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Download by: [Universitas Maritim Raja Ali Haji] Date: 11 January 2016, At: 21:54

Journal of Education for Business

ISSN: 0883-2323 (Print) 1940-3356 (Online) Journal homepage: http://www.tandfonline.com/loi/vjeb20

Academic Performance in MBA Programs: Do

Prerequisites Really Matter?

Donald Gene Christensen , William R. Nance & Darin W. White

To cite this article: Donald Gene Christensen , William R. Nance & Darin W. White (2012)

Academic Performance in MBA Programs: Do Prerequisites Really Matter?, Journal of Education for Business, 87:1, 42-47, DOI: 10.1080/08832323.2011.555790

To link to this article: http://dx.doi.org/10.1080/08832323.2011.555790

Published online: 21 Nov 2011.

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ISSN: 0883-2323 print / 1940-3356 online DOI: 10.1080/08832323.2011.555790

Academic Performance in MBA Programs:

Do Prerequisites Really Matter?

Donald Gene Christensen and William R. Nance

Union University, Jackson, Tennessee, USA

Darin W. White

Samford University, Birmingham, Alabama, USA

Many researchers have examined criteria used in Master of Business Administration (MBA) admissions decisions. However, prior research has not examined predictive ability of under-graduate prerequisite courses in core business disciplines. The authors investigated whether undergraduate prerequisite courses predicted MBA success by analyzing the outcomes of 491 MBA graduates. The results revealed students who lacked business prerequisite courses per-formed better in MBA grade point average (GPA) than students who took prerequisites. Addi-tionally, performance in undergraduate written composition is positively correlated with MBA GPA. Moreover, performance in undergraduate marketing, economics, and business statistics courses are significant predictors of MBA GPA. Finally, the authors found undergraduate GPA predicted MBA success.

Keywords: MBA admissions criteria, MBA prerequisites, MBA success

The Master of Business Administration (MBA) degree has become a major component of the general credentials busi-ness professionals must have to achieve success. DeSimone and Harris (1998) described the program of study leading to the MBA degree as one of the most important avenues to man-agement education. Zhao, Truell, Alexander, and Hill (2006) found that MBA education has a positive impact on gradu-ates’ future employment, income, and promotion prospects in the short and long term.

The MBA degree represents a significant way for profes-sionals in various specialized areas of business to develop general management skills. Many examples highlight the increasing usefulness and flexibility of an MBA education. Sunoo (1999) noted that human resource professionals can increase their managerial competence and improve their chances for career advancement by acquiring an MBA. Mess-mer (1998) asserted that Certified Management Accountants benefit from an MBA by gaining skills in areas outside the accounting department. LaFerla (2005) recommended the

Correspondence should be addressed to Donald Gene Christensen, Union University, McAfee School of Business, 1050 Union University Drive, Jackson, TN 38305, USA. E-mail: dchriste@uu.edu

MBA for engineering professionals to compensate for their technical rather than general management educations and to better position themselves for advancement. McCook (2004) found that many schools offer joint PhD–MBA programs because business-savvy scientists may give companies a competitive edge or may be the key to a successful startup. Lynch, Baty, Abdullah, and Seaman (2005) and Mangan (2007) emphasized that MBA education is useful for managers of small and family-owned firms. Some business schools are creating techno-MBAs because of the increasing importance of technological knowledge along with manage-rial expertise. Dietrich et al. (1989) proposed requirements for a joint MBA–information systems management program. The demand for MBA education has increased consider-ably (Greco, 2001) with the growing popularity and perceived value of an MBA education and with higher average salaries paid to MBA graduates. Consequently, MBA admissions of-ficers face increased challenges to select students who are ap-propriately qualified to enter MBA programs to better ensure student success and meet various accreditation requirements. The purpose of this study was to identify specific variables that successfully predict the possibility of success for students entering MBA programs. First, we review the findings of prior research, which has identified variables

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ACADEMIC PERFORMANCE IN MBA PROGRAMS 43

considered predictors of MBA student success. We then extend this literature by identifying the variables found by our study to be good predictors of student success in MBA programs.

