I'm a developer at a financial services company. I was content to be a developer and let the "business" folks define our stories and I'd just code them. I never understood the application I was building on a deep level--it was always superficial.
A friend convinced me to take a few MBA classes at a local university. The first class was accounting. It opened my eyes to understanding what our product and business owners were saying on my projects at work. Now I could understand the "why" behind the screens I was building! I asked questions that made them re-think their screen mockups. Since then I've graduated and taken classes in Finance, Leadership, Economics, and my favorite: Strategy.
I use more knowledge from my MBA in my coding career than the stuff I learned in my undergrad in Computer Engineering.
In my experience, an MBA doesn't make me a better "coder." But it has given me confidence and competence in my interactions with customers and the leadership team. I'm very glad I took the time and effort to pursue my MBA.
Most entrepreneurs need to spend a significant amount of time thinking about non-tech related objectives (e.g. sales, pricing, marketing, etc). Sure -- there are tons of publications out there teaching a technical entrepreneur the fundamentals of marketing and sales, but it is always specific to the author's/interviewee's own experience which happens to be unlike all others. Or, and perhaps more commonly, these publications tend to gloss over a really important fact (or facts): the author/interviewee had insane connections or a very rich uncle that allowed her to achieve success as an entrepreneur/businessperson without an MBA.
For those would-be entrepreneurs without insane connections, deep pockets, or a future unicorn in the making, the MBA provides an opportunity to build skills and knowledge important to getting a business off the ground and, more generally, teaches one how to operate in a world that revolves around money, not tech. Personally, my MBA gave way to a great new career path, higher salary, great connections, and -- most importantly -- a much more holistic view of the world.
In the end, I do believe that an MBA is not required for success. However, I disagree with Thiel and Sandberg drawing such a hard line in the sand. People looking to learn is never a useless act.
For context -- I picked up an EE degree in undergrad and eventually went on to grab an MBA.
FS is a bit of a special circumstance -- you are expected to understand complex financial instruments well enough to write code around them, so a background in investment finance is almost required. There are few places to learn about investment finance outside of an MBA, so it's almost a requirement.
And I can understand what Sandberg is saying -- it's definitely not an explicit requirement; some people are great engineers and have excellent soft skills and can play that up into management. They can play the politics game well, and likely had role models who taught them the rules of the game.
But for myself, an MBA was absolutely necessary. I wasn't ignorant about how to run a business, but I was completely unprepared for how corporate politics work. There are some things you can learn by trial and error, but the complex dance between operations, product, sales, and finance is something I didn't even fully understand until I was working post-MBA.
Can I offer a different point of view? I think that the situation you were in would have benefitted from any effort to learn the other aspects of the business. Going to b-school to do so was just one path. Alternatively you could have sought out someone in the business and asked them for help on learning the other part of the business. Its not universal but I've never met someone who wouldn't help me learn the business better if it helped me to provide a better product.
I think the point that Sandberg might have been making was there are some good fundamentals learned in going to business school, however, in tech we move so fast that the education is diluted.
I'd also say that in tech we are pre-disposed to attract a lot of self-educated/self-starter types, those folks seem to take a modular approach where if they are deficient in some piece of information they go out and learn it.
There are different types of learning. It can be easily said everything a person learns in school can just be learned by reading a book outside of school. However, some people learn better by lecture and other people by simply reading on their own.
There was also a movement in the 90s with secondary education where teachers tried multidisciplinary education -- I don't follow these things so it might still be a thing now. The idea is students are more engaged and retain information when instead of being taught math and history separately, they are taught the history of Fibonacci as the same time they are taught about Western Civ and the dark ages of math in science in Europe. Another example is integrating metal shop with physics no becoming energy shop.
What OP has discovered is that what might have been boring and inconsequential to his life now has become important to the task at hand.
Absolutely true. Quoting Justine Musk (Elon's ex-wife, I think):
"...Choose one thing and become a master of it. Choose a second thing and become a master of that. When you become a master of two worlds (say, engineering and business), you can bring them together in a way that will a) introduce hot ideas to each other, so they can have idea sex and make idea babies that no one has seen before and b) create a competitive advantage because you can move between worlds, speak both languages, connect the tribes, mash the elements to spark fresh creative insight until you wake up with the epiphany that changes your life."
That's also what Steve Jobs said in his commencement speech. He talked about the DTP industry not existing before the Mac, but by adding greatly designed fonts to the system a whole new market was created. And Steve got the fonts idea back from his college years, when he followed a calligraphy class at Reed college [0].
Yes, I do...but I haven't only worked in the financial industry. I still think an understanding of how business leaders think is helpful in any industry.
"Tech Industry" is pretty broad...Facebook does advertising, marketing, and communication....all areas that benefit from an MBA.
I'm from South America, have a b.s. in computer science and worked in management consulting before going to business school. For the past few years, I've been working in tech and living with my family in the Bay area solely because of my MBA.
