Determinants of Internship Conversion Among Management Graduates: Evidence from India.
| Author | Chiramel, Carol |
Background
Internship as an integral and foremost means of transfer of knowledge between academia and practice has somehow been overlooked by researchers in the past (Narayanan and Olk, 2010). Post-graduate management student internships in India is not just a mandatory course requirement or avenue to gain practical knowledge in a specific domain, but a key means of career exploration or in other words securing a pre-placement offer (PPO). Baron & Kreps (1999) defines internships as temporary work arrangements that employers use to train and select future employees. For organizations, internships are an important means by which they attract and identify talented future employees. This high level of orientation towards suitable employment emerges as a win-win situation for both interns and employers. Lately, the emphasis on internships by employers in India can largely be attributed to their ability on the one hand to provide host organizations with the opportunity to evaluate potential job applicants in actual workplace settings prior to formal employment, while on the other it also allows interns to evaluate their fit with potential employers and vocations prior to making a long-term career commitment. Companies, hiring summer interns from business schools, are increasingly giving pre-placement offers (PPOs) to students of top B-schools based on their performance during summer internships. If this trend continues, the short 30-40 minutes' interview during final placement, the traditional method of campus recruitment, may soon take a back seat and become the second most-preferred way for hiring future managers India. Current estimates suggest that one in every three business schools undergrads is going to be hired through PPOs (Basu, 2018).
Moreover, the student is keen to secure a PPO early to relieve oneself of the stress of finding suitable job opportunities a year later or improve their bargaining power with respect to recruiters when they complete their program.
Context
In Indian business schools, internship is a mandatory 8-9 weeks' industry stint stipulated in the curriculum of the two-year MBA Program. There is no restriction concerning the nature or field of internship. Students are expected to submit a report to the business school on returning describing the nature and objectives of the internship. The placement committee of the school coordinates the interview processes for the various companies looking to hire summer interns in a single week and has historically been successful in placing all applicants. Students may even choose to find internship employment opportunities on their own off campus, but seldom choose to. The internship commences post completion of the first year of the course. Since a student may not have prior knowledge of the sector or specific domain, the internship can also act as a check to see if the job is a fit with one's personal attributes and work style. However, in practice, there are only a few students who either rejected a pre-placement offer or chose not to actively work towards it after having joined the internship and not liked the nature of work.
Generally, the recruiting firms hires a large pool of interns, out of whom they will be looking to hire anything from 10% to 100% of all interns. The variation depends on the nature of the domain, job openings, business performance and attrition. Consulting, for instance, has a history of a very high intern to PPO conversion rate.
The main deliverable of the internship is generally a specific project, whose work expectations are set by a supervisor. Some roles in consulting and finance however, require the candidate to do the work of a regular employee, under the guidance of their Supervisor and not create any specific report.
Interns are given mentors with whom they are encouraged to share their difficulties and experiences. These mentors are generally more experienced executives in the middle to senior level of designation in the firm. The project is very structured with fixed timely deliverables and a final presentation to a panel of evaluators. The final presentation is typically presented to a panel of CXO level officials in the firm. The final presentation, team review, mentor inputs and supervisor reviews are combined to arrive at a decision to recommend for PPO or PPI (Pre-Placement Interview). In the case of some consulting firms, this process may be skipped altogether. The supervisor and team will be asked for feedback and internal consensus reached as to a decision to give a PPO or not. There will be no 'evaluation round'. The candidate will only be intimated of the final decision.
Though generally structured, internship programs may or may not be well monitored. If the process of review and evaluation is set aside, not all organizations actively assess the quality of interaction between the organization and the intern. The most well-planned programs required 360-degree feedback to check if the interns were suitably engaged with their mentors/ supervisors.
Past Research on Internship
Diverse theoretical framework has been used in earlier research to understand and explain internship. Literature concerning socialization, job design, recruitment and selection and training has been used to understand various dimensions of internship. Recruitment literature suggests that internship saves an intern from the entry shock and help them to develop realistic expectation from the job resulting in reduced disappointment. The socialization literature (Feldman, 1976; 1988) indicates the interns to develop better understanding about the congruence between their skill level and the requirement of the j ob. The selection literature (Dipboye, 1982; Schmitt & Coyle, 1976; Fisher, Ilgen & Hoyer, 1979) directs the intern to have better understanding about the career path in the organization in comparison to a short interview. The job design literature (Hackman & Oldham, 1980; Taylor, 1988; Weitz, Sujan & Sujan, 1986) shows that interns who are intrinsically motivated by the work itself tend to be more positive when making longer term decisions about whether to pursue careers in that field or jobs in the organization.
MBA internships are a valuable, economical way of managing talent in organizations. This unique 'try before you buy' approach to employment means that internships are becoming a workplace context of increasing relevance to organizational and vocational researchers alike (Gomboa, Paixao & Jesus, 2013; Zhao & Liden, 2011, Coco, 2000). Despite the prevalence, little research exists on MBA internships in general and India in particular. Instead, the sparse internship literature focuses on undergraduates (Gruman, Saks & Zweig, 2006; Taylor, 1988). In fact, with the exception of a recently emerging stream of literature (Hurst, Good & Gardner, 2012; Zhao & Liden, 2011), the research on internship has been dominated by studies conducted from the intern's perspective, focused largely on learning outcomes (Hynie, Jensen, Johnny, Wedlock & Phipps, 2011; Mihail, 2006), or widely on the career benefits of internship participation for interns in general terms (Cheung & Arnold, 2010; Linn, Ferguson & Egart, 2004).
Value of Internship
There is a good value proposition of internship for organizations and interns. Whereas, an intern ends up earning opportunity to get the feel of working in the company, getting to know the fit with the firm and developing marketable skills (such as, communication, time-management, self- confidence, and self-motivation) the company gets to evaluate intern's capabilities and fit before considering for full time employment.
Knouse et al. (1999) reported that business students who completed an internship obtained jobs more readily than students who did not. Besides, the work experience gained through internship programs provides a plausible way to soften the reality shock of making the transition from the world of academics to the world of work (Garavan & Murphy, 2001; Collin & Tynja'la", 2003).
Converting good interns into full-time employees upon completion of the internship-program is becoming the preferred path to permanent employment for many interns and employers (NACE, 2009; Stevens-Huffman, 2006). Increasing internship conversion rates is beneficial to the employer for a number of reasons, such as a significant amount of money saved in both hiring and training costs (Pianko, 1996); interns are a partially trained workforce that can contribute to the organization immediately (Dixon et al., 2005); and interns typically experience higher levels of job satisfaction than non-interns (Gault et al., 2000). Given that interns represent a viable pool of potential new hires (Sessions, 2006), and internship conversion rates remain low (Gardner et al., 2008), understanding the specific variables/factors that contribute to increased conversion rates would be beneficial to internship offering companies and academicians.
Supervisory Support
The supervisor's role is crucial to the intern for several reasons: first, supervisors control the degree of structure, ambiguity, and conflict in the work itself, second, supervisors provide informal and formal feedback to employees regarding their performance and work behavior, and lastly, supervisors control rewards and possible job security that may benefit employees (Krackhardt et al., 1981). These job experience factors are important for interns as they familiarize themselves with a new organizational environment and culture (Van Maanen, 1975). New hires experience many ambiguities regarding their job-duties, their co-workers, and their supervisors.
Babin and Boles (1996) in their study found that increased perceptions of supervisory support reduced employee...
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