Home » Business » Does an MBA degree make sense ?

Does an MBA degree make sense ?

Consider the following facts :

1.The biggest and best business men do not have an MBA degree Rockfeller,,Sam Walton,Warren Buffet,Ingmar Kamprag(IKEA),Richard Branson and closer home Dhirubhai Ambani,GM Rao,Kishore Biyani …..the list is just endless.The point is that while you may find a lot of mediocre managers and small business men having a degree in Business Management most of the big guys would not have bothered to spend time on such a wasteful academic pursuit.

We did a small test in the office too while most could recollect names of business men who were not MBA’s we had to really struggle to get a few names of those who were.We were also not sure whether they really did an MBA or they got an honorary degree.These names came up during the discussion.

2.Take the recent example of Indian railways.I am sure that the analysts from fancy consulting firms would have filled reports after reports weeping about what is wrong with this century old largest employer in the world.They would have wasted hours of power points suggesting every damn trick in the book quoting from all possible gurus and case studies.But what was the result ? Zero as usual.

Enter Mr Lalu Prasad Yadav and the railways is turned around in 4 qtrs ( as the management guys would say).Nothing great just plain common sense and a will to act.Now the same institutes are falling over each other to learn management from the  Bihari whom they mocked at every opportunity.How rediculous ?They are not even ashamed of the fact that it is slap on their face.

3.Till last year the most coveted job on the campus were the i banks till the greedy pigs of wall street brought the whole world’s economy on the verge of collapse parking their bums on Ferrari’s in the process.What they could have figured out was that their own brethren will be out of jobs and it will make the investment(the word feels laughable)banks  extinct from campuses for a long time to come.

4.As per a survey conducted in the US quoted in one of the popular GMAT preparation guides 70 out of the 100 top MNC’s in the US do not have MBA’s as their CEO’s,only 10 of them from ivy league.Does it ring a bell?May be you are better qualified for the Chief executive’s position if you are immune to the MBA virus.

5.Obama’s Election campaign is being touted as the most successful marketing event in the history of mankind generating $650 million against a plan of $ 150 million.Not only the Americans but the entire world got swept by the sales pitch conjoured by the Lawyer turned politician.Once again the marketing Gurus are asking their pupils to learn from Mr. Obama – How to sell a dream ?

There are a hundred and one ways that I can demonstrate the futility of this uncalled for piece de education but the best quote I have is one Mr.Kishore Biyani.He says” Business is simple,people make it look complex to retain their jobs”.It pretty much sums up the mood of my argument.

Sam Walton ,the Sultan of common sense as people remember him was never convinced about having MBA’s work for Wal Mart.He believed that they cost much and do little.And therefore Wal Mart never really hired MBA’s untill his death in 1991.In fact almost all the top management till date comprises people who have learnt the business by doing it the Wal Mart way, as they proudly call it.

So What’s the Bottom line ? (sorry for the cliche but I can’t put the MBA in me to sleep)

Any education is as good as the one who receives it.It is true for the management degree too.There is no magic mantra that they can teach and the degree at best helps build an orientation towards thinking in terms of money. The hype is a big farce and nothing justifies the huge pay packets that the fresh MBA’s demand by creating an artificial supply situation.The best management institutes are more of marketing successes than creators of thought leaders who can change the course of history as positioned by themselves.You can wear the degree when you come out of college as a trophy you won in the kindergarten sack race but the ultimate test will be the market place.Very shortly you will realize that the organizations are interested in knowing what you can do and not what you have done?There is no difference between not being able to sell and having lower inventory turns – that by which you cal a rose would smell as sweet by any other.

The last word on rankings in business magazines.This was beautifully put forward by a manager in corporate HR in one of the training sessions I attended( this MBA thing never dies you see).He asked us to consider this –  people get interviewed by magazines,magazines rate institutes,people form opinions,magazines interview people and so the cycle goes on and on without anyone pausing to have a look at the actual value added by an institution to the society.

And why this post ? Well I am shaken up by the loot that some of the so called ‘world class’ institutes in India are indulging in by telling innocent young men and women that this ticket to heaven costs a fortune.Not true.The MBA too calls for the same cost benefit analysis that any business plan needs to consider.

