Australian Lefty on Politics, Governance, Science and Info Management

What’s wrong with MBAs? A lot!

Posted by Dave Bath on 2008-11-26

Harvard Business School Working Knowledge has a recent article discussing the "Future of the MBA".  Their bottom line?

The MBA industry is in turmoil. Many business schools are revisiting their offerings to see if they still have relevance in the 21st century.

There are some other gems.

Warren Bennis at USC’s Marshall School of Business argues that they are "institutionalizing their own irrelevance"… Henry Mintzberg of McGill University in Montreal devoted a book to his contention that "conventional MBA programs train the wrong people in the wrong ways with the wrong consequences."

Personally I think that any postgrad qualification that only includes coursework rather than a thesis and should usually be termed a postgraduate diploma, or at best a bachelor’s.  (And a big "hope it went well" to all of you finishing a real thesis-based postgrad qualification, given the time of year.)

Only a few MBA’s I met deserve a "Master"… and they were more than capable of grokking what they needed from private study and experience anyway.

"Management Bu**s**t Artist" usually seems a more accurate expansion of the acronym.

After all, if you think about the question "What is the difference between an executive briefing and an idiot guide", all the answers (there are some differences) are flattering only to idiot guide readers.

(Go on, gimme some answers as a comment!  Remember, the Australian Bureau of Statistics doesn’t classify managers as professionals.)

If you want to get the knowledge, simply go to MIT’s OpenCourseware, follow the bouncing links to the under-and-post graduate course materials at Sloane Business School, download the notes for the units of interest and read.  If you are a manager committed to the organization you work for, you’ll be too often doing overtime for the organization you work for when projects go icky to have a reliable schedule for formal coursework anyway.

(I reckon we’d be much better off if the Minister for Stuffing Up Oz Communications Infrastructure should get the materials for this course.)

How useful (except as a label when applying for a job) can an MBA be anyway, given the number of MBAs who made the decisions over the last decade or so to flush the economy down the toilet?

I remember a discussion with a CEO of a one kilo-person company.  I showed him COBIT and said "everywhere you see ‘Information Technology’ or ‘Computer’, cross it out and see if it covers what you need for the general case, after all, the same issues and controls apply for managing a third party contract whether it’s designing a data centre or keeping the toilets hygenic".  After spending 5 minutes taking my advice, he exclaimed "Why the hell don’t they teach us this in my course?" "Because it’s the engineers, geeks and auditors who’ve realized the need for this sort of stuff, and are capable of producing professional, actionable and falsifiable guides rather than only motherhood statements."

It’s worth looking at the basic message in university advertisements.  Most (especially the MBA courses) are saying "do something for yourself, to help you beat the next person", while those for science faculties are saying "do something for others… look what [example student] discovered/built and how cool that is".

Just imagine if bridge designers (usually mere B.Eng) were as competent as MBAs!  Nobody would ever drive or walk on or under a span!

And a final titbit from the HBSWK article:

Garvin concluded, "Business as usual isn’t good enough."

Personally I’d add a couple of commas: "Business, as usual, isn’t good enough."

Note: if you have done or are doing a real Masters in business, with a thesis, a publication and a waterboarding confirmation, I’m not slagging you off, but get out a black marker to cross out “IT” from Val IT and COBIT and Value Measuring Methodology.  If it isn’t a revelation, if you don’t have a near-satori experience, slag me off in a comment.


9 Responses to “What’s wrong with MBAs? A lot!”

  1. Those who believe MBAs are not ‘academic” enough are quite right! However, in terms of actually DOING the job of managing and directing, I will take an MBA with common sense (or anybody with common sense) over somebody who believes that academia is the only answer. I have worked in universities for a long time, and have seen the mess that the impractical and learned can make of even the simplest tasks. I have taught MBAs and postgrad students alike. Give me the MBA any day!

  2. Dave Bath said

    (1) I’m not saying that some courses currently termed an MBA are rubbish, but that “Masters” is an inappropriate term without a thesis.
    (2) The “anyone with common sense” is absolutely correct, which is why the hbswk paper notes that headhunters look for people who gained entry, not necessarily did the course.

  3. Gar Misra said

    Yeah…as a 2nd-year MBA graduating in 2009, I’ve heard all the revised acronyms, and unfortunately, some are dead-on. However, I would say that Operations MBA’s are a noteworthy exception. Most have engineering backgrounds coming in, and during their curriculum, do a diligent and exemplary job of building and exercising the organizational leadership skill set they will need to succeed and to execute on behalf of their employers, or in an entrepreneurial capacity. I speak as a non-engineering candidate who chose operations partially out of admiration for those friends of that background who have mentored me, and hope I can take those lessons with me along my career arc. In terms of academics, however, I’m of the opinion that MBA programs are actually too “academic”…there need to be many more structured programs that truly put candidates to the test in terms of execution and quality, as well as leadership skills, from a 360-degree perspective, as opposed to mere learning; however, as long as tuition and fees are so high I believe few universities are going to increase the rigor in this area. If you’ve paid your tuition, you’re getting a pass – read Ahead of The Curve for further explanation.

  4. Dave Bath said

    You cynic about universities having to supply the product (the degree) that the customer paid for!

    You made a good point about engineering backgrounds, and were probably wise to follow your friends. But Operations is making things work and not fail… something engies are good at.

    I don’t know where you are, but here in Oz, someone on an admissions board said that he was ordered to require only two attributes of a full-fee-paying student: being warm and being vertical. Speaking the language? Who cares?

    And did you have a look at COBIT, particularly the areas dealing with keeping things running? If so, what did you think about crossing out every mention of “computer” or “IT” and being able to apply to document to the planning and operations of any organization?

  5. Jacques Chester said

    As I understand it, the real reason to go and get a prestigious MBA from Harvard, Stanford, Wharton, INRIA or Oxford is for the access it gives you to future graduates of Harvard, Stanford, Wharton, INRIA or Oxford.

  6. Jacques Chester said

    Hmmm, I’ve got my institutions mixed up. There’s a famous French business school, but INRIA is full of smart people instead.

  7. Jacques Chester said

    INSEAD. I was thinking of INSEAD, not INRIA.

  8. Dave said

    The funny thing about a Masters of BullS*it Administration is what happens when you give an MBA a business job in a business. They can study the snot out of it and come up with short tonnes of documentations, but can’t actually perform the job.

    One example, of a newly-minted MBA who was tasked to write some television commercial copy. The rules are simple: 30 seconds long, good pictures, compelling message and an increase in sales.

    Result from the MBA? A five minute dissertation of the features and benefits crammed into 30 seconds with one shot of the corporate business card including logo, phone number and street address.

    Beaing recieved by the MBA from the client? Priceless.

    (via alphainventions)

  9. Jayjee said

    I have thought a lot about this, as I know many people who have MBAs from the very top schools such as Harvard, Stanford, and MIT. I have also encountered people who have MBAs from Monash, Cranfield, University of Tennessee, etc. There is one thing I will absolutely emphasise. The difference is calibre of these two groups is overwhelming.

    Four of my closest Australian friends have Harvard MBAs. Among they had 1st Class Honours degrees in Organic Chemistry, Pure Mathematics, Law, History, some combined. They have always excelled academically. Two of them I would confidently say have IQs of 160. They are each charasmatic, articulate, very funny, have other talents such as playing musical instruments, performing arts, and spent two to four years doing very grown up corporate work at places like Mallesons, McKinsey, Macquarie Bank, Boston Consulting Group, BHP, DFAT, etc.

    But what happens when they get admitted to HBS – and for the first time in their lives, not one was blase, they were all so excited they almost wet themselves – and then attend HBS, usually with an American cohort less talented than they are, they emerge supremely confident that all the messages they had received their whole lived about being “brilliant, geniuses, will become Prime Minister” and more, are not only true, they UDERstate the case. Now, don’t get me wrong. This does not mean they are unbearable, arrogant assholes. Quite the opposite. Such people simply would not clear the many hurdles it takes for an Australian to get into one of these places. (OTOH, yes, I can name a few who most here might not like).

    Convinced, they are now among sliver of gilded young leaders who are sufficiently brilliant to rule the world, they then become very naive and accept as the gospel of the gods, everything they are taught in their classes. In some ways, this is inevitable. If you have someone with degrees in Maths/History/Law suddenly thrown into Accounting, Microeconomics, Organisational Behaviour, Operations Management, and Marketing all in first semester, at most each of those areas will have only one 2-hour class per week for 14 weeks.

    At HBS, for example, each of those two-hour classes involves 90 of these these neophytes in each class competing for “airtime” as 50% of their grade comes from their class analysis of business cases, the other 50% from a 3 hour end of semester final. And then it’s over. In Semester 2, its on to Finance, Strategy, Leadership, the Entrepreneur,Macroeconomic environment of the global business, Corporate Valuation. And all through this second semester, they are schmoozing and being wined, dined, by the biggest players in global commerce.

    There is NO time for intellectual reflection on anything. And the culture says, “hey rockstar Michael Porter, or whomever says this is how you analyse a company; i’ll learn it by rote”.

    Now, anybody here who has majored in economics, for example, knows how incredibly nuanced and subtle it gets. One semester of Intermediate Micro taught so these MBAs can discuss their “cases” ain’t gonna cut it.

    I have found when discussing the recent GFC for example, these same brilliant people, some of whom actually worked in IB (though always in M&A, never in the declasse sales and Trading), their assumptions always come back to barely picked up Intro micro/Finance, etc. But don’t question them. They went to HARVARD, or STANFORD, or MIT. So they KNOW!

    My take on much of the GFC is that the people who were ‘designing’ these incredibly mathematically-sophisticated derivatives products were not MBAs. They were Ph.Ds in Maths, Physics, Econometrics, Engineering, etc. The average Harvard MBA wouldn’t have a clue about them. But they know enough to know how to sell them or if they work on the buys-side (say in funds management), they can pick up enough not to seem dumb or get completely bamboozled. But they were bamboozled; by the Ph.D quants.

    There must be benefit in taking a History, Classics, or Politics graduate and make them able to run the marketing division of a large multinational, or get the price in a cross-broder M&A deal, but the knowledge they get through the actual MBA is spread too thin.

    One solution I think is to restrict the degree to people who are at least 30 years of age, and can show some bruises, grazes, and humility, before being anointed “Master of the Universe.”

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