It is big news that women who go to college, join the workforce, and delay having children don't lose money when later on they do combine work and family. A recent study by researchers from the University of Maryland and UCLA looked at the economics of women who didn't have children until they were over the age of 26, and found that their earnings were comparable to women who had never had children. Earlier studies add that women with a college education are much less likely to opt out of the workforce when they have a baby than are women with less education.
This is great news, unless of course you worry that all these older, ambitious working mothers are shortchanging their children, but this turns out not to be true either. As we show in our book, Red Families v. Blue Families, the college educated, who postpone childrearing until the parents achieve a measure of financial self-sufficiency and emotional maturity, have become more likely to marry and less likely to divorce than the rest of the population, with two-parent families that remain intact, replicating the statistics that existed before no-fault divorce, the pill and legalized abortion.
Perhaps more surprisingly, these mothers spend no less time on childcare than similar mothers of earlier generations -- it's housecare, not childcare that's changed. Indeed, Princeton University sociologist Sara McLanahan observes that "Children who were born to mothers from the most advantaged backgrounds are making substantial gains in resources. Relative to their counterparts 40 years ago, their mothers are more mature and more likely to be working at well-paying jobs. These children were born into stable unions and are spending more time with their fathers." By contrast, the rest of the country has seen skyrocketing rates of non-marital births, divorce, and single-parent families, magnifying the effects of income inequality on children. And these poorer mothers are the ones more likely to cycle in and out of the workforce, limiting their earnings potential while feeling pressed to adequately care for their children.
How do dual career families manage the juggling act so much better than more traditional families? The well-kept secret is that investments in human capital, in college degrees, specialized training and experience, and workforce stability pay off for employers as well as employees. Employment studies show that the greater a woman's education and experience the more likely she is to work in a flexible labor environment and to live in a state that mandates greater parental leave and other family benefits. Younger, less educated, and less skilled women find that they bring less to the bargaining table in negotiating with their bosses. When they cannot get sufficient maternity leave to manage the second child, they quit. When their children require more after school time, they may find it easier to switch employers than to switch schedules. They are more likely to return to school after their children complete elementary school than before they are born. As a result, they find work-family balance harder to manage than their better off peers -- and their children fall farther behind in the share of society's resources they enjoy.
Where are the men in all this? The wage gap that exists between men and women is also true for mothers and fathers. According to Congressional testimony from last month, "women with children earn about 2.5 percent less than women without children, while men with children enjoy an earnings boost of 2.1 percent, compared with men without children." Fathers, however, are spending more time with their children than they once did, and married college educated men have increased that time the most. Well off working women are also getting the most assistance at home.
Third, as we discuss in Red Families v. Blue Families, the essential next step for all families is reconsideration of the relationship between work and family. For blue families, where human capital acquisition precedes family formation, the challenge is to structure the work place to fit in family. For red families, where family formation may come first, the challenge is to restructure the relationship to the workplace to fit in continued human capital acquisition. We must provide better support and policies for family stability and for work. Moreover, one critical area where genuine convergence between the two models might ultimately transform the debate: can we persuade our prototypical red family to delay family formation to the mid-twenties to maximize their children's well-being?
Original article>>>
Leveraging Facebook to Find a Job By JENNA WORTHAM
Most people use Facebook to keep in touch with their friends, plan their social calendars, crowdsource apartment hunts and even finagle a first date.
Why not use it to land a job?
That’s the idea behind Jibe, a New York start-up hoping to revitalize online job search using Facebook.
Jibe is one of the start-ups housed in Dogpatch Lab’s New York
office, a technology incubator backed by Polaris Ventures, a Boston-area venture capital firm. The company recently raised $875,000 in seed funding from Polaris Ventures, Josh and Jared Kushner, Zelkova Ventures and Lerer Media Ventures. On Tuesday, the service comes out of beta.
To start, job seekers connect their LinkedIn and Facebook profiles to pull in education and work history to quickly build a profile on Jibe. Then, they can begin searching for companies and industries they are interesting in working at to see who they know employed in those areas and can easily get in touch with friends to ask for advice or a reference or inquire about job openings.
Many start-ups have tackled reinventing the jobs board, with varying success. Others, like Craigslist and Monster.com, tend to be overrun with duplicate postings and have a high volume of applicants for each listing. And still others, like TheLadders, target people in search of executive positions and six-figure salaries.
Jibe, however, is setting its sights on the collegiate crowd and recent graduates who are starting from scratch and likely to be bewildered by the job application process, said Joe Essenfeld, co-founder and chief executive of the company.
“We want to help entry-level job seekers find their first job and get recommendations, which is something you don’t learn in college,” he said.
The company said its primary goal is attracting new users to the service.
The next step for Jibe, Mr. Essenfeld said, is incorporating job listings culled from the Internet and through partnerships with companies looking to target a small pool of qualified applicants for entry-level positions.
“We’re targeting white-collar companies in cities looking for entry-level candidates in finance, health care and marketing,” said Mr. Essenfeld.
To monetize its service, Jibe will charge employers to have full access to its pool of job candidates. Recruiters can search through the database free, Mr. Essenfeld said, but to send a message to a Jibe member or see a full profile will cost money.
As a former hiring manager, Mr. Essenfeld said he believed that employers would be happy to pay for access to a smaller pool of qualified applicants, rather than wade through the hundreds of résumés that are sent to each listing on sites like Craigslist and CareerBuilders.
In addition, Mr. Essenfeld said the service would charge its highest-volume users.
“If you want to be a power user and apply to 25 jobs in a week, you pay $5 to do that,” he said. “But if you only want to apply to four or five jobs in a week, that’s free.”
Alternatively, job seekers can earn credits that unlock paid features by using services within Jibe, like writing a recommendation, tweeting about the service and inviting friends to join the network.
“We want to give everyone the opportunity to apply for a job for free,” Mr. Essenfeld said.
Read more>>>>>>
Why not use it to land a job?
That’s the idea behind Jibe, a New York start-up hoping to revitalize online job search using Facebook.
Jibe is one of the start-ups housed in Dogpatch Lab’s New York
office, a technology incubator backed by Polaris Ventures, a Boston-area venture capital firm. The company recently raised $875,000 in seed funding from Polaris Ventures, Josh and Jared Kushner, Zelkova Ventures and Lerer Media Ventures. On Tuesday, the service comes out of beta.
To start, job seekers connect their LinkedIn and Facebook profiles to pull in education and work history to quickly build a profile on Jibe. Then, they can begin searching for companies and industries they are interesting in working at to see who they know employed in those areas and can easily get in touch with friends to ask for advice or a reference or inquire about job openings.
Many start-ups have tackled reinventing the jobs board, with varying success. Others, like Craigslist and Monster.com, tend to be overrun with duplicate postings and have a high volume of applicants for each listing. And still others, like TheLadders, target people in search of executive positions and six-figure salaries.
Jibe, however, is setting its sights on the collegiate crowd and recent graduates who are starting from scratch and likely to be bewildered by the job application process, said Joe Essenfeld, co-founder and chief executive of the company.
“We want to help entry-level job seekers find their first job and get recommendations, which is something you don’t learn in college,” he said.
The company said its primary goal is attracting new users to the service.
The next step for Jibe, Mr. Essenfeld said, is incorporating job listings culled from the Internet and through partnerships with companies looking to target a small pool of qualified applicants for entry-level positions.
“We’re targeting white-collar companies in cities looking for entry-level candidates in finance, health care and marketing,” said Mr. Essenfeld.
To monetize its service, Jibe will charge employers to have full access to its pool of job candidates. Recruiters can search through the database free, Mr. Essenfeld said, but to send a message to a Jibe member or see a full profile will cost money.
As a former hiring manager, Mr. Essenfeld said he believed that employers would be happy to pay for access to a smaller pool of qualified applicants, rather than wade through the hundreds of résumés that are sent to each listing on sites like Craigslist and CareerBuilders.
In addition, Mr. Essenfeld said the service would charge its highest-volume users.
“If you want to be a power user and apply to 25 jobs in a week, you pay $5 to do that,” he said. “But if you only want to apply to four or five jobs in a week, that’s free.”
