GMAT scores over CAT in testing times; Flexible format popular

The number of Indians appearing for the Graduate Management Admission Test (GMAT) hit an all time high in the year 2013, a year when applicants for the Common Admission Test (CAT) have dipped to a seven-year low. Together, the two numbers capture the story of the changing management education landscape in India at a time when the economy is slowing down appreciably.

The CAT is the main entry point for freshers or those with only a couple of years experience looking for a two-year, full-time MBA. GMAT on the other hand opens doors to global B-Schools, but has more recently been the preferred test for shorter executive MBA programs that experienced professionals tend to opt for.

In all, 22,878 candidates took the test from India in 2013 compared with 22,310 a year ago. More significantly, the number has increased by 25% since 2010. On the other hand, CAT applicants have declined four percent since 2010.

CAT’s declining popularity and GMAT’s growing appeal suggest that seasoned executives are keen to re-skill in the midst of this slowdown, but the lure of the full-time MBA is fading. “GMAT takers have an average work experience of seven years. It is catering to an entirely different pool of applicants,” says Prof. Sankarshan Basu, Chairperson of Career Development Services at Indian Institute of Management-Bangalore (IIM-B).

The number of Indian institutions accepting GMAT scores has also increased. About 235 management programmes in India accepted GMAT scores in 2013, up from only 37 in 2010.

GMAT’s Flexible Format Popular
“About 6-7 years ago, if you had not done an MBA early on, chances of you getting into management education after having had substantial work experience in India were non-existent. Now, a lot of Indian institutions offer diploma level one-year management programmes for executives and take GMAT scores into account. That has also altered the equation to a great extent,” Prof. Basu adds.

However, total GMAT applicants from all over the world declined this year, the first such drop in three years. “2013 has been the strongest year ever for GMAT volume in India, backed by robust demand among candidates who aspire for management education at leading business schools and rising acceptance of the test’s scores worldwide and in India,” says Ashish Bhardwaj, Vice-President, Asia Pacific at Graduate Management Admission Council (GMAC), which conducts the GMAT. 

“At the same time, there is a slowdown in global GMAT volume in 2013 as 2012 was an exceptional year,” he adds. Another reason for the drop in global GMAT applicants is the introduction of a new section on integrated reasoning in the test pattern. This, however, may give Indians an edge. “This is about integrating information across different areas and is a skill that is particularly useful for consulting jobs. Indians are normally good at integrated reasoning,” says Atish Chattopadhyay, Deputy Director, PGDM programme, SP Jain Institute of Management & Research (SPJIMR).

Also GMAT’s growing popularity over CAT could be attributed to its flexible format. “The flexibility it offers in terms of the number of times in a year the test can be taken and longer validity makes it popular,” says Chattopadhyay. “Continued economic uncertainty in the global economy, the length and severity of the recent recession and fitful nature of the recovery has also had an impact among testing groups that are more sensitive to economic uncertainty,” Bhardwaj said.

India currently has the third-largest number of GMAT takers after US and China. China had 48,327 in 2012 versus 46,136 in 2011.

Source: The Economic Times, January 10, 2014

GMAT takers dip by 17% in 2013

The number of people who took the GMAT (Graduate Management Admission Test) in the 12 months ending last June fell by 48,000, or 17%, from the year before, according to new data. That steep drop may sound like more air hissing out of the MBA bubble, at least to those who subscribe to the theory that business schools are over-swelled. For those who have been paying attention, the drop in test takers was apparent from a long way off. It has little to do with demand for MBAs in the job market.

The Graduate Management Admission Council (GMAC), which publishes the GMAT, introduced a revamped version of the test in June 2012, adding a section on Integrated Reasoning. The new test—not the job market—is responsible for the lower numbers, wrote GMAC spokeswoman Tracey Briggs in an email: “Traditionally, there is an increase in testing volume before you change a standardised test as test takers opt for the familiar over the unfamiliar at transition time.”

