personality factor was found to have the highest correlation (from the big five) to general cognitive ability (one of the main predictors of job
performance), so it is possible that openness to experience, in this case, not only measures the will to learn but also the ability to do so (Barrick and Mount, 1991).
Neuroticism or Emotional Stability was found to have mostly relatively small correlations to the job performance criteria. One of the possible explanations for this is that individuals who score very high on neuroticism, the extreme cases, are not able to function adequately and therefore are not part of the work force. Another plausible explanation is that there might not be a causal relation between emotional stability and job performance beyond the “critically unstable” range. This is: “as long as an individual possesses enough Emotional Stability, the predictive value of any differences are minimized” (Barrick and Mount, 1991).
Agreeableness was found not to be an important predictor of job performance, even in those occupations which have a high social component, in contrast to Extraversion, the other “socially based personality dimension” (Barrick and Mount, 1991).
In general, Barrick and Mount (1991) concluded that the overall validity of personality factors in predicting job performance was relatively low; specifically when compared to other predictors of job performance, such as experience and general mental ability. Nonetheless, even though overall validity was considered relatively low by Barrick and Mount, by comparison to the other predictors, there is substantial evidence in the literature that Conscientiousness is indeed a predictor of job performance (Barrick and Mount, 1991) (Schmidt & Hunter, 1992) (Hurtz and Donovan, 2000). In fact, Hurtz and Donovan (2000) conducted a meta-analysis on the overall validity and criterion related validity of the Big Five personality dimensions’ effect on job performance, and concluded
their results to be “highly consistent with the original work of Barrick and Mount (1991)” for the personality factor Conscientiousness. They also concluded that: “Although they are less generalizable (…) personality traits other than Conscientiousness are nearly equally
important for certain occupations and criteria” (Hurtz & Donovan, 2000). This is also in line with the results from Barrick and Mount’s research.
c. Predictors of job performance: Job Experience and Prior Job Knowledge
Job experience and prior job knowledge are closely related to job knowledge and to each other, that is why these two predictors will be handled in the same chapter.
Job experience can be defined as “length of experience in a given occupation”, it is “a measure of practice on the job and hence a measure of opportunity to learn” (McDaniel, Hunter & Schmidt, 1988) (Hunter & Schmidt, 1998). It is therefore straightforward to think that job experience has a direct positive impact on the level of job knowledge, several researchers have found that to be the case (Schmidt & Hunter, 1992)(Schmidt, Hunter & Outerbridge, 1986). Schmidt & Hunter (1998) found that, up to 5 years, increasing
experience on the job leads to increasing job knowledge. This time limit on the level at which experience keeps increasing knowledge is the perfect example of a learning curve, at a certain point experience as a resource to generate knowledge is exhausted (Schmidt & Hunter, 1998).
Prior job knowledge is, as the term suggests, knowledge an individual has concerning a specific task or job, before he/she actually performs the task or job (Carretta & Doub, 1998). So, individuals that have prior job knowledge regarding a specific job, and that subsequently enroll into that job, will have greater job knowledge than individuals that did not have prior job knowledge (at the moment of hiring, before any training or learning through experience takes place). The fact that prior job knowledge and job experience both lead to job knowledge is the reason why they are simultaneously treated in this chapter, through the focus on the effects of job knowledge on job performance.
Job knowledge was shown to be the most important direct determinant of job
performance, of the three studied by Schmidt, Hunter & Outerbridge (1986): Job Experience, Ability and Job Knowledge. It is logical that knowing how to do the job is the most important factor in determining the level of performance. So, directly, job knowledge is the most important determinant for job performance, but, as mentioned above, job knowledge is
influenced by both job experience and prior job knowledge, as well as ability. In the case of this specific research, the focus is on freshly graduated business students entering “real world” business, which will, in the grand majority of cases, have very low or no job experience and prior job knowledge. This because, internships and other ways of acquiring some experience in the area like student boards and counsels put aside, business school graduates entering the job market will enroll into a job that’s totally or almost totally new for them. The interviews that will be conducted will possible shed some light on the level of prior job knowledge and/or experience business school graduates gained during their education. Anyhow, in this case, the role of ability in predicting future job performance becomes even more important.
d. Predictors of job performance: General Cognitive Ability.
General cognitive ability, also known as general mental ability or the g factor, is a psychological construct that was discovered by C. Spearman in 1904 and it is considered the ”most important psychometric construct in the study of individual differences in human cognitive abilities” (Jensen, 1998). This construct is used as a measure of individual cognitive abilities and causes positive correlation among individual differences in performance at general cognitive tasks, it is considered a “biological property of the brain” (Jensen,1998). The g factor has become so widely accepted as a major psychological construct for psychometric and factor analytic criteria that Jensen (1998) claims that “further research along these lines is very unlikely either to disconfirm the construct validity of g or to add anything essentially new to our understanding of it.” The g factor is “extracted from the correlation matrix of a battery of mental ability tests by a number of different methods of factor analysis and according to different models of the factor structure of abilities” (Jensen, 1998). The g factor is what causes individual differences in performance not only at cognitive tests but also at school and job performance (Jensen, 1998) (Schmidt & Hunter, 1998).
