5 Myths Surrounding HR Careers


Contrary to popular belief, business school isn’t all about financial modeling — there are many lucrative career paths for those focusing on the so-called “softer” side of business. For many leading global businesses the acquisition and retention of top talent has become as imperative as developing new blockbuster products or expanding into previously untapped markets. As a result, the traditional corporate HR function — once relegated to the supervision of various executives — increasingly plays a vital strategic role that’s fully enmeshed in the C-Suite.

Read McNamara, Executive Director of Owen’s Career Management Center, and Ranga Ramanujam, Associate Professor of Management in Human and Organizational Performance, dispel five myths for MBA candidates considering specializing in human capital management — an area in which the Financial Times ranks Vanderbilt #4 among U.S. business schools and #7 globally.

Myth 1: Isn’t compensation for Human and Organizational Performance (HOP) MBAs from top programs significantly less that that of other functions? No.

That may have been true before, but it’s not anymore. In 2012, the average starting salary for HOP students was $90,000 — not to mention a 100% job placement rate. That compares to an all-class average of $92,000, which includes graduates who went into highly lucrative fields like finance and consulting.

If you look at the trend of the past seven years, salaries for HOP students are on a sustainable path north. By comparison, the trend for all-class median and average salaries has been more jagged. And this past year, only finance internships had a higher average salary, and that was due to several unexpected investment bank offers. If not for those, HOP internship pay would have come in higher.

The fact is that demand for top HOP management talent is outstripping supply. Because of this, the Career Management Center staff is seeing more room for negotiation in HOP careers, particularly when it comes to things like work flexibility and travel commitments. By the time the class of 2014 graduates, it is likely that starting salaries and bonuses for HOP jobs will be at parity with the rest of the class. That was unthinkable 10-15 years ago, but the trend lines are clearly headed in that direction.

Myth 2: Aren’t MBA entry-level positions in HOP narrowly focused corporate staff functions? No.

A decade ago, there was one common template for HR executives in the corporate hierarchy: They tended to be at the senior vice president level, not executive vice president. This was the only career path HR executives had.

Today, forget it. In terms of mobility, HR talent coming from top MBA programs like Vanderbilt are much more likely to be embedded in a strategic business unit, getting graduates much closer to senior management — people in operating roles with P&L responsibility — at a relatively early stage in their careers. And if that’s not the case in a company, if a business is still operating under an outdated corporate structure, consider that a red flag. Several recent studies suggest that in companies where the HR function continues to report through a vice president, or even a Chief Operating Officer, those businesses tend to perform worse in terms of share price and profitability.

As for human capital consulting, that space is white hot. Any consultancy that doesn’t have a practice will have one soon. And the ones that do are rapidly expanding. It’s an absolute necessity for consulting firms today.

Myth 3: Isn’t the HOP career path narrow and has finite limits? No.

Here’s an interesting statistic: Thirteen CEOs of current Fortune 100 companies have some HR work in their backgrounds. That reflects the importance HR and human capital management has taken on in corporate America. As the field grows, you will see more people in senior operational roles coming from HR. Career-wise, that’s a very favorable trend.

Myth 4: Isn’t Demand for HR/HOP concentrators  moderate? No.

Every time the Career Management Center helps place an HOP candidate in a job, the employer says they wish they could hire two students instead of just one. The statistics certainly back up the sentiment: Last year, those specializing in HOP received 2.3 job offers, on average. In fact, we have talked about the feasibility of trying to double the number of incoming MBA students concentrating in HOP — because we can certainly accommodate them with job offers. Our office will be getting desperate calls from employers looking for job candidates all the way up to graduation because we have a very attractive program. That happens far more in HOP than in any other discipline.

Myth 5: Isn’t there little exposure to senior management in the HR function?

Here’s a little bit of anecdotal evidence: The only person that has accompanied the CEO of a global Fortune 50 household-goods conglomerate on every single market review trip in the last three years has been the director of global talent supply. (Market review trips are when the boss fires up the company’s Gulfstream jet and makes on-site inspections at sites throughout the world.) Similarly, an iconic U.S. office products maker recently hired a well-known consulting firms on a $20 million engagement tasked with overhauling the corporate culture. At least five of the members on the consulting team had graduated with their MBA less than two years ago, and all of them had specialized in HOP. The point is that more and more, people working in HOP are not only exposed to senior management, they’re a major part of the team.

Comments & Responses

2 Responses so far.

  1. Rob Polston says:

    I could not agree more with the content of this article. I graduated from OGSM in 2003 and have worked in various Finance roles for Intel until 2012, when I was transitioned into kicking off Intel’s military veteran hiring initiative in the HR staffing organization. I have to admit that my role as an HR staffing program manager is dynamic, fun, challenging and I have plenty of exposure to senior management, including the CEO. I wish I had taken more HOP courses in my time at Owen. My kudos to any student that chooses to pursue a career in HR.

  2. Great atricle. I agree with Rob, HR is one of many great avenues to gain exposure to executive management. While I cannot say it is the best avenue, it certainly should not be discounted as lesser path to senior management.

    Linwood Smith
    President
    eagleemployerservices.com

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