I'm not referring to the academic knowledge I gained, or the global mindset I now have, nor the network I built, which are all valuable. For internationals like myself, the MBA is a great opportunity to make a radical change in your career, as well as your personal life.
This has been my experience as well - getting a deeper, business insight into the applications that I was building for my customers.
It has also helped me in one more way - getting a feel and helping me understand why my own company behaved the way it did - including business strategy, sales dynamics as well as HR policies and practices.
Moi aussi. My original impetus for going to business school was the realisation that there was a lot I didn't know about running a business, strategy, marketing, business development, finance, cash flow planning, accounting, cap tables, negotiation and all the other little things that add up to a successful venture. I was a CTO at the time, and I was exposed to all this sort of stuff during interactions with the CEO, COO and other board members.
What I didn't realise until after I'd graduated was that having a better understanding of business would effectively make me a better product manager/designer. When you can combine an understanding of business with an understanding of technology, the whole is greater than the simple sum of its parts.
IMO, you can go a long way by picking up a few basic textbooks for whatever your coding. A basic understanding of terminology is really useful and takes far less time than going to class.
PS: If you have never looked into the topic an MBA has plenty of useful ideas. But, I find the cost / benefit of getting an MBA is a negative indicator.
For me, a lot of the learning came from interactions with my classmates. Instead of just reading (or being taught) the theory, you can discuss most of the subjects with someone who works in that field.
I would be interested to hear from you, and anybody else with similar experience, what were some of the most valuable courses you took. That is, for someone with no interest in pursuing an MBA but with the opportunity to take a course or two, what are the must-haves?
Finance, basic accounting, economics, and strategy. A lot of it boils down to thinking about cost/benefits all the time. A lot of these concepts are common on this HN board because it is entrepreneurship themed. Examples:
"Is it okay to build a cheap thing today, knowing the engineering sucks and it will be expensive to fix later?"
"Technology X is cool, what is the cost to switch? Short term, long term? Support costs? People costs? Are there savings? Are there strategic advantages?"
Core marketing, accounting, finance, and microeconomics. In more or less that order. Others include behavioral economics/decision theory--or at least read Ariely or Thaler's book. Other possibilities include organizational behavior, negotiation, pricing, business strategy. One general comment is that, if you're just looking at a few courses, you'll probably get more out of in-person courses that have case studies and/or group discussions, role playing, etc. and just read a book to cover more lecture-oriented material (like microeconomics usually is).
Understanding the fundamental concepts of, for instance, CAPM and free cash flow have been useful in my career. You also pick up some useful personal investing lessons.
In general, this class gives you insights into the decisions a CFO (and supporting team) is faced with -- e.g. is it better to invest in tech A or tech B or neither?
In my own personal career, I've had to make a case to Finance in order to build out a program and being able to talk-the-talk was helpful.
1. Accounting - It's the language of business. Like learning English before you become a pilot. This class helped me start asking deeper questions when meeting with business people.
2. Finance - Holy cow, the ability to put a value on cashflows and understand the cost of capital really opened my eyes to the big picture. I also use my Finance classes to help when deciding to take Job X or Job Y...
3. Strategy - My FAVORITE class of my MBA. It's helped me when a complex situation arises--I can objectively measure the different components of the problem and look for solutions.
4. Economics - Really impacted me to ignore the hype of the news. "CHINA WILL OVERTAKE THE US ECONOMY IN X YEARS" So what, it isn't a zero-sum game.
Accounting is really important, but if you have the basics getting to the point you can see though accounting tricks has limited value and takes a lot of work.
It's like an extreme version of the 80:20 rule. You can get some basic c functions to compile in a few hours, but seeing though the winner of an obfuscated c contest on your own might take years.
Just remember, your not a specialist and becoming one takes a lot more effort than a few MBA classes.
That all sounds good. But why not just grab a book and read. I recently read "Crossing the Chasm," and it was completely eye opening as I was able to reflect on mistakes I made in terms of early market development when I "started out."
To each his own, I guess. Perhaps I just don't like to glorify schools of any sort.
Grabbing a book and reading also works. The thing that a school gives is a standard curriculum so that a student doesn't miss concepts they may simply not know about.
I did things a bit opposite of who you are responding to though. In undergrad when I did my CS degree, I also did business classes on the side (economics is simply interesting to me). I ended up only a few classes away from an undergrad business degree when I graduated. Later I went back and got my MSc in CS.
The business knowledge I gained from those few classes early on has helped more than anything else in my career.
That's really interesting. I am like you were. I am a developer but all the decisions are done above my head. I don't feel like I don't understand the whys and I do have my own questions to why things were done the way they were and I have opinions on improvements. The problem is that that is not my job. The company wants business people to plan and developers to create - because that makes sense. Everyone's time is used for their strengths.
After you did your MBA, did you take up new responsibilities in work? Did you get compensated for being a more valuable member of the team?
Do you think it would be worthwhile for someone in my position to do an MBA considering I don't feel like you did?
