Preparing for Take-Off
Corporate America has an ongoing problem
with diversity: it doesn’t have enough of it. In response, the newly
established Jump Start program aims to help meet the need for more diverse
managers by expanding the pool of business school candidates.
by Erica Grieder
In 1995, Advantica, the parent company of the Denny’s restaurant chain, paid $54 million to settle two class-action suits charging the chain with racial discrimination. In 1996, the company’s new CEO, Jim Adamson, was named “CEO of the Year” by the National Association for the Advancement of Colored People.
Adamson, installed as chairman and CEO at a low point in the company’s history, had effected an enormous change in a very short time. How did he do it?
Speaking at The University of Texas at Austin last year, the chain’s chief diversity officer, Ray Hood, shed some light on the process. Key to the turnaround, she said, was a reorganization of the company’s executive board.
“Before, we had a brilliant board of directors, but they were all white men,” Hood said. Now that the board is 50 percent women and people of color, on the other hand, “there are things on their radar screens that were never there before.”
The recent history of Denny’s illustrates just one of the ways that executive diversity is crucial to any corporation—it helps ensure that a company avoids “consumer racial profiling,” the phenomenon at work when, for example, a “flesh-colored” bandage is a delicate shade of ecru. And race is only one axis of diversity.
Gender, geographical and cultural executive diversity can also help companies anticipate the concerns and interests of their customers.
Diversity, in other words, is not only a societal good—it can be a strategic advantage for any business. Still, less than a third of MBA students are women, and women make up less than 14 percent of Fortune 500 board directors. Racial diversity in upper-level management is similarly hindered by the fact that, according to the Diversity Pipeline Alliance, underrepresented minorities earned only 15 percent of all MBAs granted in 2003.
“As the underrepresented minorities grow, businesses and corporations will require a workforce that reflects their customer base,” the group concluded. “However, if today’s trends in education continue, that level of diversity will not be possible,” according to the report.
To foster greater diversity, the McCombs School recently announced the Jump Start program. “It was Dean Gau’s vision,” says Katy Nelson, the McCombs School’s director of corporate relationship management, “based on feedback from corporations.” By partnering with eight companies—Frito-Lay, TXU, FedEx Kinkos, Deloitte Consulting, BMC Software, JPMorgan Chase, SBC and Wells Fargo—the program aims to expand the pool of top students who continue pursuing an MBA degree.
Widening the PoolJump Start will be open to students from any background. Companies, not admissions officers, will define the diversity they seek and will select final candidates.
The program targets undergraduate seniors who are academically qualified—by virtue of their undergraduate GPA and GMAT scores—for a top-ranked MBA but lack the required work experience.
Companies agree to provide the experience by hiring the students for three years. The McCombs School may then offer candidates deferred admission to the MBA program, contingent on the completion of their job commitment.
As such, Jump Start differs from diversity-enhancing initiatives that have preceded it at the McCombs School and other business schools around the country. Traditionally, those efforts focused on a self-selected set of people—women at the beginning of their careers in business, for example— and attempted to draw more of their contingent to a particular program. Essentially, MBA programs were competing against one another for a limited number of qualified candidates.
In contrast, Jump Start seeks to increase the number of qualified candidates that exist in the first place.
“What we want to do for these students is to get business on their radar screen,” says Nelson, who has worked closely with MBA program directors and industry partners to lay the groundwork for the program.
One of the reasons that business schools are lagging in enrollment diversity relative to law and medical schools, says Nelson, is the self-perpetuating nature of demographic trends. With the number of female executives at Fortune 1000 companies hovering around an anemic 10 percent, for example, young women have few visible female role models.
Signing Students UpAwareness-raising activities will take several forms. Beginning this fall, for example, a Jump Start program coordinator will go on recruiting trips to undergraduate institutions around the country.
For the most part, however, recruiting for the Jump Start program will be the province of the participating companies, which will likely take slightly different tacks. Some might make recruiting trips specifically for Jump Start; others may recruit as usual and then mention the program to qualified candidates when they see fit.
“We’re mostly removed from the undergraduate recruiting process,” explains Daniel Garza, director of the McCombs MBA program.
Traditionally, the odds of getting into a top MBA program are best for students who have relevant work experience, a competitive GMAT score and a good undergraduate GPA. Jump Start candidates will have an undergraduate GPA, of course, and will have to take the GMAT before applying, but will have little, if any, professional experience.
These concerns, says Garza, are mitigated by the fact that the structure of the Jump Start program allows the McCombs School to “pre-certify” the work experience students will have in the interim. That is, while many entry-level jobs (in any field) can be quite rote, the Jump Start companies have a vested interest in the professional development of program participants.
“This is a long-term commitment for the companies, in a business environment where many companies don’t see past the next quarter,” adds Nelson. “It’s a tribute to our corporate partners.”
Each company may structure their Jump Start program differently. One might have employees working in several different functional areas, another might have them concentrating in the same field for three years. All, though, “are focused on putting students on a good career path,” says Garza.
While Jump Start applicants might not have any business coursework under their belts, that is not so unusual. “We already take so many people from outside the business population,” Garza says, noting that in the McCombs MBA Class of 2006, for example, just around a third of students earned their undergraduate degrees in business.
Instead of focusing on students who are already pursuing a career in business, in other words, Jump Start looks for those who have not yet decided how to harness their initiative and drive. “We’re looking for students who are engaged in the management of their career,” says Garza.
If these students find that a career in business is emphatically not for them, they are not obligated to continue with the program. But, being confident in both the quality of the McCombs MBA and the work experience available at the Jump Start program’s corporate partners, Garza expects defections to be minimal.
The benefits of the Jump Start program, he adds, will trickle down to all McCombs MBA students, not just program participants. “The effects of diversity in the classroom and learning environment are positive for everyone,” he says.
“Also,” he adds, “these are key companies for us from a recruiting standpoint.” Jump Start participants will bring information about and contacts at their sponsoring companies to the MBA program. And as the McCombs School builds its reputation for diversity (the Jump Start program has already been highlighted in BusinessWeek) other companies might be motivated to recruit at McCombs. Jump Start can jump start careers-even for students who aren’t program participants.
For information on specific programs at the McCombs School, consult our contacts page. For media information, contact the Communications Director by phone at 512-471-3314 or by email at CommunicationsDirector@mccombs.utexas.edu.