Alternatively, job seekers can earn credits that unlock paid features by using services within Jibe, like writing a recommendation, tweeting about the service and inviting friends to join the network.
“We want to give everyone the opportunity to apply for a job for free,” Mr. Essenfeld said.
Read more>>>>>>
Brandman University Introduces Bachelor and Master of Business Administration Degrees at Campuses in California and Washington State
Chapman System's adult education university offers business curriculum to meet emerging employer needs for talent, help working adults advance their careers
IRVINE, Calif., May 5 /PRNewswire/ -- Brandman University, a fully accredited adult education university within the Chapman University System, today announced the introduction of Bachelor of Business Administration (BBA) and Master of Business Administration (MBA) degrees across campuses in California and Washington State. The university developed its new business curriculum to meet changing employer needs in a global economy and address gaps in current business degree offerings, particularly in the areas of leadership development, entrepreneurship and sustainability.
The 50-year-old institution, renamed Brandman University in 2009, is introducing system-wide business degree programs as the shifting global economy and government regulations have changed employer expectations and needs from workers. In planning the business curriculum, Brandman surveyed both employers and potential students to ensure the program met needs, particularly in the areas of leadership and ethics. Executive development research has shown that many business programs, particularly MBAs, do not adequately prepare students for the leadership and ethical challenges they will face in their careers.
In fact, a 2007 study appearing in the Journal of Business Ethics found that only one quarter of the top U.S. business schools require a stand-alone ethics course before graduation, and study authors concluded that ethical decision-making should be incorporated into every course in an MBA program. In response, both the Brandman BBA and MBA degree programs provide students with the tools to evaluate ethical issues, formulate solid business strategies and policy practices and communicate effectively in a global and diverse business environment. Both degree programs also incorporate organizational leadership as an area of emphasis, extending Brandman's Organizational Leadership degree offerings, which have earned the Outstanding Program Award by the Association of Leadership Educators.
Brandman's MBA degree program also is one of few to focus on sustainability and innovation as key elements of curriculum. Although sustainability is a key focus and requirement for many companies and organizations, few MBA degree programs incorporate training on sustainability practices. The Brandman MBA weaves sustainability into all Brandman MBA courses along with innovation and corporate responsibility.
Brandman's focus on sustainability extends beyond the curriculum, as the University is launching the Center for Sustainable Living, which will be housed at the Irvine campus. The Center provides a hub for Orange County's public and private sectors to connect on sustainability initiatives, and Brandman's business students in Orange County will participate in the Center's applied research projects, providing "hands-on" experience in sustainability practices. Students also can attend guest lectures and seminars hosted by the Center to complement their course work.
In addition to its focus on the critical issues facing today's business leader, Brandman University's reputation as a leader in adult education and its affiliation with the Chapman System has enabled the University to attract some of higher education's best business educators, as well as influential business leaders as faculty to bring strong real-world business application.
A benefit of being a part of the Chapman University System is the collaboration between Chapman and Brandman faculty. Notable faculty include P. K. Shukla, Ph.D., a longtime management professor at Chapman University's George L. Argyros School of Business and Economics. Dr. Shukla will develop and teach courses for Brandman's business degrees, giving tomorrow's entrepreneurs a distinct advantage, leveraging his experience with Chapman's well-known entrepreneurship programs, which were ranked among the top ten nationally in a survey published by The Princeton Review and Entrepreneur magazine.
Other faculty leaders include Helen Eckmann, Ed.D., whose firm provides leadership development consulting to Fortune 500 companies, and was named the San Diego Business Woman of the Year by the National Association of Women Business Owners (NAWBO) in 2009. Dr. Eckmann has worked with a number of companies on innovation, supply chain management and integrating sustainability into all aspects of business. In addition, Janet Cooper Jackson, Ph.D., brings to the Brandman classroom a successful career as an independent consultant specializing in the design, development, delivery and evaluation of training/educational courseware, as well as nearly 15 years of experience with Xerox Corporation in systems management and analysis.
In addition to a robust curriculum and strong faculty, BBA and MBA students also benefit from the support Brandman University provides to its students throughout their academic careers. Brandman's counselors and academic advisors provide sustained, hands-on guidance to help students succeed – a key factor in Brandman's high graduation rates, measured above the industry average at 68 percent for transfer-to-graduation in four years.
"Brandman University is introducing high-quality, competitively priced BBA and MBA degree programs to help working adults in California and Washington achieve their advancement goals while accommodating their time constraints and unique learning needs," said Brandman University Chancellor Gary Brahm. "In addition, Brandman's accreditation and high graduation rates are key benefits for working adults who want a degree that will impact their careers."
Classes for the BBA and the MBA programs have begun online and at the Irvine campus. Classes at all other campuses will begin August 30, 2010 and applications for admission are being accepted now. For more information or to apply to the School of Business and Professional Studies, prospective students can visit www.brandman.edu/business.
About Brandman University
Brandman University, formerly Chapman University College, is accredited by the Western Association of Schools and Colleges and focuses on meeting the unique needs of the more than 10,000 working students it serves both online and through 25 campuses in California and Washington. Brandman University is part of the Chapman University system and is known for providing students with more than 200 degrees, credentials, certificates and professional development programs. www.brandman.edu.
About Chapman University
Founded in 1861, Chapman University (www.chapman.edu) is one of California's oldest, most prestigious private universities and is home to over 4,000 undergraduate students and 1,500 graduate students at its home campus in Orange, California.
Media Contact:
Kirsten Clausen, for Brandman University
213-438-8726
kclausen@golinharris.com
SOURCE Brandman University
IRVINE, Calif., May 5 /PRNewswire/ -- Brandman University, a fully accredited adult education university within the Chapman University System, today announced the introduction of Bachelor of Business Administration (BBA) and Master of Business Administration (MBA) degrees across campuses in California and Washington State. The university developed its new business curriculum to meet changing employer needs in a global economy and address gaps in current business degree offerings, particularly in the areas of leadership development, entrepreneurship and sustainability.
The 50-year-old institution, renamed Brandman University in 2009, is introducing system-wide business degree programs as the shifting global economy and government regulations have changed employer expectations and needs from workers. In planning the business curriculum, Brandman surveyed both employers and potential students to ensure the program met needs, particularly in the areas of leadership and ethics. Executive development research has shown that many business programs, particularly MBAs, do not adequately prepare students for the leadership and ethical challenges they will face in their careers.
In fact, a 2007 study appearing in the Journal of Business Ethics found that only one quarter of the top U.S. business schools require a stand-alone ethics course before graduation, and study authors concluded that ethical decision-making should be incorporated into every course in an MBA program. In response, both the Brandman BBA and MBA degree programs provide students with the tools to evaluate ethical issues, formulate solid business strategies and policy practices and communicate effectively in a global and diverse business environment. Both degree programs also incorporate organizational leadership as an area of emphasis, extending Brandman's Organizational Leadership degree offerings, which have earned the Outstanding Program Award by the Association of Leadership Educators.
Brandman's MBA degree program also is one of few to focus on sustainability and innovation as key elements of curriculum. Although sustainability is a key focus and requirement for many companies and organizations, few MBA degree programs incorporate training on sustainability practices. The Brandman MBA weaves sustainability into all Brandman MBA courses along with innovation and corporate responsibility.
Brandman's focus on sustainability extends beyond the curriculum, as the University is launching the Center for Sustainable Living, which will be housed at the Irvine campus. The Center provides a hub for Orange County's public and private sectors to connect on sustainability initiatives, and Brandman's business students in Orange County will participate in the Center's applied research projects, providing "hands-on" experience in sustainability practices. Students also can attend guest lectures and seminars hosted by the Center to complement their course work.
In addition to its focus on the critical issues facing today's business leader, Brandman University's reputation as a leader in adult education and its affiliation with the Chapman System has enabled the University to attract some of higher education's best business educators, as well as influential business leaders as faculty to bring strong real-world business application.
A benefit of being a part of the Chapman University System is the collaboration between Chapman and Brandman faculty. Notable faculty include P. K. Shukla, Ph.D., a longtime management professor at Chapman University's George L. Argyros School of Business and Economics. Dr. Shukla will develop and teach courses for Brandman's business degrees, giving tomorrow's entrepreneurs a distinct advantage, leveraging his experience with Chapman's well-known entrepreneurship programs, which were ranked among the top ten nationally in a survey published by The Princeton Review and Entrepreneur magazine.
