MBA? PROs and CONs for Individuals, Companies and Society

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Knowledge and Intangibles Management > Best Practices > MBA? PROs and CONs for Individuals, Companies and Society

MBA? PROs and CONs for Individuals, Companies and Society
Paula Kokare, Project Manager, Switzerland, Premium Member
Management researcher Yehuda Baruch has analyzed benefits and costs of MBA degrees. He classifies the impacts of an MBA in three categories: the individual level, company level and society as a whole.

  • PROS: The main advantages gained during MBA studies attributable to individual themselves include additional:
    1. Knowledge
    2. Skills
    3. Personal competencies
    4. Network of contacts
    5. Prestige attached to gaining the “MBA” title.
  • CONS: Individual costs, however, consist of the:
    1. Financial investments
    2. Opportunity cost of the time dedicated for the studies.
    3. The value added to individuals already having a first degree made in general management to highly focused professional roles and to high rank executives has been often disputed.
  • PROS: Investing in MBAs is seen as utilization and development of their tangible and intangible asset base by organizations in order to achieve their strategic goals. Main advantages gained by organizations from such investments include improvements in:
    1. Work quality
    2. Productivity
    3. Promotability of individuals
    4. Leadership capabilities
    5. Overall managerial skills
    6. Employee retention
    7. Customer satisfaction
  • CONS: The critique associated with investing in MBAs relate to the fact that:
    1. Potential risks can be clearly observed (e.g. low return on investment, employee departure).
    2. Related benefits are mainly intangible in their nature.
Baruch argues that the value added by investments in MBAs to different organizations varies from minimal to very high, depending on the organization’s reliance on professional expertise versus a managerial orientation.

  • PROS:
    1. Promote managerial competencies which on the aggregate level have been proven to enable more efficient and effective societies
    2. MBAs are responsible for the creation of a large share of all start-ups which represent a source of employment, innovation and tax income for societies.
Source: Yehuda Baruch, (2009),"To MBA or not to MBA", Career Development International, Vol. 14 Iss 4 pp. 388 – 406

The Value of an MBA for Leaders and Managers
Jaap de Jonge, Editor, Netherlands
Thanks for sharing this, Paula. Good list of the strong points and disadvantages of an MBA at these various levels.
This made me remember a critical video by Professor Mintzberg in which he said leaders/managers should beware of an MBA; according to Mintzberg it is dangerous to believe that you can create leaders or managers through business education in a classroom: an MBA is not making a person into a manager or a leader. He argues the only thing you can do in a classroom is helping already established managers to perform on a higher level by working and reflecting with each other and learning from their experiences.

The Value of an MBA Depends on the Candidates' Education Background
nan zeng, Project Manager, China, Member
The Pros/Cons vary depending on the education background of the student. Established leaders or managers may not have had a systematic business management education. Some courses like finance, accounting, economics are mature and classic but marketing, strategy management are more dynamic in that they are attributed to many more different theories and also to arrays of practices and experiences.
An MBA provides them a platform within a certain period of time to quickly equip themselves with knowledge, in addition to networking and experience sharing. Indeed an MBA is not a green channel to the position of "leader" or "manager". However, it is definitely a big plus.

The Value of MBA Depends on the Type of Education
Molokanova, Professor, Ukraine, Member
@Jaap de Jonge (Editor): It all depends on the type of education. For example, in project management there are three types of competencies: technical, behavioral and contextual. Technical is the PM methodology and its application, and behavioral competence is first of all the education of leadership qualities and the ability to cooperate, respecting others.

Careerism versus Servant Leadership
Tom Wilson, HR Consultant, United States, Premium Member
The Servant Leadership model of the Gospel of Mark is organic to the ethos of West Point and the US Army, George Washington, Commanding.
The Harvard MBA program creates the commercial equivalent of the military warrant officer. There is no leadership model. It is what the military calls a "lifer" and sociologists would call "careerists". It is not a command role, but a career service provider for big bucks.
In 1962, my dad began to notice the careerism Robert McNamara was importing into the senior military slots to accommodate his Whiz Kids. I didn't know what he meant until I ran into it as a new lieutenant at Ft. Benning: designing your career path was the prevailing enchantment.
This is a real problem for the Army. There is a fix, but it means fixing the Harvard Business School MBA program to focus on Servant Leadership as an element becoming a Steward of Business.

