NC State MBA a top overperformer

Poets and Quants published an article this week on brand perception for MBA programs, pointing out that perception of program quality by deans often lags reality.  They have a nice table showing how little the dean assessments for top 20 schools change; over the last two years no school changed by more than 0.2 on a five point scale.  

But reputation often lags reality, as many schools outside the top tier do very well on objective measures of program success, such as employment outcomes for graduates.  P&Q came up with a list of the top over-performers, defined as schools whose overall rank is well above their dean assessment score.  NC State's Jenkins MBA came in tied for 4th (with Alabama and Binghamton), with the top three slots going to UT-Dallas, Rutgers and BYU.  Here is a direct quote from the article: 

For years, North Carolina State (Jenkins) was a recruiter’s dream, an unheralded program with a tech-driven, hands-on, multidisciplinary curriculum. While the program is no secret to companies like IBM, it has seemingly been stuck in neutral among academics, posting its second consecutive 2.7 score (despite soaring 23 spots overall from #88 to #65). With the school continuing to build partnerships within the nearby Research Triangle Park to complement its STEM roots, Jenkins is definitely a school to watch for innovation.

NC State is working to continuously improve the MBA experience.  In time the deans at other business schools will recognize what great opportunities we provide.  

FCC and net neutrality

The FCC made news last week when it issued a new set of regulatory guidelines that would allow broadband companies to charge content providers for faster access to customers.  In the "I could not make this up if I tried department," the proposal blocks the Comcasts and AT&Ts of the world from blocking or slowing down any website.  In other words, it is ok to shake companies down for money but you cannot block them out of pure meanness.

It is hard to find anyone who is happy with the proposal.  The hard-core net neutrality crowd is displeased because they want the internet to be the same speed for all.  They do not spend too much time thinking about what incentives Comcast and its ilk would have to build and maintain the bandwidth necessary to make that happen.  Moving 180 degrees to the other side of the political spectrum, any hint of regulation has stirred concerns that the FCC will impose 1970s style telephone regulation.

There is one basic point that is getting lost in this discussion -- as more broadband hungry services become available, someone's gotta pay for the pipes.  Either Netflix, HuLu and other heavy-duty video providers start charging their customers higher rates (to reflect the payments they will have to make to Comcast and Verizon) or the internet providers themselves will have to start directly charging heavy-duty video consumers more.  Hopefully the FCC can remember this simple fact before adopting final regulations.

Evidence that employers really care about internships

What do employers really look for in a resume?  To find out four researchers at three universities did a randomized study where they sent fictitious resumes to online job postings.  Each resume showed a college degree received in 2010 and one job held since then.  The resumes varied by major (half business and half liberal arts), GPA and whether the applicant held an internship in the same field as the opening.  

I was a bit surprised to see 17 percent of the resumes were invited for an interview; this strikes me as very high for an online application process.  But more importantly, what were the key variables in predicting who landed the interview?  It was not the major.  It was not the GPA.  It was whether or not the student had an internship!  Those with internships were 14 percent more likely to get interviews than those without.  

This may actually understate the true impact of internships because it does not include the most common scenario -- where the internship leads directly to a job.  So even though summer school starts tomorrow, don't give up on that internship yet!

Beware iPhone operating system upgrade

Upgraded my iPhone5's operating system to iOS 7.1.1 on Sunday.  Two days later the phone became totally non-responsive.  I was able to get it going twice, but then it died (bricked is the term used by the cognoscenti) Tuesday afternoon.  I then learned that many users are having similar problems.  

My phone was past warranty by five months and the local Apple store manager clearly had been directed to not accept any responsibility for its early demise.  Hopefully my case is a relatively isolated instance, but needless to say we are NOT going to do the same upgrade for the other iPhone in our household.  

Dependability has been a key reason over the years as to why Apple has been able to charge a premium for its products.  Already under pressure from cheaper Android devices, Apple had better hope that this ends up being a small scale problem.  (P.S. Typed on a five year old MacBook Pro.)

What does the Apple-Beats merger tell us?

Apple -- the revolutionary company that brought us iPads, iPhones, iTunes and countless other innovations -- is in talks to buy Beats Electronics for $3.2m.  What does this tell us?  First, Apple can leverage Beats' new music streaming service to offset the less than spectacular rollout of iTunes Radio.  At a minimum, Apple kills off a potential competitor and maybe there are some synergies (don't hold your breath).  

Second, more and more music is being consumed on headphones and Beats has become a force to deal with in that market.  Perhaps there are some technical payoffs to this, but carrying the logic further maybe Apple buys a company that makes receivers and another that makes speakers.  Somehow I do not think consumers will start getting a $300 headphone with each new iPhone or iPad.  Next step: will Apple buy a printer company to go with its Macs?

Third, Apple now thinks it has to buy innovation instead of creating it.  As many investors feared, the pipeline of breakthroughs has run dry.  Apple has a history of acquiring small firms in the technology space, but this would be its first big buy in the consumer electronics space.  

With or without the merger, the music biz will continue creating great product.  As the former rock-and-roll critic for the Michigan State News, I encourage you to give a listen to War on Drugs' "Lost in the Dream" and Future Islands' "Singles."  You can hear both for free on Spotify.  

Who stays in the top 1 percent?

The share of the economic pie that accrues to the top one percent of households in the earnings distribution has been increasing over the last 40 years in the US.  On the surface this implies that a small circle of people keeps getting richer and richer every year.  

However, the composition of the top one percent changes every year.  Recently two sociologists did a study to examine how much turnover takes place in the upper income brackets.  One would expect some turnover for a number of reasons.  First, most people start their careers in low to middle income categories.  Second, some income is transitory; for instance Thomas Piketty is a wonky French academic economist who has become a best selling author (but probably for only one year).  

The results of the sociologists' study, reported two weeks ago in NYT, will surprise many.  

It turns out that 12 percent of the population will find themselves in the top 1 percent of the income distribution for at least one year. What’s more, 39 percent of Americans will spend a year in the top 5 percent of the income distribution, 56 percent will find themselves in the top 10 percent, and a whopping 73 percent will spend a year in the top 20 percent of the income distribution. 

Yet while many Americans will experience some level of affluence during their lives, a much smaller percentage of them will do so for an extended period of time. Although 12 percent of the population will experience a year in which they find themselves in the top 1 percent of the income distribution, a mere 0.6 percent will do so in 10 consecutive years.

One must be careful to distinguish between inequality in income, which clearly varies from year to year, and inequality in wealth, which is more likely to be stable over time.  It would be interesting to see how much change there is in the composition of the top one percent of the wealth distribution.