Business and academia pointing fingers: who’s responsible for graduates’ readiness?

There is a very strange dance going on between colleges and business, where employers rely quite heavily on a college degree as a basic requirement for hiring but believe that colleges are doing a bad job of preparing graduates for the workplace. But academic respond that they are teaching students to think, not to work.

Karin Fischer, A College Degree Sorts Job Applicants, but Employers Wish It Meant More

Sine Nomine Associates, Mr. Boyes’s firm, works with high-tech companies like Cisco and IBM. However, it’s fundamental abilities that he says recent graduates lack, like how to analyze large amounts of data or construct a cogent argument. “It’s not a matter of technical skill,” he says, “but of knowing how to think.”

Mr. Boyes, who takes on one or two new employees a year, isn’t alone in finding recent graduates weak in those areas. While fresh hires had the right technical know-how for the job, said most employers in the survey, they grumbled that colleges weren’t adequately preparing students in written and oral communication, decision-making, and analytical and research skills.

That might come as a surprise to college leaders, who frequently cast the value of a degree in those very terms. But Julian L. Alssid, of the nonprofit Workforce Strategy Center, says that although business and higher education may use the same language, it doesn’t always have the same meaning. Educators often think of such competencies “in a purely academic context,” Mr. Alssid says, while employers want “book smarts to translate to the real world.”

“It’s a matter of how to apply that knowledge,” he says.

Such a push, however, tends not to go over well with faculty members who look down on any instruction perceived as vocational.

The Boeing Company in 2008 began to rank colleges based on how well their graduates perform within the corporation; it plans to conduct the same evaluation again this year, says Richard D. Stephens, senior vice president for human resources and management.

“To expect business to bring graduates up to speed,” Richard D. Stevens, senior vice president for Boeing human resources and management, says, “that’s too much to ask.”While the results have not been made public, Boeing did share them with colleges. Some took the findings seriously, even working with the aerospace company to refine their curricula, while others dismissed them. Colleges’ responses, Mr. Stephens says, have affected where Boeing focuses its internship programs and hiring.

“To expect business to bring graduates up to speed,” he says, “that’s too much to ask.”

With many people now moving from job to job and employer to employer throughout their careers, on-the-job preparation no longer makes economic sense to a lot of companies. Mr. Boyes, the technology consultant, puts all new hires through a yearlong training program, but he’s an outlier.

“Once upon a time, ‘trainee’ used to be a common job title,” says Philip D. Gardner, director of the Collegiate Employment Research Institute at Michigan State University. “Now companies expect everyone, recent graduates included, to be ready to go on Day One.

“The mantle of preparing the work force,” he says, “has been passed to higher ed.”

Whether colleges want to accept that responsibility is another matter. While some institutions tout their career centers, internship offerings, and academic programs designed with industry input, others argue that workplace skills ought to be taught on the job. Higher education is meant to educate broadly, not train narrowly, they say: It’s business that’s asking too much.

So, who is responsible for training graduates in the skills needed in the office?

Boeing seems to think that colleges and universities are part of their supply chain, and that they should be providing cogs that will fit the corporate gearbox, without any tooling by the business at all.

Historically, however, American business spent a great deal of effort training new hires. This was partly due to the companies desires to train people to do things the ‘company way’ but also as a practical response to the inexperience of candidates. How would a new high school or college graduate have had access to the tools available on the factory floor? Or exposure to logistics at railways or ports? Or practical experience in erecting skyscrapers or bridges?

But we have moved into a different era, where much of the work being performed in business relies on the coordination of human thinking, mediated by computers, software, and the web. Yes, we still have factories, and we are building bridges, but the proportion of jobs involved in those sectors have dwindled dramatically. in 2005, a milestone was reached, according to the Federal Reserve Bank of New York, with more than 50% of jobs in the US becoming non-routine and cognitive, shifting from 40% of jobs in 1975 to around 60% today (as I discussed in Work is rapidly becoming nonroutine).

My argument is this:

  1. Historically, company training programs focused on the routinization of work: teaching trainees how to work as bank tellers, clerks, or assembly line workers. It was intended to teach manual skills, and the application of thinking done by others.
  2. Since the ’70s, company training programs have dramatically decreased, as a function of cost cutting initiatives and a growing sense that companies weren’t getting back a return on the investment made. People were changing jobs too quickly for the benefits of anything but the most basic of training to be felt.
  3. At any rate, what is needed is a completely different set of skills, cognitive and improvisational skills needed in the vastly different work context of 2013.

I’ve argued elsewhere (see Hireart is another placeform interceding in the broken labor market) that we need actor to fill the gap in America’s broken labor market. The traditional actors — business, academia, and government — are involved in a Mexican standoff, pointing their fingers at each other, and taking no responsibility for fixing the problem. Government has slid so far out of the picture that it goes unmentioned in Fischer’s article, except implicitly, as an underwriter of funding for community colleges and so forth.