LITERATURE REVIEW

An understanding of the factors that affect student perfor-mance is of particular value to those who design academic programs and support activities. Many researchers have shed light on aspects of this issue regarding MBA programs.

Carver and King (1994) reported that several graduate schools of management base admission to MBA programs on some combination of the undergraduate grade point aver-age (GPA) and the score on the Graduate Manaver-agement Ad-mission Test (GMAT). Thus, these graduate schools assume that MBA student performance can be predicted by these two variables. However, although a number of studies an-alyzed the relationship between MBA student performance and these variables, these studies found inconclusive and conflicting results. Hecht and Powers (1982) reported mul-tiple correlations between undergraduate GPA and GMAT for first-year MBA students that ranged from .12 to .67. Wright and Palmer (1994) found that although undergradu-ate GPA and GMAT scores were modestly correlundergradu-ated with subsequent performance, those scores did not discriminate between moderately low and very-low performers. They es-timated a multipleR2factor of .212. Carver and King (1994) investigated the admission criteria for nontraditional students and explored a number of variables, including age, gen-der, undergraduate major, work experience, duration of for-mal education, competitiveness of undergraduate institution, undergraduate GPA, and GMAT verbal (GMATV) score, and GMAT quantitative (GMATQ) score. Carver and King found that three variables, GMAT score, undergraduate GPA, and work experience, predicted performance for nontradi-tional students. They estimated anR2of .22. Paolillo (1982) found that undergraduate GPA and GMAT scores explained less than 17% of variance in graduate GPA. Paolillo’s findings were consistent with the findings of Deckro and Woudenberg (1977), who determined that undergraduate GPA and GMAT explained less than 15% of the variance in graduate perfor-mance.

Some studies evaluated the impact of undergraduate GPA and GMAT on subsequent graduate performance. Zwick (1993) used schools in Canada and the United States to ana-lyze the validity of GMAT as a predictor of grades in doctoral programs in business and management. Zwick concluded that undergraduate GPA was a better predictor than GMATV and GMATQ together. However, Zwick found all three predic-tors had greater explanatory power than undergraduate GPA alone. Ahmadi, Raiszadeh, and Helms (1997) found that un-dergraduate GPA explained more than 27% of the variability in graduate GPA, whereas GMAT scores explained 18%.

Hoefer and Gould (2000) found that GMATV, GMATQ, and undergraduate GPA were strong predictors of graduate GPA, and that GMAT scores were better predictors than undergrad-uate GPA. In a prior study, Carver and King (1994) also found that, compared with undergraduate GPA, GMAT was a better predictor of graduate GPA. Yang and Lu (2001) analyzed the impact on graduate performance of students’ native language, GMATQ, GMATV, and undergraduate GPA in a multiple re-gression model and found the opposite result. Yang and Lu’s model yielded an overallR2of .259, with undergraduate GPA playing the greatest explanatory role. However, Clayton and Cate (2004) found no significant role for undergraduate GPA in predicting graduate GPA. Finally, Arnold, Chakravarty, and Balakrishnan (1996) noted that undergraduate GPA de-clines in importance as a predictor variable when the elapsed time between obtaining the undergraduate degree and en-rolling in an MBA program is greater than 10 years.

Exploring other variables, McClure, Wells, and Bower-man (1986) found that the number of years of work expe-rience correlated positively with graduate GPA. Dreher and Ryan (2000) found duration of work experience to be an im-portant predictor of graduate GPA. These results may reflect that students with greater work experience are able to see the broader view of business functions and the relevance and po-tential applications of MBA material. Adams and Hancock (2000) also found the number of years of work experience between the undergraduate degree and MBA functioned as a good predictor of MBA success. However, Dreher and Ryan (2000, 2002, 2004); Dugan, Grady, Payn, Baydar, and Johnson (1996); Graham (1991); and Peiperl and Trevelyan (1997) all concluded that work experience was not correlated with graduate GPA.

