I got my MBA many years ago. It was a good use of my time, attention, and money. That said, there are a lot of skeptics out there, and they have good reasons.
3 Cons of the MBA
Inflation. Typically the more of something there is – all things being equal – the less value it has. There was a time when advanced degrees were rare, Masters, PhD, Law degrees. Now they are a-plenty. There are more than 100,000 MBAs awarded each year, so the relative value keeps falling.
A plain MBA (however you define that) is just not valuable by itself; the program’s pedigree and regional brand matter. Careful of broad-stroke generalizations of anything – Republicans, Democrats, Americans, or MBA.
Temporary. Anyone who’s found their way to this blog will likely agree with the statement that “you need to be a life-long learner.” There is no MBA program which will 100% equip you for everything you need for your career.
Expensive. Unless you are the rare bird who can get a full scholarship, it’s expensive. I would say that 1/3 of the value of a MBA is the core learning: marketing, strategy, statistics, negotiations, finance, accounting etc. . . As shocking as it sounds, you can find a lot of that online for free. For fun, I put together a nice curriculum for you from Coursera (one of the big MOOCs).
- Financial Accounting – Wharton, U of Penn
- Strategy – Darden, U of Virginia
- Innovation – Darden, U of Virginia
- Operations – Wharton, U of Penn
- Organizations – GSB, Stanford
- Finance – Ross, U of Michigan
- Microeconomics – Wharton, U of Penn
- Bayesian statistics – Duke University
- Law – Wesleyan University
Some will say that these courses (e.g., Princeton) are not MBA-level programs, and that many are only 5-6 weeks long. Fair criticism, but let’s remember it is free. Clearly you can get 50% of MBA-type content online. Not perfect, but if you are looking to get smart on a topic, it’s a great start. You have the opportunity. No relief for the lazy.
So why bother with a MBA?
Depending on the program and the timing in your career, it might be exactly what you needed. For many of us, our career progression looks like the first S curve in the graph. It ramps up, but then slows down. For many of us, it’s when we are 27-33 years old and its when a lot of people head back for their MBA.
MBA helps you jump the S curve in your early career
It is a step-jump to the next level of career path. You’ll note that it doesn’t do anything for your next jump. That one is up to you and has less to do with your credentials, and more with your achievements. The MBA helps get your 1st good job out of school, but not your 2nd one.
PROs of the MBA
1. Relationships: You meet smart, motivated (and hopefully generous) people. Diverse people from different countries and professional careers. Lots of personalities – but all motivated learners. Although I have been out of school for 16 years, I still email and talk to a few people from my class monthly.
It’s the relationships that last. Trust me, after being out of school – being able to calculate the WACC (weighted average cost of capital) is a lot less important that being able to call a buddy for some advice, referral or a favor.
2. Recruiting: My first consulting role was as a campus hire. If you are looking to break into management consulting, the easiest entry point is through campus recruiting. Transferring as a lateral hire into consulting is not an easy or a pretty process.
3. Redefinition: For those who are career switchers, MBA is the way to go. I saw people successfully move from the military, or education, or sales to management consulting. I came from a B2B marketing / strategic planning role and made the switch.
4. Recharging: If you are fortunate enough to spend the time and money for a 2 year full-time program, MBA life is a luxury. It’s a chance to do college right. The formula I came up with : MBA = Business Learning + Good Paying Jobs + Solid Friends. For those interested, there are many websites on MBAs, but here are the 2 best ones:
Related posts:
Thanks for this helpful article. I’m beginning to do research in the space attempting to determine if I can build my own MBA experience through two years in three major cities outside the United States. My end goal is to make a career switch (mortgage banking to Impact Investing), get out and see another part of the world, and earn my stripes on the ground floor in countries I’ll ultimately be investing in.
I believe the relationships I will build along the way will serve me well on into the future and prepare me for the ever connecting global economy.
I will be enrolling in language classes in each of the countries (India, Kenya, and Brazil).
I’m curious as to how much the credential will be relevant for me down the line. I will be working with high end investors, likely to hold MBAs, in the Impact Investing space.
Should I consider linking up with a university, offering to be a guinea pig of sorts for whatever information they stand to gain in return for some sort of credentialing. Have you ever heard of a university doing so?
Could speaking engagements and books during and upon my return hold enough strength to overcome the lack of MBA credential?
Any thoughts you have would be helpful.
Hello, I am not an expert in this field, but universities are rigid and traditional institutions. They will likely not be willing to offer a credential (e.g., a formal degree) to you or specifically 1 person, on an ad-hoc basis. They are just not that flexible.
A few follow-up questions:
– Is a MBA necessary for you to achieve your goals?
– If not, what are the specific skills, experiences you need to reach your goal?
– Would it be useful for you to do some informational interviews with people in the field you are going to?
In terms of next steps, speak with people in that field, and see what approach makes the most sense. Also, be willing to think laterally as there are typically many different routes to get to the same place.
Best regards,
Thank you for the reply. I appreciate the questions you pose and do plan on tackling them next. Whenever planning, I find myself bouncing back and forth between pushing ideas forward and jumping ahead to the end goal and working backwards. I’ve spoken with a few in the field already, but I’m sensing the need, thanks to your help, to use the next few weeks to fully engage with a wide arrange of highly regarded professionals in the field, discover what their day-to-day looks like, what skill sets are of highest value, and what suggestions they have in most quickly getting there.
I’ll keep you posted as this all develops.
Thanks again. I greatly appreciate the time and insights.
Surely. MBA is a fairly regimented way to go. Very useful for banking, management consulting, brand management, corporate finance etc. For entrepreneurship, non-linear career paths. . . not so much, in my opinion. Keep trucking on.
That is what I’m seeing as well. Thanks again. All the best with your endeavors.
I have a master’s degree in business, but I definitely want to do an MBA in some point. I think it will require employer’s supplement, and I would like to have it support my next career step. Thanks for good summary!
MBA really! The degree that has produced some of the most unethical leadership in the free world. The place you go to learn the art and science of raiding our society for self gain and network with like-minded greedy cronies. MBA degrees are what the minions without any original thought feel they need and is perpetuated by other like minded minions with one more promotion in the corporation see as a right of passage. It’s a self liking ice cream cone posing as higher education. The definition of a profession is a field that policis itself to ensures a standard of ethical and competent traininng of its practishioners. There is no such aspect to MBA holders how does an MBA dare be called a “professional degree”? Shouldn’t we expect more from our so called institutions of higher learning and the business leadership of our nation.
Wow. A lot there.
1) MBA does not teach ethics, morality, or being a contributor to society. Completely agree. A bad egg is a bad egg, whether they are an MBA or not.
2) If you believe that market economics is “raiding out society and self-gain” then most of this blog will not resonate with you. Might be the wrong blog for you.
3) I do agree that there is serious MBA inflation. . people see it as a “check the box” activity, and not that original of an endeavor.
4) Agree that for MBA to rated a “professional” degree like LAW, or ACCOUNTING, it needs higher standards, policing, and governance. Completely agree.