Schmidt & Hunter (1998) have linked this g factor to job performance in their study and considered it to be the most important individual trait for predicting job performance, even more than personality and job experience. Schmidt & Hunter (1998) found that the greatest impact of mental ability on job performance was an indirect one; mental ability was found to have a significant positive effect on job knowledge which in its turn is the most important direct factor affecting job performance. Schmidt & Hunter (1992) also found that
the impact of ability is larger in jobs which are less structured, less well defined and that require more improvisation and direct problem solving; managerial and supervisory positions are good examples.
Levine et all (1996) found in their research that cognitive tests exhibited a pattern of results that support the idea that they are valid in predicting performance across many job types. They also found that there is substantial evidence to support the fact that cognitive aptitude tests are valid predictors of job performance because they are in part measures of general cognitive ability (g factor). Also, different levels of correlation between ability and job performance across different job types were detected, depending on the level of knowledge processing required and the overall complexity of the job.
Carretta and Doub (1998) have found in their study on the impact of general cognitive ability and of prior job knowledge on subsequent job knowledge that the impact of general cognitive ability is greater than the impact of prior job knowledge. The results from this study suggest that general cognitive ability is a better predictor for candidates’ on the job
performance than prior knowledge of the job in question is (Carreta and Doub, 1998). Learning plays a very important role in job performance as it leads to job knowledge, and this learning is in great deal done through experience; people with more experience have had more time to learn how to do their job efficiently and how to achieve higher performance. However, individual cognitive abilities are also here important: if one worker learns faster than another, the same level of experience will yield higher job performance for the fast learner than for the slow learner (Schmidt & Hunter, 1998).
e. Knowledge gap: A threat or an opportunity
From the literature it has come forward that the knowledge gap can be divided into three different parts: transferable and interpersonal skills, academic knowledge on matters of business and practical knowledge on matters of business. There has been considerable criticism and discussion on how the curricula from business schools should look, especially in the light of globalization and the pace at with the world has been changing since the early 1990’s (Kao, T. & Mao, T., (2011). The lack of transferable skills is tackled quite extensively in the literature and considered by the business community to be a problem or threat
(Maellaro, R. & Whittington, J. L., 2012). The academic knowledge part of the gap though hasn’t been considered a significant problem as Gardner stated: “College students show strength in their content or academic skills base (…)” (1998). As the academic base of
business school graduates on itself is considered to be satisfactory it cannot be considered a threat and not even an opportunity, in this context. From the literature, in fact, it is clear that a bigger linkage of academic business with actual business is desired in the design of curricula but as an addition to and not as a replacement of the scientific components (Clinebell & Clinebell, 2008).
The only component of the knowledge gap that has not been discussed in the literature as being a threat or an opportunity to the business school – business world linkage is practical knowledge on matters of business. Business schools have been “accused” of not emphasizing interpersonal transferrable skills, which is considered and proven to be a problem by various researchers ((Gardner, 1998), (Clinebell & Clinebell, 2008), (Maellaro, R. & Whittington, J. L., 2012)) and of not emphasizing enough on practical matters of knowledge, which has been pointed as a flaw in the teaching of business by Shipper, F. (1999) and others but has not been proven to be essential for business school graduates entering the job market. This is the gap in the literature and, coupled to the fact that business schools educate individuals that will in the future enroll in an extremely large range of jobs leads us back to the question: “Is the level of knowledge on practical matters of business in itself is the most important variable considered by employers when hiring a business school graduate?”. As I stated before, I believe that this practical prior job knowledge in the business field is not a problem but an opportunity. Indeed, I believe that, if looked at independently from the two other parts of the knowledge gap (theoretical knowledge and interpersonal transferable skills), practical knowledge on matters of business is something job specific that will be quickly adopted by the new employee. This assuming companies hire individuals based on their ability and personality, which, as stated before, are the most important factors in acquiring job knowledge (for business school graduates as they, exceptions made, have no or very little job experience). So, resuming:
- Practical knowledge is job or at least sector specific. - Companies hire employees that learn fast.
- Business schools prepare their students for an extremely wide range of positions.
- It is not possible for them to adequately prepare them (practical knowledge wise) for all these positions.
- In the literature this is suggested to be a problem but not as well-founded as the other two components of the knowledge gap.