Some researchers explored age as an explanatory factor in graduate GPA performance. Peiperl and Trevelyan (1997) found age to have predictive value. They discovered a neg-ative correlation between age and MBA performance with younger students performing better than older students. One explanation for this result may be the fact that younger stu-dents have more recent experience with academic environ-ments and thereby are better primed for graduate study. How-ever, Graham (1991) and Paolillo (1982) found age not to be significantly correlated with MBA performance. Finally, Braunstein (2006) compared business and nonbusiness un-dergraduates and found age and work experience to be more significant than GMAT for nonbusiness degree MBA appli-cants.

Gender also has been studied as a possible explanatory factor in MBA performance. Ekpenyong (2000), Hancock (1999), and Peiperl and Trevelyan (1997) found no correla-tion with MBA performance and gender. However, Hancock found that men tended to score higher on the GMAT. Deckro and Woudenberg (1997) found that women performed bet-ter academically during the MBA program than men. Their results were consistent with a more recent study by Cheung and Kan (2002). Launius (1997) explained this difference by

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proposing that women seem to put more time and effort into studies than men.

Research focusing on ethnicity also showed conflicting results. Some researchers found no distinguishable differ-ences across ethnicities. On the other hand, Clayton and Cate (2004) found students from different ethnic backgrounds dif-fered in levels of academic achievement. They found Cau-casian and Hispanic students performed better than Asian Americans in the MBA program at the University of Northern Kentucky. Some researchers attributed these results purely to native language differences. Yang and Lu (2001) found that language is a significant predictor.

Does the student’s undergraduate major play a role in sub-sequent MBA performance? Many researchers have found support for this notion (e.g., Anderson, Benjamin, & Fuss, 1994; Borde, 1998; Cheung & Kan, 2002; Durden & Ellis, 1995; Ekpenyong, 2000). In particular, Ely and Hittle (1990) showed completed accounting courses were significantly cor-related with performance in graduate business studies. Ad-ditionally, Anderson and colleagues as well as Didia and Hasnat (1998) found students who had taken calculus and other mathematics courses performed better in economics and finance courses than students without such background. However, Braunstein (2002), Adams and Hancock (2000), and Gump (2003) found students who have undergraduate degrees in business perform worse in MBA programs than students who do not have undergraduate business degrees. Gump suggested students without an academic background in business may work harder to compensate for their lack of undergraduate preparation.

Finally, Fish and Wilson (2009) found the factors to pre-dict success were different between a one-year MBA program and a part-time MBA program in the same business school. They found the factors to predict success for the one-year MBA program included GMATV, undergraduate GPA, and a Canadian factor. However, the factors to predict success in the part-time MBA program included GMATV, GMATQ, age, and undergraduate GPA. Fish and Wilson concluded that slightly different entrance criteria should be used for each program.

RESEARCH QUESTIONS AND HYPOTHESES

A number of unresolved issues remain regarding precisely which variables most strongly correlate with MBA GPA out-comes. The particular research question we posited is: Does the extent to which students have taken certain required courses as undergraduates successfully predict differences in final MBA GPA? We define these prerequisite courses as those most often required for full admission to MBA pro-grams: principles of microeconomics and macroeconomics, principles of finance, principles of marketing, principles of management, principles of financial and managerial

account-ing, and basic statistics. We selected these courses because they are the courses most often required for MBA program admission and, in addition, they are the common classes most business undergraduates take. Further, we analyzed the relationship between course performance in undergraduate algebra and written composition and final MBA GPA. We selected these courses because they are part of the core un-dergraduate programs at most universities.

Thus, we set forth the following hypotheses.

Hypothesis 1 (H1): There would be a significant positive correlation between completion of undergraduate busi-ness prerequisite courses in marketing, management, ac-counting, economics, finance, and statistics and final MBA GPA.

H2a: There would be a significant positive correlation be-tween student performance in undergraduate algebra and final MBA GPA.

