Meissner Research Group

The Kingsman Prize for 2010 has been awarded to Management Science PhD graduate Arne Strauss. The prize was established in memory of the long-standing scholar of Management Science, Professor Brian Kingsman.

Arne has completed his PhD in three years after obtaining a MSc in Mathematics at Virgina Tech and a Diploma in Mathematics from the University of Trier in Germany. His supervisor, Dr Joern Meissner, identifies him as the most capable PhD student he has worked with so far.

Arne Strauss receiving his Kingman Prize award from Mike Pidd (Head of the Department of Management Science)

Arne’s thesis advances state-of-the-art models in revenue management (RM), an application area concerned with maximising expected revenue from the sale of products that use perishable resources. For example, products might refer to flight tickets and resources to flight legs in an airline network. RM approaches also arise in many other practical industries such as train, hotel, car rental, etc. For any application, a decision maker needs to formulate a decision rule (policy) that determines which products to offer at any point in time throughout the selling horizon. In recent years, increasing effort has been devoted to incorporating the choice behaviour of customers into network RM since demand for a particular product is often observed to be dependent on the offered alternatives. In this context, Arne’s thesis addresses important optimization questions that lead to improved policies by taking the dependence of the offered products into account. His research is of great practical importance and has already attracted the interest of revenue management professionals, leading to a project with Lufthansa Systems.

With a vision to create a four-year doctoral program in statistics and operations that was based in practical knowledge and real-world implementations for managerial science, Lancaster University has opened its newest Doctoral Training Centre in Statistic and Operations. Named STOR-i, for “Statistics and Operational Research – excellence with impact”, the new 4 year program is focused on creating a new generation of advanced problem-solvers with high technical knowledge and the ability to create significant methodological contributions to STOR.

The program’s history started in December 2009 when the Engineering and Physical Sciences Research Council (EPSRC) announced a new investment of 13 million pounds to create Doctoral Training Centres at Lancaster, Cambridge, and Warwick universities. Lancaster’s program, with the combined 6.7 million pound award shared jointly between the Departments of Mathematics and of Statistics and Management Science, will build on its leading reputation in these fields. Recent accomplishments in these programs have included the success of the EPSRC Science and Innovation award in Operational Research (the LANCS Initiative) and the HEFCE-funded Centre for Excellence in Teach and Learning in Postgraduate Statistics. STOR-i will quickly add its real-world focus to the programs’ accomplishments.

STOR-i has partnered with industrial multinational companies, like Unilever Research and Shell Research, who will be directly involved with the students’ training. They will provide real-world experience throughout the program. After the student completes the first year coursework to provide a practical grounding in STOR’s mathematical core and an overview of current methodology, the student will work towards the PhD under the guidance of supervisory teams. Half of these projects will include actual industrial involvement and the added guidance of an industrial collaborator.

The Centre, led by Chairman Kevin Glazebook, Director Jonathan Tawn, and Deputy Director Idris Eckley, will train at least 40 students over seven years, and will begin to admit the first of these students in October 2010. More information about the program and how to apply can be found at www.stor-i.lancs.ac.uk.

The number of applicants to graduate programs, including MBA and other business programs, are skyrocketing thanks to the recession and the continued high unemployment rate. Added in to the normal mix of business-minded professionals who are either looking to advance their careers or change career paths entirely, a large portion of MBA applicants are in heavy competition to land a job to get them through the next few years of trying times.

But for those who believe once they have gained admission to the MBA program of their choice, I have some bad news, just getting into an MBA program may no longer be enough. In particular, job recruiters, especially in these high unemployment times where each job is getting hundreds, if not thousands, of qualified applicants, may still request to see an applicant’s GMAT scores before deciding to interview her/him.

While the GMAT score might not truly represent a person’s qualifications, it is widely accepted that there is a correlation between a person’s score and a person’s ability, especially in quantitative intensive work. Therefore, job recruiters use it just like many MBA programs: as a bottom line to quickly eliminate the weakest applicants.

Job recruiters might see this as a complete win, as they can now immediately disqualify any resume, without even reading the rest of it, that either doesn’t have a GMAT score listed (if it had been requested) or doesn’t hit a certain number score. It saves time and money, essentially making the employer happy. If it means they might miss out on interviewing one or two great candidates who just don’t take tests well, most recruiters are all right with that. Job markets and job searches are so tough right now that some recruiters have openly quoted a desired GMAT score at 700, in other words, a result within the best 10 percent of all test takers.

