Is an MBA Worth it?
As an alumnus of Harvard Business School’s MBA program, I get asked frequently if an MBA is right for them. While HBS continues to be the at the top of MBA programs, there are top-notch programs that fit different profiles — as well as a variety of Masters programs (and other more flexible MOOCs). The value proposition being able to advance in your career or pivot into a role of a manager or influential leader.
Why an MBA? My recommendation to people who ask is to first draft out your potential career track(s). Yes, most people are not sure of what to do post-MBA and while an MBA provides a highly exploratory environment you should be able to: 1) articulate a career track that leverages your experience thus far (soft, hard skills and understanding of your or other industries through the lens of your experience); and 2) see how the MBA amplifies that career track. Changing your career path post-MBA is ok, after all MBA admissions sell you on a “transformative” experience, but in order to forecast those who will do well, you must first be able to articulate a thoughtful response to yourself and later in the MBA application.
Your career paths should yield a list of tangible reasons (and some less tangible) as to why an MBA is a good fit as well as what type of an MBA. This exercise may also lead you down a different road, say a Masters in Data Science, Education or Public Policy. If your path can be achieved without an MBA keep brainstorming, you may be selling yourself short. If you still don’t have anything substantial beyond to be an associate at your same firm maybe you don’t need one.
Tangible and Intangible benefits. Tangible benefits I gained from an MBA include the network, as well as financial, strategic, marketing frameworks. The less tangible include exposure to diversity of thought within the classroom that is key to learning how to apply the strategy/financial/operations frameworks in the real world. As a student, I learned from colleagues (at rapid fire) how they solved issues I had not confronted yet. Had I not attended an MBA, I feel the perspectives are hard to match working in a single job or geography at a time — even as a consultant. I was exposed to the realm of ‘you don’t know what you don’t know’ and heard an array of problem-solving approaches. Learning this in the real world may be more costly as it may take one longer to learn on the job or by burning up startup capital in making avoidable mistakes. By no means is this a guarantee, especially if you later decide you actually don’t like leading — I have learned highly capable tech leaders that rather focus on the technical aspects.
Lastly, leadership is what I would call a one-part tangible, one-part intangible lesson. There are clear immediately applicable takeaways of how to manage every type of organization, but there is also intangible lessons you will be able to apply once you are senior in your career — for example creating a sense of urgency, prioritizing actual important tasks with little information or across different functional areas (finance, operations, tech, international jurisdictions, etc). This is why most companies look for professionals with MBAs for executive positions. Benefits each person seeks differ, what you seek and can get out of an MBA should be a key component to your career track.
Cognitive Bias in Recruiting. MBA degrees and other college degrees are often cited as not really necessary to perform most jobs, this is in direct conflict with hard reasoning you may have come up with if you followed the exercise above. So there is one additional less tangible gain from an MBA and that is being able to play to recruiters’/hiring managers’/investors’/partners’ mental shortcuts. Smart and empowered decision makers who truly understand the qualities that are needed for a specific job will hire for those qualities, and as a result rely less on credentials. Others tend to rely on shortcuts in making decisions: they are right as long as the hire checks the boxes in the short-term and is good enough in the long-term. Investors and entrepreneurial teams tend to do the former, while hiring at most large companies tend to do the latter. My favorite example is Jon Stewart choosing Trevor Noah to take over the Daily Show, someone without the tv credentials but the right global perspective, comedic ability and self-awareness — he built the same media skills through hard stand up comedy. If left to Comedy Central execs they would have chosen a safe bet, someone with years of on-air experience, their version of an MBA.
But if MBAs were truly not valuable, we can argue that the MBA degree would loose its power overnight, the fact is its probably a mix of outcomes. Another reason this does not happen is that there are also mixed results in hiring non-MBAs with the right set of skills for the same jobs. Given the ongoing success of many MBAs, this shortcut may be effective most of the time, thus while an MBA from a reputable university lets you play to that cognitive bias its also true that you would have showcased a lot of valuable skills to obtain it.
How to choose? The higher ranked MBA programs tend to do a better job at providing both the tangible and intangible benefits because the more accomplished/tested/smarter candidates want to go to the best-ranked schools, therefore, the best experience is at the top-ranked schools. This creates a self-fulfilling cycle in which the established schools stay on top. I put together a comparison sheet with key components to look out for to help anyone started: MBA Program Tracker. It also contains templates to enter your own timeline and track essay questions, make a copy and make it your own.
2Year + $200k Investment Worth it? You can argue depending on your profile — already transitioned to a role as a Product Manager/Associate, launched a successful business, have developed a strong network in tech/SV/industry focus — that you can gain those tangible lessons via books, projects, or building something; and gain the less tangible lessons by asking for advice/seeking exposure. The challenge is in the unavoidable equation Effort + Credibility = Benefits; this means what you get is correlated to the amount of effort and ability to seek out the “right” resources. Some people are great at this, but like me most people prefer a structured environment where the resources have been curated, tested and are supported everyday by 250–914 people with a shared agenda — to learn from each other.
Go for it! Start early, create a support team to come up with a career track, look for coaching, MBA events and organizations that provide help in doing this well. If you decide not to do it, consider more niche Masters programs or a self-guided career development path. Very doable. If you do decide on an MBA, build on that support network and tell your family and friends you will be MIA for a while. Get that GMAT done early not being shy about getting help/coaching if you need it. Self-reflect! The more you know about yourself, the better you will be able to clearly share what you can contribute to your classmates as well as what they could help you develop. We need leaders more then ever, be bold and go where no MBA has gone before.