Other faculty leaders include Helen Eckmann, Ed.D., whose firm provides leadership development consulting to Fortune 500 companies, and was named the San Diego Business Woman of the Year by the National Association of Women Business Owners (NAWBO) in 2009. Dr. Eckmann has worked with a number of companies on innovation, supply chain management and integrating sustainability into all aspects of business. In addition, Janet Cooper Jackson, Ph.D., brings to the Brandman classroom a successful career as an independent consultant specializing in the design, development, delivery and evaluation of training/educational courseware, as well as nearly 15 years of experience with Xerox Corporation in systems management and analysis.
In addition to a robust curriculum and strong faculty, BBA and MBA students also benefit from the support Brandman University provides to its students throughout their academic careers. Brandman's counselors and academic advisors provide sustained, hands-on guidance to help students succeed – a key factor in Brandman's high graduation rates, measured above the industry average at 68 percent for transfer-to-graduation in four years.
"Brandman University is introducing high-quality, competitively priced BBA and MBA degree programs to help working adults in California and Washington achieve their advancement goals while accommodating their time constraints and unique learning needs," said Brandman University Chancellor Gary Brahm. "In addition, Brandman's accreditation and high graduation rates are key benefits for working adults who want a degree that will impact their careers."
Classes for the BBA and the MBA programs have begun online and at the Irvine campus. Classes at all other campuses will begin August 30, 2010 and applications for admission are being accepted now. For more information or to apply to the School of Business and Professional Studies, prospective students can visit www.brandman.edu/business.
About Brandman University
Brandman University, formerly Chapman University College, is accredited by the Western Association of Schools and Colleges and focuses on meeting the unique needs of the more than 10,000 working students it serves both online and through 25 campuses in California and Washington. Brandman University is part of the Chapman University system and is known for providing students with more than 200 degrees, credentials, certificates and professional development programs. www.brandman.edu.
About Chapman University
Founded in 1861, Chapman University (www.chapman.edu) is one of California's oldest, most prestigious private universities and is home to over 4,000 undergraduate students and 1,500 graduate students at its home campus in Orange, California.
Media Contact:
Kirsten Clausen, for Brandman University
213-438-8726
kclausen@golinharris.com
SOURCE Brandman University
7 Steps To Start Investing Safely By Fleur Bradley
If you're like many Americans watching the recession unfold, you've probably started to look at your finances more closely. Maybe you've started saving - the annual savings rate by Americans has risen from almost nothing to 6.9% in 2009. Now you're wondering: what about investing my money? How do I start if I don't have a lot, and how do I limit my risk? Here are seven steps to become an investor, the low-risk way.
1. Determine Your Needs
When thinking about investing, you should first think about how liquid your money needs to be, or how quickly you should be able to access it. How likely are you to have to withdraw it again? Some investments are more liquid (like savings accounts) or easy to convert to cash than others (bonds, for example, often have a fixed term). Liquidity is a large factor in choosing investments, so examine your financial situation carefully before forging ahead.
2. Identify Your Investment Goals
What is your goal in investing? Is it to fund a retirement, your child's college or next year's vacation? Identifying these goals will help you determine your risk tolerance, since you'll know how long you'll be investing your money for. Long-term investments have different considerations than short-term ones. (Find out how to reach your long-term goals without becoming a tightwad; read 10 Simple Steps To Financial Security Before 30.)
3. Understand Your Risk Tolerance
Once you've identified your goals and how long you're planning to invest your money for, you should determine your risk tolerance. Here's a quick rule of thumb: the higher the return, the higher the risk. If you want to earn 15% on your stock investment, you also have to be willing to swallow the loss if your stock goes south (remember the recent stock devaluation following the housing crisis?). Here's where your goals come into play: a long-term investor can simply ride out these ebbs and flows of the stock market, but someone who needs that money to pay for their daughter's college tuition this year would be financially devastated.
If you are worried about risk, consider investments without a loss of principal - meaning you can't lose the money you've invested - like bonds or certificates of deposit. These investments have a much lower return than stocks, but they may help you sleep better at night. (Learn more about your risk tolerance, read Personalizing Risk Tolerance.)
4. Special Risk Consideration: Inflation
An important factor to consider when becoming an investor is risk of inflation. Let's say you're saving for your retirement, and you want to invest low-risk. You've found a certificate of deposit that pays a fixed 3% interest, with no loss of principal - not bad, you think. But what about inflation? Let's say inflation is at 3% (about average) - that means your investment really just managed to keep pace with inflation. For short-term investments, that's OK, but if you're hoping to retire someday, this inflation risk may be more pressing than the fluctuations of the stock market. Think about the term of your goal, and your comfort level with risk before making any decisions on investments. Be sure to factor in inflation when projecting your investment returns - inflation is an unfortunate but guaranteed part of life. (Learn more by reading our Inflation Tutorial.)
5. Start Small
Only have a little money to invest each month? That's actually a good thing: investing monthly (called dollar-cost averaging) helps you even out the natural ebb and flow of investments that happens throughout the year. That $50 a month leaving your bank account on payday that you barely notice will add up to $600 a year, plus your return on investment. Starting small also helps you get used to investing and how it works, and will quickly reveal your comfort with risk.
6. Do Your Homework
So how do you decide where to invest your money? Do your homework. Spend some time learning about different investment forms and how they perform, minimum investment required and so on. Some mutual funds will waive or reduce their initial investment requirement if you make regular deposits. Find out how each investment has performed in the last year, five years, and ten or more years. You can then match your liquidity needs, goals and risk tolerance that you've determined in previous steps to the right investment.
7. Check Up (But Don't Obsess)
Once you've started investing, check on your account's performance regularly. Don't get too caught up in the daily or monthly fluctuations of your investment's return; remember your investment term and goal. If your investment keeps underperforming compared to its counterparts, go back to the drawing board and find somewhere else to invest. Include your investments as you check on your budget periodically.
The Bottom Line
All investment comes with some form of risk. With these steps, you can ensure that you're minimizing your risk by being an informed investor.
Read more>>>>>>
1. Determine Your Needs
When thinking about investing, you should first think about how liquid your money needs to be, or how quickly you should be able to access it. How likely are you to have to withdraw it again? Some investments are more liquid (like savings accounts) or easy to convert to cash than others (bonds, for example, often have a fixed term). Liquidity is a large factor in choosing investments, so examine your financial situation carefully before forging ahead.
2. Identify Your Investment Goals
What is your goal in investing? Is it to fund a retirement, your child's college or next year's vacation? Identifying these goals will help you determine your risk tolerance, since you'll know how long you'll be investing your money for. Long-term investments have different considerations than short-term ones. (Find out how to reach your long-term goals without becoming a tightwad; read 10 Simple Steps To Financial Security Before 30.)
3. Understand Your Risk Tolerance
Once you've identified your goals and how long you're planning to invest your money for, you should determine your risk tolerance. Here's a quick rule of thumb: the higher the return, the higher the risk. If you want to earn 15% on your stock investment, you also have to be willing to swallow the loss if your stock goes south (remember the recent stock devaluation following the housing crisis?). Here's where your goals come into play: a long-term investor can simply ride out these ebbs and flows of the stock market, but someone who needs that money to pay for their daughter's college tuition this year would be financially devastated.
If you are worried about risk, consider investments without a loss of principal - meaning you can't lose the money you've invested - like bonds or certificates of deposit. These investments have a much lower return than stocks, but they may help you sleep better at night. (Learn more about your risk tolerance, read Personalizing Risk Tolerance.)
4. Special Risk Consideration: Inflation
An important factor to consider when becoming an investor is risk of inflation. Let's say you're saving for your retirement, and you want to invest low-risk. You've found a certificate of deposit that pays a fixed 3% interest, with no loss of principal - not bad, you think. But what about inflation? Let's say inflation is at 3% (about average) - that means your investment really just managed to keep pace with inflation. For short-term investments, that's OK, but if you're hoping to retire someday, this inflation risk may be more pressing than the fluctuations of the stock market. Think about the term of your goal, and your comfort level with risk before making any decisions on investments. Be sure to factor in inflation when projecting your investment returns - inflation is an unfortunate but guaranteed part of life. (Learn more by reading our Inflation Tutorial.)