Ineson (2011) states management development to be a two-parted process, including industrial and educational processes and that some aspects of individual development might only be achieved in a “realistic” environment. Therefore it is not possible for business schools to totally prepare their students and I believe the lack of practical knowledge on matters of business is an opportunity for companies to mold and train their employees to be perfectly suitable for their position and this research I will try to find out whether this is the case.
f. Improvements and suggestions for enhanced teaching of business Clinebell & Clinebell (2008) say that business education is at a crucial point. What started as trade schools and evolved into scientific academic institutions is now under fire for having overdone it and receiving criticism such as “those who design management education curricula are too far removed from the practical problems that confront managers in the real world” (Maellaro, R. & Whittington, J. L., 2012) and “although businesses and business schools essentially agree on the competencies that identify successful managers and
graduates, business schools do not emphasize these competencies in their curricula” (Kao, T. & Mao, T., (2011).
Even though researchers and the business community insist on a more job linked approach between business schools and the students’ future employers, they do not wish to let businesses determine the curriculum (Clinebell & Clinebell, 2008). This because researchers claim that business education should be looking at the future and contributing to new theory and new ways of thinking and helping individuals in developing themselves from a broader and more holistic perspective than the business community’s short time targets and goals would allow (Clinebell & Clinebell, 2008).
From this perspective of finding a balance between the wants and needs of the business community and those of the scientific community, various researchers have come up with various suggestions for improvement.
Clinebell & Clinebell (2008) suggest business schools should use executive professors (teachers that come from the business world) but with some rules. The teachers should be
taught how to teach, they should be carefully matched to the correct classes and they should adapt to the normal workload. Clinebell & Clinebell (2008) also suggest business schools should create a culture of mutual respect and partnerships between executive and academic professors as well as profit from these executive teachers’ networks so as to create a good linkage with the business community.
Ineson (2011) suggest that management trainees should be: “provided with coherent programmes based upon their objectively assessed needs using a standardized, reliable and valid instrument in order to identify objective measures of the requisite behavioral
characteristics upon which company and individual training programmes can be founded.” This because upon entry in business school all individuals have different levels of
development in terms of interpersonal, intrapersonal and cognitive competencies as well as different personality profiles. These differences might lead to standard training being demotivating and even of questionable utility for some trainees, wasting management resources. These (semi) individual training schemes should be developed jointly by executive and academic professors, based on individuals’ personality profiles (Ineson, 2011).
Maellaro & Whittington (2012), studied the importance of interpersonal skills in management and concluded that communication skills, influencing skills and intellectually-oriented interpersonal skills had the biggest impact on hiring decisions by employees. Therefore they suggest business schools should: “consider infusing experiential approaches that allow students to learn and practice essential microskills in the same manner that therapists and teaching professionals have successfully employed the microtraining method”. Besides helping students developing these skills, business schools should also help them using and combining them so as to create a total value that is larger than the sum of the parts (Maellaro, R. & Whittington, J. L., 2012). This development of interpersonal skills could be achieved by adding courses to the curriculum that help students in developing self-awareness about their leadership skills (strengths and weaknesses); through self-assessment and feedback from others on their ability to influence them.
Kao & Mao (2011) also propose a teaching framework in which students are allowed to build on their individual strengths, career interests and personal background. This
framework intends to “align each student - or groups of students with similar interests and backgrounds - to the target markets identified for them as most competitive”. They also suggest a new management education paradigm where business education is designed as an ongoing process so as to keep the students aligned and competitive with the complex and ever changing global business world.
There have been many suggestions for improvement in the business school
curriculum but some universities have already implemented experimental programmes with the aim of staying innovative in their curricula. Montfort University, situated in Leeds, UK, designed and tested a new final year undergraduate course in Creative Management. Students were asked to develop their own business idea and afterwards they were confronted with make-believe situations that intended to create feelings that lead to innovation, such as “Creative Tension” and “Strategic Discomfort”. The researchers found out that many students are adverse to risk-taking and feel pushed out of their comfort zone when asked to participate in innovative thinking role-play situations but concluded that “it is one way to simulate business realities to some extent” (McHardy, P. & Allan, T., 2000)
Literature Review: Conclusion
The literature analyzed thus far quite unanimously has pointed to general mental ability as the most important predictor for job performance (indirectly, through job knowledge).
Subsequently, general mental ability should be one of the most important factors in determining whether a candidate is suitable for a job vacancy. It is straightforward to admit that the candidate which is predicted to achieve the highest job performance is the one a company will want to hire (exception made for extreme situations in which personality, history or cultural differences indicate a significant misfit between vacancy and applicant).