H2b: There would be a significant positive correlation be-tween student performance in undergraduate written composition and final MBA GPA.

H3: Prerequisite courses with heavy quantitative content would be better predictors of overall MBA GPA than prerequisite courses with light quantitative content.

H4: Overall undergraduate GPA would be positively corre-lated with MBA GPA.

H5: Graduation from an Association to Advance Collegiate Schools of Business (AACSB)-accredited undergradu-ate program would be positively correlundergradu-ated with final MBA GPA.

ANALYSIS

We gathered data from students’ records for all MBA graduating-year classes of a midsized private southeastern university from the inception of the MBA program in 1999 to 2006. We obtained all data from students’ records in the school of business administration at the main campus and a branch campus. All students were enrolled in a cohort-based MBA program (cohort-based programs require students to move through the entire MBA program in a fixed progres-sion with the same group of individuals). In total, we initially gathered data for 723 students. After deleting responses with missing data, the final data set consisted of 491 students, a response rate of 67.9% of the initial total.

The MBA students in this data set were predominantly men (62%), and 4.7% of the students were racial minori-ties. Married students constituted 62.6% of the students. Un-dergraduate GPAs averaged 3.14 on a 4-point scale, while the average student in our data had 6.6 years of full-time professional work experience. Just over two-thirds of the students completed the eight undergraduate business prereq-uisite courses primarily by fulfilling requirements of under-graduate business majors.

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ACADEMIC PERFORMANCE IN MBA PROGRAMS 45

Hypothesis 1

To test the first hypothesis, we divided our sample into two subsamples. Subsample 1 included those students who had completed all eight undergraduate prerequisite courses (51.3% of the students were in this subsample). Subsample 2 included those students who completed none of the eight un-dergraduate prerequisites (33.0% of the students were in this subsample). Students who completed only some (but not all) of the eight courses were deleted from the analysis (15.7% of the students were in this subsample).

The first question was: Does overall success in the MBA program differ between these two subsets of students? The confidence level for rejecting the null hypothesis in each case is the standard ofp<.05.

The dependent variable used to assess MBA program suc-cess for this study was cumulative GPA upon graduation from the MBA program. The independent variables used in the analysis included completion of the eight undergradu-ate business prerequisite courses and specific performance in each. Specific performance in the prerequisite courses was assessed by the letter grade received by the students in each course. No students in our sample received a letter grade of F in any of the prerequisite courses.

As shown in Table 1, the regression analysis indicated a significant correlation (β =.239, p <.002) between final MBA GPA and undergraduate business prerequisite course completion. Thus,H1 was supported. However, a post hoc analysis revealed that those MBA students who had not com-pleted the eight undergraduate prerequisite courses produced a mean MBA GPA over one-tenth of a point higher than the MBA students who had completed the eight undergraduate prerequisite courses. That is, the completion of the prereq-uisites did not guarantee success in the MBA program any different than that of students who had not completed the undergraduate prerequisites.

Hypothesis 2a

H2a asserted that student performance in undergraduate al-gebra would be positively correlated with final MBA GPA (76.1% of the students had taken undergraduate algebra). Al-though the relational direction was found to be positive, as expected, this prediction was not statistically supported (β= .189,p<.085). This was surprising because of the histori-cally close link, in the literature, between quantitative ability as measured by the GMAT and MBA success.

Hypothesis 2b

H2basserted that student performance in undergraduate writ-ten composition was positively correlated with final MBA GPA. In most cases, students in our sample had taken two written composition classes (95.8% of the students had taken written composition 1 and 2 while 4.2% had taken only writ-ten composition 1). For this analysis, the grades for those

TABLE 1

Summary of Regression Results

Hypothesis

Dependent

adjusted Independent variable β p

Adj.

