Axes of diversity

Companies and educational institutions, especially those that have a global footprint and a reputation to protect, make a big deal about diversity policies. It is almost impossible to sit through a recruitment or admissions talk by one such entity without a mention to their diversity policies, which they are proud of.

And they have good reasons to have a diverse workforce. It has been shown, for example, that diversity leads to better decision-making and overall better performance. Having a diverse workforce brings together people with different backgrounds, and since backgrounds influence opinion, a more diverse team is more likely to have more diversity of opinion which results in better decision making. And so forth.

The problem, however, is that it is not easy to simultaneously achieve diversity on all possible axes. Let’s say that we have defined a number of axes, and are looking to recruit an incoming MBA class. If we want diversity on each of these axes, selection of each candidate is going to rule out a large number of other candidates and we will need a really large pool to choose from. In other words, it is akin to the eight queens problem (where you have to place eight queens on a chessboard such that no two of them are on the same row, column or diagonal). For those of you not familiar with chess, think of it like a Sudoku puzzle.

Since the pool of candidates large enough to achieve diversity on all axes is simply not feasible, firms and schools choose to prioritise certain axes over others, and seek to achieve diversity in these chosen axes. And since they can arbitrarily choose axes that they can prioritise, the incentive is to pick out those axes where diversity is most visible.

And so when you go to a global organisation or school that preaches diversity, you will notice that they indeed have a very diverse workforce/student body in terms of gender, race, and nationality, which are fairly visible dimensions. Beyond this, the choice of dimensions to impose diversity on is a matter of discretion. So you have organisations which seek diversity in sexual orientation. Others seek diversity in age profile. Yet others in educational backgrounds. And so forth.

The result of prioritising more “visible” dimensions to ensure diversity is that organisations end up becoming horribly similar in the “sacrificed dimensions”. Check out this excerpt from Peter Thiel’s Zero to One, for example, on the founding members of paypal:

The early PayPal team worked well together because we were all the same kind of nerd. We all loved science fiction: Cryptonomicon was required reading, and we preferred the capitalist Star Wars to the communist Star Trek

Now, remember that this was a fairly diverse team when it came to ethnicity, nationality and sexuality. But in a less visible dimension, the team was not diverse at all. And Thiel mentions it in his book as if it’s a good thing that they all thought so similarly.

On a similar note, I once worked for an organisation that made great shakes of its diversity policy, and the organisation was pretty diverse in terms pretty much every visible axis of diversity. And the seminars (some compulsory) they organised helped me significantly broaden my outlook on issues such as race or sexual orientation. But when it came to work, the (fairly large) team was horribly similar. Quoting from an earlier blogpost (a bit ranty, I admit):

First, a large number of guys building models come from similar backgrounds, so they think similarly. Because so many people think similarly, the rest train themselves to think similarly (or else get nudged out, by whatever means). So you have massive organizations full of massively talented brilliant minds which all think similarly! Who is to ask the uncomfortable questions?

So essentially because you had a large organisation of people from basically similar educational backgrounds (masters and PhDs in similar subjects), their way of thinking became dominant, and others were forced to conform, leading to groupthink, which might have potentially led to mishaps (but didn’t, at least not in my time).

And what of the Ivy League schools that again pride themselves on (visible forms of) diversity? Here is an excerpt from William Deresiewicz’s excellent 2008 essay:

Elite schools pride themselves on their diversity, but that diversity is almost entirely a matter of ethnicity and race. With respect to class, these schools are largely—indeed increasingly—homogeneous. Visit any elite campus in our great nation and you can thrill to the heartwarming spectacle of the children of white businesspeople and professionals studying and playing alongside the children of black, Asian, and Latino businesspeople and professionals. At the same time, because these schools tend to cultivate liberal attitudes, they leave their students in the paradoxical position of wanting to advocate on behalf of the working class while being unable to hold a simple conversation with anyone in it.

So the next time you want to make your organisation diverse, think of which axes you want diversity on. If you are public-minded and want to brag about your diversity, the obvious way to go would be to be diverse on visible axes, but that leaves other issues. On the other hand you could put together a team of people that look the same but think different!