Besides mental ability it has come forward that transferable interpersonal skills are usually the areas where the business community sees flaws in business school graduates’ preparation, which is a problem as these skills were shown to be some of the most important features in being a successful manager. This, coupled to the criticism on business schools’ excessively academic and theoretical way of preparing their students as expressed by both Pfeffer & Fong (2002) and Shipper (1999) add some sub-questions and variables to the previously mentioned research question: Do business school graduates face a knowledge gap when entering business in the “real world” and is the level of knowledge on practical matters of business in itself is the most important variable considered by employers when hiring a business school graduate? The first sub question that arises directly from the analysis of the literature and from the main research question is the following one: “If not knowledge on practical matters of business, what are the main variables considered by employers when hiring business school graduates?” Another sub-question is: “Do recruiters, trainers and other senior business professionals see the knowledge gap as a threat or an opportunity?” The 3rd
sub-question derives from the fact that the literature seems to be critic on business schools and, at least to some extent, “accusing” them of not adequately preparing their students. Therefore the role that business schools play in the preparation of their students, the fit between learning business and doing business and possible new improvements in the current model of teaching business will be looked into: “How can the current teaching model of business be improved so as to better prepare business school graduates for real world business?”
III-Conceptual Model
After analyzing, in the previous section, the existing literature on predictors of job
performance, the role of ability and experience in acquiring job knowledge and the effect of personality on job performance, this section will define the conceptual model on which the research is based and which will guide the data collection and analysis.
The most important variables and constructs that came forward from the literature review and that are expected to be meaningful in answering the research question are:
• Experience
• Personality
• Job performance
• Predicting job performance
• Criteria for personnel selection
• Training needs of business graduates
• Knowledge gap
• General mental ability
The conceptual model will include the predictors of job performance and their effects on the criteria for personnel selection, as we assume that employers generally will hire the candidates that are expected to perform best in the future, and through that assess the relevance of the knowledge gap faced by business school graduates in the eyes of senior business professionals, trainers or recruiters. In the existing literature, there is research on the factors that influence job performance as well as on the criteria for personnel selection and on the role of business schools, their history, their future and their level of success. However, the specific combination of business school graduates’ entry on the job market and their level of preparedness with the (practical) knowledge soft-hard skill gap and predictors of job performance has not been found in the existing literature.
Fig.2- Conceptual Framework
This conceptual model shows the relationships between variables that I expect to find in this research. Based on this model and on the literature review the following is expected:
• The most important personnel selection criteria is expected job performance. • Expected job performance is influenced by Ability, Experience, Personality and Pre-job
knowledge.
• Transferable interpersonal skills are also of great importance and can, up to a certain level, be better developed in business school.
• Transferrable interpersonal skills are severely conditioned by ability and personality. • Ability is the most important predictor of job performance and therefore the most important
personnel selection criteria.
• Personality is the second most important personnel selection criteria when hiring business students.
• Training needs are also influenced by the predictors of job performance as well as by the knowledge gap.
• The relevance of knowledge as a criteria in hiring business school graduates is low.
• A business school diploma’s relevance as a proof of ability is larger than the relevance of the knowledge obtained during the education.
• Recruiters see the practical knowledge gap as an opportunity to, through training, mold business school graduates into well performing employees.
• The value of the knowledge on practical matters of business obtained at business school is low, especially when compared to the knowledge obtained on the job and during training. • More valuable than the obtained knowledge on itself (theoretical or practical) are ways of thinking, analyzing and other soft skills learned and/or the potential to acquire them in the future.
IV – Methodology
a. Research design and Data Collection
Possible improvements to reduce the misfit between knowledge and practice will be inferred from the analysis of the interviews that will be conducted as part of the research. Five interviews will be conducted by myself with the objective of gaining a larger understanding of how well prepared business school graduates enter the “real world” of business. The interviewees will be senior professional that work or have worked at firms which get at least part of their employees coming in from business schools. These senior professionals, experienced and well versed in practical knowledge and the training needs of these new employees, will be asked a series of questions regarding those needs and possible faults in the education as well as the importance of prior job knowledge for the hiring (or not) of a candidate. The level of analysis will thus be at firm or firms level, depending candidates found to be interviewed. Interviews were chosen as the most efficient way of collecting data
for this kind of research as observation of job interviews, for example, would not provide the necessary insights in how senior professionals look at business school graduates and
observation of on-the-job-training is not possible due to time and facility constraints. A questionnaire would also not be appropriate as it would limit the answers and not make a more in depth analysis of the research question possible, due to its broad and diverse implications.
For each interview approximately half an hour is taken into account. As the respondents are senior business professionals in exercise, they have significant time constraints to deal with. Therefore the location and date will be one that suits their personal and professional agenda, so that enough time is available to deal with all the interview questions. To ensure that respondents are talking easily and are willing to bring up every subject that is on their mind, locations will preferably be informal and not in work context. Regarding these business professional’s time and agenda constraints, there is the possibility of telephonic interviews, although this is not the preferred option because there might be non-vocal communication lost and/or they might not be fully focused on the conversation. Each interview will be recorded to make sure that the gathered data will not get lost. The findings of the interviews are discussed later at the end of this thesis. The aide memoire used for the semi-structured interviews as well as the interview-transcripts of the interviews held with the respondents can be found in the Appendix A.
The research sample will consist of the previously mentioned five interviews added to a database of twenty five interviews conducted by others researching the same topic simultaneously. As these others follow the same timeline, criteria and structure in their research, their interviews and the results that follow from them can be used, at least partly, in answering my research question. This leads to a total database of 30 interviews from which approximately fifteen will concern senior business professionals and another fifteen will concern business school graduates. This creates a good basis for research and a sample that is big enough to support relevant and valid findings, as well as providing a perspective from both sides of the issue; recruiters and recruited. What the constructs and variables are concerned, these are relatively straightforward; the level of preparedness from business school graduates can be considered too low, satisfactory or high, the importance of prior job knowledge can be classified as low, medium or high. The same is the case for the other constructs mentioned so far. If it so happens to be that during the interviews or during the later stage of literature analysis other constructs present themselves, then, depending on their
nature, more complex operationalization may be necessary.
b. Data analysis
This qualitative research is empirical by nature and based on previous findings in the literature. As it derives from the constructs, theories, ideas and assumptions from previous research on the matter it can be considered deductive. This also because so many research has been done on the various topics that make up the conceptual framework. Since no real hypothesis have been formulated as such, and there is the possibility of new insights and findings deriving from the data collection and analysis, there is also an inductive component to this research. As new and old constructs need to be deducted and linked from the interview results there is a possibility that important suggestions for future research arise.
The raw data resulting from the interviews will be firstly recorded and transcribed so that a qualitative analysis through coding is possible. The type of coding is mainly closed as the extensive previous research has provided several constructs and definitions that can be used as main codes, before the analysis takes place. The preset codes are seen as categories or themes and exist of operationalized variables derived from previous literature that are expected to be related to the researched subject. As I hope the interviews lead to new insights on the matter there might be new codes deriving from the analysis and preset codes altered.
c. Data reporting
After the data analysis through coding, the results will be presented in this paper, as a final stage of the research. The final knowledge product that is expected to derive from the analysis is related to the relevance and size of the knowledge gap faced by business school graduates when entering the job market, to the main criteria used by employers when hiring and to possible improvements in the business school curriculum and teaching ways. The reporting of the data can be characterized as a summary of the main findings and conclusions, accompanied by extensive citations from the interviews.
V- Validity, Generalizability and Reliability
a. Validity
According to Mortelmans (2007) validity consists of measuring what you want to measure, through your chosen research methods. So as to ensure the interviews come up with useful information the questions were formulated with great care and based on the constructs deriving from the literature review. The fact that the interviews are semi-structured contributes as well to validity as it allows the researcher to enter in a more specific ways topics that come forward from the answers to the original interview questions. In this way the researcher has some control over the conversation and the possibility to carefully steer it towards the intended topics. The use of open questions is also a way to ensure validity as it leads to more descriptive answers that can contain important elements.
b. Generalizability
Generalizability is one of the criteria where this research might have some limitations. This because of the very broad spectrum of positions in very different companies that business school graduates can enroll in in the job market, all of which may have different demands and views on the level of knowledge, both practical and theoretical, that these graduates have and should have. This, allied to graduates’ abilities of individual nature, leads to possible
difficulties in generalizing for different firms in different industries. However, it can be possible after the research to draw a relatively correct picture of the size and components of the knowledge gap business students face after graduation, if the results from the research are not too different for each senior business professional and/or business school graduate interviewed and possibly inconclusive of course. If the research does present very different findings this doesn’t necessarily mean that there are no conclusions possible; it might be an indication that individual cognitive and interpersonal (and not only) abilities are the most important variable in determining level of preparation for the job market, training needs and/or future job performance.
c. Reliability
As I am also a business school student and pretty soon a business school graduate, I have great interest in the topic but might also have my own perceptions. It is important to eliminate those in the data analysis process and in the formulation of conclusions. The fact that the majority of the interview questions is shared with three others researching the same general topic but interviewing different respondents can help increase reliability. The fact that senior business professionals are the interviewees and not business school graduates helps to reduce that possible problem of my own perceptions as they can observe the problem from a different angle. The five interviewed senior business professionals are all people with great experience in real-life business in different areas and with important functions in relatively big companies. All of them have had contact with business school graduates and taken part in personnel selection procedures. These characteristics allied to their own experiencing of the knowledge gap in the start of their careers makes them valuable respondents for the topics this research intends to analyze. The fact that the transcript of the recorded interviews will be provided along with the rest of the research allows for control by independent readers.