5. Start Small
Only have a little money to invest each month? That's actually a good thing: investing monthly (called dollar-cost averaging) helps you even out the natural ebb and flow of investments that happens throughout the year. That $50 a month leaving your bank account on payday that you barely notice will add up to $600 a year, plus your return on investment. Starting small also helps you get used to investing and how it works, and will quickly reveal your comfort with risk.
6. Do Your Homework
So how do you decide where to invest your money? Do your homework. Spend some time learning about different investment forms and how they perform, minimum investment required and so on. Some mutual funds will waive or reduce their initial investment requirement if you make regular deposits. Find out how each investment has performed in the last year, five years, and ten or more years. You can then match your liquidity needs, goals and risk tolerance that you've determined in previous steps to the right investment.
7. Check Up (But Don't Obsess)
Once you've started investing, check on your account's performance regularly. Don't get too caught up in the daily or monthly fluctuations of your investment's return; remember your investment term and goal. If your investment keeps underperforming compared to its counterparts, go back to the drawing board and find somewhere else to invest. Include your investments as you check on your budget periodically.
The Bottom Line
All investment comes with some form of risk. With these steps, you can ensure that you're minimizing your risk by being an informed investor.
Read more>>>>>>
Health Bill Reforms To Help Recent Graduates By Madison Medeiros
Local Congresswoman Lois Capps and the Obama administration are working with insurance companies on a health care provision that would extend coverage for young adults.
Beginning in September, the Health Care Reform Bill will allow individuals under 26 years of age to stay on their parents’ plan, provided they do not receive health care coverage from their employer. Capps is currently pushing for a revision that would cover all youth 26 and under, regardless of employee status.
Furthermore, Health and Human Services secretary Kathleen Sebelius recently announced that Blue Cross, Blue Shield, Humana, Kaiser Permanente, WellPoint and UnitedHealthcare will bridge any gap in health care coverage for students graduating in June prior to the bill’s implementation this fall.
In a statement, Capps noted that Sebelius and the Obama administration have been “working to guarantee timely implementation of the health insurance reform benefits and protection, helping to ensure that young people are not without health insurance coverage for even a few months.”
Ashley Schapitl, Capps’ press secretary, said creators of the current Health Care Reform Bill hope to protect students during a time of high unemployment.
“Given the particular uncertainty of the job market, we thought it would be great to keep students on their parents’ plan until their 26th birthday,” Schapitl said. “Only 53 percent of young people ages 18 to 29 are offered coverage through their job so, even if you have a job after you graduate, it is not guaranteed that you will be offered full coverage.”
One in three people ages 19 to 34 are currently uninsured, though the recently passed bill will eventually provide 32 million uninsured Americans with health coverage.
Chloe Stryker, a second-year political science major, said she thinks the bill’s passage will make life easier for students post-graduation.
“The bill is really helpful because many people will go on to obtain higher degrees, and paying for insurance is just one less burden that they will have to face,” Stryker said. “Most entry level jobs people get coming out of college don’t offer suitable health care coverage, so this reform would be helpful both for people going into the workforce or moving forward in their education.”
The current bill also offers preventive care to all people under newly insured plans. Capps hopes that this will create a system that prevents disease and illness before treatment is necessary, eventually saving young people huge sums of money.
Paul Herzlich, a third-year psychology major, said these provisions will help young adults wishing to focus on finding a suitable career rather than securing any job that will pay the bills.
“I think that the bill is definitely a good thing,” Herzlich said. “It allows students to focus on other costs if their parents can cover them, so it will allow them to focus on getting into the job world instead.”
Under prior law, young adults over 18 only qualified for coverage under a parent’s plan if they remained full-time students and had not reached age 23.
Beginning in September, the Health Care Reform Bill will allow individuals under 26 years of age to stay on their parents’ plan, provided they do not receive health care coverage from their employer. Capps is currently pushing for a revision that would cover all youth 26 and under, regardless of employee status.
Furthermore, Health and Human Services secretary Kathleen Sebelius recently announced that Blue Cross, Blue Shield, Humana, Kaiser Permanente, WellPoint and UnitedHealthcare will bridge any gap in health care coverage for students graduating in June prior to the bill’s implementation this fall.
In a statement, Capps noted that Sebelius and the Obama administration have been “working to guarantee timely implementation of the health insurance reform benefits and protection, helping to ensure that young people are not without health insurance coverage for even a few months.”
Ashley Schapitl, Capps’ press secretary, said creators of the current Health Care Reform Bill hope to protect students during a time of high unemployment.
“Given the particular uncertainty of the job market, we thought it would be great to keep students on their parents’ plan until their 26th birthday,” Schapitl said. “Only 53 percent of young people ages 18 to 29 are offered coverage through their job so, even if you have a job after you graduate, it is not guaranteed that you will be offered full coverage.”
One in three people ages 19 to 34 are currently uninsured, though the recently passed bill will eventually provide 32 million uninsured Americans with health coverage.
Chloe Stryker, a second-year political science major, said she thinks the bill’s passage will make life easier for students post-graduation.
“The bill is really helpful because many people will go on to obtain higher degrees, and paying for insurance is just one less burden that they will have to face,” Stryker said. “Most entry level jobs people get coming out of college don’t offer suitable health care coverage, so this reform would be helpful both for people going into the workforce or moving forward in their education.”
The current bill also offers preventive care to all people under newly insured plans. Capps hopes that this will create a system that prevents disease and illness before treatment is necessary, eventually saving young people huge sums of money.
Paul Herzlich, a third-year psychology major, said these provisions will help young adults wishing to focus on finding a suitable career rather than securing any job that will pay the bills.
“I think that the bill is definitely a good thing,” Herzlich said. “It allows students to focus on other costs if their parents can cover them, so it will allow them to focus on getting into the job world instead.”
Under prior law, young adults over 18 only qualified for coverage under a parent’s plan if they remained full-time students and had not reached age 23.
What Is the Future of MBA Education?
Business schools are positioned on increasingly unsteady—and unpopular—ground. MBA enrollments fluctuate or decline; recruiters voice skepticism about the value of newly-minted MBA degrees; and deans, faculty, students, executives, and a concerned public wonder what business schools can or should do to train knowledgeable, principled, and skilled leaders.
Against this backdrop of problems, business schools are poised to take advantage of exciting opportunities to cooperate and innovate, argue HBS professors Srikant M. Datar and David A. Garvin and research associate Patrick G. Cullen in their new book, Rethinking the MBA: Business Education at a Crossroads. Employing a wealth of interviews and quantitative data, their book takes the first comprehensive approach in decades to examine the evolving MBA marketplace and its threats as well as possibilities for improvement and growth.
"Rebalancing must occur." -Srikant Datar
"Increasingly, we believe, business schools are at a crossroads and will have to take a hard look at their value propositions," the authors write in the introduction. "This was true before the economic crisis, but is even truer in its aftermath. The world has changed, and with it the security that used to come almost automatically with an MBA degree. […] High-paying jobs are no longer guaranteed to graduates, and the opportunity costs of two years of training—especially for those who still hold jobs and are not looking to change fields—loom ever larger. To remain relevant, business schools will have to rethink many of their most cherished assumptions."
In an interview, we asked Datar and Garvin to explain more. Datar, the Arthur Lowes Dickinson Professor of Accounting at Harvard University, is the Harvard Business School senior associate dean and director of research. Garvin, the C. Roland Christensen Professor of Business Administration, teaches courses for MBAs and executives on leadership, general management, and operations. Garvin is also faculty chair of the School's Christensen Center for Teaching and Learning, which promotes and supports teaching excellence and innovation.
Martha Lagace: What led you to identify and study gaps and opportunities in MBA education?
David Garvin: To celebrate the 100th anniversary of Harvard Business School in 2008, we convened a number of colloquia and workshops. One was entitled "The Future of MBA Education," and Srikant and I were responsible for preparing and leading it. Our initial goal was simply to gather enough material to conduct a day-long conversation with our faculty drawing on interviews with executives and business school deans.
