The role of predictive analytics to explain the employability of management graduates

Abstract

PurposeIn India, one of the prime focuses of a post-graduate management program is to prepare students and make them job-ready. Masters in Business Management (MBA) program helps students to imbibe theoretical and practical skills which are required by the industry, which can make them hit the ground running from the day they start their career. Many students (almost 40–50%) get pre-placement offers based on their performance in summer internship. The selection for summer interns by the corporate happens within a few months of the student joining the MBA program. Signaling theory in education indicates that the level of productivity of an individual is independent of education, but the educational qualification acts as a testimony for higher ability. However, this theory does not explain the reason for the mismatch between “education and work” or “education and the disparity in salary” between individuals who earn differently but have the same qualification. The paper aims to explore three attributes namely – “employability”– the chance of being employable; “pre-placement offers” – the chance of securing a job offer based on the performance in internship and “salary” – the chance of bagging a good job offer with a high salary.Design/methodology/approachThe authors have used longitudinal data consisting of 1,202 students who graduated from reputable business schools (B-Schools) in India. In the study, the authors have used predictive analytics on six years data set that have been gathered. The authors have considered 24 attributes including educational background at the graduate level (BE, B Tech, B Com, BSc, BBA and others), score secured in class ten (high, medium and low), score secured in class twelve (high, medium and low), score secured in graduation (high, medium and low), competency in soft skills (high, medium and low), participation in co-curricular activities (high, medium and low) and social engagement status (high, medium and low).FindingsThe findings of the study contradict the signaling theory in education. The findings suggest that the educational qualification alone cannot be the predictor of the employability and the salary offered to the student. The authors note that the better performance at a lower level of qualification (class 12) is the strong predictor in comparison to the student performance at their graduation and post-graduation level. The authors further observed at the post-graduate management education level that soft skills and participation in co-curricular activities are the major deciding factors to predict employability and pre-placement job opportunity and marks secured in class 12 is one more factor that gets added to this list to predict salary. The paper can immensely help management graduates to focus on key aspects that can help to hone appropriate skills and also can help management institutions to select the right students for management programs.Research limitations/implicationsThe analysis and the predictive model may apply to Indian B-Schools wherein the quality of students are almost the same or better. Predictive analytics has been used to explain the employability of management graduates alone and not any other.Practical implicationsThe authors' study might be useful for those students who often fail to understand “what” skills are the most important predictors of their performance in the pre-placement and final-placement interviews. Moreover, the study may serve as a useful guide to those organizations that often face dilemmas to understand “how” to select an ideal candidate for the particular job profile from a campus.Originality/valueThe authors believe that the current study is one of the few studies that have attempted to examine the employability of management graduates using predictive analytics. The study further contradicts that the signaling theory in education does not help better explain the employability of the students in extremely high-paced business environments.