Going or not to Going for an MBA
Luisa Pineda Martinez, Professor, Guatemala, Member
Good morning to all. I recommend this article for those who are evaluating if it is worth or not to spend one´s time and money to attend an MBA.
Buenos días. Este artículo está excelente para quienes apreciamos nuestros recursos en tiempo de clase. Vale o no Vale la pena pagar por atender una magister?

Recommendation for MBA
Tom Wilson, HR Consultant, United States, Premium Member
@Luisa Pineda Martinez: I don't have an MBA, but I can recommend its achievement for anyone. Much earlier in time, my plan was to apply to Wharton for an MBA in finance because I am interested in the subject. Plans change.
My point is that an MBA is not a command agenda, but the perspective of a career specialist. Obviously, the skills and methods acquired can suggest horizons in contrast to boundaries and lead to a larger territory of mastery, but it can also induce an intellectual myopia that provides a hammer for a world needing pounding.

MBA is an Intellectual Marathon
Collins, Director, New Zealand, Member
The MBA is a pressure cooker. Whether you do it full time, or part time while working full time, it amounts to an intellectual marathon.
Regardless of course content or suitability for the modern workplace (disputed by many) there will always be 'those who have' and 'those who have not'.

Overall Value of MBA Depends on Reasons for Enrolling
Paula Kokare, Project Manager, Switzerland, Premium Member
Thank you very much everyone for interesting comments and discussion.
Based on my own review of range of MBA programs and schools out there, I can certainly add that learning approaches adopted by different institutions vary significantly. Therefore, it is certainly wise to do an in-depth research before subscribing for a particular program.
I also believe that the main motivating factors why one considers enrolling (e.g. promotion, taking opportunity offered by the employer, networking opportunity, broadening perception and view of the world, etc.) will ultimately determine the impact of the MBA on one’s life. Even though Baruch (2009) takes quite a generalist approach in his article, I have observed that an MBA program may produce highly different results for individuals with even similar professional backgrounds.

Process to Improve on Awareness Levels
srinivas, Lecturer, India, Member
Conceptual exposure for the first time to different theories is fine. Also testing for understanding of the concepts is also good. Educational institutions are doing both of these things.
However in the light of advances in the automation technology is it enough to test for remembrance, understanding, analysis and application of the concepts? Today it's possible to use a semantic-enabled application to make the knowledge available into some context and it's possible for machines (computers) to solve problems by applying the concepts appropriately.
In my opinion today's managers need to work on being more 'awareful' by increasing their focus levels with regard to conscious-based factors such as hunger, sleep, reflection etc. I think the levels of awareness and management by consciousness may hold the key for the future of management education. Once the exposure to conceptual understanding is given, the focus may be to be more on knowledge creation, quality level of experience of the people involved and new insights rather than on remembrance, analysis and application.

MBA versus 12manage
Jaap de Jonge, Editor, Netherlands
I could not resist to compare 12manage with an MBA 😉. Of the mentioned 5 benefits for the individual (1. Knowledge 2. Skills 3. Personal competencies 4. Network of contacts and 5. Prestige), 12manage also offers 1, 2, and 4. Obviously at lower cost (even a Premium membership is just $/€169 per annum). Another difference is 12manage is on an "on demand"-basis (when you need it) instead of the pressure cooker approach mentioned by @Mr. Collins.
So if you are looking for 1,2 and 4, 12manage is IMHO the better option.
But if you have adequate funding and you are either looking for the Prestige (title) or you want to develop your Personal competencies, then consider an MBA.
I recommend you make sure your business school is actually offering substantial personal competencies development, because traditionally many if not all focus on 1, 2, 4 and 5… To develop personal competencies requires personal attention and intensive coaching and is costly and really hard to accomplish in a classroom setting.

MBA Versus 12 Manage
Jesus Perez ibarra, ICT Consultant, Mexico, Member
I'm agreeing with @Jaap de Jonge, the MBA encourages your development, improves knowledge, skills and personal competencies. 12manage is a web platform where we'll develop knowledge and skills and we collaborate, interchanging ideas and experiences.
Jesús Pérez, Oracle JD Edwards Consultant, México.

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