The MBA Conundrum

A colleague on my MBA programme here at the BI in Oslo questioned me somewhat aggressively the other week: “You seem very relaxed about the process of studying. Is this something you really want to do?”

Over the last few years, there has been a lot of scepticism surrounding the true value of MBAs once inside an organisation. As the first term of my MBA programme comes to a close, and I begin to look forward to a week absent of work and full of long Mediterranean dinners and hot evenings, I can’t help reflect as I sit in class now on the validity of all the scepticism. First of all, I am sympathetic to the cynics. For a long time I was a cynic myself of the validity of MBAs – after all, they are usually twenty-somethings like myself who think they know all the answers based on what has to be a fairly limited amount of real, practical experience.

From my experience on this MBA programme here at the BI in Oslo, the scepticism is not unjustified but it is misplaced.

When I chose to study an MBA, it was predominantly for the intellectual process of reasoning and studying that I wanted to do it. Unlike some, for me graduating in the top ten of the class is not an all-consuming goal – it is rather the acquisition of knowledge and the opportunity to be back in one of my favourite places, the classroom, again that are the pivotal reasons I am studying for this degree. It seems I am part of a minority, however. I may be fortunate in not finding the task of getting high grades overly demanding and actually enjoying the process of studying, but putting it diplomatically, there are certainly a number of less than congenial individuals on the programme who are clearly studying an MBA for one sole purpose: because they can’t rise any higher in their careers without one. The problem with these individuals is that studying an MBA is not what they need: what they need is a lesson in how to get on with people. Most of the types I am speaking about ironically have quite outstanding qualifications already; it is certainly not for lack of academic kudos that they have encountered a limit to how far they can rise within their respective organisations.

The problem is in the classification of “MBA’s” as a general categorical statement. It is immediately evident on this programme at least that those who are going to climb the ladder in an organisational context would do so anyway, without an MBA. All the programme does is to sharpen the intellectual process so that those who have been “winging” subjects like accounting for the past four years, like myself, can now talk about it with a sense of meaning. On the other hand, an MBA won’t teach those who have a personality disorder how to acquire a personality. Ironically, it is these students who are the most “grade” focused, and who therefore immediately, at least, come across as the most ambitious: because they have found themselves in the unenviable position of having to be. However, once these individuals assume management positions, they quickly find themselves at square one.

Management is more of an intuitive process than an intellectual one. The problem with studying an MBA for the students who are doing it with the sole purpose of advancing their careers in mind is that, while being somewhat more intuitive perhaps than most degrees, it is still predominantly an intellectual pursuit. MBA’s are great degrees, they are just being used for the wrong purpose.

Comments

[Superanders]

I could not agree more!
I do howerver feel that there are some aspects that you dont cover. Like how some of the grade chasers are actully free-riders in the groups. When they claim superiority in fields where they continiously show no insights what so ever...

[Heiko Schulz]

What? Doesn't an MBA guarantee superior skills in management?

The thing is that no study will guarantee the building of competence. - I have been taught by professors in educational research totally lacking in pedagogical skills! In terms of business education, I guess a valid critical question is: "what would you have to pay to be taught by a really successful business leader?" - Donald Trump charges $1,5 mill per hour...

The answer is obvious: If you could afford it, you wouldn't need it! The irony then follows for MBA students, and is in my mind an illustration of the modern society's misfit of educational practice. Formal education is focused on the transfer of theories and mental models about real life situations in which the educator by standard is not regularly involved.

The Scandinavean countries are, however, increasingly concerned with putting and reading tags on people. Like you rightfully point out, having the MBA tag on your CV tells absolutely nothing about your ability to lead a process or a team. Considering at least the group study style of the MBA program at BI, Norwegian School of Management, the MBA tag might just as well tell you something about your ability to 'freeload' and take undue credit.

There's a limited amount of jobs that you can get merely by showing your tag, however, and if you can, it probably wouldn't be the most interesting work place...

-I guess the main conclusion is that you need to master the entire game to accomplish anything, and should check your references both in hiring and being hired. Meanwhile, those of us who do need a boost of formal qualifications have to be patient and go with the flow...

[Fredd]

"It is immediately evident on this programme at least that those who are going to climb the ladder in an organisational context would do so anyway, without an MBA. All the programme does is to sharpen the intellectual process so that those who have been “winging” subjects like accounting for the past four years, like myself, can now talk about it with a sense of meaning."

Daniel, I have been struggling with this very decision myself. Do I or do I not pursue an MBA....but the passage above simple though it may be, really strikes a chord. But there's also the question of whether the extra codified learning is worth the expense. What would you say?

[Carsten]

Indeed a very well written article. Daniel, you seem to have the intellectual capability to investigate problems thoroughly. Therefore I cannot understand the view you present here at all.

I would like to pose the same question to you that a class mate seemed to ask you the other week: “Is this something you really want to do?”
The decision to go for an MBA program was something I also evaluated very carefully because it takes a big intellectual and financial commitment. You stated your view of MBA participants as follows: “they are usually twenty-somethings like myself who think they know all the answers based on what has to be a fairly limited amount of real, practical experience”.
I prefer to look as MBA participants as mostly mature and self-reflected persons that at one time in their career understood that they might possess a very valuable toolbox acquired through their first university degree and their practical work experience. But those individuals may eventually find out that they have a toolbox stacked with high quality tools but these do not fit the job anymore.
So what do you do then? A logical think would be to gather some cash, hop into the car and travel to the next home depot. There you can hope that you find new tools that actually are suited for the job you want to do. Coming out of the store you may have a toolbox that is twice as big as your previous one and you will most likely have a financial problem. Well, we better not focus on that one…

So does the MBA make sense?
I hope so. At the moment I feel I pick up some very good quality tools here and there. The big advantage I see for myself is that as an engineer, I am shopping in a department that I have not been in before. Therefore it is very unlikely that I pick up any tools twice. Here I may see a problem for people that take an MBA but have actually covered most of the subjects of the course in university before.
In the end though it is you and your personality that determines how well you are able to apply your tools and how far they will take you.

You state that you study because: “When I chose to study an MBA, it was predominantly for the intellectual process of reasoning and studying that I wanted to do it.”
That is a very honourable cause.
No offence meant, but why don’t you participate in a philosophy class at university then?
I am really enjoying being back in a classroom and I like the intellectual challenges this implies. But taking into account the high costs of taking an MBA I foremost look at it as an investment into my future and career. It is possible to attend a very challenging course at university at a fraction of the costs involved for an MBA program.
To me the MBA is a very non-diversified, high-risk investment where I invest money that I usually would not put into this class of equity. So this investment better perform. And guess what, I invest in myself. Therefore I expect myself to perform reasonably well and show commitment. But since your grades in any MBA class are also very dependent on your team mates don’t you think this may put the question your colleague asked you into a new perspective?
To clarify this, I do not think that grades are of high importance for an MBA degree. Rather you learn for yourself and you should take with you as much knowledge as possible in this short period of time. But to stigmatize the people that get good grades (either as performers or freeriders) like you do in your article sounds to me very “twenty-something “.

Another advantage the MBA offers is the possibility to build relations or to “network”, how it is called these days. That is probably just as important as the course itself. You wrote your article before the first term is over, which translates to ca. 1/4th of the program and in it you write:” what they need is a lesson in how to get on with people”. Do you follow your own agenda with this article or are you falling into the same trap?

OK, this has gotten longer than I intended it to be, so just one final question:
You write very elegantly: “Management is more of an intuitive process than an intellectual one.”
Did you try both approaches? Is this your own experience? How does that fit with your previous claim: “after all, they are usually twenty-somethings like myself who think they know all the answers based on what has to be a fairly limited amount of real, practical experience”.

Daniel, good luck with your MBA and good luck with your blog.

I understand your article as being published honouring the very wise words of J M Keynes you cite in the heading. My answer is composed keeping the same spirit in mind.

[Daniel M. Harrison]

Some fascinating comments and undoubted feelings stirred. So let me try and come back at the two excellent comments by Carsten and Heiko, and out of this hopefully the answers will surface to what you are asking, Fredd.

Whether any of us on an MBA course/intending to take an MBA wants to admit it or not, there’s a load of scepticism out there in the organizational sphere about the value of these degrees in creating quality ‘managers’. Why is there all this scepticism: common sense tell me that it’s because some organizations have found that in the past they have paid large sums of money for human capital of less than substantial quality (i.e. people who have not been able to do the job well) because of the fact that they come from a good business school with an MBA. In trying to asses the cause for these experiences, I am saying: look at a guy whose got some great grades from school, a good degree and who has entered an organization for maybe five to ten years. He’s smart but … he isn’t likeable. In other words, he’s the sort of guy you would happily use as a ‘knowledge resource’ within an organization but who you wouldn’t necessarily want to go for a beer to debrief a project with after work. Because of this, he finds he can only climb so high within the organization. This is the type of guy, on average, who sadly thinks what he needs is an MBA because what he lacks is ‘management’ knowledge. And yet he’s had half a decade of experience already …

What is ironic is that this guy comes out of business school, once again, armed with another great degree, and appears at ‘interview stage’ to be just the type of guy who Microsoft/Morgan Stanley/Google need at middle management level. Except once inside the organization, he is of course, the same person he was before the MBA, and so he finds he back to square one (while the organization is at square -100K that could have been spent on promoting the talented sales girl with just a high school diploma who gets on with everyone and seems to have all the clients’ birthdays, weddings and anniversaries taped in some miasmic internal database).

Being a good manager isn’t about knowing the intellectual process of management, and in my experience, this is not what an MBA teaches or should teach … because it’s an intuitive process. It’s about understanding an industry and taking advantage of the right opportunities at the right time. A great lawyer doesn’t need an MBA to run a legal practice, after all.

I’m not lambasting those who want to score high grades and perform academically at all, but I do wonder what the motivation is. For example: is it better if I learn 80% of the stuff taught and get a ‘C’ average or if I do everything and anything to get an ‘A’ and learn only 20% of what’s being taught? Ask an employer and they’ll say ‘Option 1’, as would almost anyone, but in practice they will always hire the second candidate first. (In this sense it is actually the systematic and bureaucratic interviewing method of organizations that is at fault, but that’s another topic). To ask why I’m not taking a philosophy night course, Carsten, is meaningless. The answer is, naturally … because I’m fascinated by the intellectual study of business practice.

Studying an MBA is not the same as studying a degree in Medicine. The person who is going to be great in an organization, as I said, is going to be great regardless of the paper verifying his ability. The vast majority of managers do not have an MBA: every medical doctor has to have a Medicine degree. And that’s where I would say – study an MBA because it’s an interesting, soul-enriching, exciting, intellectual process. Otherwise, if you’re out to earn a killing in business, there are much easier (not to mention cheaper) ways of pursuing that goal, as most entrepreneurs will tell you.