Elon Musk Trashes The MBA — And Faces An Immediate Backlash

Tesla founder Elon Musk is making little secret of his dislike of MBAs.

“I think there might be too many M.B.A.s running companies,” Musk told an online audience at The Wall Street Journal’s CEO Council summit. “There’s the M.B.A.-ization of America, which I think is maybe not that great. There should be more focus on the product or service itself, less time on board meetings, less time on financials.”

It’s not the first time that Musk, who has bachelor’s degrees in economics and physics from the University of Pennsylvania, has trashed MBA education.  Seven years ago, during a 2013 interview, Musk made a point of saying, “I hire people in spite of an M.B.A., not because of one.”

‘DO WE REALLY THINK THAT INVESTOR FOCUS ON FINANCIALS IS AN MBA-EDUCATION PROBLEM?’

Musk’s most recent comments, made during a wide-ranging conversation about leadership, immediately fueled a backlash of sorts and a mountain of commentary from readers of The Wall Street Journal which published his attack.

“Do we really think that investor focus on financials is an MBA-education problem?” asked Rich Lyons, the former dean of UC-Berkeley’s Haas School of Business. “Do firms with fewer MBAs on their boards and senior teams have shorter meetings? I’m skeptical. Might Musk’s rightful emphasis on product be more a function of the science-driven industry he’s in, as opposed to valid generalization?”

And Glenn Hubbard, who recently stepped down from his job as dean of Columbia Business School, countered that an the MBA degree provides entrepreneurs with the foundation to succeed, including imagining a product for a customer’s needs, developing a strategy, putting together a financing plan and building a team. “He is a visionary, but many CEOs do well at vision and execution with the benefit of an MBA, or with a strong team of MBAs,” said Hubbard, according to the WSJ.

‘YOU THINK YOU ARE HOT STUFF AFTER YOU GRADUATE’

Ironically, perhaps, Tesla is regarded highly among business students, placing in the top ten of most attractive employers in a recent survey behind Google, Apple, Walt Disney, Amazon, Nike, JP Morgan, and Netflix.

Of course, MBA bashing is hardly new. Over the years, it has popped up again and again. After all, not everyone is ready to defend the most popular graduate degree in America. Carl Saxon, who said he graduated with an MBA from Chicago’s Booth School of Business, was on Musk’s side. “I could not agree more with Elon’s statement,” he wrote in the comment section of the WSJ. “You think you are hot stuff after you graduate, but it doesn’t take long to learn that you are really complicating the simple. It’s really about execution of the simple to be successful.  When I realized that key fact and it took a few years, I found success.”

Another reader agreed. “This is what happened to Intel,” added Mark Bloomfield. “The MBAs have taken over and the company has entered the terminal HP / IBM death spiral. Intel is now more worried about ‘diversity & inclusion’ than cutting edge technological innovation. Sure, Intel’s financials LOOK good, but that won’t last forever.”

And a few professors weighed in as well. “As a strategy professor who has taught MBAs all over the world for the last 30 years,” wrote Ed Bukszar, I’d say that MBA programs have become less rigorous, and the level of critical thinking has declined. There’s way too little questioning of basic assumptions; far too much acceptance of conventional wisdom. Programs have also become more homogeneous, a byproduct of accreditation from AACSB (American) and EQUIS (European). That leads to greater predictability of competitive moves from grads, and less variety in Universities to facilitate organizational learning. Funny thing is that the more homogeneous programs have become, the more effort that programs everywhere are putting in to selling the uniqueness of their programs.”

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