I got my MBA 8 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:
1. MBA inflation: MBA programs are not created equal, there are more than 100,000 MBAs awarded each year. A plain MBA (however you define that) is just not valuable on its own; the program’s pedigree and regional brand matter.
2. MBA is temporary: Peter Drucker said it 40 years ago, but knowledge workers should never stop learning. A MBA is perfect at a certain stage of your career, but that is temporary. Steven Covey said to “sharpen the saw”. Seth Godin said to “Learn all the Time” As trite as it sounds, it is true: What Got You Here, Will Not Get You There (affiliate link). The value of a MBA at age 45 is about as valuable as a BA/BS is at age 30. Which means, not very.
3. MBAs are not free: I would say that 1/3 of the value of a MBA is the core learning: marketing, strategy, statistics, negotiations, finance, accounting etc. . . If you look at the curriculum at top programs (e.g., UCLA, Michigan, and Yale) that is what you will find.
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.
The 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.
4 PROS of the MBA:
1. Relationships: You meet good people. Diverse people from different countries and professional careers. Lots of personalities – but all motivated learners. Although I have been out of school for 8 years, I still email and talk to people from my class monthly.
It is 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: