For quite some time, I’ve had something on my mind that I haven’t voiced because I didn’t want to offend many people that I worked with. So, I’m just going to come out and say it. MBAs are ruining business.
Well, I feel better. In all honesty, though, it surely won’t be a popular thing for me to say, and some may be bothered (hopefully this article will calm that a bit). An MBA is a very personal thing. Many have sacrificed a great deal in terms of time and money, among other things, to earn their business school degrees. Please don’t misunderstand me. I’m not saying that it’s not an impressive accomplishment, and that there’s no value in it. The point I’m trying to make is that business schools don’t do an adequate job preparing students to impact organizations, specifically in a leadership capacity, and it is having a profoundly negative impact on companies.
The irony in this is that I went to a top business school and paid a small fortune for my degree. I met some great people and found much of the material very interesting. Unfortunately, it did not prepare me to lead a company, despite taking a course load that was disproportionately high in leadership courses and content.
Perhaps the problem is that for most MBAs, the degree is the end and not the beginning of their journey as professionals and leaders. In fact, for many (myself included), an MBA simply becomes part of the game. We attend not just because we think the content is worthwhile, but so that we can justify a higher salary or avail us to more job opportunities. That’s not necessarily wrong, but we need to demand more of this degree, and make it more meaningful to the next generation of leaders. Nonetheless, here are five ways that business schools and their graduates are missing the mark.
1. Leadership is not a Formula
Surely you’re sick of me saying this, but there is no right way to lead. The way we lead people and teams is entirely dependent on the situation and its context. Because of this, business schools are essentially behind the eight ball from the get-go, as they have to boil things down into absolutes in an art where there are few absolutes.
Leadership is very hard to teach in a classroom, especially to groups of students with a variety of personalities and futures. Every student will need to lead in a different way, so creating content that applies to all of them at a granular level can be somewhat impossible.
The mindset of students doesn’t lend itself to success either. These are usually type A, highly motivated individuals that want answers. They want a formula that they can apply – basically looking for science when the situation demands art. We must prepare the students for the ambiguity of leadership.
2. Spreadsheets are not Reality
After their iPhones, most business school graduates will lean on excel more heavily than any other device or piece of software. Rightfully so. It’s how we look at data and gain insight. Moreso – and more dangerously – it’s how we try to predict the future. Throughout the years, I’ve been part of thousands of financial models that were used to make decisions about how millions – sometimes hundreds of millions – of dollars were spent.
We do our best to detail out all the different scenarios and then rely on the spreadsheet to tell us what’s the best option. That’s where we get into trouble. Even in a model or a spreadsheet, there are human elements that have to input assumptions and other data to get to the output. Even more important is that the things that make a business successful (leadership, customer experience, etc) don’t exist on a spreadsheet. Pull up your favorite company’s P&L. How much of their revenue came from having a great leader? How much more did they make than their competitors because they have a great customer experience?
The point is this: leadership maximizes the things that don’t exist on spreadsheets. Without fail, those are the most important things. The sooner we rely on leadership rather than spreadsheets to make decisions, the more success our companies will have.
3. “Dream it and Do it” is a Farce
This is a hard one for even the most seasoned leader. After all, for real leaders, those under their command are their most valuable assets, and they do whatever they can to capitalize on all of their ideas. There’s a bit of a line where this can go too far. Ideas must be rooted in the realm of reason and be situationally relevant. It’s easy for these to become distractions and dovetail into endeavors that spread your team or company too thing.
For instance, let’s say you’re a niche home interior retailer with a unique product line and loyal following. Most of your customers are young professionals. Since it’s likely many of your customers are starting to have babies, a team member suggests that you start an infant car seat rental service. In isolation this idea of perfectly fine and perhaps worth pursuing. Unfortunately, time is a finite resource and you and your team need to maintain laser focus on your task at hand.
Business schools have missed the boat with this really important point, perhaps driven by the VC-fueled tech frenzy that has every person under the age of 40 dreaming of being Steve Jobs or Mark Zuckerberg, and are pushing their students more with classes and content to think dramatically outside the box rather than those focused on execution. This results in impaired organizations. I’ve found this in a variety of teams, and it’s nearly always a top MBA graduate. Approaching problems with unique insight is one thing. Derailing an entire company’s mission and focus is another.
It’s vital that we approach problems with the appropriate context within which they exist. That means accounting for a company’s culture and “the way” things get done. Using reality to ground our endeavors removes executional risk and increases the chances of success. That’s our goal.
4. The Education is Limited
I need to be careful with this point because it will be very easily misconstrued. A business school education is valuable, but it’s only valuable with experience to match. Otherwise, it’s simply theory.
Sitting in a classroom, discussing theories and cases may provide some subject matter expertise, but it will not provide the most valuable expertise of all: experience. You can simply not learn the things that it takes to be a successful leader in an organization within an isolated, “safe” environment. Further, a big part of the education you receive comes from those around you and the discussions that you have. Remember, leaders surround themselves with those better than them on their question to always be learning and improving. At most business schools, students may have a year or two of work experience under their belts. It’s simply not enough experience to have real conversations about the problems they are supposedly being prepared to face.
I was fortunate that I chose to attend business school while working a full time job and having many years of experience. My classmates had the same, if not more, experience, and as a result the classroom discussions were rich and insightful, full of relevant experiences. A funny observation about this. For most of the classes, a section was taught to the full time students and a section was taught to the evening students. Same class, same content. For many classes, there was a “live” event at the end of the class where teams of students competed in exercises based on the course content. Without fail, each time this happened, the teams of evening students, with more experience, out-ranked the full-time students.
Experience is how we learn. We cannot rely on a classroom education to solve our problems and educate us. Our faith needs to be in what we’ve experienced, not a piece of paper on the wall.
5. Higher Ranking, More Pressure
Most students spend years working hard to get their test scores and applications in order so that they can get into the highest ranked business school possible. Once they’re admitted, and ultimately graduate, this can feel like the culmination of their hard work and their crowning accomplishment.
We need to reframe this so that business school is just the beginning. After all, leaders, are on an endless quest to improve. I’ve never gotten the sense that most top business school graduates feel this, though. A few of my colleagues recently suggested that the “douche factor” (their words) seems to be directly correlated to the ranking of the business school someone went to. That’s a problem, and we need to make sure that leading business schools understand this. After all, their students aren’t going to lead companies solely comprised of people that went to their school. We need to put a stop to this.
An MBA isn’t a golden ticket that entitles you to a high salary or a given job title. All it means is that more responsibility is placed on your shoulders to lead companies, teams, and people in effective manners. The biggest failure a business school can have is being the biggest achievement in their students’ lives.
Despite all of this, I think business school can be a tremendous force of good as we develop leaders that can impact organizations. To do so, we must rethink what that education looks like and the mindsets that we input to students.
Disagree? I’d love to hear your thoughts. The bottom line is that we need to develop a new generation of leaders, and I’m all ears if someone has a better idea as to how we can do that.