Data from other graduate exams appear to bear her out. About 18% fewer candidates took the GRE (Graduate Record Examination) in the year after a revised test was introduced in August 2011. The number of test takers for the GED dropped even more precipitously when a new test was introduced in 2002. Some other nuggets from the GMAC data: Test takers in the US were especially apt to take a pass on the new test, with 22% fewer taking the exam last year. Women made up 42.5% of test takers, down slightly from the previous year. The average score for all test takers was 546.

Source: The Economic Times, January 7, 2014

IIMs might lower GMAT bar for foreign students

To improve their global quotient and attract more foreign students, the Indian Institutes of Management (IIMs) are planning to lower the graduate management admission test (GMAT)’s cut-off score for the flagship two-year management programme (PGP) and the one-year full-time MBA. IIM directors said the GMAT cut-off used by IIMs, at over 700, was too high for candidates to even qualify for interviews.

“As the institute builds its global reputation, it will have to take steps to internationalise the students admitted to its academic programmes,” said Samir Barua, former Director, IIM-Ahmedabad. “This may require the institute to lower its cut-off in GMAT for admission, particularly for the PGP. Since potential applicants with such high GMAT scores easily get admission to the best schools in the world, practically no candidates apply to the PGP of the institute.”

IIM-A uses a cut-off of 760 or so, which Barua said was high. The GMAT scores of the selected candidates of the past batches have been 695 to 728. GMAT is administered by the Graduate Management Admission Council (GMAC), a US-based organisation.

IIMs said lowering the cut-off significantly enhance chances of getting more foreign students. “Citizenship diversity is a major component for world ranking of management education institutes. Currently, we are marked almost zero for it,” said an IIM-A faculty member on condition of anonymity. “By bringing down the GMAT cut-off, we could attract more foreign students and enhance citizenship diversity. Out of a batch of 400-odd students, a good 20-25 foreign students would make such a difference and also increase our chances of getting ranked higher as a global B-school.”

IIM-A is the only management school in India ranked among the top-100 schools globally by The Economist. The institute is also the only management school in India that has all the three post-graduate programmes ranking high globally. Its two-year post-graduate programme in management is ranked seventh and the post-graduate programme for executives (PGPX) is ranked 11th among comparable programmes globally by the Financial Times.

Devi Singh, Director of IIM-Lucknow, too, said the GMAT cut-offs at IIMs were too high. “Every IIM is thinking of bringing down the cut-off for GMAT scores. In addition to this, IIMs need to create an eco-system to attract more foreign students at our campuses. More foreign students increase chances of higher ranking among global B-schools.”

There is no cut-off score for GMAT at the Indian School of Business (ISB), Hyderabad, which introduced the one-year management programmes in India. 

Source: Business Standard, June 23, 2013

GMAT Council plans to attract more aspirants

The Graduate Management Admission Council (GMAC), which conducts the Graduate Management Admission Test (GMAT), wants to increase its base of test takers in India by attracting undergraduate students to appear for the examination. Traditionally, GMAT, a standardised test to help business schools select qualified applicants, has been popular with candidates with more than four years of work experience, and undergraduates have largely kept away from taking GMAT.

“Undergraduates typically do not write the GMAT in large numbers. If they write the exam, they do so for banking the score—which is valid for five years. We are trying to inform them they can go for a masters programme right after graduation. We are trying to broaden the perspective of the audience, and thus working with undergraduates,” said Ashish Bhardwaj, Regional Director, South Asia, GMAC.

Bhardwaj says over the last decade, most of the top business schools internationally have launched masters programme in various streams, including management, accounting, financial accounting, telecom management, health care, hospitality, etc. This one year masters programme prepares one for a functional job.

“This particular set up of offering enjoys a very limited awareness in India. Therefore, we think we can make more information flow to candidates and inform their choices by telling them that they can straight away go for a masters programme after graduation,” says Bhardwaj.

GMAC has so far worked with around 16 undergraduate colleges, and the council says the response has been good. Another focus area for the council, says Bhardwaj, is to get more women candidates to take GMAT. In India, only 26 per cent GMAT takers are women, whereas in China, it is 58 per cent. GMAC wishes to take the number of Indian woman test takers to around 40 per cent in the next five years.