> The problem is that that is not my job. The company wants business people to plan and developers to create - because that makes sense. Everyone's time is used for their strengths.
Why isn't it your job to ask questions and suggest better ways to do things? I'm not saying you should be contrarian, but in my experience the business owner welcomes suggestions for app improvements if done respectfully.
I had the illusion that I understood the business reasons, just because I was familiar with the terminology...but really, I didn't quite have the full picture.
> After you did your MBA, did you take up new responsibilities in work?
Actually, yes. Due to the confidence in my Accounting and Finance classes, I really started to stand out among my peers. It led to a promotion to a lead developer and then I was nominated for my company's "Emerging Leader" program (open to less than 2% of employees).
I have since parlayed it into a director of software development job at a small tech company. When I met with the founder and the management my MBA was a key reason why they offered me the salary I wanted. I get to sit in the management meetings and talk about marketing, pricing, hiring and team size. My Strategy class has given me a framework for focusing on our strengths. My Finance classes have given me an understanding of how to value different projects and their resulting cashflows. My Accounting classes have given me the ability to speak the language of business. My marketing classes have allowed me to talk about market segments and understand why the Marketing team is so insistent that we keep a brand message consistent throughout our products.
> Do you think it would be worthwhile for someone in my position to do an MBA considering I don't feel like you did?
I think I'd approach I'd ask myself the following questions:
* Do I keep quiet in meetings because I lack certainty or confidence about what the business people are saying?
* Do I have 4-6 hours a week for the next 2-3 years I can spend on class and coursework?
* Do I anticipate leading a software team someday or founding a company?
* Do I struggle to gain credibility with influential people?
* Do I think I'd like to teach at a community college or higher?
* Do I lack the motivation to read intentionally, forcing myself to really understand and absorb the information?
If you answer yes to 4 or more of these I think you could benefit from an MBA. I think you could get a lot of the knowledge by reading books from Drucker, Levinson, Carnegie, and Collins. I read a lot of these books too, before I started taking MBA classes. I had knowledge, but didn't have confidence (or a fuller understanding).
Sorry for the long-winded reply...hopefully it's helpful.
I'm always skeptical about stuff like this. Sandberg's springboard into her career was two-fold: working at McKinsey after HBS, and working under Larry Summers, who was her thesis advisor at Harvard UG. She went to Google as a VP after her stint in government.
There is a huge "getting your foot in the door" advantage to that credential. I can totally believe she didn't use much of what she learned at HBS in what she did at Google. But would she ever have gotten that VP job at Google without that sterling resume?
Good point. Pedigree is and always has been a huge advantage. A disproportionate number of execs' backgrounds I've looked into have Yale/Harvard/Stanford/etc somewhere. I wonder if that will ever change. Having worked with many folks who attended those universities, most do not strike me as being intrinsically more capable than their counterparts who attended other universities, although a few have a high degree of self-assuredness (which, granted, is quite valuable as a career trait).
I think it's wise to rephrase her statement: "An MBA is not useful in the tech field if you already have a degree from a top university"
For the rest, if you want a foot in the door at Facebook and don't have Harvard or Stanford on your resume, a MBA from Booth or MIT Sloan will definitely help
I've never worked with MBAs before, in all my tech career, which included stints as a programmer and then a long period as a manager/director where I was in a much more business-oriented role. I always had a preconception that "MBA" essentially meant "management consultant", those high-priced guys who were paid to support bad news the CEO didn't want to seem came from himself. Restructuring advisement is certainly a valid role business consultants fulfill, but it's definitely not the only one, or even one of the more common ones.
I joined Google this summer and I have 2 ex-consultant MBAs in the team I'm managing, along with a third employee who is ex-BCG-but-no-MBA. They are awesome. They freaking rock at analysis, and are highly skilled at asking good & pointed questions to help nail down business opportunities & good/bad ideas. Two of them have technical BSes (EE & CS) and are fantastic PMs: well organized, analytical, strong communicators, outgoing, and perhaps most importantly, they know when they're weak in an area and how to recruit complimentary team members.
This by no means should be considered advice that everyone needs an MBA, that all MBAs are equal, that all tech PMs need an MBA, or even that all Google MBAs are good at their jobs, but MINE ARE, and they'd be much less proficient if they hadn't spent that extra two years in business school (along with tech internships both years). Just like everything else, people need to set goals and work appropriately to achieve them. For some individuals this will suggest an MBA; for many others, not so much.
Honestly, the biggest piece of business school advice I'd offer anyone is that if you can't get into or afford a top tier school, don't bother paying a school at all. Just try to DIY it the best you can. The gap between what students get out of the tier 1 programs and everything else (with a few notable exceptions) is immense.
I'm not counting exec MBA programs at all. They're specifically targeted at people who are already execs and just look to amp up certain skills (M&A, international development, etc).
