Is Now the Time to Hire MBAs?

http://bhorowitz.com/2012/05/18/is-now-the-time-to-hire-mbas/

by eande • 14 years ago

45 42 14 years ago

geophile2• 14 years ago

This is like asking if it's time to start taking heroin. Not a perfect analogy since that is reported to feel good the first time around.

rpwilcox• 14 years ago

Seems like there was a talent crunch for MBAs back in the day. In fact, substituting "developer" for "MBA" and the MBA history lesson still rings mostly true...

ojbyrne• 14 years ago

"Broad categorizations usually tend to be a bad idea when it comes to people and in this case, the trends that led to the negative characterization have reversed."

And yet MBAs from places other than top schools need not apply.

kapilkale• 14 years ago

It may be possible that MBAs as a whole are undervalued for their price tag, but there's another set of candidates that are even cheaper and even more undervalued.

You can pick up kids that have 3/4 of the qualities on Horowitz's list for a lower price tag by recruiting candidates out of top tier consulting firms, banks, etc. E.g. the kids that would have gotten into a top MBA program if they actually wanted.

The degree itself just makes MBA candidates more expensive.

ls6• 14 years ago

Well, even if Ben is right the title should be amended with "... from Harvard or Stanford". The other problem (even bigger) with MBA is one can get it from really obscure universities.

ckluis• 14 years ago

Speaking as someone with an MBA from a non-Ivy League, I got a second Masters to help differentiate myself from the 10s of 1,000s of MBAs with no tanigble skills or benefits to offer companies.

I think I also learned more in the Masters in Entrepreneurship in Applied Technologies than in the MBA. The teachers in that program were far more versed having worked or started several startups each.

derstang• 14 years ago

In general, I think people put too much weight on the degree. You should hire people because of their skills, background, promise and personality. If they have an MBA is a credential not a reason to/not to hire. I also know a bunch of devs with JDs, but that's not important to whether they can code!

csel• 14 years ago

I think based on what is happening with Facebook, YES, it is time to hire MBA's and put more emphasis on monetization. Having 900 million users is pointless if you don't know how to monetize them.

SkyMarshal2• 14 years ago

Assumption: when you need to increase monetization you should hire MBAs.

Is that because MBAs are uniquely good at monetization, or because we lack a better certification for someone's monetization ability and creativity?

lancewiggs• 14 years ago

Ex MBA, consultant take: Hire people - not MBAs or PhDs or whatever. Most MBAs have a lot more going for them than their last degree. Don't expect to find the best from the bottom of the class at any school or consulting company. Keep the overall number of any group of non-core employee down. Too many MBAs/consultants ruined eBay. And, the saying goes, short any industry where the majority of HBS graduates are being hired in to.

jedc• 14 years ago

> Hire people - not MBAs or PhDs

Completely agree. (Full disclosure, I have an MBA)

I really like the way Hunter Walk put it in his essay here: http://www.hunterwalk.com/2011/12/its-fine-to-get-mba-but-do...

"It's fine to get an MBA, but don't be an MBA"

geophile2• 14 years ago

I started twitching when I read that last line. Malcolm Gladwell's post-mortem on Enron (in which HBS grads figured prominently) has stuck with me. Especially because I read it while working at a company that had a large HBS contingent. What a bunch of arrogant, ignorant, self-satisfied, know-nothing blowhards. Loved to hear themselves talk. And talk and talk and talk, saying exactly nothing. Many of them had a consulting background and they loved to bring in their clones to do their job for them. But the clones didn't do their jobs very well, so they would bring in another batch of clones who would start from scratch and also not do their jobs very well. This resulted in a web-based service that was a year late, and way, way over budget.

This was theoretically a startup, and this was the cream of the HBS crop, but they made every mistake a startup absolutely should not make: Spending money extravagantly (and this was post-dotcom blowup); not going live until the website was perfect "because you only have one chance to make a first impression"; feature bloat; no follow-through on anything (that was for their less glamorous underlings).

There, that feels better, I've stopped twitching now.

jaylevitt3• 14 years ago

"When I began my career in the late 80s and early 90s, MBAs ran most of the best new technology companies."