As we began to conduct initial interviews, however, we kept hearing the same concern: "Thank goodness you folks are doing this. All of us collectively need to take a hard look at the state of business education."
Srikant Datar: With that prompting, we expanded our efforts. We collected comprehensive data on business schools, including the yield rates at various schools; how many applicants they accept of those who apply; of those who accept, how many actually attend; and what is happening to the total enrollments. It was a big surprise to see a hollowing out of the MBA marketplace: in full-time programs, declines in the order of 25-, 30-, even 50-percent at highly-ranked schools outside the top 15 or so schools.
The schools were, by and large, unaware of how widespread the problem was. Each thought the problem of declining enrolments was unique to them. In the course of our research, we learned that prospective applicants were being discouraged by many employers from going to full-time MBA programs, that part-time MBA, executive MBA, and other masters programs were seen as attractive substitutes, and that the students who came were not as engaged with the academic curriculum.
Garvin: The common question we heard was about the value added of an MBA degree. In every interview, deans and executives returned repeatedly to that question, as well as to a large set of unmet needs that they identified in areas such as leadership development, skill at critical, creative, and integrative thinking, and understanding organizational realities.
Q: Were they deeply worried?
Garvin: Among deans, there was widespread acceptance and recognition of the same set of missed opportunities and unmet needs. Some schools, however, had already launched change programs that incorporated flexible curriculums, courses in creative or integrative thinking, or experiential learning and project work. A few schools were cutting-edge in one or more of these areas. Other schools felt that the business school community as a whole had a long way to go. So while there was a uniform degree of acceptance of opportunities and needs, the extent to which they were being met revealed disparity.
Q: Why is MBA education at a crossroads?
Garvin: We are approaching the end of an era. Since 1959, business schools have taken a more analytical and discipline-based approach than before. For the last 50 years, then, business schools have emphasized analytics, models, and statistics.
Yet MBA graduates increasingly need to be more effective: they need to have a global mindset, for example, develop leadership skills of self-awareness and self-reflection; and develop an understanding of the roles and responsibilities of business, and the limitations of models and markets.
At these crossroads, how should business education proceed? We wrote the book to outline the needs and to explain how schools are addressing them in surprisingly innovative ways. We include in-depth case studies of six programs: the University of Chicago Booth School of Business, INSEAD, the Center for Creative Leadership, Harvard Business School, Yale School of Management, and Stanford Graduate School of Business. Each is exemplary in some way—largely in their efforts to address one or more of the unmet needs.
Q: How should schools close these gaps? You say your book offers a compass, not a roadmap: it points readers in a direction but doesn't tell them exactly which path to take.
Datar: The right answer for each school depends on that school's strategy, challenges, constraints, and skill sets. Yet rebalancing from the current focus on "knowing" or analytical knowledge to more of what we call "doing" (skills) and "being" (a sense of purpose and identity) must occur. Business schools need to think innovatively about how best to use the resources available to them. For example, there are many exciting opportunities to engage alumni in the learning process.
Garvin: Faculty could be expanded in creative ways. Think of Harvard Medical School. It has incoming classes of 165 students and 10,000 faculty! It's an astonishing number that makes sense only after you realize Harvard has 17 affiliated hospitals and many of the doctors in those hospitals teach tutorials and lead clinical rotations, and in that sense are considered faculty. The same notion of an extended faculty could apply to business schools, where the 10,000 might include alumni such as local business leaders, who with suitable oversight and training by core faculty could help with team projects and experiential learning. Training might come initially through the collective work of multiple business schools, with cohorts of alumni who receive a short dose of either functional knowledge or research skills or teaching training, or some combination of the three. Schools need to experiment to see what works best for them.
Datar: We also believe that it is important for schools to broaden the types of research that faculty conduct at business schools. The discipline-based research of the last 50 years has certainly advanced our understanding of management, and needs to continue. At the same time, as a recent report by the Association to Advance Collegiate Schools of Business points out, we need research that is more practice-oriented and interdisciplinary.
Q: Could you discuss gaps you identified, such as leadership development?
Garvin: The single strongest theme we heard in our interviews was the need for MBA students to cultivate greater self-awareness. Executives said, "The more an MBA understands his or her impact on others and vice-versa, the more effective he or she will be."
The second theme we heard was the need for practical skills: how to run a meeting, make a presentation, and give performance feedback. The third theme was the need for MBAs to develop a better sense of the realities of organizations within which leaders operate. Politics—issues of power, coalitions, and hidden agendas—are part of that reality. Yet MBAs, with their analytical focus, always try to find the "right" answer. Organizations often prefer a "good enough" answer, providing it can be implemented effectively. Future leaders need to better understand the nuances of how to get things done and what they can actually accomplish in organizational settings.
Datar: The landscape of business is shifting from leaders who had high authority and faced low conflict to leaders who have lower authority and face greater conflict. Leadership skills that worked in the old model are unlikely to work today. MBAs need to understand how to work "through" people, how to motivate and inspire. That takes skill and practice. MBAs need to ask themselves, "How do I engage people to accomplish a task while I remain in the background?" At HBS, the Authentic Leadership Development course aims to teach these skills in small groups and reflective exercises.
Garvin: In addition, the required course Leadership and Corporate Accountability includes personal development exercises. Students discuss examples from their own past when they failed to rise to a moral challenge, as well as examples when someone led them to be their very best selves. As a class we try to draw general lessons from these discussions.
Q: Another gap you identified was that MBA students were not developing a global mindset. How can MBA programs better prepare students for an increasingly globalized business world?
Garvin: Executives and deans told us that MBAs need to develop cultural intelligence, specifically a better understanding of which practices, strategies, and behaviors are universal and which are contingent. When an MBA works with a person or group from another culture, how can he or she be most effective? Students need to develop a skill set rather than just knowledge about a country's economics and political system.
Datar: MBAs need to understand what it means to be a general manager in a global world and the differences in institutions, norms, cultures, and legal frameworks. It would be fascinating, for example, to have student teams work on an issue such as global branding in different countries; and share their learning with the class when they return. The reflection piece is crucial. It is important to build leadership skills in the context of a global world.
Q: What are you working on now?
Garvin: I am on sabbatical and have been travelling to interview general managers in countries such as India, Japan, China, and Mexico, to ask about the distinctive challenges of their markets and organizations. I am developing several cases based on this research for my second-year course General Management: Processes and Action. I certainly think differently about leadership and management than I did since we began researching and writing this book.
Datar: I am looking at how implementation and execution strategies vary across countries. I'm also continuing my research in microfinance. I am particularly interested in understanding how microfinance helps alleviate poverty. I am also looking at how incentive systems can be designed to promote long-run performance.
Excerpt from Rethinking the MBA: Business Education at a Crossroads
By Srikant M. Datar, David A. Garvin, and Patrick G. Cullen
Rethinking the MBA: Business Education at a Crossroads
Voices from the Field: How Deans and Recruiters View the MBA Degree:
Immediately after graduation, a significant majority of the graduates of the leading two-year, full-time MBA programs take jobs in financial services and consulting, driven in part by financial rewards that make it very difficult for companies in other sectors to compete for graduates.
The numbers—at least before the recent financial crisis—have remained consistently high. In 2006, for example, 52 percent of Chicago Booth graduates took jobs in financial services and 22 percent took jobs in consulting; 42 percent of Harvard graduates took jobs in financial services and 22 percent took jobs in consulting; and 46 percent of Yale graduates took jobs in financial services and 15 percent took jobs in consulting.13 The boom in jobs in financial services and consulting during the last ten years made obtaining a prestigious MBA degree—long viewed as essential to gaining entry to these careers—a very attractive option. Even if one had previously worked in the industry, an MBA from a high-ranking school was, for many years, a de facto requirement for climbing the ladder.
The deans we interviewed from higher-ranking schools were clear on the value that they believed accrued to those armed with an MBA: it ensured access to these (as well as other) attractive, otherwise inaccessible careers. In their eyes—as well as those of many students—the full-time MBA is increasingly aimed at "career switchers." For those wishing to change fields—to enter investment banking, private equity, hedge funds, or strategy consulting from a prior position in industry, government, or the nonprofit world—the MBA has long been viewed as absolutely essential. One dean, for example, noted that nearly 80 percent of students at his prior institution had switched careers upon graduation.