This is a great comment, and I love seeing these kinds of testimonials counteract the dog pile of MBA bashing you usually see in this forum when the degree gets mentioned. Also, the advice about only bothering to consider tier 1 schools (basically top-10 or top-15 depending on who you talk to) is accurate. I think the degree gets a bad rap and is severely under-appreciated here in the Valley, but it's hard to change people's minds and correct biases.
IT people with MBAs are super valuable. Every company HAS to have a tech strategy beyond what JS lib to use next year on the website. This merging of technology and business is hard and requires people who can live comfortably in both lands. Typically it means starting as a technologist and moving towards the business side, although I have seen it come from the other direction also.
In my experience, ex-consultants are nearly always extraordinarily capable. The anti-consultant bias comes from what consultants are often asked to do, not from their competency.
> Sandberg suggested a career in tech might not even be necessary to catch Facebook’s attention. “We don't look for a specific background or skill-set when we make hiring decisions,” she wrote. “As my friend and Instagram COO Marne Levine says, we hire athletes and cross-train them.”
From a randomly selected job posting on Facebook's web site:
Requirements
B.S. or M.S. Computer Science or related field
Experience building high-performance, large-scale server applications and reliable software
Expert knowledge developing and debugging in C++
End-to-end experience in online ad serving and background in online advertising/auction theory strongly preferred
Knowledge of Perl, PHP, or Python a plus
Knowledge of Hadoop/MapReduce a plus
Her words are carefully chosen. They don't look at it when they make hiring decisions. They do look at background and skill set when selecting candidates. (i.e. If you can lateral into the interview process it's cool that you don't meet the job description. If you come in off the street looking to interview, you better check all the boxes if you want our time.)
I believe Sandberg was referring to positions where someone might think an MBA is required, like product management. No one is asking whether an MBA might be useful for highly technical roles, like the above posting for someone doing the technical implementation of an online ad engine.
From what I've read of Sandberg, she is an executive looking at grooming executives. In her mind, "professional" is equivalent to a plumber: not her children.
Her athlete analogy makes a special sort of sense in that context. I have seen a strong connection from the athletes and spec-ops people I went to school with now moving into executive positions. I'm not sure what the common denominator is, because I know a lot of athletes who are now in construction too. But if you're an athlete and can hang intellectually, there's a desirable mindset there. And I think that mindset is the striver: they see themselves every day as a little faster or a little slower, never the same. And they always want to be faster.
In Plato's Republic, there's a chapter on training the guardians, and I think that reflects her ideas reasonably well, in so far as a lot of Western leadership practices derived from the Greeks and the Republic in particular.
I wonder if she would still become COO of Facebook without Harvard MBA and all the oportunities resulted from it.
MBA is probably really not necessary, but if you have the oportunity to do one on a top school, it may open some doors and expand your network. At least it has no negative effects (if you can efford it).
Especially if you have technical background and want to move to management position. It simply diversifies your background and strengthens signaling.
It has opportunity costs though. Assuming that MBA is indeed useless, she would have achieved greater things in lesser time had she spent the time on something more meaningful than pursuing the MBA.
But are statistical conclusions really necessary? Or the only conclusions that matter?
I look at it from a market perspective: she had to compete with a lot of people for that position. If an MBA was a disadvantage, would she win that position?
Of course, there are many factors for why she got her position. But I doubt that she strictly speaking knows which of them contributed and which of them didn't.
> But are statistical conclusions really necessary? Or the
> only conclusions that matter?
They are in the sense that without any further information, let's make other claims:
- Would she really be the COO of Facebook if she wasn't a woman?
- Would she really be the COO of Facebook if she wasn't an Harvard alumna?
- Would she really be the COO of Facebook if she wasn't Jewish?
.
.
.
> there are many factors for why she got her position. But
> I doubt that she strictly speaking knows which of them
> contributed
Precisely; nor do we. There seems little point speculating. (However something statistical like 'x% tech COOs have an MBA' would be more interesting).
The issue with pointing to things like "the Harvard MBA" is that people who are selected into top tier programs are likely to have done just fine on their own anyway... so it's really hard to say that the MBA is why she was successful. I think she was successful because of qualities she already had, not something she learned in business school.
I think the implication may have been that the "Harvard MBA" credentials - not necessarily training - may have been instrumental in her career path. Degrees are filtering mechanisms, and while it may be true that an MBA isn't needed to succeed once you're in the door, it may be harder to get your foot in there in the first place without them.
The assumption underlying your point is that Harvard does a good job selecting people who have the qualities to be successful and would be successful anyway. That's probably true. But the catch is that lots of employers make the same assumption, and use the Harvard credential to screen the candidate pool. Which makes total sense if the assumption is true, but also makes it risky to forgo the credential on the reasoning that if you are smart enough to get into Harvard, you'll be successful anyway.
Yes, someone saying something is unnecessary in a given context, while they possess that thing, which may or may not have helped them getting where they are in that very context causes some cognitive dissonance.
I actually agree with her, however, I wonder whether she'd be where she is how having had listened to her own advice.
