Sunday, December 21, 2008

Value of an MBA Part 3 – Business Needs MBA People

The recession and various related crises have scared a lot of businesses into kneejerk reactions, including production slowdowns and layoffs. That’s not to say these actions may not be necessary in some places, but in too many places these actions are not considered in the context of their need and effect, but as automatic measures. As a result, many companies are allowing themselves to be tossed about by events, out of control with relation to their environment. In far too many situations, companies allow themselves to lose revenue and miss opportunities for sales and growth, which could have been gained through effective management. Those management skills can best be found through acquisition of experienced managers with MBAs.

Frankly, if you earn an MBA you need to be picky about where you work. From my experience, at least half of those businesses which have 1,000 employees or more do not know how to make the best use of their MBA-caliber people. Instead, they rely on policy and formula, which has the advantages of clarity and consistency, but which discourages innovation and recognition of ability. While many of these companies will be glad to hire people who have earned MBAs, it is a bad career choice to take such as post, since you will be locked into a set routine that would not allow you to use all of your tools and ability. The person who earns an MBA should seek a company which not only offers a good salary and position, but which will make use of the full skill set of its MBA class.

How do you find such companies? A good MBA student can actually do this without too much trouble. One of the requirements of any decent MBA curriculum is regular production of research and analysis for all the different classes. Find the industry you want, narrow it down to the region and other particulars which suit your desired work conditions, then that should work it down to sets of private and public companies you would consider. For the public companies, look at the last three annual reports, especially the Management Analysis and Discussion, and see how they make use of their people. Look at trade journals and see who gets mentioned – if you only hear about the chief officers at a public company, that is a sign they are not paying attention or giving credit to their working talent, the phrase I use to describe the people who have experience and ability, but who are all too often neglected by the executives. What you want to see, is buzz about the performers who are making things happen, and you want to see evidence of innovation and development of their opportunities.

In considering private companies, information is harder to find but if you look at the local level, you will still find indicators. Media will discuss companies which are leaders in their industry, which is an indication that they are making good use of their management, and even though they do not release audited financials, there will also be financial data available through trade journals and you can pick up buzz through anecdotal discussions with people in the area.

The point for here, though, is that earning an MBA produces a specific skill set, one which only some companies will make effective use of, and so the candidate seeking a career position must do the same dedicated research in choosing a target company as he or she does in his classwork.

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