Not exactly. By 1993, MBAs were already starting to turn AOL into the "how much can we milk you before you'll walk away?" behemoth it became. They'd tried to weasel out of our promise of a "lifetime 20% discount" for charter members, they'd rounded up in some directions and down in others, and they'd literally removed the "Sign Off" button from the toolbar because we billed by the hour, and --

Well, I'll let the MBA tell you.

"We needed to drop one icon because of space/look and feel and it made sense to us out of all the other functionality to drop exit. In addition, some folks were uncomfortable with how visible the ability to get out of the service was--all in keeping with our philosophy to keep them online for that one additional minute :)"

dkrich3• 14 years ago

You think that is unique to AOL or MBA's? Try deleting your Facebook account sometime if you'd like a real good mindfucking. Then tell me MBA's are the one's behind it.

Estragon• 14 years ago

  > Try deleting your Facebook account sometime if you'd like 
  > a real good mindfucking

What happens? (I deleted mine in 2008. I get plaintive emails from them to sign up again, but that's about it.)

raverbashing• 14 years ago

Humm the icon thing: not an MBA thing

I guess a group of engineers could do the same

That's called Design by Committee. See also: Windows Vista

jaylevitt3• 14 years ago

No. It wasn't a committee. It was specifically the new, MBA-credentialed "product marketing" person.

dkrich3• 14 years ago

This is just fraught with assumptions, generalizations, and misinformation.

I have an MBA and degrees in Computer Science and have worked as a programmer so I know both sides, and this is what it boils down to: how much an MBA can help you really depends upon what kind of business you are in, and of course, the value of the potential hire.

If you are running an internet startup there is probably not a whole lot an MBA can do for you that you can't do yourself.

However if you are running a more conventional business that requires sourcing, operations, marketing, statistical analysis, etc., an MBA can absolutely be the difference between success and failure. There is a reason Tim Cook is the CEO of Apple- he is an operations expert, and Apple is largely a business built on outstanding operations and sourcing. Companies like Wal-Mart aren't as widely discussed as the Facebook's of the world, but the reality is that the Wal-Mart's do a whole lot more to improve our daily lives, and are far more difficult to run. Then again, Sheryl Sandburg and Mark Pincus are both Harvard MBA's, so maybe there is some value there as well.

So I would advise people to never bucket a group of people on something as vague as "he has an MBA, he brings no value." I think a lot of the comments Peter Thiel makes about education are cavalier and show a general bubble mentality that shows that he doesn't seem to realize that there is an entire economy outside the valley that makes our lives better without the recognition or star power. I get it, he's extremely smart and has made a boatload of cash through savvy investments. That alone does not make him authority on every subject though, so it irks me a bit when people quote him as if his word is law without much examination.

kylelibra• 14 years ago

The moment MBAs become the new developer or designer, you can no longer argue we aren't in a bubble.

sparknlaunch122• 14 years ago

MBA holders really get a hard time. There are so many different types of MBAs. Hard to pigeon hole all of them.

Sure you cannot teach someone to be an entrepreneur, however there are many important disciplines you can gain from studying a business degree. Most executives hold an MBA - although this may be simply to speak-the-speak with others at that level.

Sheryl K. Sandberg (COO of Facebook) holds a MBA. Zuckerberg went to a world renown business school (albeit he dropped out).

Maybe you only need an MBA hire when you have gone public/IPO?

neilkelty• 14 years ago

Mark Zuckerberg has never been enrolled in a business school, let alone a "world renowned business school."

sparknlaunch122• 14 years ago

Okay, maybe not in the business school, but he was certainly within an organisation known locally and internationally for their business school.

He enrolled at Harvard in September 2002. He dropped out in 2004. He studied psychology and computer science. Harvard Business School is ranked 5th top MBA Uni by The Economist.

http://en.wikipedia.org/wiki/Mark_Zuckerberg#Harvard_years

http://www.economist.com/whichmba/full-time-mba-ranking

klbarry• 14 years ago

I'm curious - what does H.N. think about a Masters of Science in a business field (Marketing, Statistics, Accounting, etc.) as opposed to an MBA?