Honestly the MBA has always mostly been an advanced degree for people who didn't get an advanced degree in a real subject. Lets people tick the 'grad school' box. The real world value has always been quite questionable and yes I'd agree here that in tech it's mostly useless, if not actually even a disadvantage.
For what's it's worth nearly all the excellent executives I've met over the years didn't have an MBA and nearly all the worst ones did...
My experience is that the entire value of an MBA is in the network of people you meet through business school.
I asked a friend who had a technical degree from an excellent university, and later got an MBA what useful skills he learned, and he flat out said that he only got it for signaling purposes. As far as new ideas/notions, it was basically absolutely nothing.
A quick glance at any publication on 'managerial studies' will confirm the total vacuity of the field. The average published article is a 'just so' story backed up by a dramatically statistically underpowered study. Managerial science makes social psychology look like quantum physics.
Well, I have had the opposite experience, but then again I'm not in tech.
Thing is, the useless MBA image comes from the indiscriminate and formalistic practices of HR recruiters, who would equate an "MBA" with "value". So the incentives have changed from "I want to bring my company forward" to "I want a cushy job with little actual work".
And it is true, that traditional business education has now suffered from this. What I ask myself, if CS will be immune to this. Judging that Fizz Buzz is still a thing, I'd say no.
Why are people on HN so obsessed with trying to find argument fallacies in comments?
No, I am not saying that. The words "true MBA" have the same amount of content to them as "a true kitchen sink": zero.
I say that people buy education for different reasons. Some get an MBA because they want to flash their CVs, have a cushy job, and avoid the strains of being original. Others get an MBA because they need the skills, the language, the professional network, and the confidence, that such degrees (at least from good universities) bring for a specific goal they want to accomplish, be that within an already established business or not.
Saying that those kind of mind sets (or only one of those mind sets) is strictly particular to a group of people, which made a certain academic choice is wrong.
In my professional experience, for example, I've met a lot more engineers who were absolutely useless from a business perspective, than I've met useless MBAs. Of course, this is because I've met way more engineers than MBAs.
Well, when you quantify your opinion like that, there's not much of an opinion left to even debate.
"Different people get an education for different reasons" is a nice statement, and I would even agree that it's true. But nothing follows from that. It's not a statement that one can draw conclusions from.
In your original statement you're saying "MBAs are useless now, but it's because of HR, and it sucks that MBAs are useless but it didn't always use to be like that". Now you're saying "no, they aren't useless, in fact they're better than engineers".
Oh, how easy it is to claim a strong point when you're unconstrained by the truth.
I haven't claimed a strong point. Neither have I said anything like what you are implying I've said. I've only tried to clarify my previous comments at which I seem to have failed.
Unless you're considering the opportunity cost of doing an MBA vs. learning a new technical skill for 2 years, I'm not sure how extra education could ever be a disadvantage. Sure, in tech (specifically in Silicon Valley), the value of the degree is pretty much ignored. I'd probably get the same opportunities out here with or without mine on my resume. I can't see it ever being a detriment though. Are you telling me that there are companies who will interview me, be all set to send me an offer, then find out I have an MBA and say "Oops, no-hire! Looks like you're a moron!"
I reckon I'm a prime candidate for an MBA because of the aforementioned factors. I don't have an advanced degree in a 'hard' field. Even though I run a business - and a growing one at that - there is some insecurity that comes from not having an advanced degree checkbox against my name, especially since I come from a culture that values education highly.
> For what's it's worth nearly all the excellent executives I've met over the years didn't have an MBA and nearly all the worst ones did...
I sort of draw a comparison between that and something I heard the director of a local accelerator say once: "We look for founders who are open to taking advice from mentors, but at the same time, don't take everything everyone says to them as gospel."
I think there's something similar to an MBA program. The people who do best are the ones who are able to take what they've learned and run with it, rather than use exactly what was taught in school as playbook for every business.
It confuses me endlessly that MBAs should be so misunderstood by so many people, it being suggested that they are only good for networking, that people with MBAs are cold and evil, and so on. They're simply a course which teach you the fundamentals of several areas which are relevant to business. It'd be like saying that a degree in CS would be superfluous for somebody who wants to program. If you love programming, then you'll get value from every aspect of a CS degree. Likewise for an MBA and business. Also, truly they only teach the fundamentals. An MBA's exposure to marketing/accounting/management would be far more diluted than that of an 18 year old who pursues a degree in one of these specific areas, so I'm not sure why people seem to be so threatened by the MBA.
It's also funny to read in the article that Thiel has said MBAs are useless, because his books are a joke when compared to the most basic business courses. It's also laughable that Sandberg would say this, having already gotten an education from a place which has been central to business trends globally for decades. It's likely that Facebook et al would not exist without HBS and similar institutions in the US.
The usual criticism is that MBAs believe the degree endows them with far more strategic intelligence than they really have.
It's like officer school. The worst graduates come out absolutely convinced they can run an entire army, when in fact they're still almost completely clueless.
