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Lessons from the “Learning Assessment Week 2012”

Over six days last week all of our 32 full-time St. Gallen MBAs were put through a tough 70 minute oral exam, in front of a jury including a professor from a peer MBA programme, two private sector employers, and myself. What follows are my initial reactions to this innovation in the St. Gallen MBA programme–the views of others involved are being canvassed. But first some more background.

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Prof. Simon Evenett

Purpose and rationale of the LAW week

The purpose of the exam was to check whether MBAs understood, could apply, and explain concepts from the core MBA courses. Each MBA received a mini-case study 24 hours in advance of his exam. Unlike typical business school cases, these cases did not come with any leading questions. One important challenge, therefore, was to identify the most important business problem in the case and propose a solution. MBAs were free to choose what perspective to take (e.g., internal roles like CEO or CFO versus external role, such as corporate advisors or stakeholders) and how to approach the problem featured in the case (e.g., criticising a decision that has been made versus recommending a course of action).

In the exam itself students then presented the mini-case, and, in a follow-up exercise, answered detailed questions about that case. These detailed questions were to evaluate how well a MBA could apply the tools of the core curriculum to the case in question. In the last part of the exam, the so-called business implication analysis, each MBA was then asked to respond to any contemporary business matter that the jury want to raise and the impact of contemporary developments on specific firms. 

The latter included questions such as
• “How much would you pay for Facebook?”
• “Which has a better business model: Google or Facebook?”
• “What commercial value is created by Twitter?”
• “Are bankers paid too much?”
• “What marketing strategy would you recommend for the London Olympics?”
• “What marketing strategy would you recommend for the Queen’s 60th jubilee?”
• “What are the lessons of the flooding of Bangkok and last year’s earthquake in Japan for the organisation and viability of international outsourcing?”
• “Does leadership really matter?”
• “What is social entrepreneurship?”
• “What steps should the head of Nespresso sales in Greece take if Nestlé believes that there is a 70 percent probability that Greece will devalue and leave the Eurozone?”
• “What steps should Shell take if it expects Israel will attack Iran in the second quarter of this year?”

These broader questions reveal much about how a MBA thinks and their personality (especially in terms of how they react to uncertainty and pressure.) The 70 minute length was deliberate: long enough for a MBA to get a little tired, again to see how they perform under pressure, and long enough for the jury to really put the candidates knowledge to the test. As one employer attending the LAW put it: “Two years ago we realised we’d been hiring based on skills and firing based on personality. Now we check both.” This comment reflects the spirit of our Learning Assessment Week, as it was also meant to combine these two perspectives.

Before the LAW the MBA office had prepared 18 mini-cases, mainly from articles in the Financial Times. Also, MBAs were told that they were responsible for answering questions about major business developments since the New Year. I also annotated 181 articles on the Financial Times’ website and these were made available to St. Gallen MBAs and to the jury of the LAW. Every employee representative on the LAW juries spoke about the importance of MBAs being able to intelligently comment on contemporary business developments. MBAs are not expected to be only functional experts, they are expected to tackle major business challenges from a number of perspectives and to develop a comprehensive perspective. The Learning Assessment Week gave the students a foretaste of this daily management challenge.

The LAW was introduced as part of the new thinking underlying the revamped St. Gallen MBA. We view the MBA as facilitating three transformations of bright people that want to pursue careers in business. Those transformations are occupational (hence the need for training on a range of functional skills), industry, locational/ cultural (hence our tailored career and personal development programme and a strong commitment to learning the local business language.) The lucrative Swiss labour market expects MBA to have demonstrated a portfolio of skills, both functional and personal. Being a brilliant IT geek is no compensation for arrogance and poor people skills. That is the reality of one of the most diverse labour markets available to ambitious MBAs in the 21st century. The LAW, in this context, is an excellent opportunity for students to determine their progress in this transformation and their overall position at the “half-time” of the MBA programme. The remainder of the MBA, and especially the elective phase, gives them plenty of room to improve on any identified weaknesses.

Even with these transformative goals in mind, one real fear is that some MBAs treat each course like a 100 metre sprint. On this view lots of effort is crammed into a short period of time, then insights and material are forgotten. Moreover, some MBAs may be tempted to make little attempt to integrate material across courses. Maybe undergraduate degrees have deteriorated so much that gaming-the-system has taken over from real learning. The problem is that the real world is becoming more—not less—demanding and that future managers will be held to a higher standard. The revamped St. Gallen MBA is designed to stress quality first. The LAW week emphasises the need for MBAs to integrate their skills across courses so as to develop a more sophisticated perspective of each business situation. As a consequence, barely any questions were asked by the jury in isolation, but always with the bigger picture and linkages to other areas in mind.

Substantial, individually-tailored feedback was provided after the LAW. Immediately after each MBA’s exam, the jury would deliberate over what advice to pass on to the MBA. This advice was frank but always delivered in a constructive manner. It was understood by the jury that the MBAs are only half way through their programme and have time to remedy any deficiencies. Each MBA’s presentation was filmed and the MBA’s coach will review presentational skills and other matters afterwards. Every MBA is free to discuss their performance with me after the event. Upon receiving feedback on the day, some MBAs were very open about the learning deficiencies they had. Such maturity and introspection was well received and led to useful discussions with the jury about ways to improve the MBA’s future performance.

