Saturday, January 17, 2015

MBA Doubts

Earlier this week a co-worker asked me if I had plans to do an MBA.  I replied with 

"No, I have looked into it and decided not to go"

Had he asked me when I had been working 1-2 years worth I would have said yes and not give much thought other than how to get in an MBA program, irrelevant of cost.

The longer I've worked though, I start thinking less of how to get in and more of whether an MBA does have a real impact in people's careers, especially since it is a lot of money now to get one.  

I now conclude that having an MBA doesn't have much impact in careers other than hardcore finance -- and those jobs require a lot of sacrifice away from family and personal pursuits.  If you value your time to what you get paid, the "high salary" may be the equivalent of an entry level job working 40-45 hours a week.  

If nothing else, prospective MBA students need to know that if they are not careful, an MBA can turn out to be a big and very expensive mistake and close a lot of doors rather than open doors. 

How can an MBA possibly close doors and be an expensive mistake????

Hear me out and let me explain so that you can make an informed decision before devoting all your spare time to GMAT, taking out student loans, and depart from the path of Finding the Job You Love.   


It is easier to find a new job when you are still working.  If people tell you otherwise they are lying.  This is because real world experience holds more weight instead of isolation from the market for two years.   

If going back to school is solely because you hate your current job, and think an MBA will facilitate your career switch or make the magical leap to a manager job that pays well, the first step is to 


If it's not the right fit, keep looking for the job you want, take the Clifton StrengthsFinder to find work that meshes with your strengths, and trust me in due time, you will find the job that works for you.   The only way to find that is by focusing your time in working at different places in different roles picking out things you like and discovering things you may be good at.  

People forget that sometimes, it's really about taking a job that is not your ideal job but it puts you in the door for the one you want in that company or a better company.  

If you have the scarce skills that an employer needs, they will hire you over the top MBA that doesn't have the skills.  In fact, if your skills and potential are just that amazing, other employers will come out in an attempt to poach you with a compensation package to make you dance with the consideration of leaving the company you are already happy working at!! 

If you come from a non-business background in an attempt of doing a "career-switch" you are going to have a harder time finding a business/finance job post-grad than the rest of your peers that came to MBA programs with finance experience - always.   So really think long and hard if you are an artist and want to take out student loans for an MBA. 

Prospective MBAs need to add the two years of lost pay, benefits and work experience to the overall program cost.  That will be how much you will pay upfront, and you can't guarantee what an employer will offer you post graduation after 2 years...a lot can happen between then.  The only thing that is guaranteed after graduation is paying off your student loans.

In addition, prospective MBAs need to be wary that the salary reports posted by business schools are SELF REPORTED.  Meaning that if you graduated and didn't get a job or working in a job that pays less, you are just not going to tell the Career Office how much you are really making.  So the averages are truly lower.

Salaries will increase anyway by staying in the workforce.  Prospective MBAs need to know that if they stay working AND change industries/companies with similar job functions, you can expect higher salary increases enough for you to contemplate making the switch.  Usually it's about 25%-35% more than previous pay.  Internal promotions are around 10%-15%

With the rise of part-time, executive and online MBA programs, full-time MBAs are competing with more MBA students than before upon graduating for the same number of jobs along with competing with non-MBAers with the 5-7 years of work experience. 

MBA holders need to go in their interviews realizing that if their hiring managers do not have MBAs, or even undergrad degrees, those managers will not or cannot differentiate the "value" between these MBAs.  The only thing that they can see and relate to is relevant work experience, the skills, and aptitude to do the job.  Heck some job applications don't even ask what type of MBA you got!  

Depending on the employer, and responsibilities of the job, an MBA may be viewed as "over-qualified" or "high-risk" and therefore not requested for interviews.  It may be difficult even getting an entry-level job after not working two years! 

The MBA does not and will not teach you how to be a manager or leader or give licensure to be one.  The MBA teaches business functions and that's it.  Many people go into MBA thinking they want to be a manager simply because it seems better and pays better.  

Managing others and leadership are things have to be experienced, tried and earned over time in a job that requires managing others.  It's more of a craft/art than a science.  

Some people are not cut out personality-wise or want the responsibility of being a manager.  Meaning, if your team member you supervise does something wrong, it is your fault not theirs - it was your responsibility to develop them.  Most MBA students come in as analysts (non-managerial experience) and come out as analysts, because that's all they're learning in an MBA.  This can also explain why some of the best managers or leaders never went to school: they simply learned by experience.  Seriously my favorite managers never finished college and both of them did cheerleading.  Imagine that.

Companies with good management practices in place don't hand off manager duties to an external candidate who hasn't experienced the nuances and personalities of the team members they need to manage. The last thing a good company wants is an inexperienced manager and have their employees quit because of that manager.

There are lots of manager jobs out there but the majority are reserved for internal applicants because only they can see them and only internal candidates that have proven their leadership can apply.  If you are really good, you are approached with "an opportunity" - no need to apply.  

Not having loans gives people more options to switch jobs or take a break, all leading to you the job that is right for you considering all factors and not just one that will pay the bills.  

The critics are right, the MBA has no correlation to senior management positions I saw at the companies I worked in.  (university healthcare, health insurance, and now banking)

My opinion is to first get used to working first for as long as you've been in college plus the two years you would have committed to an MBA.   Waiting a bit longer gives you enough time to mature, witness some good work experience, as well as the bad, and most importantly think more objectively if the cost of the MBA program plus the 2 years of lost work experience and wages is really what you want to do.  Life choices should be taken into consideration but the problem is that most people in their 20s and fresh out of college do not have enough perspective to consider this and thus do not do the proper due diligence in getting an MBA. 

If you still want to get an MBA, you need to talk to alumni 2-3 years out of the programs you're interested in.  That group will provide the most objective and relatively current opinion about their MBA experience.  Ask them what they did before grad school, how they felt about the program, whether it oversold and under delivered, and what jobs they are doing now.  You may be surprised as was myself discovering this, that many grads are not necessarily happier or better situated now than they were before the MBA.  

There.  I just saved you two years of your life, a decade of student loan payments, and free up your evenings and weekends studying for the GMAT.  

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