Aside from the networking - which is not trivial - the benefits of an MBA for talented individuals seem to be exposure to the idea that strategy, cost/benefit analysis, accounting, marketing, and the rest all exist, and are more relevant to a business than the code base.
This can be a surprise to straight CS people, many of whom only care about code.
But by analogy, many MBAs only seem to care about money.
There's more to running a successful business than the bottom line - or at least there should be - and more subtle management principles that build businesses by making customers and employees happy as well as making shareholders rich don't seem to figure at all in MBA schools.
The MBA point of view seems to be that happiness doesn't matter when there's profit to be made.
Ironically, there's a lot of poverty in that view - not just morally, but politically and economically. In the longer term it leads to the kind of economic picture we have today, where there's a lot of profit being made, but at the cost of rapidly shrinking broad prosperity and economic freedom for most of the population.
I can't agree on your interpretation of an MBA point of view, but I will say that it does seem to be the most prevalent interpretation. Thinking solely about the bottom line could be the result of a twisted grounding in accounting, but no other course in an MBA relates to profit in any direct way. Almost every class typically/simply involves being grounded in decades of research in complicated areas.
It seems to me that your interpretation is more of a criticism of public shareholding and the duties of the board. Coincidentally, board members in public companies may be MBAs, and their consultants may be MBAs, but the Masters isn't why they're pursuing profit.
Lastly, I had whole courses on the happiness of employees (Organisational Behaviour, HR), but like Strategy and Marketing and every other class, they were extremely theoretical and totally unrelated to practicalities of business such as profit.
My complaint (and I suspect many others') is with the idea that someone who has studied the discipline of "business" is qualified to run any business, regardless of what it does. That they know better than, and should have authority over, the people who are actually domain experts in what the business does.
When we complain about empty-suit MBAs running a software company, that's assuming the suits are just MBAs, not engineers who also got MBAs. They have no skill in or respect for the craft of programming, they probably don't even understand what it consists of, and yet they are in charge and the programmers are not.
Working for a technical or formerly technical manager, rather than an MBA who studied Information Systems 10 years ago and reads InfoWorld, as if that qualifies him to be CIO/CTO, is in large part what draws people to Silicon Valley and away from corporate IT departments.
> My complaint (and I suspect many others') is with the idea that someone who has studied the discipline of "business" is qualified to run any business, regardless of what it does.
Yes, this is my impression too, having once worked for a CEO whose primary qualification seemed to have been his MBA. What they taught him seemed to be applicable to running a division of a large company; it seemed anywhere between irrelevant and outright wrong when applied to a software startup.
Maybe the efforts of people like Peter Thiel and Steve Blank will help get out the word that managing a startup requires a very different skill set. In general, it's my observation that different kinds of businesses need to be managed very differently. While there probably are some general principles, I have the impression that business schools underemphasize the variety that's out there, and the importance of understanding the business before trying to manage it.
I think you sum it up in your first sentence: an MBA involves the study of the discipline of business. It's distinct from the practice of actually running a business, and the courses/classes are almost always highly theoretical and research based. I have a masters in business and I can assure you that no company will let me manage shit, because the course didn't confer 'experience' unto me.
I'm sure that all competent managers of programmers respect the craft. I've met several managers who didn't respect programmers though, but my perception of them was that they weren't competent ;)
Also, I remember reading somewhere that one of the Google founders (Brin, I think) was actually proud of not having an MBA. Not 100% about the validity of the story though.
Thing is, if it's true, I can understand the sentiment of rebelling against the older business culture that people with MBAs represented at the time. Thing is, all the VCs that bankrolled early Silicon Valley did (and do) have MBAs. So the point is the stance is a bit hypocritical.
The older business culture do not hold MBAs more often than not. They usually came from finance/accounting backgrounds. The better ones had some operations experience before going to university for a bachelors degree. That or were former engineers who had learned finance on their own.
The contempt I have often seen towards MBA holders has more to do with them being young people with little or no experience in operations, but with huge amounts of encyclopedic knowledge on "business stuff" (strategy, management theory, etc). They are good to have as tacticians if you can pair them up with some greybeard who can provide context, but left to their own devices they tend to abstract away too much details of the businesss.
Or maybe that is what you refer by "old" and what I am talking about is "ancient history".
> She said her MBA helped her get a basic sense of business, which might be instrumental “for some people and in some situations,” but dismissed the notion that the training would offer a leg up at Facebook.
My background is economics (and political philosophy) - and I work in tech - first as a programmer, the product manager, and now as founder: knowing economics has been useful in my roles as PM and founder.
Everyone should know some basic economics - micro-econ concepts such as marginal utility, producer/consumer surplus - as its useful for business.
And everyone should know basic macro stuff (interest rates/GDP/etc) because in a democracy it pays to have informed citizens.
ehh... MBAs are pretty useful when you raise ridiculous later stage round and need to justify a high burn rate so you hire a team of them....