Observations on the performance of this year’s MBAs in the LAW

Approximately 25 percent of the 32 MBAs performed at such a high level–even at this early stage in their MBA studies–that the employee representatives said that would offer the MBA a job. The best performances showed a mastery of corporate strategy tools, the business environment, and finance methods. Sensible application and good judgement, along with poise and an ability to answer some very tough questions without digressing, were key features. These oral exams felt like intelligent, informed, and fun conversations that were over before anyone looked at their watches. Impressive stuff. The MBAs concerned are to be congratulated.

A smaller percentage of current MBAs’ performance in the oral exam fell below an acceptable standard. Superficial analyses and recommendations were presented and quickly exposed as indefensible. Being unable to defend claims made often reflected poor understanding of underlying strategy and finance tools. In each case, the MBAs in question were given remarkable opportunities to discuss ANY corporate business insight or example from which an intelligent conversation could begin. All too often, this failed to elicit insights. In some cases, there was little to no knowledge of contemporary business matters. Undoubtedly, for some nervousness played a part. Maybe some didn’t realise just how demanding a MBA is. Now they do. To their credit, in almost every such case, the MBA understood the oral exam went badly and started a constructive discussion about their learning difficulties. Such initiative was repayed with plenty of constructive advice from the jurors.

The remaining MBAs varied considerably in their performance. Most had some difficulty applying or defending the use of a core concept. Many had difficulty answering questions directly. Some fell into the trap of thinking the jury was actually interested foremost in their opinion of a matter, rather than how they were thinking about a matter. In every case, what deficiencies were identified were remediable. The weeks and months ahead provide a good opportunity to raise performance across the board.

In terms of substantive skills, it was a little depressing how many times Porter’s 5 forces were incompletely used. Identifying the significance of each of the 5 forces in a particular setting is not the last step in such a strategy analysis. Applications of Ghemawat and Baron were rarer but better handled. As a general rule, the ability to defend with logic and financials strategy recommendations needs strengthening.

One area where more practice is clearly needed—and this may have implications for the MBA curriculum as much as for the current MBAs—is in translating the effects of corporate strategies into the balance sheets of companies, on to financial valuation of firms, and onto other measures of financial performance. All of the external professors (each of whom has demonstrated finance and corporate finance expertise) saw this deficiency and commented on it.
There was a huge variance in presentational skills (two thirds of MBAs overran the 10 minutes allotted for presentations), in the quality of Powerpoint Slides, in the capacity to think on one’s feet and to react to questions that a MBA may have never thought about. One or two MBAs came across as arrogant. To their credit, everyone was very well prepared.

Other reactions and lessons
• Afterwards every external professor and private sector participants whole heartedly endorsed the goals of the LAW week. It was seen as a constructive exercise that provided high quality feedback at a point in time in a MBA’s studies that they could take remediable steps before the job market began in earnest. The St. Gallen MBA was commended for taking this step.
• Every jury member commented on the excellent preparation of the LAW. The use and preparation of contemporary materials—in particular, the Financial Times—was seen as particularly valuable. Further integration of such contemporary business materials into the MBA curriculum was seen as desirable.
• Although a lot of thought has gone into how to articulate the demanding and multifaceted nature of the St. Gallen MBA programme, further thought may be necessary here. Too many incoming MBAs may have been influenced by undemanding undergraduate programmes and mismatches between rhetoric on academic standards and the reality to take seriously claims that the MBA will be rigorous and demanding. Some MBAs may not realise just how much help they need to overcome personality quirks that may limit their performance on the job market.
• Time should be found in the curriculum planning to allow MBAs to apply tools more often and to discuss those applications among themselves. Some external professors and private sector participants offered to help in this regard.
• The oral exam could be shortened to 60 minutes without loss, in particular if MBAs keep to the 10 minutes allotted presentation time. Sixty minutes is long enough, it was felt, to see how a MBA can respond under pressure.
• The message that MBAs are expected to be able to analyse a business problem from a number of different perspectives (strategy, financial, OB, corporate governance, legal, sustainability, etc) need to be reinforced. The expectations of MBAs here are different—perhaps more demanding–from those of graduates of function-specific masters programmes in business. One useful suggestion made here is that business cases be identified that could be tackled from a variety of different perspectives. During the LAW week it became clear that the Facebook IPO, discussion on banker’s pay, as well as the Glencore-Xstrada merger could all be approached this way. The coming EMI breakup could likewise be viewed from other perspectives.


A short biography Prof. Dr. Simon Evenett

Prof. Dr. Simon Evenett is the Academic Director of the St. Gallen MBA programme. Originally from the UK, Prof. Evenett moved to Switzerland in 2005. He teaches International Trade and Economic Development at the University of St. Gallen and his research focuses on the factors determining the intensity of competition in emerging markets, on the effects of competition, law and policy on firms’ behaviour, and on the analysis of existing and proposed agreements at the World Trade Organization.

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