“We think women are very important. We are struggling to find out how to get more women in India to take GMAT. We are looking at ways on how to reach out to women. One way is to go to women only undergraduate college,” says Bhardwaj.

With nearly 80 per cent of Indians preferring an MBA education, an important test taker group for GMAC are candidates from the non-traditional undergraduate background, like lawyers, doctors, ex-defence officers, etc. The council says it is looking at ways to create more diversity in a class. “Not just business schools, but recruiters too want more diversity,” says Bhardwaj.

After the US and China, India is the third biggest market for GMAT. The council says it sees the most dramatic growth for itself in the Asian region. “Asia is clearly going to be a growth area for us in the near future. Given the demographic dividend in the region and the growth of management education, we see the growth continuing for us,” added Bhardwaj.

GMAT exam volume for the 2012 testing year (July 1, 2011, to June 30, 2012), was up 11 per cent from the previous year. This was also eight per cent higher than the previous record of 265,613 in 2009.

Chinese test takers, the second-largest citizenship group after the US, represented 20 per cent of global testing. In 2012, the number of exams taken by Chinese citizens increased 45 per cent to 58,196 exams. Indian citizens, the third-largest citizenship group, took 30,213 GMAT exams, a figure that increased 19 per cent in 2012.

GMAC’s India office looks at the SAARC (South Asian Association for Regional Cooperation) market. Within this area, India alone is 96 per cent of the market. “So, it’s needless to say our time will go in developing the India market,” says Bhardwaj. Around 175 programmes in India accept GMAT. The Council is focusing only on top 200 business schools in India.

With an investment of over $4 million in the India market so far, the Council is also looking at opening a few more new test centres in the country.

Source: Business Standard, October 4, 2012

After 18 years, GMAT test format set to see a change

With the introduction of a new section called “integrated reasoning”, the format of the Graduate Management Admission Test (GMAT) is about to change. The new section will replace one essay in the analytical writing assessment section of the paper with a set of 12 questions. Till now, students were required to write two essays.

After a survey identified the need for data skills, GMAT will include the new section from June 5. “While the verbal and quantitative sections will not undergo any change, one question from the Analysis Writing Assessment section will be dropped,” said Ashish Bhardwaj, a spokesperson for the Graduate Management Admission Council (GMAC) — the body which conducts the GMAT exam.

The performance on the integrated reasoning section will not affect the total score. “This 12-question section will be scored separately on a scale of one to eight,” the spokesperson said. A worldwide survey of 740 business schools conducted by GMAC in 2009 had “highlighted the need for processing, analysing and interpreting” different types of information. “The current GMAT format has been in effect since 1994 and we believe in constant evolution,” Bhardwaj said. He said the section reflects the “new realities” of today’s business world and the way we use multiple sources of data to make sound business decisions.

The section will include four new question formats — graphic interpretation, table analysis, multiple-source reasoning and two-part analysis. The section has been designed to measure the ability to convert data from various sources and formats into relevant information to solve problems. “The survey had identified emerging data analysis skills needed to succeed in the classroom and the professional world. These were not tested in the GMAT,” said the GMAC spokesperson.

Ashutosh Singh, a candidate who recently appeared for the exam said, “The essay was graded on the basis of quality and now points will replace grades. The new changes are unlikely to make any difference to the marking of GMAT.” Kuber Sharma, who scored 780 in GMAT last year, said the scrapping of the essay was a good thing as it delayed results. “Everything else is multiple choice but an essay has to be read and graded, which takes time,” he said. He said the essays were redundant as there were 30 expected topics that most people learnt by rote before the exam.

Source: The Indian Express, June 1, 2012

Indian B-schools draw aspiring managers from Asia

Indian management schools have drawn more overseas students last year than five years ago. Many Asian MBA aspirants, particularly from central and south Asia, showed interest in studying in India rather than the US. According to the recently published 2012 World Geographic Trend Report for Graduate Management Admission Test (GMAT) examinees, India remains Asia’s leading destination for GMAT scores. Its business schools received 17,638 score reports in 2011 against 11,484 in 2007.

