What Business Really Thinks of the MBA

Integration

Business schools have long organized their faculties and course offerings by function and discipline. Each course addresses problems from its own relatively narrow, specialized point of view, and topics are seldom integrated or coordinated across courses or fields. A silo mentality pervades business schools, just as it does many corporations. Business problems, unfortunately, seldom respect functional or disciplinary boundaries. As one executive was quoted in Rethinking the MBA:

What’s missing from business schools is boundary spanning. Most business education today rests in silos. It is disciplinary-based. There’s very little opportunity to deal with real problems that cross boundaries, yet that is the nature of problems that people confront in work settings. Think of an M&A deal where you have to weigh the value, complementarities, and conflict in brands, consider tax and manufacturing issues, and recommend how to finance and value the deal. If you walk into a meeting with the CEO of a merger candidate with a Blue Book (the written analysis of the deal) that doesn’t address these issues in detail, you’re cooked.

Organizational Realities: Power, Politics, and the Challenges of Implementation

Despite their years of work experience, MBAs, according to experienced executives, are often surprisingly naïve about organizations. Newly minted MBAs frequently underestimate the power of hidden agendas, unwritten rules, long-term loyalties, behind-the-scene conditions, and other potent political forces. As one executive put it, “They’re not too good at the chess game.” Two other executives expanded on these concerns in the book:

MBAs do not have a good sense of how business works. They don’t have a good understanding of how a decision is made. More should be done to help students understand that the right answer on paper is not necessarily the right answer in practice. There should be more attention paid to process, and more emphasis on politics and power. In other words, there should be more focus on organizational realities.

There is a level of naïveté, especially when it comes to resolving problems. Students need to understand why rational plans don’t get implemented, why logical arguments don’t get accepted, why people say ‘yes’ and then don’t follow through. They need to understand how people think about initiatives that relate to their budgets and their organizations, and how to determine who is their boss and who is not. The MBA curriculum is thin in these respects.

Creative, Innovative Thinking

Even though MBAs are well trained analytically, many executives believe that they still lack essential innovative thinking skills. When faced with unstructured problems, ambiguous data, rapidly changing environments, and information overload, MBAs, critics contend, are less likely to be effective. Several executives quoted in “Rethinking the MBA” cited the ability to work in such environments as crucial to the future of business and the education of MBAs:

We are all suffering from an increase in the signal-to-noise problem. When students develop business plans, they are flooded with information and have trouble teasing out the critical nuggets in their projects and proposals.

The most important thing that business schools do is prepare students for a world that is unpredictable. They need to learn how to cope with problems that are totally different from those that they have been exposed to. There is too much belief in models and data-based thinking. Students are not able to think originally; they aren’t god at working from a blank sheet of paper.

Oral and Written Communication

Managing is a social process, and managers ‘working life is a never-ending series of contacts with other people, say the Harvard authors. “They must talk and listen, telephone, call meetings, plead, argue, negotiate,” as author Leonard R.  Sayles notes in his book Leadership: Managing in Real Organizations. Unfortunately, MBAs are frequently weak in these areas. Several executives quoted in “Rethinking” singled out presentation skills as an area of special weakness:

Students need to master the art of storytelling. They must learn to sell their ideas in a powerful, succinct way.

Students fail to deliver the important message up front. I’m often asked to review their five-minute pitch for a business plan, but after the first minute they still haven’t given me a reason to listen for the next four. I’m looking for clarity with accuracy, precision, and conciseness.