Going by todays numbers the ROI on my degree would be 1000 % as I did my sarkari MBA from the University of Lucknow when life was simpler.

http://www.veritasprep.com/

9 thoughts on “Does an MBA degree make sense ?

  1. What is an MBA degree today?????
    A book each of Marketing, Management and Finance plus a Projector/AV…..dats it. Every damn institute offers MBA to rake in easy moolah. The youngstars feel that dis is the Gateway to a better career for why would you have Electrical Engineers from IITs opting for Investment Banking after MBA. Were they fooling themselves or their fathers????? The idle approach should be proper use of every word learnt. Mr.Kotler is alive for us only during the two years of MBA….before dat he is non-existent and post that he is useless.Its high time I guess to streamline the MBA education and mould it into “Work and Learn or Learn and Work” structure.

  2. Very well put. I’d say: to each his own. Not everybody can be an entrepreneur or a business genius like Ambani, and hence an MBA degree may be helpful to them. However, it may not be necessary that they’ll do wonders even after that expensive piece of paper they earned in two years.
    As for the fee the institutes are charging, its ridiculous.

    • Thanks for your comment.Any education is as good as the one who takes it.Being an MBA myself I am not against the education – the hype and fee being charged is gross injustice to young people.
      To each his own is a good way to sum it up.

  3. Hi,

    Really a good observation and i fully support the arguments given by you in this whole debate. Heads up to you.
    Ravindra

    • Thanks.You are yourself a very good example ! This post is inspired by folks like you who can deliver sans the drama.Cheers !

  4. I mostly agree with your points that MBA is overrated, but feel that due to the current scenario, the conclusions have made it more under-rated than it deserves to be🙂.

    Does a company need MBA qualified employees? I tend to agree with most of your points here, however there are cases when an MBA degree holder can get the ball rolling quickly. Still, in most cases, not a necessary requirement.

    Do you need an MBA ? Here, I feel the answer can be “yes” in many cases. How many people are going to become the famous business tycoons. For the rest of the millions, an MBA degree is a flag to show that the person has better than average analytical skils, can work harder and above average communication skills. Here MBA is not much about course content, but higher studies. e.g. if two person come to you with the same abilities, who would you give the job for the same salary? One is an MBA , while other is a BA.
    So, in economic terms, MBA degree is used as a signal in job market to circumvent the problem of assymetric information.

    I am not an MBA and didn’t do it despite getting calls from IIMs. But the reasons were different🙂.

    • Prashant,
      Your comments are well taken.As I said, I have nothing against the education part of an MBA degree I am disappointed with the way it is being projected by the institutes that are gaining from misinformation.If an ISB or a harvard has a big fee tag it is still justified on ROI terms but every other institute now is charging as much for a week what I paid for two years ! And where do you think this is leading too – more corruption.Dad’s are looting others as the kid is ready to get fleeced by thugs in order to gain a tag for social acceptance.Think about it.I wish it was only about the corporates.
      Over the last 12 years I have seen some of the best contributors to be non MBA’s and some of the worst parasites from famed institutions- which is true the other way round too.What finally counts is the individual’s attitude and orientation and not a bit of laminated paper.Trust me🙂

  5. Excellent analysis.

    On one hand I respect people who truly are academics, on the other hand I don’t believe we should expect a majority of our workforce to hold advanced degrees.

    You could argue that the economic mess we are in today was amplified by the proliferation of MBAs in the last 2 decades, having created an illusion of value at many companies.

    Personally I believe we need a revalidation of technical occupations and entrepreneurs, not more MBAs.

    • Thanks.Take the example of Japan.Why none of the Japanese business schools are not so popular?An MBA is an American concept marketed through smooth talk to unsuspecting wannabes. Till recently the concept of an MBA was not very well accepted in the Japanese businesses.The Japanese Society which honors skills picked up by experience also is not comfortable with young MBA’s passing out and giving lessons to veterans on how to run an enterprise.
      But Japan remains the world’s second largest economy and Toyota and Sony have beaten the Americans on their home ground for decades.
      That gives strength to your argument that we need specialists with passion and not vague generalists who are ready to botch up every thing that they come in contact with.

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