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In a far-reaching career survey, alumni/ae of Stanford Business School's MBA classes of 1965 through 1989 reported that they are professionally peripatetic, financially comfortable and generally pleased with their place in life and with the preparation given them by Stanford.
Early in 1996, the Business School mailed a two-page questionnaire to 4,000 graduates of the MBA classes of 1965 through 1989. A surprisingly responsive 2,440 MBAs (61 percent) completed and returned the survey. Results were analyzed by the Pacific Consulting Group, Palo Alto, Calif., and released to the Business School community at the end of the year.
Respondents were divided into five groups, representing the classes of 1965 through 1969, 1970 through 1974, 1975 through 1979, 1980 through 1984, and 1985 through 1989. They listed their major career moves over the years and provided information about each position, such as industry, size of the organization, ending salary and reason for leaving.
The first job
In a business school, the first job after graduation seems all-important. Students tend to think it will make the difference between failure and success in later life. Perhaps it does, but one-quarter of the respondents not only left their first jobs but also changed industries by the end of the second year, and 40 percent by the fifth.
The choice of first industry varied according to the date of graduation. In the earliest group, MBAs from 1965 through 1969, nearly a third went into manufacturing (21 percent) or high tech (11 percent). Management consulting drew only 8 percent.
After 1969, there was a definite trend away from non-high-tech manufacturing (it never topped 9 percent) and toward management consulting and, to a lesser degree, investment banking. After 1975, management consulting settled into uncontested first place, with figures ranging from 20 to 23 percent. Meanwhile, investment banking rose from 6 percent in the 1970-1974 group to 16 percent in the most recent block of classes surveyed. Overall, graduates of the last 20 years are twice as likely as those 21 to 30 years out to have taken a first job in consulting or investment banking.
Along the career path
Of all the respondents, more than half changed industries with the second job. Only 20 percent of MBAs who started out in consulting took a second job in that area. The retention rate was highest for high tech, with 71 percent remaining in the industry (despite frequent job changes), followed by media/entertainment; health care/biotech; construction/real estate development; and financial services other than investment and commercial banking. While 30 percent of graduates have taken a job in consulting at some point in their careers, 75 percent of them have left the industry. Similarly, 16 percent have taken jobs in investment banking, but 59 percent have left the industry.
Work roles also shifted dramatically over time, moving toward general management and entrepreneurial positions. While most grads took first jobs as "functional specialists" (defined as stock brokers, venture capital analysts, CPAs, attorneys or other specialists responsible for application of technical expertise within an organization), currently 38 percent lead organizations as general managers, owners or entrepreneurs, and another 32 percent are business unit or functional managers. Overall, one-third have owned a company at least once in their careers and over half have been general managers or owners.
Of the "oldest" MBA classes surveyed 1965 to 1974 31 percent led organizations 10 years after graduation. By 20 years out, the number of "bosses" reached 44 percent. Currently, 26 percent of the graduates in the 1965-1974 block identify themselves as entrepreneurs. Only 2 percent of them took first jobs as entrepreneurs, but their number grew to 20 percent by the time they were out 10 years.
Reasons for changing jobs were remarkably similar down through the classes. They were, in order: career advancement; interest in new opportunity; more money; lifestyle; unhappiness with the current job; progression blocked; and relocation. There were differences by gender, however. Although women also ranked advancement and opportunity first and second, they were more than twice as likely as men to leave their first job for reasons of lifestyle.
Money may have ranked a poor third as a reason for taking a new job, but GSB graduates seem comfortably well off. Today's median salary-plus-bonus range of alumni/ae from the classes of 1965 through 1984 is $150,000 to $200,000. At the 75th percentile, the range is $300,000 to $500,000. Corresponding figures for the youngest group surveyed (1985-1989) are $100,000 to $150,000 and $200,000 to $300,000.
One of the most prominent trends over time was a migration to smaller companies. More than half of the respondents originally came to the Business School from companies of more than 1,000 employees. Fully one-quarter came from organizations of 25,000 employees or more. While the medium-to-large companies rose briefly in popularity at the first job after graduation, the giant 25,000-plus firms fell slightly from 26 percent to 21 at the first job and then bombed to the current figure 10 percent. Today, only 35 percent of respondents work in organizations of more than 1,000 employees. An almost equal number, 33 percent, are in firms of 25 or fewer. This "downsizing" held true across all the classes.
Of the total, 2 percent rated their business school experience as poor preparation for their first jobs and 1 percent for their entire careers. However, two-thirds rated it as "very good" or "excellent" in preparing them for their first jobs, and even more nearly three-quarters found it prepared them exceptionally well for their careers.
The career survey report can be seen on the World Wide Web at http://www-gsb.stanford.edu/ under "Employment Survey." Also, see career placement reports of the MBA classes of 1992 through 1996 at http://www-gsb.stanford.edu/cmc.
By Janet Zich