The problem for the higher-ranking business schools is that there are a number of forces at work that threaten to undermine or reduce the opportunities for employment in financial services and consulting. Post-crisis, many lucrative jobs in financial services, and to a lesser extent in consulting, have simply disappeared. Each day brings new reports of hedge fund closings and the scaling back of private equity investments. Not surprisingly, the enormously high compensation packages in these fields are shrinking as well, making jobs in these sectors far less attractive.
These changes threaten one of the key selling points of the top U.S. business schools. A further challenge comes from the fact that companies in these industries have increasingly been promoting from within.14 In part, this is because technical work, such as sales and trading, now contributes a large share of the firm's profits relative to activities such as investment banking. Consequently, many companies are actively discouraging their best young people from leaving lower-level positions for business school, arguing that their odds of success are actually better if they stay at the firm. This theme can be heard, with minor variations, from executives at two financial services firms:
Previously the Wall Street tradition was to send Analysts for the MBA. That's no longer the case. We do not want to show these people the door because they are valuable to us. Now, a third of the Analyst class is offered full-time Associate positions without doing an MBA. For technical work, the training an Analyst gets from a Wall Street firm is better than the training they would receive at business school. […]
The same point was made by a senior partner in a consulting firm, who, when asked pointedly if he would advise a highly successful junior person with several years at the firm who was intent on a career in consulting whether an MBA would be valuable for his future, answered, "Definitely not."
In the past, deans and business school faculty had a ready response to questions about the value of the MBA degree.
At the same time, financial services and consulting firms are increasingly substituting non-MBAs for MBAs. The numbers are small but growing. Before the crisis, a managing director at one large investment bank noted that his firm still hired 300 to 400 MBAs per year but only about fifty technical experts with PhDs or comparable degrees, even though it set out each year to hire twice as many. These latter individuals are viewed as essential because the fields of finance and strategy have become increasingly analytical and because leading financial services firms are, as one experienced financial executive put it, "increasingly dominated by traders, who believe business school is a waste of time." According to a senior manager at a leading investment bank:
The investment banking industry needs to recruit more technically competent people than it did in the past because our products, and the industry as a whole, are more complex. The requirements are higher than even the most quantitative MBA programs can deliver. As a result, we are aggressively pursuing PhDs in business, finance, mathematics, physics, and operations. The common thread is that all are people who are highly analytical and can translate complex situations into mathematical models. The percentage of MBAs that we hire will go down in the next ten years.
A director of a leading consulting firm made much the same point:
We now hire a very large number of non-MBAs into our Associate roles. In fact, our incoming mix is 50 percent MBA and 50 percent non-MBA. The non-MBAs mostly come from medical schools, medical school residency programs, law schools, and a variety of PhD programs in economics, applied math, physics, life sciences, and computer science. The non-MBA portion of the mix is growing, and we are actively seeking to expand into these sources.
In the past, deans and business school faculty had a ready response to questions about the value of the MBA degree: graduate business training was a way of getting ahead of the pack and igniting one's career. MBAs, the argument ran, were a breed apart and were more likely to be placed on the fast track. They might not be the best technicians, but their breadth of training and skills would win out over the long haul. Although this may still be true in some fields, it appears to be less true in others. At least before the crisis, for those in financial services wishing to accelerate their careers (i.e., who hoped to stay in the same function or area and get promoted more rapidly or frequently at the same company), the two-year, full-time MBA was no longer viewed as necessary. Both the head of a leading hedge fund and a senior executive at a leading investment bank made much the same point:
Something has changed in the last few years. We've always hired young people from elite colleges and universities and started them as Analysts. For many years we found that after six or seven years with us and one or more promotions, they would hit a wall—we had to send them to business school to get the grounding and perspective necessary to make it to the upper rungs of the firm. But recently, we've found that our young people have been able to make the jump without leaving for an MBA. Those two years of training just aren't needed. […]
Whether the financial crisis will alter these views about obtaining an MBA is still unclear.
Taken together, the threats identified throughout this chapter suggest challenges for all MBA programs, including the most highly ranked programs. Enrollments are under pressure, and questions are being raised about the value-added of the degree, especially the two-year, full-time version, when compared with alternatives.
Against this backdrop of problems, business schools are poised to take advantage of exciting opportunities to cooperate and innovate, argue HBS professors Srikant M. Datar and David A. Garvin and research associate Patrick G. Cullen in their new book, Rethinking the MBA: Business Education at a Crossroads. Employing a wealth of interviews and quantitative data, their book takes the first comprehensive approach in decades to examine the evolving MBA marketplace and its threats as well as possibilities for improvement and growth.
"Rebalancing must occur." -Srikant Datar
"Increasingly, we believe, business schools are at a crossroads and will have to take a hard look at their value propositions," the authors write in the introduction. "This was true before the economic crisis, but is even truer in its aftermath. The world has changed, and with it the security that used to come almost automatically with an MBA degree. […] High-paying jobs are no longer guaranteed to graduates, and the opportunity costs of two years of training—especially for those who still hold jobs and are not looking to change fields—loom ever larger. To remain relevant, business schools will have to rethink many of their most cherished assumptions."
In an interview, we asked Datar and Garvin to explain more. Datar, the Arthur Lowes Dickinson Professor of Accounting at Harvard University, is the Harvard Business School senior associate dean and director of research. Garvin, the C. Roland Christensen Professor of Business Administration, teaches courses for MBAs and executives on leadership, general management, and operations. Garvin is also faculty chair of the School's Christensen Center for Teaching and Learning, which promotes and supports teaching excellence and innovation.
Martha Lagace: What led you to identify and study gaps and opportunities in MBA education?
David Garvin: To celebrate the 100th anniversary of Harvard Business School in 2008, we convened a number of colloquia and workshops. One was entitled "The Future of MBA Education," and Srikant and I were responsible for preparing and leading it. Our initial goal was simply to gather enough material to conduct a day-long conversation with our faculty drawing on interviews with executives and business school deans.
As we began to conduct initial interviews, however, we kept hearing the same concern: "Thank goodness you folks are doing this. All of us collectively need to take a hard look at the state of business education."
Srikant Datar: With that prompting, we expanded our efforts. We collected comprehensive data on business schools, including the yield rates at various schools; how many applicants they accept of those who apply; of those who accept, how many actually attend; and what is happening to the total enrollments. It was a big surprise to see a hollowing out of the MBA marketplace: in full-time programs, declines in the order of 25-, 30-, even 50-percent at highly-ranked schools outside the top 15 or so schools.
The schools were, by and large, unaware of how widespread the problem was. Each thought the problem of declining enrolments was unique to them. In the course of our research, we learned that prospective applicants were being discouraged by many employers from going to full-time MBA programs, that part-time MBA, executive MBA, and other masters programs were seen as attractive substitutes, and that the students who came were not as engaged with the academic curriculum.
Garvin: The common question we heard was about the value added of an MBA degree. In every interview, deans and executives returned repeatedly to that question, as well as to a large set of unmet needs that they identified in areas such as leadership development, skill at critical, creative, and integrative thinking, and understanding organizational realities.
Q: Were they deeply worried?
Garvin: Among deans, there was widespread acceptance and recognition of the same set of missed opportunities and unmet needs. Some schools, however, had already launched change programs that incorporated flexible curriculums, courses in creative or integrative thinking, or experiential learning and project work. A few schools were cutting-edge in one or more of these areas. Other schools felt that the business school community as a whole had a long way to go. So while there was a uniform degree of acceptance of opportunities and needs, the extent to which they were being met revealed disparity.
Q: Why is MBA education at a crossroads?
Garvin: We are approaching the end of an era. Since 1959, business schools have taken a more analytical and discipline-based approach than before. For the last 50 years, then, business schools have emphasized analytics, models, and statistics.
Yet MBA graduates increasingly need to be more effective: they need to have a global mindset, for example, develop leadership skills of self-awareness and self-reflection; and develop an understanding of the roles and responsibilities of business, and the limitations of models and markets.