Here’s a way to look at it. In a well-organized world we’d have some coordination between government, business, and academia. Imagine a recent graduate and job candidate, Bette, looking for a job applying her degree in Spanish Literature (with a minor in Chemistry).  Her factual knowledge — the principles of chemistry, American History, and Spanish — has been provided by her college, and application of that factual knowledge in the business context — making better rubber gaskets for Latin American markets, perhaps — would be the province of her hypothetical employer. However, several companies where she’s interviewed think she doesn’t have enough business experience, and that she lacks needed financial skills, like understanding cash flow and currency fluctuations. The federal, state, and local governments have no programs to school Bette — and the many other recent graduates — and she opted to work part-time during college, especially during the summers, to pay for part of her college expenses rather than taking on an unpaid internship. However, she still has over $20,000 in student debt.

The picture looks like this:

three circle


The relations here have been boiled down to the most basic economic ones, which is a vast oversimplification. While at college, Bette also built a network of friends and colleagues at the Gap, where she worked as a retail clerk. But her network does not overlap much with the working world at the sort of companies that might want to hypothetically take advantage of her skills in Spanish and chemistry. And none of the three players wants to take responsibility, after Bette has graduated, for the additional training, networking, or outreach that might be necessary for Bette to connect with a job.

A Modest Proposal

I think we have to wind this back and imagine how it might be if there was a fourth actor in the picture from the start of Bette’s time in college, one organized for the purpose of avoiding the vacuum that Bette and millions of other graduates fall into.

A placeform is a for profit enterprise that creates and mediates a marketplace using a software platform, and leveraging scale on all sides of the market in ways that the other actors may not have the capacity to do.I have been using the idea of placeforms (marketplace + platformplaceform) for the past few months, and I propose that this is the answer, and perhaps the only possible answer to this problem. A placeform is a for profit enterprise that creates and mediates a marketplace using a software platform, and leveraging scale on all sides of the market in ways that the other actors may not have the capacity to do. (In essence, they are undertaking what a more benevolent government might do, but which ours cannot, fo a complex series of political reasons.)

Let’s describe an imaginary placeform — — that was started by a group of recent college graduates with some initial seed funding (from Linkedin founders) and grants from government programs. Imagine this happened 10 years ago, 5 years before before Bette started college, and she was one of the fifth year group of college freshman to be involved in the project.

How is this scenario different for Bette?

  • While Bette might still have studied Spanish literature, her BeLabor advisor, Carla, would have set up a mentorship with a local Spanish-speaking business woman of Gautemalan background, to help Bette learn more about the local, Latino business community, and perhaps to find practical opportunities to apply her language skills. That led to a job in a local Spanish newspaper in her junior and senior years, instead of the Gap job she started with, and led her to consider adding some accounting courses.
  • BeLabor provided Bette with a great deal of information about the job market, and BeLabor’s online network (designed along the lines of Angellist and Linkedin) allowed Bette to follow recommended companies — those that matched her interests, skills, and personal values — and for those companies to follow her, as well. This connected here with dozens of contacts within those companies, some of which became initial points of contact in her job search.
  • BeLabor applied psychodynamic characterization of corporate culture and Bette’s psychological orientation to help identify ‘best fit’ recommendations for her and participating companies.
  • BeLabor worked with Bette and companies that expressed initial interest in her, and starting in her junior year, BeLabor suggested specific online courses and seminars that Bette should take, to better meet the needs of potential employers.
  • Bette scored very high in certain tests, leading BeLabor to offer her a full-time summer internship in her junior year, counseling high school students preparing for college and considering BeLabor relative to competitive placeforms.

How can BeLabor pay for this?

  1. BeLabor charges companies a 15% finder’s fee (based on first 12 months salary) for placing a candidate. This is in line with industry norms for headhunting, and is a small price for avoiding the costs of mishires.
  2. BeLabor charges the successfully placed candidates a 5% fee (at the end of the first 12 months of employment), but candidates can opt to provide counseling and advice in lieu of payment, if BeLabor agrees. Their is also an option to contribute time to charitable work in lieu of payment as well. Successfully placed candidates can also opt to continue to rely on BeLabor as an agent for a fee — like a sport’s or entertainment agent — to negotiate on Bette’s behalf for pay raises, promotions, and assignments. (I discussed this idea in Freelancers need agents like companies need head hunters.)
  3. Belabor — after its initial few years of operation — became a private student loan division. Because of its involvement with students, BeLabor was able to decrease the cost of loans for those in good standing.
  4. BeLabor works with colleges and universities, many of whom have outsourced their student placement and related services to the company, reducing expenses for the institutions while opening a very profitable business for BeLabor.
  5. BeLabor manages internship and new hire training programs on behalf of corporations who wish to outsource them, again, saving money for the company and a significant profit for BeLabor. BeLabor can leverage its skills in big data and the broad information it has on company culture and candidates psychological make-up to make better matches. It also handles the new (mythical at present, but coming soon) federal regulations on internship pay and reporting on behalf of the companies.

Well, you get the picture. Bette got a great job with Proctor & Gamble, based in Cincinnati, focused on business development in Latin America for health care products. She opted to advise youngsters in lieu of payment back to BeLabor, and fifteen years later — as a SVP at P&G — she was asked to join the board of  BeLabor, which she did.

three circle 2


[I am aware that this scenario is not very well-represented in these diagrams, a failing I will rectify in a report I am planning for August on the topic of placeforms.]