MBA aspirants take the globally accepted GMAT for getting admission to B-schools of their choice. The GMAT scores become easy yardstick for selection of students for institutes that use the scores. The report shows that Asian citizens sent an average of 3.4 GMAT scores per exam taken in 2011, significantly higher than the global average of 2.9. However, there were substantial regional differences in score-sending habits. For example, Indian citizens sent the highest average number (4.4), and South Koreans sent the lowest (2.0).

Overall, Asian citizens sent 69 per cent of their scores to management programmes in the US in 2011, compared with 74 per cent in 2007. The top 10 study destinations other than the US that received more than 10,000 score reports from Asian citizens included India, the UK, Singapore, and Canada. “Much of this shift is explained by increased interest among regional (Asian) examinees to study in India, the UK and Singapore,” said the authors of the report.

The report illustrates the globalisation of management education and the quality options within Asia and around the world. Programmes in Asia saw a 63 per cent increase in the number of GMAT scores received from test takers in testing year 2011 (42,933) when compared with 2007 (26,296). “The significance of the Asian impact on management education is real,” said Mr Dave Wilson, President and Chief Executive of the US-based Graduate Management Admission Council (GMAC), the non-profit owner of GMAT.

Source: The Hindu Business Line, April 18, 2012

Visa curbs reducing GMAT applicants

Half of Indians, who appeared for GMAT in 2011, were in the 25-30 age group, up from 45% in 2007. The Asian Geographical Trend Report for GMAT examinees, however, did not see any alarm in the Indian numbers, saying, “Although lower than the TY (test year) 2009 peak, GMAT testing in India has now stabilized and showed new signs of growth during the second half of 2011.”

Indian analysts saw the trend in the context of reasonsranging from a slowing economy to a greater choice of exams. A high 64% of Chinese applicants last year were women in contrast to India, where females constituted only 25% of the examinees. Analysing the drop in Indian applicants, IIM-Ahmedabad Director Prof. S K Barua suggested several factors like visa restrictions imposed by the US and even a backlash against students being targeted in Australia in recent years.

Prof. Barua also attributed the trend to caution arising from a slowing economy in India. “The Indian economy has not being doing well which would make people wary of taking a break from a reasonably good job to appear for GMAT,” he said. AICTE Chairman Dr. S S Mantha said students now had the option of a choice of exams including CAT, CMAT and MAT which could be a reason for flagging appeal. “Several states take CMAT scores so only students who are clearly opting for a college overseas sit for the test,” he added.

Source: The Times of India, April 15, 2012

GMAT loses popularity in India, jumps high in China

The holy grail of management students – the Graduate Management Admission Test (GMAT) – has slipped in popularity in India with 25,394 students sitting for the exam in 2011, while China saw a sharp jump with 40,069 candidates in the same year.

Seen for long as the ticket to a US college, a career and a green card, GMAT seems to have lost some of its appeal in India, where 30,633 applicants took the test in 2009. While the numbers are dropping in India, management hopefuls surged in China recording a 200% jump from 13,048 in 2007.

In 2007, India was ahead with 21,481 applicants. The numbers went up marginally over the next two years and have been sliding since then. This, when more applicants in the 25-30 age group are opting for the exam, according to the Asian Geographical Trend Report for GMAT examinees, collated and analysed by the Graduate Management Admission Council (GMAC) that conducts the test.

The percentage of those younger than 25 among Chinese applicants rose from 48% in 2007 to 77% in 2011. For India, that figure was 34% last year, down from 36% in 2007.

Source: The Times of India, April 15, 2012

GMAC looks to diversify, may enter soft skills

Graduate Management Admission Council (GMAC), the body that administers the Graduate Management Admission Test (GMAT) for entry into thousands of business schools globally, sees India as a phenomenal market, where it can double its presence in another five years. David A. Wilson, President and CEO of GMAC, spoke in an interview on the changing format of GMAT, rising number of women MBA aspirants and India strategy. Edited excerpts:

What changes are you making to GMAT from June?
What we have done is, we have taken out one of the two essays in the analytical writing and removed it because we found not much information is coming out of that. There was high correlation with first essay. By talking to 740 faculties in last three or four years around the world, we have learnt that the way business is being transacted has changed. The way schools are teaching young people has changed. They would like if we could augment GMAT not only with quantitative and verbal, but also introduce integrated reasoning. It will be a new section, it will be a 30 minutes section…it will be a replacement of analytical writing assessment. You get a separate score for the integrated reasoning section.