38f0ia• 14 years ago

Sadly, this is the true value of an MBA, not to mention certain other professional degrees. People just think it means something, on its own, that it doesn't. This benefits the person with the MBA more than anyone else. Like someone else said, you hire people not their academic degrees.

rbanffy• 14 years ago

It's never the time to hire a degree. Hire people who can help you. And that depends a lot on what you want to do.

zeteo• 14 years ago

No.

http://en.wikipedia.org/wiki/Betteridges_Law_of_Headlines

wensheng• 14 years ago

(Aaron Patzer, founder of Mint, expressed the sentiment well when he said: “When valuing a startup, add $500k for every engineer, and subtract $250k for every MBA.” )

I think it should be attribute to Guy Kawasaki. [1] I heard him saying those lines in a talk a few years ago.

[1]http://www.forbes.com/2004/03/17/cx_gk_0317artofthestart.htm...

1234the1234• 14 years ago

eh... the problem is the cost with the degree. Engineers are really expensive. If I could grab an MBA for 55k, sure, in a heartbeat. But for 120k I'm going to grab another engineer and a humanities major for 35k who might turn into an MBA type.

melindajb• 14 years ago

Except that the humanities major who has no experience buying ads will waste another $100k before they learn what they are doing wrong.

I like to say that I'm an MBA who is dubious about MBAs. I needed one (a humanities undergrad--ahem!--) to demonstrate my math skills on a resume. Without it I never got calls back for jobs, even though I had turned around two different divisions of a company by the time I was 28. Yes, that wasn't in tech and yes, it was a different time, but still....

Meanwhile I was raised by a tinkerer, and I respect builders and makers. The science says diversity makes for better companies. once you are starting to scale, having built a product people want, people like me with a decade of experience add a lot of value and keep you from making costly mistakes. A lot of us are out here in startups, making it work, every day, and while there are lots of jerk MBAs, it's no more fair to lump me in with them, than it is to lump you in with the guy who sits in his mom's basement and watches old episodes of star trek 4 hours every day.

alain94040• 14 years ago

For once I find Ben's arguments unnecessarily misleading. It's pretty clear to me that MBAs are best suited for mid to large corporations. They have already proven that they like to follow conventional wisdom. They have extensive knowledge in many ways a normal business operates.

Early startup life? Not their forte. Improvising, moving quickly, taking high risks with no data?

Ben's argument that large tech companies of the time were run by MBAs doesn't prove anything. They are large companies!

bjoernw• 14 years ago

I have an MBA with a BA in Economics but I work for a boutique investment bank startup where I taught myself quantitative finance, SQL, and now C#. The MBA provided a great framework. I did not get the MBA because I like to follow conventional wisdom. I thought of it more like an intro to a set of tools. At least in my MBA program they made us question everything. Case studies can be approached from many different angles and my professors were never looking for the right "conventional" answer.

Why is early startup life not my forte? Would you say that engineers shouldn't go to bars because they are socially awkward?

penetrator• 14 years ago

i sat on an mba class for a week or so, and they taught y=ax+b and talked, talked, talked about this simple linear model the whole week. you guys remember 'beta' ? -- they emphasize as if that variable can explain everything.

i dropped out of that course the next day. i felt mba classes are just too easy and would dull me. it might be better these days, but i doubt it beats the math stats courses i took.

couple years later i talked with a friend who took mba because he was not confident. he said the mba math is joke and does not compare to ee courses he took.

i wonder if the mba uses simple tools to solve hard problems. if that's the case, it's like a bodybuilder try mining with spoon. a lanky guy with pick will produce more.

gawker2• 14 years ago

Hard problems are not necessarily solved by complicated tools. Sometimes solutions can be found from simplicity.

infinitesimal• 14 years ago

Why aren't we teaching our scientists and engineers in a similar fashion then?

ILIKEPONIES• 14 years ago

A response from a recent MBA graduate: http://joshgoldstein.me/post/23607867900/mbas-are-not-all-wo...

Is Now the Time to Hire MBAs?

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