The MBA could be useful but most MBA curriculums have not adjusted to the speed of firm development in the startup space. the degree needs a 21st century revamp.
It needs decoupling from academia, like a lot of university education. It's not a vocational qualification, yet industry treats it as if it is (Computer Science also suffers from this), so the universities do their best to make it as vocational as they can.
It really needs to be separated out into "advanced management training", a "masters of business research" for the academics, and really a "business teaching qualification" as a third option. Trying to wedge all these objectives into one course is hurting everyone.
An MBA is an academic qualification, taught mostly by academics. Academics generally won't teach Lean because there hasn't been much academic discussion of it (yet). Mind you, I completed mine in 2013, so it's possible there's been some changes since.
Entrepreneurial units in my MBA focussed on writing 40-page business plans for conventional bricks-and-mortar businesses with known business models. Which is fine, because that's what 90% of entrepreneurs do. Building a business without knowing the business model before you start is stupid risky according to this mindset (and they're right, it is, but that's half the fun).
Then why do several prominent tech companies have MBA preferred in their business job postings? I noticed maybe 9 months ago during a job search.
I also have a friend who is MBA and works at FB. They have a whole formal program set up for them.
So while it may not be advantangeous per Se I think companies do use it as a proxy for character traits or pattern of achievement. Because of that it is an advantage. Even if not if they have a formal Recruiting program then IT is an advantage.
It's a matter of walking the talk. Every tech company says, "We don't care about years of experience with a specific language. We want someone who can learn quickly no matter what they do". Then you interview and they ask you specifics on whatever programming languages they're using internally.
Because, honestly, HR at most of these "tech companies" is rather clueless. Also as an investor if I see a tech companies looking to pack the halls with MBAs that tells me a lot about its soon to be bloated future.
If someone is really skilled outside the MBA and it was more of a tack-on then they'll probably be fine. ...but in my experience the person relying on their MBA is the type of clueless executive that demands all the metrics for their division be totally reworked into some crazy ridiculous Excel spreadsheet because that's the only thing they know how to use and they think this means that they are doing analytics. These are the types that slowly destroy companies these days.
So you stopped investing in Google, Facebook, Amazon, and Apple? Each has formally hired MBAs for years. Google just promoted one to CEO. I assume you're calling the top of each of these companies? How have they managed the MBA death spiral for the past five years -- is their demise just a matter of time?
I agree 100% with Sheryl.
I'm a 7 time serial entrepreneur.
built a few big ones.
the only bad/failed ones were because of MBA leaders in the company.
the only good ones were with techies leading who learned through experience the practical application of scientific business practices.
99% of all top tech company CEO's are techies who learned practical business through experience --- and are not MBAs.
Sheryl Sandberg knows exactly what she's talking about.
MBA was designed for corporate middle management.
No need for that in a startup - especially at founder level.
Now I invest in startups. I do not invest in MBA founders. I'm doing very good investing.
I haven't found this to be universal. If anything, I think it can warp your thinking in a way that can be beneficial in certain circumstances, but is really scary in others. By way of example:
I have a parent who teaches at a top-5 business school. A few years ago, I had the opportunity to travel to Japan on a trip where my parent acted as a faculty chaperone and was able to attend some of the meetings with Japanese business leaders. One of the trips was to a 400+ year-old sake brewer. After the tour of the brewery, there was a Q & A period with the president of the company. The business school students asked him question after question about expansion, new product lines, finding new markets, advertising campaigns...everything they could think about to achieve growth. His answer was always basically the same and to the effect of, "I'm happy with the current situation. I make a profit making the best sake in the world, just as my ancestors have made it for the past 400 years. I provide a comfortable life for my family and the families of the people who work for me. Why would I want to change?"
It was a profound experience for me to watch him try to explain what should be a completely reasonable position to a group of people that have had the ideal of growth beyond all else drilled into their head so thoroughly that they simply couldn't understand contentment with the status quo. On the ride home, the whole group was complaining about why they'd even wasted their time talking to someone so ignorant. Comments ranged from, "He'll be out of business in 10 years" to "At least we got to drink sake."
I worry that putting MBAs in charge of businesses puts a skewed view on risk and desired outcomes. Each and every one of their suggestions could have backfired immensely and most would have required taking on considerable debt. It's this way of thinking that gives people the unicorn-or-bust mentality and look down on those who try to build "lifestyle businesses" (I hate that term). The world would be a much better place with fewer unicorns and more lifestyle businesses. The hockey stick isn't necessary to be successful, at yet it seems to be all that MBAs understand.
Part of the lesson that was drilled into our heads in my MBA program as it relates to strategy consulting was to always start by understanding the goals and motivations of owners/management. The fact that you should understand people's motivations before you can claim to understand a situation seems self-evident to me, but it's obviously not that evident to many.
I'm not sure how much I would blame MBA programs for this - there are a lot of idiots with MBAs, just like there are a lot of idiots with other degrees. An MBA gives students a set of tools and hopefully some understanding of how to apply them - but it's still up to the individuals to use their own judgement.