Businesses have always emphasized on reasoning, but a global business education test like GMAT took decades to incorporate it…
If you think about reasoning, we had critical reasoning skills in GMAT for a long time. What we have seen in recent years is some schools have changed. GMAT is an exam by business schools for business schools. Schools have changed their curriculum where there is not only critical reasoning, but also integrated reasoning. What business schools are trying to do is create a microcosm of what the graduates are going to face when they go to the real world. So what we are trying to do with the exam is help schools get a better assessment of how well their students will be able to cope with the microcosm of the real world. B-schools think their classroom is the microcosm of the real world. We got this by talking to the faculty, by talking to the recruiters and employers on what skills are going to be critical. Employers support that completely.

We have seen that an increasing number of women are now opting for an MBA. This trend is visible in India, but in China, Indonesia, Thailand and Taiwan, women outnumber men. How do you read this trend?
If you look at China in particular, then you will see a dramatic increase, a lot of young people taking GMAT. What they are opting for is one-year specialized degrees, more pre-experience (courses). You look at those one-year degrees that give you a specific focus on finance management, accounting, energy, healthcare, public policy. What you are seeing is that a number of people, especially young women, opt for such programmes that allow them to write (GMAT) from the undergraduate schools. Management education is still dominated by engineers in India and more women are not seen in engineering too, and in China it’s not like that. So local trends play out.

While European and American students are going for specialized MBAs, in India there seems to be an increasing demand for a generalized MBA.
If you look at MBA students typically, you can put them in two buckets. One who want to change their career. They will come in with a solid background in let’s say accounting, finance, public policy, they want to change their career. They will go for typically a full-time MBA programme, at the end of which they will see lot of recruiters coming to campus. The others who want a career enhancement, build their skills and stay where they are. You can find those in part-time programmes, specialized programmes. Why are you seeing this—because it depends on the economy.

Your study has shown India’s demand for an American business education degree is dropping (from 67% Indian GMAT scores sent to US schools in 2007 to 55% in 2011). Comment.
(Look at the) growth of high-quality programmes across the world. Now you can go to South America, Africa, you can go to Middle East, Europe. Other part is that business network is far more global now than ever. Young people like to immerse in other cultures and are adventurous. Oh yes, quality of Indian business schools is improving. But faculty is a critical thing here and everywhere.

In 2011, 77% of Chinese students who took GMAT were below 25 years of age, but in India the number is only 34%.
In China, we have seen dramatic growth in under 25-year-old aspirants, and females. They are the majority, applying for the pre-experience masters programmes. GMAT score is applicable for five years, so a lot of young people are realizing that the best time to take the GMAT is when they are in the last year of undergraduate programme. They are used to exams, have time to study, etc. You can see in American schools a lot of young Chinese applying for those specialized courses in accounting and finance management. It has not caught up in India. Not enough Indians are aware that they can go for many specialized MBAs without any experience. It is in recent times that you see such surge in China.

In 2007, about 21,500 Indians took GMAT whereas in 2011 the number was a little over 25,000. That’s a small growth if you look at the size of the country and demand for quality higher education?
If you map that, you will see that it peaked in 2009 and came down. We see the softening in the volume immediately with devaluation of the Indian rupee in 2009. When you look at 2012, it will be dramatically higher.

What’s your India strategy now?
I look at India in a generational way… I want to look at 2020, 2030. It’s a stable democracy, very strong ethic in respect to education, entrepreneurial, it’s dramatically growing. India will need more and more managers. Look at Indian companies, the Tatas, Infosys (Ltd), they are exciting companies. The growth potential here is phenomenal…the absolute scale is here; the commitment to education is here, the demand for managers and leaders is here. In five years, we will double India presence.