I have always advised those MBA students at Lancaster University Management School to retake the GMAT if their test score is below 720 and if they aim to apply for competitive positions, for example management consulting or investment banking. The job recruiter doesn’t care if you got your best GMAT result before your MBA admission or after, just as long as you can prove you’re just as good, or hopefully even better, than the next guy.

[The following is an English version of the article ‘MBA in Europa: Die Mischung macht’s‘ that appeared as an op-ed in the MBA supplement of the Frankfurter Allgemeine Zeitung (FAZ) on October 29^th, 2009.]

Without a doubt, every MBA applicant needs an excellent GMAT score, a flawless academic record and a unique quality to stand out from the crowd, but social competence is what a potential applicant needs to have to be a winner to complete a MBA program, land a dream job and conquer the business world.

For the past several years, the secret has no longer lied in grades and academic awards but rather in a mix of different mental, personal and even physical strengths. From my teaching experience at the Lancaster University Management School (LUMS), I have learned that the GMAT is a strong indicator for the future academic success of a student, especially if the course in question is heavy on the quantitative side. This is, however, only half the battle.

Well-known MBA critic Henry Mintzberg strongly believes that no student can become a successful manager by just attending lectures. The difference between mere theory and actual practice of management implies that a student cannot learn what it takes to handle the challenges of a manager position without actually taking part in a production or service creation related job themselves. While case studies are in theory useful to get a feel for the daily life of a manager, they also undermine the importance of real-life work experience. The fact is that co-workers and subordinates aren’t just a set of data, but complex individuals who require more than analysis and strategies to be led effectively.

In a sense, this can already be seen during a MBA program where complex projects can only be completed successfully by a team, not just a strong individual. It is not about commenting on and controlling the work of others, but using them for guidance and stimulus. The students who are the most successful can identify the complementary skills of others and are able to motivate them to participate. A good MBA student can be paired up with the weakest team members and still deliver the best project, simply because he or she knows how to effectively lead a team. Authentic enthusiasm and positive attitudes help successful MBA students, and eventual managers, not only to utilize their laborers but to pass their ambitions on to others. By doing so, they create a healthier and more efficient working environment in which common goals and the well-being of the organization are highly valued.

Therefore, social competence is a must for top managers. Business schools are incorporating such components into their programs to enable students to gain this needed skill. At LUMS, we have added three consulting projects to our MBA program, and two of them must be completed in randomly assigned teams. After the projects, many students report that they have been a true highlight of the program, and one of the program’s aspects from which they have learned the most. The idea was developed after the success of International Master in Practicing Management (IMPM), a program for senior managers co-developed with Henry Mintzberg in response to his own criticism of existing programs and offered by LUMS in cooperation with McGill, INSEAD, and a few other partner institutions.

While there are MBA programs that attempt to integrate practical learning experience into the curriculum, the social management skills should already play a role in the admissions process. It is certainly not an easy task, since character can’t be easily evaluated in a short time period. Assessment centers simply cost too much. There have been rumors, however, that GMAC is working on a new version of the GMAT which will also test social components and time management skills, although nothing has been made official yet. It will still be the admissions office’s task to make sure that the right candidates are accepted.

However, one needs to be aware that this argument is often misused as well. A solid, quantitative understanding is still vital for every top managerial position and can not be replaced. But just alone, it is not enough. MBA programs that do not require applicants to take the GMAT, and instead claim it is sufficient to interview potential applicants, must be dealt with carefully. These programs are often more afraid about the external evaluation of its students, like the average GMAT score of their incoming class, than the social character skills of their candidates. These admission interviews often resemble sales pitches to the students. Because applicants also learn a great deal from fellow students, they should pay careful attention in such cases and research the student body of the institution they consider to join.

Altogether the MBA student needs excellent qualities in both academic and character-related areas for ultimate success during and after the MBA program. Just as in most other aspects of life, it’s in the mix.

Dr. Joern Meissner is a Lecturer in Management Science at the Lancaster University Management School in England and founder of the educational institutions Manhattan Review and Lancaster Executive.