At these crossroads, how should business education proceed? We wrote the book to outline the needs and to explain how schools are addressing them in surprisingly innovative ways. We include in-depth case studies of six programs: the University of Chicago Booth School of Business, INSEAD, the Center for Creative Leadership, Harvard Business School, Yale School of Management, and Stanford Graduate School of Business. Each is exemplary in some way—largely in their efforts to address one or more of the unmet needs.
Q: How should schools close these gaps? You say your book offers a compass, not a roadmap: it points readers in a direction but doesn't tell them exactly which path to take.
Datar: The right answer for each school depends on that school's strategy, challenges, constraints, and skill sets. Yet rebalancing from the current focus on "knowing" or analytical knowledge to more of what we call "doing" (skills) and "being" (a sense of purpose and identity) must occur. Business schools need to think innovatively about how best to use the resources available to them. For example, there are many exciting opportunities to engage alumni in the learning process.
Garvin: Faculty could be expanded in creative ways. Think of Harvard Medical School. It has incoming classes of 165 students and 10,000 faculty! It's an astonishing number that makes sense only after you realize Harvard has 17 affiliated hospitals and many of the doctors in those hospitals teach tutorials and lead clinical rotations, and in that sense are considered faculty. The same notion of an extended faculty could apply to business schools, where the 10,000 might include alumni such as local business leaders, who with suitable oversight and training by core faculty could help with team projects and experiential learning. Training might come initially through the collective work of multiple business schools, with cohorts of alumni who receive a short dose of either functional knowledge or research skills or teaching training, or some combination of the three. Schools need to experiment to see what works best for them.
Datar: We also believe that it is important for schools to broaden the types of research that faculty conduct at business schools. The discipline-based research of the last 50 years has certainly advanced our understanding of management, and needs to continue. At the same time, as a recent report by the Association to Advance Collegiate Schools of Business points out, we need research that is more practice-oriented and interdisciplinary.
Q: Could you discuss gaps you identified, such as leadership development?
Garvin: The single strongest theme we heard in our interviews was the need for MBA students to cultivate greater self-awareness. Executives said, "The more an MBA understands his or her impact on others and vice-versa, the more effective he or she will be."
The second theme we heard was the need for practical skills: how to run a meeting, make a presentation, and give performance feedback. The third theme was the need for MBAs to develop a better sense of the realities of organizations within which leaders operate. Politics—issues of power, coalitions, and hidden agendas—are part of that reality. Yet MBAs, with their analytical focus, always try to find the "right" answer. Organizations often prefer a "good enough" answer, providing it can be implemented effectively. Future leaders need to better understand the nuances of how to get things done and what they can actually accomplish in organizational settings.
Datar: The landscape of business is shifting from leaders who had high authority and faced low conflict to leaders who have lower authority and face greater conflict. Leadership skills that worked in the old model are unlikely to work today. MBAs need to understand how to work "through" people, how to motivate and inspire. That takes skill and practice. MBAs need to ask themselves, "How do I engage people to accomplish a task while I remain in the background?" At HBS, the Authentic Leadership Development course aims to teach these skills in small groups and reflective exercises.
Garvin: In addition, the required course Leadership and Corporate Accountability includes personal development exercises. Students discuss examples from their own past when they failed to rise to a moral challenge, as well as examples when someone led them to be their very best selves. As a class we try to draw general lessons from these discussions.
Q: Another gap you identified was that MBA students were not developing a global mindset. How can MBA programs better prepare students for an increasingly globalized business world?
Garvin: Executives and deans told us that MBAs need to develop cultural intelligence, specifically a better understanding of which practices, strategies, and behaviors are universal and which are contingent. When an MBA works with a person or group from another culture, how can he or she be most effective? Students need to develop a skill set rather than just knowledge about a country's economics and political system.
Datar: MBAs need to understand what it means to be a general manager in a global world and the differences in institutions, norms, cultures, and legal frameworks. It would be fascinating, for example, to have student teams work on an issue such as global branding in different countries; and share their learning with the class when they return. The reflection piece is crucial. It is important to build leadership skills in the context of a global world.
Q: What are you working on now?
Garvin: I am on sabbatical and have been travelling to interview general managers in countries such as India, Japan, China, and Mexico, to ask about the distinctive challenges of their markets and organizations. I am developing several cases based on this research for my second-year course General Management: Processes and Action. I certainly think differently about leadership and management than I did since we began researching and writing this book.
Datar: I am looking at how implementation and execution strategies vary across countries. I'm also continuing my research in microfinance. I am particularly interested in understanding how microfinance helps alleviate poverty. I am also looking at how incentive systems can be designed to promote long-run performance.
Excerpt from Rethinking the MBA: Business Education at a Crossroads
By Srikant M. Datar, David A. Garvin, and Patrick G. Cullen
Rethinking the MBA: Business Education at a Crossroads
Voices from the Field: How Deans and Recruiters View the MBA Degree:
Immediately after graduation, a significant majority of the graduates of the leading two-year, full-time MBA programs take jobs in financial services and consulting, driven in part by financial rewards that make it very difficult for companies in other sectors to compete for graduates.
The numbers—at least before the recent financial crisis—have remained consistently high. In 2006, for example, 52 percent of Chicago Booth graduates took jobs in financial services and 22 percent took jobs in consulting; 42 percent of Harvard graduates took jobs in financial services and 22 percent took jobs in consulting; and 46 percent of Yale graduates took jobs in financial services and 15 percent took jobs in consulting.13 The boom in jobs in financial services and consulting during the last ten years made obtaining a prestigious MBA degree—long viewed as essential to gaining entry to these careers—a very attractive option. Even if one had previously worked in the industry, an MBA from a high-ranking school was, for many years, a de facto requirement for climbing the ladder.
The deans we interviewed from higher-ranking schools were clear on the value that they believed accrued to those armed with an MBA: it ensured access to these (as well as other) attractive, otherwise inaccessible careers. In their eyes—as well as those of many students—the full-time MBA is increasingly aimed at "career switchers." For those wishing to change fields—to enter investment banking, private equity, hedge funds, or strategy consulting from a prior position in industry, government, or the nonprofit world—the MBA has long been viewed as absolutely essential. One dean, for example, noted that nearly 80 percent of students at his prior institution had switched careers upon graduation.
The problem for the higher-ranking business schools is that there are a number of forces at work that threaten to undermine or reduce the opportunities for employment in financial services and consulting. Post-crisis, many lucrative jobs in financial services, and to a lesser extent in consulting, have simply disappeared. Each day brings new reports of hedge fund closings and the scaling back of private equity investments. Not surprisingly, the enormously high compensation packages in these fields are shrinking as well, making jobs in these sectors far less attractive.
These changes threaten one of the key selling points of the top U.S. business schools. A further challenge comes from the fact that companies in these industries have increasingly been promoting from within.14 In part, this is because technical work, such as sales and trading, now contributes a large share of the firm's profits relative to activities such as investment banking. Consequently, many companies are actively discouraging their best young people from leaving lower-level positions for business school, arguing that their odds of success are actually better if they stay at the firm. This theme can be heard, with minor variations, from executives at two financial services firms:
Previously the Wall Street tradition was to send Analysts for the MBA. That's no longer the case. We do not want to show these people the door because they are valuable to us. Now, a third of the Analyst class is offered full-time Associate positions without doing an MBA. For technical work, the training an Analyst gets from a Wall Street firm is better than the training they would receive at business school. […]
The same point was made by a senior partner in a consulting firm, who, when asked pointedly if he would advise a highly successful junior person with several years at the firm who was intent on a career in consulting whether an MBA would be valuable for his future, answered, "Definitely not."
In the past, deans and business school faculty had a ready response to questions about the value of the MBA degree.
At the same time, financial services and consulting firms are increasingly substituting non-MBAs for MBAs. The numbers are small but growing. Before the crisis, a managing director at one large investment bank noted that his firm still hired 300 to 400 MBAs per year but only about fifty technical experts with PhDs or comparable degrees, even though it set out each year to hire twice as many. These latter individuals are viewed as essential because the fields of finance and strategy have become increasingly analytical and because leading financial services firms are, as one experienced financial executive put it, "increasingly dominated by traders, who believe business school is a waste of time." According to a senior manager at a leading investment bank:
The investment banking industry needs to recruit more technically competent people than it did in the past because our products, and the industry as a whole, are more complex. The requirements are higher than even the most quantitative MBA programs can deliver. As a result, we are aggressively pursuing PhDs in business, finance, mathematics, physics, and operations. The common thread is that all are people who are highly analytical and can translate complex situations into mathematical models. The percentage of MBAs that we hire will go down in the next ten years.