What next for GMAC?
When I began in 1995, GMAC was not global, it’s now. We have now embraced more technology, and we did not have then (as is now) strategic alliance partnerships. Those principles still apply, but what I think is — what we are going to be offering to the business school community except a very strong test, what else we can do — one of the things we can think of is the whole question of soft skills, non-cognitive skills. That whole arena is fascinating because what B-schools will be requiring in future and are we measuring that? The challenge for going forward is new assessments, new instruments to add greater value to enterprises and to the public sector. We are good at assessment, we have great channel…we need to work on the content side. We also need to expand our global reach.

So you could diversify into soft skills?
We are looking at all kinds of things.

Source: Mint, April 14, 2012

B-School Applicants Getting Younger, Pickier Over Time

The number of test takers taking the Graduate Management Admission Test (GMAT) today are younger than their counterparts five years ago, and are increasingly turning their sights to graduate masters programs in management and finance, over the traditional MBA, according to a report released today by the Graduate Management Admission Council (GMAC), the group that administers the GMAT exam.

“The GMAT pipeline as it relates to prospective MBA students is almost entirely different today than it used to be,” said Alex Chisholm, GMAT’s senior manager of statistical analysis.” While it might be one exam, I think it is increasingly reflecting two distinct pipelines in management education today, both the MBA programs and specialized masters programs.”

As the global management education landscape has shifted over the last five years, so has the profile of those taking the GMAT exam, the standardized test used by graduate business programs. Over the last five years, the number of GMAT exams taken has grown by 18 percent, with 263,979 examinees taking the test in 2011. The vast majority of growth occurred outside of the U.S., according to GMAC’s 2011 World Geographic Trend Report for GMAT Examinees.

The primary study destination for the majority of examinees remains the U.S. but the overall proportion of people sending GMAT reports to U.S. schools is declining. Only 77 percent of score reports sent last year were directed towards U.S. schools, down from 83 percent four years ago, GMAC said. That shift has been more pronounced in some regions of the world, like Central and South Asia, where last year only 55 percent of those who took the GMAT sent their scores to U.S. schools, down from 67 percent five years ago.

“We’ve seen a lot of schools around the world start to use the GMAT in the admissions process, so they now have more options closer to home and are exercising that ability to send scores locally,” Chisholm said.

All of the regions surveyed in the report had more test takers in 2011 than in 2007, with the exception of the U.S., where the number of people taking the GMAT “now sits near the pre-recessionary levels” of five years ago, GMAC said. In the last five years, Europe has edged ahead of Canada as the second leading destination for GMAT scores after the U.S., while Hong Kong jumped from ninth to seventh place over the same period.

Last year, non-U.S. citizens took the majority, or 55 percent, of GMAT exams, which GMAC said is the “highest proportion on record”. The first year this group made up the majority of examinees was in 2009, and that number has continued its climb upwards since then. Said Chisholm: “It is a pretty big shift.”

Much of the growth in GMAT test volume is being driven by examinees from East and Southeast Asia, especially China, which represents 70 percent of testing volume in the region, Chisholm said. In East and Southeast Asia, just 40 percent of test takers sent their scores to an MBA program in 2011, down from 64 percent five years ago, the “lowest level of any world region” in the report, GMAC said. At the same time, the proportion of examinees younger than 25 soared during that same period, jumping from 32 percent to 61 percent.

Many of these test takers are young women under the age of 25 flocking overseas to accounting and finance programs, hoping to get an edge in Asia’s burgeoning job market, Chisholm said. This demographic age shift may not be quite as pronounced in other parts of the world, but it is evident across the board. The proportion of exams worldwide taken by men and women younger than 25 has increased from 37 percent to 44 percent over the last five years, according to the report.

Another important but subtle change is the number of women taking the exam, which was 41.4 percent in 2011, the highest number ever, the report said. Chisholm said he expects this number will continue to inch upwards, especially as more women seek out specialized masters degree programs in the coming years.

Source: The Economic Times, February 21, 2012