It’s entirely up to you!

 

Deresiewicz, Pinker and the IIT JEE

A few months back, William Deresiewicz, formerly of Yale, wrote a long piece advising people why they should not send their kids to Ivy League schools. He talked about students in Ivy League schools becoming single dimensioned, hyper-competitive, and less appreciative of the finer things in life. He spoke of the Ivy League system being broken, and not close to what it used to be once upon a time.

Now, Steven Pinker (he of the Stuff of Thought and Language Instinct fame) of Harvard has responded, and he has the opposite problem with Ivy League students. Halfway though the semester, the class is half-empty, he cribs, with students more involved in extra curricular activities rather than attending class. This implies that all the effort the university puts in building world-class libraries and laboratories and other facilities go waste. Pinker’s diagnosis is different – he blames the “well roundedness” criteria that universities use for admissions (supposedly initially put in place to restrict the number of jewish students, and then kept in place to restrict the number of asians).

I’m about halfway through Pinker’s article, and I remember reading Deresiewicz’s article in full, and my reaction to both is the same – “IIT JEE rocks”. By having a standardised exam to admit students, the IITs actually take pressure off high school students rather than imposing more pressure – since the criteria for admission are clear – that one examination, a student of class 11 or 12 has her objectives clear in front of her in case she wants to go to IIT – single-minded mugging of Maths, Physics and Chemistry.

With a more “well-rounded” criterion – say one that includes social service and extra curricular activities and sport and all such, the objective function is not that clear, and the student needs to slog towards an uncertain objective function, which is significantly inferior to slogging towards a known objective function.

Some of the cribs that Pinker puts in his post is true of IITs as well – I’ve had several professors lecture to me about the lack of seriousness on the part of IIT students, and how they would prefer students who might be less brilliant but more serious about their learning (an oft touted solution to this was to jack up the fees and make students dependent on education loans they had to repay. Not sure if the IITs have implemented this, but the IIMs have, for sure).

But then IIT Madras, where I studied for four years, and where everyone had come in after passing a rigorous standardised test, had no shortage of characters. While everyone who was in had necessarily shown single-minded devotion to mugging maths physics and chemistry in the preceding year or two, a large number of students there had interests that went much beyond those three scientific subjects. In that sense, if the Ivy League schools want to see a system where standardised admissions process actually lead to a fairly diverse class, they need not look beyond the IITs (a system they are no doubt familiar with since the IITs contribute generously to the grad student population of the Ivy League schools).

One of the frequent criticisms of the IIT JEE is that it can easily be gamed – rather than selecting the “brightest” students or those that have the best understanding of maths, physics and chemistry, the IITs end up selecting students who are best prepared for the standardised exam. An oft-touted solution to this is to make the entry process more “holistic” (in India that means including board exam marks (??!!) ), to make it less game-able. However, evidence from the Deresiewicz and Pinker pieces suggests that even the “holistic” admissions process that the Ivy League schools follow are easily gamed, and that the gaming of those systems is in fact biased towards kids with rich parents.

A while back I was looking at the admissions process of some Ivy League schools – both undergrad and MBA programs. Now, all these schools tout diversity as one of their drawing criteria. But if you look a little deeper, you will notice that this purported diversity is only skin-deep (literally!). While these schools might do a fantastic job of getting students from different nationalities, skin colour, undergraduate backgrounds and work experience, the way their essays are structured implies that the students they get are largely similar in thought – students should have done some social work, they should have exhibited a particular kind of leadership, they should be politically correct, and so forth.

The reason I mention this is that “holistic” admissions criteria need not actually produce a student body that is necessarily more diverse than that produced by a standardised test – it all depends upon the axis that you look along!

PS: I happened to have a good day on 7th May 2000, when I wrote the IIT JEE and did rather well, so this post might be biased by that. I don’t know if I would have taken such a charitable view towards standardised tests if I hadn’t done so well in them.