VI. Results
This section will present the results from the semi-structured interview held with senior business professionals on the knowledge gap and business school graduates’ training needs. The results will be presented in a narrative manner accompanied by direct quotes from the interviews. The interviews were transcribed then coded and analyzed. The transcribed interviews with codes can be found in the appendix.
a) Preparedness from business school graduates at different levels, when entering the job market.
From the interviews with senior business professionals it came forward that they consider business school graduates to be generally well prepared at theoretical and analytical level. The consider the theoretical education obtained at business school to be a good basis, although not strictly necessary for further development on the job and the analytical skills to
be well developed. This theoretical knowledge, when new and based on the latest evolutions in the business field, can even be a valuable addition to the existing processes and working ways.
“I think that the theory is generally in order, specially the latest theory, considering that business schools follow the newest developments, it has got added value for a company.” – M.M.
“The course and the academic knowledge are of value as a basis, more than that, sometimes you will be able to have valuable new input on things that aren’t good or are non-sufficient.” – L.B.
“Theoretical knowledge on matters of business is not essential, but it gives you self-confidence because you have this basis to rely on, you already know up to some level what it’s all about”. – M.M.
They do consider it very difficult for business schools to adequately prepare their students in specific practical skills as the range of occupations and functions these graduates will later fulfill is very broad. This broadness of the working area a business graduate can end up in is considered to be one of the biggest problems for developing a business model with a bigger practical component in the teaching but also considered to be an opportunity for students as they can specialize and move into many different areas, depending on their interests.
“(…) because it is so broad it is not possible to specifically educate people and that is where the problem is. The range of companies where you can end up working is so big that you can’t develop a specific model for business schools, you can’t really prepare people in a practical way because if you do that they might end in companies where that specific skill or knowledge doesn’t apply.” – J.G “Business is a very broad course and I believe you can go into many different directions with it and at the same time you ask yourself: “where should I go?””. – L.B.
One other level where senior business professionals consider graduates to be lacking preparedness is that of interpersonal relationships and politics. Interpersonal skills are one of the key components in being successful in business as the world of business is one of people. Even though the range of functions a business degree might lead to is very big, the utter majority of these functions requires working with people and dealing with their individual
differences. As these interpersonal skills are so transversally important and can be improved to a least some level in university, this seems like an important point for possible
improvements in the business curriculum. Although they consider it is possible to better prepare graduates in terms of interpersonal skills than what is currently being done, it has also come forward that individual traits are very relevant in how graduates develop these skills and up to what level they can do that. However, the political games that are played within companies are considered to be very difficult to recreate at university and should be learned through practice and experience, through trial and error.
“The course, at this point, might not teaching you to deal and learn about interpersonal relationships. (..)You have to learn how to know yourself in relation to other people and that can be taught and will most certainly be necessary.(…) I know you can learn this because I have had classes about it myself. (..) There are a lot of underlying emotional mechanisms that play a role and you can learn how to deal with them. The political game, I don’t think you can learn how to play it at university, maybe on a very general level. The real playing of the game; that requires a certain talent and feeling and you’ll mostly learn it by making mistakes and being wrong.” – I.S.
b. Selection criteria and the importance of training for business school graduates.
The most important selection criteria that came forward from the interviews with senior business professionals were ability, personality, experience and drive or motivation. This latter was a new addition to the expected criteria and considered to be very important by senior business professionals as this intrinsic motivation related to the job at hands leads to a higher commitment and therefore performance. However, this intrinsic motivation has to be coupled to a certain level of ability because even though it might lead to more effort and a bigger willingness to learn, the level of learning is limited by the level of intellectual capacity. “I always look at a certain drive and passion in people, there has to be a certain intelligence to start with and then there is passion. Is there the will to learn, is there something that makes the person different than the rest. It is so intuitive and different from individual to individual, I really think it is a personal thing. Intelligence and personality are very important but passion is what makes or breaks it for me, it is very important so as to know whether someone will fit In my team.” – M.M.
Ability was found to be usually proven by the capacity of a candidate in obtaining an university degree and in learning new skills or methods. Grades were in some cases considered to be a measure of ability but not an absolute or decisive criteria of ability on its own. Personality was found to be a very important selection criteria, perhaps more decisive than ability because senior business professionals considered that most of the graduates applying for a job generally already had the required intellectual level, as they managed to finish an university course and the theoretical basis. This leaves personality, interpersonal skills (which are dependent on both personality and general mental ability) and previous experience through work or life as the most important criteria looked at by recruiters. This experience comes in the form of internships (the most frequently quoted example) and also through more socially oriented life experiences such as studying abroad or being part of a student board. The economic conjuncture has led to an ever bigger focus on extracurricular activities as companies want to hire with the least risk possible. Someone who has been extremely active, besides correctly finishing his course, has obtained some level of experience, has shown the ability to handle a certain workload and displayed a certain ambition.
