MBA applicants are seeing red.
Red as in Harvard crimson and Stanford cardinal.
These business schools are a case study for supply-and-demand. Together, they attracted 17,875 applications in the 2015-2016 cycle, more than Kellogg, Booth, Tuck, and Sloan combined. Last year, just 1,351 MBA candidates earned a seat at these two programs — a 7.5% chance. So why do some applicants go through the trouble knowing the odds?
For one, Harvard and Stanford are the standards of excellence in MBA education. Their MBA graduates run the blue chip firms. Think JP Morgan Chase, General Motors, Bain & Company, Time Warner, General Electric, Capital One, and the Boston Consulting Group. Their alumni range from towering figures like Michael Bloomberg and Phil Knight to hip upstarts like Seth Godin and Sheryl Sandberg. Their brands are synonymous with prestige, not to mention starting pay packages that approach $154,000 on average. Their brands confer respect and open doors; their deeply entrenched and connected networks give graduates a leg up throughout their careers; and their lavish resources ensure the best possible educational experience.
A MEASURE OF BRAND APPEAL…AND APPLICANT COMMITMENT
One more thing: They can be nitpicky about who they accept, with their student bodies packed with accomplished and diverse talents. Like the Royal Canadian Mounties — another organization associated with red — Harvard and Stanford almost always get their man (or woman).
Look no further than their yield rates — the percentage of accepted candidates who ultimately enroll in the program. At Harvard Business School, 89.6% of 2015-2016 cycle applicants who received an acceptance letter inevitably joined the Class of 2018. That’s nine out ten applicants! The number is nearly as high at Stanford, where 85.3% of accepted applicants make it to Palo Alto. Bottom line: Harvard and Stanford aren’t options. They are THE destination.
You can think of yield as a barometer for several indices. For one, it is a measure of brand appeal. By accepting school offers, MBA candidates reflect the perceived value of a program’s degree in the marketplace. In other words, yield — the conversion rate —is a gauge of a program’s desirability, the degree to which it was the first choice of applicants. It can also indicate the loyalty and commitment level of candidates to particular programs. Yield also shines the spotlight on the admissions department. For example, a low conversion rate may be a sign of lax acceptance standards. In contrast, a high yield may reveal the art of closing the deal. Here, students are buying into school messaging or adcoms are simply better at leveraging student and alumni connections or dangling inducements like financial aid.
Alas, Harvard and Stanford enjoy the advantage of exclusivity. Their MBA degrees stamp graduates (in the public mind, at least) as plug-and-play finished products who are battle-tested and a cut above. They also benefit from their location, with Harvard found within a train ride from the banking and consulting capitals and Stanford just a few miles from Silicon Valley and Sand Hill Road. This makes it easier for students to network with insiders and influencers.
HOW BYU AND UC DAVIS LAND THEIR TOP CHOICES
U.C. Davis is roughly a 90-minute jaunt to either Silicon Valley or San Francisco. A truly small program with just 48 full-time MBAs in its 2018 Class, Davis also boasts the highest yield of any MBA program in the American Top 50, with 90.7% of accepted applicants ultimately enrolling. Why? Davis tends to be very selective. Out of the 336 applications it received in 2015-2016, just 53 students received the letter. This 15.8% acceptance rate is lower than top tier programs like Wharton, Chicago Booth, Dartmouth Tuck, and Northwestern Kellogg. Its 679 GMAT average for the class also aligns with higher-ranked programs like Indiana Kelley, Ohio State Fisher, and Minnesota Carlson. At 3.41, Davis’ first-years averaged GPAs higher than those from Cornell Johnson, Vanderbilt Owen, Notre Dame Mendoza, USC Marshall, and Emory Goizueta. In other words, Davis knows exactly who it wants — and focuses its efforts to closing the right students over casting a wide net.