College Admissions

Why does the government require colleges in India to have “objective criteria” for admissions? I understand that such criteria are necessary for government-owned or run or aided colleges where there’s scope for rent seeking. But why is it that “private” colleges are also forced to adopt “objective criteria” such as board exam marks or entrance test scores for admission?

Abroad, and here, too for MBA admissions, admission is more “subjective”. While of course this has the scope to introduce bias, and is a fairly random process (though I’d argue that the JEE is also a fairly random process), won’t it reduce pressure on the overall student population, and bring in more diversity into colleges?

As a natural experiment I want to see a few state governments deregulating the admissions process for private colleges, making it possible for the colleges to choose their students based on whatever criterion. So what would happen? Of course, some seats would be “reserved” for those with big moneybags. Some more would be reserved for people who are well connected with the college management. But would it be rational for the college boards to “reserve” all the seats this way?

Maybe some colleges would take a short-term view and try to thus “cash out”. The cleverer ones will realize that they need to build up a reputation. So while some seats will be thus “reserved”, others will be used to attract what the college thinks are “good students”. Some might define “good students” to be those that got high marks in board exams. Others might pick students based on how far they can throw a cricket ball. The colleges have a wide variety of ways in which to make a name, and they’ll pick students accordingly.

The problem with such a measure is that there is a transient cost. A few batches of students might get screwed, since they wouldn’t have figured out the reputations of colleges (or maybe not – assuming colleges don’t change drastically from the way they are right now). But in a few years’ time, reputations of various sorts would have been built. Colleges would have figured out various business models. The willingness to pay of the collective population would ensure that reasonably priced “seats” are available.

And remember that I mentioned that a few states should implement this, with the others sticking to the current system of regulating admissions and fees and all such. In due course of time it’ll be known what works better. Rather, it’ll be known what the students prefer.

It’s crazy that colleges now require students to get “cent per cent” in their board exams as a prerequisite to admission. It’s crazy that hundreds of thousands of students all over India, every year, spend two years of their prime youth just preparing to get into a good college (nowadays the madness is spreading. A cousin-in-law is in 9th standard, and he’s already joined JEE coaching). On reflection, it’s crazy that I wasted all of my 12th standard simply mugging, for an exam that would admit me to a college that I knew little about. Madness, sheer madness.

Medical Insurance Subsidy

Exactly a year back my mother was in hospital. She was there for three weeks before she died. The bill for the three weeks came to close to four hundred thousand rupees. She was covered under my corporate medical insurance so I passed on the cost to the insurer, who paid most of it. I didn’t really complain, the insurer was obliged to pay, and the hospital was more than happy to receive the fee.

The hospital follows an interesting business model. On one hand it dons the garb of a corporate hospital while on the other it is a charitable hospital. A large section of the patients are treated at extremely low cost, or even for free. The rest of the patients have insurance coverage. Those that have coverage are fleeced, and this money effectively cross-subsidizes the treatment of the poor. All works out well for the hospital. Except..

Do you realize that when you (or, in most cases, your employer) pay your premium for medical insurance you’re not insuring just yourself? That because of hospitals like I just mentioned, your insurance is also effectively paying for the treatment of a larger population? That the cost of treating some random patient in the hospital you were admitted to is paid for by you, as part of your medical insurance premium?

Changing tracks, I think the best thing about India’s healthcare industry is the diversity. You have government hospitals. There are university hospitals. There are large corporate hospitals you wouldn’t think of stepping into unless you had insurance. There are charitable hospitals which treat you for next to no cost. There are the neighbourhood nursing homes which essentially cater to the uninsured middle class. Reasonable facilities but not too expensive. And so forth.

There is no formal system of medical insurance in the country. There is no single large government system. If the current state of healthcare in the country is one of not having evolved much, I really wouldn’t mind it remaining this way. I hope we never get into the kind of equilibria that the US and the UK have gotten themselves into, which appear efficient but which ultimately prove expensive for people.

It is the diversity in the system that keeps the healthcare industry here competitive, and keeps costs low. And of course, you pay for other people too when you pay your medical insurance premium.