A director of a leading consulting firm made much the same point:
We now hire a very large number of non-MBAs into our Associate roles. In fact, our incoming mix is 50 percent MBA and 50 percent non-MBA. The non-MBAs mostly come from medical schools, medical school residency programs, law schools, and a variety of PhD programs in economics, applied math, physics, life sciences, and computer science. The non-MBA portion of the mix is growing, and we are actively seeking to expand into these sources.
In the past, deans and business school faculty had a ready response to questions about the value of the MBA degree: graduate business training was a way of getting ahead of the pack and igniting one's career. MBAs, the argument ran, were a breed apart and were more likely to be placed on the fast track. They might not be the best technicians, but their breadth of training and skills would win out over the long haul. Although this may still be true in some fields, it appears to be less true in others. At least before the crisis, for those in financial services wishing to accelerate their careers (i.e., who hoped to stay in the same function or area and get promoted more rapidly or frequently at the same company), the two-year, full-time MBA was no longer viewed as necessary. Both the head of a leading hedge fund and a senior executive at a leading investment bank made much the same point:
Something has changed in the last few years. We've always hired young people from elite colleges and universities and started them as Analysts. For many years we found that after six or seven years with us and one or more promotions, they would hit a wall—we had to send them to business school to get the grounding and perspective necessary to make it to the upper rungs of the firm. But recently, we've found that our young people have been able to make the jump without leaving for an MBA. Those two years of training just aren't needed. […]
Whether the financial crisis will alter these views about obtaining an MBA is still unclear.
Taken together, the threats identified throughout this chapter suggest challenges for all MBA programs, including the most highly ranked programs. Enrollments are under pressure, and questions are being raised about the value-added of the degree, especially the two-year, full-time version, when compared with alternatives.
Pakistani man found guilty of Mumbai attack
Indian court convicts Mumbai attack gunman
By Rina Chandran
MUMBAI (Reuters) - An Indian court Monday found a Pakistani man guilty on 86 charges from the 2008 Mumbai attacks, including waging war on India and murder, in a trial that strained ties between New Delhi and Islamabad.
Mohammad Ajmal Kasab, the lone surviving gunman from the attacks that killed 166 people, will be sentenced Tuesday and could face the gallows.
"It was not a simple act of murder. It was war," judge M.L. Tahiliyani said in a summary of the 1,522 page judgment. "This type of preparation is not made by ordinary criminals. This type of preparation is made by those waging war."
India accuses Pakistan-based militants of organizing the attacks, saying Islamabad is failing to act against those who organized the raids. Pakistan denies involvement and says it is prosecuting seven suspected militants for their role.
"The judgment itself is a message to Pakistan that they should not export terrorism to India," Indian Home Minister Palaniappan Chidambaram told reporters after the court decision.
New Delhi broke off peace talks after the attacks, saying Islamabad must first act against militants operating from its soil, including Pakistan-based group Lashkar-e-Taiba (LeT), of which Kasab is accused of being a member.
The verdict came days after the prime ministers of India and Pakistan held talks in Bhutan and asked officials to take steps to normalize relations, signaling a thaw in ties that analysts say should not be affected by Monday's verdict.
One risk to normalizing relations would be another major militant attack in India and the ensuing political pressure that could force the Indian government to break off dialogue again.
India had charged 38 people in connection with the attacks, most of them living in Pakistan. Tuesday, the court found 20 of them guilty of conspiracy, including LeT founder Hafiz Mohammad Saeed and LeT commander Zaki-ur Rehman Lakhvi.
It acquitted two Indians accused of being LeT members and of conducting reconnaissance in Mumbai for lack of evidence.
Pakistani government officials were not immediately available for comment. Yahya Mujahid, a spokesman for Saeed, denied involvement and said the acquittal of the Indians "has also raised many questions."
Many foreigners and some of India's wealthy business elite, as well as poor train commuters, were killed by 10 Pakistani gunmen in a three-day rampage through some of Mumbai's best-known landmarks, including two luxury hotels and a Jewish center.
Kasab, 22, was filmed walking through Mumbai's main train station carrying an AK-47 rifle and a knapsack on his back. Nearly 60 people were gunned down in the crowded station.
Police arrested Kasab, who was wounded, on the first night of the attacks. He initially admitted his role but later said he had been framed.
Monday, Kasab, dressed in white, stood but did not react to a summary of the verdict read out to him in Hindi by the judge and then sat down.
He was also found guilty of offences ranging from damage to public property to entering the country without a passport.
Crowds gathered outside the courtroom, which was protected by armored vehicles and snipers, before the verdict was announced. Relatives spoke of their anguish and their expectations.
"You should understand our feelings. He should be punished immediately," Kavita Karkare, the wife of a police official killed in the attacks, told CNN/IBN TV before the judgment.
(Additional reporting by Zeeshan Haider in Islamabad; Writing by C.J. Kuncheria; Editing by Alistair Scrutton and Nick Macfie)
By Rina Chandran
MUMBAI (Reuters) - An Indian court Monday found a Pakistani man guilty on 86 charges from the 2008 Mumbai attacks, including waging war on India and murder, in a trial that strained ties between New Delhi and Islamabad.
Mohammad Ajmal Kasab, the lone surviving gunman from the attacks that killed 166 people, will be sentenced Tuesday and could face the gallows.
"It was not a simple act of murder. It was war," judge M.L. Tahiliyani said in a summary of the 1,522 page judgment. "This type of preparation is not made by ordinary criminals. This type of preparation is made by those waging war."
India accuses Pakistan-based militants of organizing the attacks, saying Islamabad is failing to act against those who organized the raids. Pakistan denies involvement and says it is prosecuting seven suspected militants for their role.
"The judgment itself is a message to Pakistan that they should not export terrorism to India," Indian Home Minister Palaniappan Chidambaram told reporters after the court decision.
New Delhi broke off peace talks after the attacks, saying Islamabad must first act against militants operating from its soil, including Pakistan-based group Lashkar-e-Taiba (LeT), of which Kasab is accused of being a member.
The verdict came days after the prime ministers of India and Pakistan held talks in Bhutan and asked officials to take steps to normalize relations, signaling a thaw in ties that analysts say should not be affected by Monday's verdict.
One risk to normalizing relations would be another major militant attack in India and the ensuing political pressure that could force the Indian government to break off dialogue again.
India had charged 38 people in connection with the attacks, most of them living in Pakistan. Tuesday, the court found 20 of them guilty of conspiracy, including LeT founder Hafiz Mohammad Saeed and LeT commander Zaki-ur Rehman Lakhvi.
It acquitted two Indians accused of being LeT members and of conducting reconnaissance in Mumbai for lack of evidence.
Pakistani government officials were not immediately available for comment. Yahya Mujahid, a spokesman for Saeed, denied involvement and said the acquittal of the Indians "has also raised many questions."
Many foreigners and some of India's wealthy business elite, as well as poor train commuters, were killed by 10 Pakistani gunmen in a three-day rampage through some of Mumbai's best-known landmarks, including two luxury hotels and a Jewish center.
Kasab, 22, was filmed walking through Mumbai's main train station carrying an AK-47 rifle and a knapsack on his back. Nearly 60 people were gunned down in the crowded station.
Police arrested Kasab, who was wounded, on the first night of the attacks. He initially admitted his role but later said he had been framed.
Monday, Kasab, dressed in white, stood but did not react to a summary of the verdict read out to him in Hindi by the judge and then sat down.
He was also found guilty of offences ranging from damage to public property to entering the country without a passport.
Crowds gathered outside the courtroom, which was protected by armored vehicles and snipers, before the verdict was announced. Relatives spoke of their anguish and their expectations.
"You should understand our feelings. He should be punished immediately," Kavita Karkare, the wife of a police official killed in the attacks, told CNN/IBN TV before the judgment.
(Additional reporting by Zeeshan Haider in Islamabad; Writing by C.J. Kuncheria; Editing by Alistair Scrutton and Nick Macfie)
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