Is the MBA of value?
Putting cost aside, I would say that an MBA would definitely be of value if it actually taught you to be masterful at administering a business. Every endeavor of any significant size needs some level of administration—or what I call “adult supervision.”
I went for a part-time MBA at NYU in the 1980s in the hopes I would learn how to become a business administrator. I had worked as a programmer for a decade and I wanted to advance, so I started my MBA as a computer applications and information systems major.
But I changed my mind with the first course. It was about how to wrestle a relational database into a third normal form, and I got the impression the professor was one chapter ahead of the class—and I was a few years ahead of her. I looked around at my classmates and they were all aspiring to become my boss someday—the kind of boss any self-respecting line worker would despise.
So I changed majors.
I switched to finance and that sort of helped; I learned a lot of math theory at night that I could apply on the job the next day. Sadly, most of that theory was just that—theory. When I graduated in 1986, I had no idea how dangerous bad theory could be.
Luckily, I soon figured out the role portfolio insurance played in the Crash of 1987. That taught me not to trust a theory just because you could get a Ph. D. by concocting it, and you could get rich by selling it. For more, read: A Demon of our own Design by Richard Bookstaber. He started his career on Wall Street the same time as me, and his book begins: “While it is not strictly true that I caused the two great financial crises of the late twentieth century…[the 1987 crash and LTCM]…let’s just say I was in the vicinity.” My memoir could begin with the very same words.
For years I would pay for my employees to get their MBAs at night even though my own degree had been a bad investment. Then I read Managers Not MBAs by Henry Mintzberg. He says that business is about making things and selling them, two activities denigrated by those who teach at business school. Although schools often tout the achievements of their graduates, Mintzberg points out that you can find plenty of convicted felons among the same ranks. At a conference on how to re-engineer the MBA, he said, “Perhaps business schools should issue recall notices.” So I called him up and you can read about our conversation here. Or you might consider Rodney Dangerfield’s input here.
After that I began telling my employees that I’ll pay for an MBA only if it is a good decision, and to determine that they must read Mintzberg’s book and write a report itemizing and overcoming each of his points. None of my recent hires has done that and I have saved a lot of money. If you are considering getting an MBA, then you could save yourself money by doing the same thing.
At a venture capital forum I remember hearing someone describe how to value a startup: Multiply the number of engineers by $1 million, and subtract $500,000 for every MBA. I agree with those sentiments. During your startup phase, you don’t need business administration because you don’t have a business yet.
But in the in the unlikely event your venture takes off then you will need some adult supervision and so I recommend you get such a person.
What do I mean by an adult?
Adults have learned about the world from first-hand experience, and they have a track record of being worth more than they cost. Although we should never trust a surgeon who has never been to medical school, you and I have no trouble trusting competent business people who have never been to business school. But would you trust your business to someone who has never experienced the world first-hand and has never been worth more than they cost? This eliminates many recently minted MBAs no matter what they know in theory; especially if they have not paid for school entirely themselves.
And, where do you find competent adults capable of administering businesses?
Look for people with track records of administering businesses. They are all over the place and lots of them are unemployed. Many are over 40 and overlooked. One reason is that our youth-oriented start-up culture doesn’t even notice that they exist, and the other reason is that they themselves don’t know their competitive strengths. These experienced administrators think that to be employable they have to be fearless young entrepreneurs or skilled technologists. Why do they think this? Because that is what they have been told.
I talked about one of these people in my story: “Want a job? Stop complaining and start solving someone else’s problems.” She was the woman who said she was unemployed because of age discrimination and that nobody values wise problem solvers. I suggested that perhaps she wasn’t so wise after all, and that she needed to apply her skills to solving the problem of finding a job.
While she was not good at getting a job, she was good at solving the kinds of on-the-job problems that don’t particularly need wisdom, only experience: the logistical problems of getting this thing to that place on time, of getting a vendor to be both inexpensive and reliable, of keeping a place humming so the prima donnas can go sing their operas in front of the customers and investors.
(Note to HR: Your job is to find people who are good at doing the job, not people who are good at getting a job. Let others hire the ones with good job-hunting skills while you concentrate on uncovering the hidden talent that is better priced and more loyal because they have put their efforts into being good at something rather than just appearing to be.)
OK, now that’s settled. Remember:
- All businesses need adult supervision.
- You find adult supervisors where adults are supervising things.
- Do not judge people by how old they are but by how adult they are.
So, what does a young person do if he or she aspires to become a master at administering a business but has concluded that the MBA has become too expensive and somewhat irrelevant?
The advice is the same for young workers as older ones, except that it is easier for the young. To land an entry level job, all you have to do is:
- Find someone who is complaining about their job.
- Ask to see their boss.
- Tell their boss to fire the complainer and hire you.
- Do the work extremely well and without complaints.
If you cannot do the simplest jobs well and without complaining then I’m not sure you are smart enough or hard-working enough to be worthy of the respect that good managers deserve.
You might work as a barista because it teaches much-needed politeness skills. But just being pleasant isn’t nearly enough. You need to recognize, respect, and be grateful for the hard work of others, even if you never meet them. Before you can draw a double-shot, people had to make the espresso machine, build a building around it, and pick some coffee beans. If you want to develop character and stamina then go for jobs that are hard and lack glamour, such as those on a farm, on the shop floor, or on the loading dock. Don’t waste your money on an MBA if you have a bad attitude. Louis CK says this better than me in “Doing Your Job & the Current Crop of 20 year-Olds.”
If you are young, then grow up before you grow old.
If you are old and competent, then don’t let jerks get you down.
And if your business needs adult supervision, then write to me. I can introduce you to some people of all ages who are awesome and available. A few even have MBAs.