New study confirms that testing business students for practical intelligence is an effective predictor of future academic and real-world success.

ANN ARBOR---New research conducted among M.B.A. students at the University of Michigan Business School by renowned psychologist Robert Sternberg and collaborator Jennifer Hedlund provides further evidence that tests that assess students' practical abilities can be as valuable as standardized intelligence testing, like the Graduate Management Admissions Test (GMAT).

"The types of problems found on standardized intelligence or aptitude tests are quite different from the types of problems found in the real world," says Sternberg, a professor at Yale University and author of "Successful Intelligence." "Individuals who perform well on academic problems do not necessarily perform well on poorly defined practical problems. Thus, individuals who are successful by GMAT standards may not be successful by business standards."

In a study with two classes of incoming M.B.A. students at the U-M Business School in 1999 and 2000, Sternberg and Hedlund of Central Connecticut State University found that measures of managerial potential that assess practical abilities predict success in both academic and practical endeavors.

The researchers' framework for developing a better predictor of success was based on Sternberg's theory of successful intelligence, which proposes that success is an interactive function of analytic, creative and practical abilities.

Case-based short-answer problems and situational judgment problems, in which answers are rated for quality rather than classified right or wrong as in standardized testing, were used in the study to measure successful intelligence (SI).

Sternberg and Hedlund found that the higher the scores on these two measures, the better the first-year and final grade point averages, and the higher the grade on an applied team-consulting project---a cornerstone of Michigan's M.B.A. first-year curriculum. They further found that students with higher SI scores participated in more academic clubs and held more leadership positions.

GMAT scores also were found to predict grade point average in the M.B.A. program, but they did not necessarily predict grades on the applied project. Likewise, GMAT scores were unrelated to scores on the SI measures administered in the study.

"The SI scores accounted for unique variance in both academic and practical performance beyond that accounted for by GMAT scores and undergraduate GPA," Sternberg says. "Although the amount of variance accounted for by the SI scores is modest, the results are quite promising given the preliminary nature of the measure. The findings do suggest that both formats---case studies and situational judgment problems---are measuring unique abilities that are not tapped by existing methods."

While the study shows that practical intelligence testing predicts successful performance and evaluates abilities distinct from those measured by the GMAT, it also found that this type of assessment displays less gender and racial disparity than do standardized tests.

According to Sternberg and Hedlund, women scored significantly higher than men in both SI formats, while men scored significantly higher on the GMAT. African Americans scored only slightly lower on the practical intelligence measures, but substantially lower than whites on the GMAT.

"Our results confirm the findings that the GMAT disadvantages females and African Americans," Sternberg says. "Although the SI measures exhibit some disparities of their own, the results suggest that they do not exhibit the same pattern or degree of disparity found for the GMAT."

In all, the researchers say that their results, so far, are promising and that they plan further research and development on their new measures.

Jeanne M. Wilt, assistant dean for admissions and career development at the U-M Business School, is excited about the possibilities offered by the use of SI measures.

"We are always looking for better ways to identify and develop leadership talent," she says. "This type of assessment not only has potential use as a complement to the GMAT in admissions decisions for M.B.A. programs, but it also can be used as a tool for teaching students practical problem-solving skills that can help them become more effective business leaders."

---University of Michigan

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