MBA=Master of Business Administration; GPA=grade point average; AACSB=Association to Advance Collegiate Schools of Business; Adj.=

adjusted.

students who took both courses were averaged, and the re-sulting mean grade was used as the independent variable. Students who had taken only one written composition course were deleted from the sample. Regression analysis, as shown in Table 1, indicated a significant correlation (β =.324,p

<.000) between final MBA GPA and undergraduate written composition grade.

Hypothesis 3

To testH3, regression analysis was employed for those stu-dents who completed all eight of the typical business under-graduate prerequisites (as indicated forH1, this was 51.3% of the sample). In those cases in which students had taken a series of two courses in a given area (for example, principles of accounting I and II), the mean grade of the two courses was determined and was used for our analysis. Our results for marketing (β=.202,p<.044), economics (β=.335,p

<.001), and business Statistics (β =.346,p <.000) were all significant predictors of MBA GPA. Accounting, man-agement, and finance were not significantly related to MBA GPA.

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Hypothesis 4

Regression analysis, as shown in Table 1, indicated a signifi-cant correlation (β=.466,p<.000) between undergraduate GPA and MBA GPA. Interestingly, this relationship produced the strongest statistical correlation, with a beta of .466 across all variables tested in the present study.

Hypothesis 5

To test the final hypothesis, the sample of MBA graduates was divided into two subsamples; those who graduated with undergraduate degrees from an AACSB-accredited business school (52.5% of the MBA graduates) and those who did not (47.5% of the MBA graduates). The prediction of a pos-itive correlation between MBA GPA and graduation from an AACSB-accredited undergraduate program was not sup-ported by our analysis (β=.027,p<.556).

SUMMARY AND CONCLUSIONS

The purpose of the present study was to analyze the influence of several variables on the predictability of student success in MBA programs. Over the years, a host of researchers have contributed a great deal of valuable information and direc-tion with regard to what drives the predicdirec-tion of success for graduate students as they enter MBA programs. We docu-mented many of those studies in the literature review. In this study, we developed five hypotheses to test the effectiveness of certain variables and relationships that we think contribute to the literature surrounding this interesting issue.

We set forth the hypothesis that a significant relationship exists between final MBA GPA and the completion of the eight undergraduate business prerequisite courses in mar-keting, management, accounting, economics, statistics, and finance. We found completion of those courses at the under-graduate level does predict MBA success. However, we also found the rather surprising result that students who did not complete those undergraduate courses performed at the same level or slightly higher in MBA programs than those who did. Further research into the academic backgrounds of the stu-dents who did not complete the usual business prerequisites is needed to shed more light on this issue.

We researched the relationship between students with un-dergraduate algebra and the subsequent performance of those students in the MBA program. We found there was only a rather weak link between undergraduate algebra completion and MBA success. As noted previously, this was a surpris-ing result because of the relationship documented in prior literature showing a close link between quantitative ability measured by the GMAT and MBA success.

We studied the relationship between undergraduate writ-ten composition courses and final MBA GPA. We found a strong positive relationship between written composition

performance and subsequent final MBA GPA. This result is not surprising because most MBA programs have rigorous written paper analysis components.

In addition, we analyzed the relationship between final MBA GPA and the completion of some typical undergradu-ate MBA prerequisites. Interestingly, marketing, economics, and business statistics were significant predictors of MBA GPA success whereas accounting, management, and finance were not. We also analyzed the success in MBA programs of those students who graduated from AACSB-accredited un-dergraduate programs against those who did not and found no significant results.

The most significant relationship we found was between undergraduate GPA and MBA GPA. Those students who were strong performers at the undergraduate level continued to be, on average, strong performers at the graduate level.

Our findings suggest that the requirement for students to take prerequisite courses should be reviewed. The MBA pre-requisite courses may function as an unnecessary deterrent to students who would otherwise succeed in MBA studies. In addition, future researchers should emphasize factors affect-ing students’ motivation and desire to excel. Areas of study could include each student’s life-long study habits, degree of competitiveness, and time available for MBA study given the constraints of professional work schedules and personal commitments.

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ACADEMIC PERFORMANCE IN MBA PROGRAMS 47

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