“I believe, in the current economy, that the most important criteria are extracurricular activities you were a part of and also grades. Besides those two it is also important how you present yourself because in a company you work with people and you have to be able function in a social
environment. If someone has great academic results but is socially handicapped than it won’t work. A commercial company is usually a social one, you have to be able to deal with both your co-worker and your customers.” – J.G.
It is noticeable that personality is considered by all of the respondents to be an essential personnel selection criteria as it is related to all the other criteria. One can learn academic and practical skills, as well as interpersonal skills (though this is more complicated) but one’s personality is already formed and molded by nature and nurture at this point. Personality, allied to ability, is considered to be decisive in the learning of technical and social competencies by employees. As earlier stated, drive and motivation came forward as important criteria from the interviews and in the last interview these are coupled to
perspective. Perspective is considered to lead to more sustainable and long term motivation, positively influencing job performance. It is the things that can’t be learnt at a company and
that are already sort of pre-set that are the most important, as those are the limitations of an individual’s potential to perform.
“It is useful to have knowledge and experience but you really need to have the personality, you can learn the rest. Personality, intellectual capacities, communication skills and analytic capacity are the most important things. I look at motivation, perspective, potential and help, the so called MPPH. Perspective is how someone sees his growing possibilities in a job, if there is no perspective for the future this will lead to a less sustainable effort and the marriage will not be long(..). A motivated, talented person with perspective needs to be able to accept and ask for help when necessary, that is an important feature to be successful. Besides that someone also has to be flexible and be able to admit when he or she is wrong. – I.S.
c. Value of a business degree
Senior business professional consider the value of a degree in business to be more related to the fact that someone has proven himself to be able to reach a certain analytical level and learn things that require a certain level of intellectual ability.
“The value of a business degree in general, for a specific function, is non-existent, because the education and possible functions are so broad. The only value it has is that it proves you can handle a certain analytical level. – J.G.
They consider this proof of a certain analytical level to be more important than the actual knowledge that is inherent to the degree. The knowledge is considered a good though not essential basis for functioning in the business world. Without this knowledge it is still possible to be successful in the world of business, as long as the personality and intellectual capacities from an individual allow that. The most important practical knowledge related to the specific job is acquired through training, training which is by the majority of the senior business professionals considered to be in some cases enough for performing a certain job. So it is during the job-specific training that employees really learn something valuable from a practical perspective, besides the mentioned analytical skills.
“The degree is important, no matter how you put it, you proved something. It is the proof that you can handle a certain level and that you achieved that, apart from that the degree doesn’t have to add anything, but it is a very good basis. The good thing about the degree is that it gives you a basis and tells the employer something about the person in front of them. This person fits a certain number of intellectual demands. But there are enough examples of people that made their career in business without a degree, smart people that learned whilst doing. – M.M.
This means that a degree in business is not necessary to work in business. Other university degrees will do and will give the students the required analytical level. In many cases senior business professionals considered that a function can be done with just training and no degree, although this is not desirable and in many cases will not happen. This because of the crisis, which has led to a smaller margin for error in terms of who you hire, and a degree is, as stated before, a proof of ability. So, even though the overall value of a business degree is considered to be low by senior business professionals and its obtainment is not considered essential for being able to perform in the business world, the obtainment of such a degree or one of equal value is considered essential in the selection procedure. In short, you don’t need the degree to do the job, in most cases, but you need the degree to be given a chance at doing the job. This might seem contradictory but the fact is that the degree works as a guarantee in the eyes of employers. The guarantee that that specific individual will be able to do the job properly.
“Yes, I do believe that this on-the-job training is essential. I have seen functions where I didn’t see any added value by the theoretical knowledge, but the way of thinking might add something. I think you could do the job without the degree and with training, but the learning curve would be very steep” – E.B.
“The value of the degree is in showing that you can finish something. I think that all university courses teach you or should teach you to do analyses, to acquire and efficiently gather knowledge, to summarize knowledge, to write, to orally present it and to draw conclusions. And these are general skills you’ll need in the business world. I think that learning academic skills has an added value to business. (…) I don’t think that someone that just graduated could do the job without training. The
other way around maybe, but I wouldn’t hire that person for the traineeship. If a trainee isn’t performing properly that costs a lot of money and that’s why employers will be very strict in the selection procedure and a degree and the right personality are essential there.” – I.S.
