Is the GMAT Structure Flawed? Or Do People Just Wish it was?

The GMAT exam is a critical part of the admissions procedure for the vast majority of prospective MBA students. Such is its importance in securing a place at a top business school that it is probably not surprising that the GMAT structure falls under scrutiny from time to time, as the type of questions it asks and the answers it rewards are clearly of interest.

However, when accusations were made in a recent report that the questions favored those lacking in business ethics, concerns were raised and the Graduate Management Admission Council, GMAC (the body that governs the GMAT exam) had to publicly decry the findings as a regrettable misuse of statistics.

So, why does the GMAT structure attract this attention? Are people actively looking to find flaws because they know it will ignite controversy? And what does GMAC do to ensure that legitimate concerns over fairness, and a level playing field to all who take the GMAT, are consistently met?

A good place to start would be to emphasize just how much time many people invest in taking the exam. This alone could explain why criticism over the GMAT structure resonates greatly with all who have taken it, or plan to in the near future.     

GMAT preparation – not to be taken lightly

GMAT preparation has been likened more to a long-distance marathon than a last-minute sprint. It requires plenty of planning and a sustained period of study.

One recent student blog post suggests that the average time spent on GMAT preparation by those who achieve strong scores is around 120 hours spread over ten weeks. This is almost two hours daily – that is, if you don’t take any days off from study.

Accusations of rewarding a lack of business ethics

If you’re spending the kind of hours detailed above on GMAT preparation, you certainly don’t want to hear accusations that the exam is biased.

This recent study in the Journal of Business Ethics suggested exactly that, and in particular, that it rewards negative traits in candidates in terms of business ethics. In addition, the authors say they found that women score less on average than men and that risk-taking is not appropriately rewarded, which could be bad news for the aspiring entrepreneur.

The paper does have substance in the amount of data collected – exam papers from 25 countries from 2004 to 2010 – but, according to GMAC, where it falls down is in its handling of this data.

“I teach statistics classes, and I have examples of the misuse of statistics. This example will now go into my portfolio. It’s interesting but not actionable”, is how Lawrence Rudner, GMAC’s vice president of research and development deflected these accusations of bias in Businessweek. His argument was based around the fact that the paper confused correlation with causation in a big way.

Be that as it may, the paper’s stated raison d’être seems reasonable. With so much at stake to so many, the paper sought to rectify a relative lack of independent research on the topic and it echoes common sentiment in its reference to GMAT scores as ‘gatekeepers for business leadership’.  

Indeed, the importance leading business schools ascribe to high scores seems to be increasing and not diminishing.

Successful GMAT scores on the rise

Average GMAT scores for admittance are included in the QS Global 200 Business Schools Report. Statistics show that top US schools frequently have an average score in excess of 700 (out of 800), whereas average GMAT scores for MBA students attending one of the top European or Asian programs were a little under 700.

It is a sign that the average GMAT scores needed to secure a place at a top US business school have been creeping upwards. This is also the case at top Indian Institutes of Management – with averages sometimes in excess of 750.

Of course, this is considered alongside other essential admissions criteria and there are cases where business schools will forgo a lower test score for the right candidate. For example, although Harvard admitted average GMAT scores of 730 for its class of 2015, the lowest accepted score was 550.

However, there will always be prospective MBAs who feel a low GMAT score has scuppered their chances of admissions success. The question is whether this is fair or not.

Graduate Management Admission Council accepts scrutiny as part of the profession

It’s not as if the Graduate Management Admission Council isn’t aware of this being an ongoing concern for students across the world. It is, after all, an international non-profit organization that works hard to ensure each question has passed its ‘fairness as lack of bias’ conditions.

“We accept the scrutiny that comes with being the leader in the field. Hundreds of thousands of GMAT are sat each year, the vast majority without any aura of controversy, real or contrived”, says Jane Delbene, GMAC’s director of marketing for Europe, the Middle East and Africa.

Working against bias is one of GMAC’s ‘Four Faces of Fairness’ and involves conducting and publishing validity studies that can identify and eliminate questions which, based on statistics, might test differently across various culture groups. In this way the organization seeks to ensure that the GMAT will reward those who are high in ability regardless of gender, nationality, or native language.

“We have detailed protocols and methodology in place to ensure both the test and individual questions are valid and not biased for or against any subgroup of test takers. Each individual question is carefully screened in multiple ways before it is used on the GMAT exam”, Delbene explains.

It’s a philosophy summed up neatly by a quote attributed to GMAC’s CEO (who in turn lifted it from US detective novelist, Michael Connelly) which reads “Everybody matters, or no one matters.”

GMAT structure updated to meet business school and employer needs

With the work that all this question cross-checking must entail, is there really any suggestion that another organization could do a better job at this? It is true that unease with the GMAT has encouraged more interest in the GRE, and has led to the recent acceptance of the GRE at many schools. However, how business schools perceive the value of the GRE remains unclear and therefore could represent a risk for MBA applicants.

In most cases, the GMAT exam is the only common denominator for business school applicants that can claim to be irrespective of cultural and academic background. So, while every effort should of course be made to ensure fairness and to foster a culture of positive business ethics in the GMAT structure and the questions it poses, it is hard to see what could replace it.  Or, for that matter, what the benefits of removing a written test that has been proven by a 2007 research paper to effectively predict academic success altogether might be. 

The Graduate Management Admission Council knows the significance of its exam and relates its content directly to what business schools are looking for. “We are – and always have been – proactive in updating the exam to serve the needs of business schools”, says Delbene, before pointing out that the changing requirements of business schools are themselves the result of employers’ demand for certain skills.

Therefore yes, prospective MBAs must sacrifice a lot of their time to do their GMAT preparation justice, but if you’re truly serious about attending a leading business school, surely the potential rewards on offer make it a worthwhile venture by any stretch of the imagination.