Actually economics is the dismal science but hey, I needed a title. I don't really like to talk about MBAs because the topic is pretty boring, to me anyway. But I know it is on the minds of a lot of young people so here we go. Got a few comments/questions regarding MBAs from the Cincinnati Kid post so let's look at one.
I wonder what one stands to gain from an mba....if its is all I am hoping it will be.Doing an mba has been on my todo list...i hope to get to it within 1 yr. Would you be kind enough to give me your opinion about part-time vs full time mba. Though i can't pay for the full time, I am wondering if it will be worth taking a loan out for. thanks,C
C has basically boiled the issue down into three issues. What is it good for? Part time or full time? How much does it cost?
What is it good for or I wonder what one stands to gain from an MBA? Great question. First let's subdivide the world. Accounting, advertising, retial, engineering, some banks, software, computer companies genereally do not put a premium on MBAs. They may want you to get one later but for entrance into their world the door is open to mere undergraduates. Consumer goods companies like pharmaceuticals (Merck, J&J), companies like Coke, Pepsico, P&G, they do. Companies like GM, Ford, Daimler take engineers but their finance guys probably have MBAs. (This analysis is my own--it may be wrong. I don't care. It is what I have observed.) So first find out if your industry puts a premium on an MBA.
My case is illustrative and may be a bit dusty but I think it still holds true. I was a history major at the University of Illinois. Graduated with absolutely no idea of what to do. Vague notions of law school and thank God I didn't get in. My sister did make it (Stanford, no less), has her own law firm, loves left wing Democrat clients and staying up all night getting ready to go to court over some school issue thing. Bores me to tears but she loves it so I'm proud of her. But not for me. So got tossed out of the house, moved to Denver (everybody did in those days), got a job selling door to door and then driving trucks in the worst winter in Denver history (global freezing) and said, there's got to be a better way. MBA school started to look pretty good. At least it was indoors.
Took the test, did ok, applied to Illinois because it was cheap and had a good reputation for accountants. Not that I wanted to be an accountant but figured some of that would rub off. Had to take summer school because calculus was not a requirement in Liberal Arts. (Can anyone define calculus?) Started the fall semester and the cold fist of reality hit me hard. Because here is a fact. The MBA came into being a long time ago as a noble idea--business training for the non-business major. The idea was to take English majors and history majors and engineers and such that had somehow wormed their way into business and then have them get an MBA to round out their education. Hey, that's me, I thought. Until I showed up for Accounting 301 or whatever it was. I took the first test and got the second lowest grade in the class. I beat out a Turkish woman who couldn't speak English. Here is the truth I soon found out--90% of the people in a MBA program were business majors who already had this stuff. Why are these guys here? I thought this was business for Liberal Arts dummies? But anyway, sucked it up and went forward.
So why were they there? Because the best job opportunities go to people with MBA's. As noted in earlier posts, Human Resources divides up jobs. The best ones in traditional industries have an MBA required. You don't get the job unless you got the MBA.
So the answer to C's first question of what do I have to gain from an MBA is You Get Your Foot In The Door of some of the biggest companies in America.
The only problem is that the biggest companies get their MBA's from the 'best' schools. Back to the case in point-me. I was near graduation in the biggest recession since 1929 and desperate for anything. Along comes Quaker Oats. Quaker Oats doesn't exist anymore. Well it does but as part of Pepsico. (Hey, how about that lady CEO at Pepsico? A woman no less and from India. There goes the glass ceiling. And reverse outsourcing.) But Quaker hired from Stanford, Wharton, Harvard. Not Illinois. Except me. And one friend who became VP and Treasurer of the Tribune Company. Not bad.
So let's summarize. First, if you want an entry level job at a big company do this. Graduate from undergraduate in anything, get a few years job experience, look at the schools you want to get in, see if you can and go.
We will discuss what to do about part time vs full time tomorrow.
But lastly the real reason for getting an MBA. If you were not a business major undergraduate, you will learn something. You will learn a lot. You will learn how a business is run. You won't learn everything but you will learn that because a lot, not all, of what you learn in business school is used in a real business.