Besides being a foot in the door of employers, having a business degree also indicates that an individual has obtained some skills and competencies. These skills and competencies are however not exclusive of a business degree, most university courses should lead to the same level of analytical preparedness.
d. Suggestions for change in the current ways of teaching business
The common denominator in the suggestions for change in the curriculum was the need for a better connection of the academic learning with the practical learning. Senior business professionals considered that it would be very benefic if internships were to be mandatory. However, they also notice that students themselves are more and more realizing the importance of such a practical component and seeking to bridge this gap on own initiative. “You could make a larger practical component, in form of internships for example, mandatory as part of the course. Although nowadays we see that a lot of students are looking for that on their own”. – E.B.
Through internships it is possible for employers to have a better picture of who they are hiring and it is possible for students to have a better picture of where they want to work. It is this mutually positive relationship from students with employers concerning internships that was highlighted by many of the interviewees. Besides this it was also considered to be so that it is easier to understand the theory and it becomes more valuable when there has been some practical experience where it could have been relevant. The theory is more valued and better understood when it can be coupled with previous practical experiences where it could have been useful.
“Because of the broad range of companies in business it is not possible to get more practically specific in the course. But what you could do is something that is already done in some MBA’s, where a work experience of at least 5 years is demanded. Sometimes it is really good to go back to the
theory at the point where you are already working in business, because it gives you the chance to see whether a certain theory is useful for you and your company. (..) you could go towards a system where you say: We have done the bachelor and as a master we won’t go to another research based thesis but we will go to, for example, a path of 2 or 3 years where you will look at specific practical knowledge at different companies in different sectors.” – J.G.
The respondents also suggest that the cultural and political environments found in the business world are so different from the ones in university that internships are the most effective way for someone to learn and understand how the real world works. Senior professionals and managers themselves make decisions that are induced by emotional and irrational reasons, something that is, understandably, not treated in university as this is not the correct way of acting, but something that happens anyway.
“I believe that internships should be mandatory anyhow, and not because you learn so much about executing business itself but because you learn about that cultural part because that is where I think the gap usually is, I mean, you can be fantastic at knowing the theory and understanding all that but you have been in an auditory, go work at Akzo-Nobel for a while and see how that is. You’ll ask yourself: “What is that? What are they acting weird, and they aren’t even working that hard”. You can get away with so many things and decisions are made in the weirdest ways.” M.M.
VII – Discussion and Conclusions
The results from the research are, in great part, in line with the literature. It came forward from the research that business school graduates do face some limitations and lack certain knowledge or skills when entering the real world of business. So there is a knowledge gap of some sort. From the interviews it is possible to conclude that the knowledge gap can be seen
as a combination of three things: practical knowledge, theoretical knowledge and
interpersonal skills. This division of the knowledge gap into 3 parts was previously suggested in this paper and was proven to be at least a valid suggestion. Based on the literature we would expect business school graduates to be lacking skills at interpersonal level and practical level and to be well versed in the theoretical knowledge. This was also what arose from the interviews. Interpersonal skills where, just like in the literature, considered to be the area where business school graduates were lacking the most. The culture and ways within business organizations were considered to be very different from the culture students experience at university. Especially politics and the fact that even in large corporations weird and emotionally based decisions are made very frequently were considered by senior business professionals to be areas were graduates have a lot to learn. Just like in the literature there was some suggestion that interpersonal skills can be learned, at least up to some level, at university, something that is not currently being done to full potential, especially considering the importance of those skills in the real world of business. From the interviews it also came forward that interpersonal skills can be learned up to a certain level but also depend very much on an individual’s ability and personality. Personality was considered to be one of the most important factors of success and one of the most important criteria in personnel selection, particularly coupled to the construct motivation or drive. This was a new variable that resulted from this research and that wasn’t found during the review of the literature, at least not in the direct way it appeared in the interviews. The most important personality traits that came forward were related to the previously mentioned interpersonal skills and
communication skills. Just like the literature suggested for the managerial positions, the communication with both the internal and external environment is crucial. Other traits that where considered important, besides the intrinsic motivation and passion for a certain area or function, were willingness to learn, flexibility and the ability to ask for and accept help. None of these was though as present as drive and motivation. This because employers want, especially in the current economic situation, to have employees that are motivated and productive on the long term and there is no better way to achieve that than having people working on something they are passionate about. Personality was, unlike expected, as important or perhaps even more important of a variable in the selection of personnel that ability. This not because ability was considered to be less important but because employers assume that business school graduates must have a certain level of intellectual ability and analytical skills to be able to conclude their education and that is in most cases enough to perform their future function, when coupled to the right personality/interpersonal skills. This