That's a fair point. Those skills are probably completely unnecessary for building small, sustainable businesses. But whether they self-select or are produced, I can see it leading to broad, cynical generalizations about MBAs which are, for the most part, true.
Why is it that every couple of weeks the tech world has to re-adjudicate the MBA argument? Is it just a fun debate? Why do so many people care about other people's degrees?
I have an MBA, I normally go around saying it doesn't matter. Mostly it's because bragging about your MBA is douchey, and we know it. I don't feel like people I work with care either way.
I think Sheryl might be missing the point that it depends with where you're coming from. Career paths differ and I think it's hyperbolic to reduce it to one "true" way and discredit some things from a privileged position.
A lot of top execs do have the credentials often dismissed so I'm not personally sure they'd be there without that kind of education.
The value of attending business school (assuming it's a top school) might be more related to "outside" factors such as more opportunities, tapping into good networks and of course, involvement in different disciplines with all the resources you need to grow your thinking and expertise.
What I am concerned about is that some statements can easily be taken the wrong way by people who honestly would benefit from MBAs. Facebook not choosing or using an MBA as main criteria is fine, but Facebook is not the only company that matters and i'm sure having an MBA does also not discredit you in their eyes.
Corporations are legal constructs that require specific domain knowledge to correctly administer and develop. MBAs are ostensibly targeted at that (in the same way Computer Science degrees are ostensibly targeted at teaching you domain knowledge to think and reason about the specific mathematics that underlie computers and software).
What you get out of them and their utility probably is very contextual in the same way any degree is.
My suspicion is that for many roles and at many times in a technology business, the utility is low, but that for some roles at some times, it is quite high.
Ultimately, the thing that's might be funky is that if you hire someone for their expertise in domains pertinent to MBAs, you are putting them very close to having control of the legal construct of your business. Like a sysadmin, you need to place a lot of trust in them to ensure they are doing their job correctly if you don't have the domain knowledge to provide careful oversight.
Aside from the value of the degree itself, can anyone attest to the usefulness of any particular knowledge gained from doing an MBA, particularly around running small companies and startups? If so, any recommendations for resources, books etc?
This whole issue (usefulness of MBA in tech management) sounds very similar to the usefulness of CS degree in development issue. We can talk all day about the effect the CS degree has on getting jobs in the first place, but putting that entirely aside, as a developer with a CS degree, I can certainly point to some very useful things for the job that I learned in the course of doing the degree, and I could tell somebody without a CS degree what those were and where to read about them. Ignoring the entire issue of whether or not the 'piece of paper' would help them in their career, this knowledge certainly would.
If anyone (MBA or not) has any such advice, I'd be very grateful to hear it!
I'm a chemical engineer and self taught programmer who turned strategy consultant. Graduated from my MBA a few weeks ago, so I might be a bit biased :)
I've found that different people find different things valuable in their MBA. We had an entrepreneurship prof who was also an investor who took us yoking from term sheets to buy outs. Found that super valuable, but yes, no doubt could read up more on this online as well.
Same for finance, which was a topic that I didn't know that well before. From a course perspective also got more out of strategy than I expected, but that seems to be very dependent on the prof teaching. (Read 'profit or growth' by bala if you want a book, but more suited for large corporates)
Above all though, i think you get more out of the MBA in personal development (leadership in group work, dealing with pressure, being confident with new material, etc.) and network (after 1-2 years you are at least well connected to a group of people that have high business ambitions, plus alumni). In that sense it's difficult to replace the full MBA experience with a set of MOOCs.
Finally, I've always found it powerful if someone in a room full of technical people knows more about business than any other tech guy in that room (or vice versa, being the only biz guy who understands tech or can program in a room full of biz guys). The MBA is one way for technical people to make that step.
realizing that I didn't answer the question... Here are some things I think would also be interesting, regardless of the paper for more tech oriented people:
- time value of money (finance)
- basics of accounting (p&l vs cash flow, you'd be amazed how many startups die by running out of cash even though their p&l is positive)
- basic operations: the difference between efficient and market responsive supply chains (right supply chain for right product, i.e. Don't typically airfreight toilet paper); and the newsfeed or model if you make real products
- lots around marketing (pricing, channels, etc.)
- some stuff on more executive lvl management (do executives have most impact by the decisions they make themselves, or by the premises they set for others in the organization within which they make decisions? If the latter, how do you work best as an exec?)
- negotiation 101: there are some great HBS cases available online, it's even fun as a Friday afternoon to negotiate between people and see what works best.
- governance and boards
- basics of investing, leveraged buyouts, private equity/VC
Carrying the analogy further, the value of getting a CS degree is relative to how you learn. If you're good at learning a lot of stuff in a classroom (as I was in my college majors, math and physics), then getting a degree makes sense. If you're good at learning stuff at home (as I was with computer programming), then getting a degree might be less useful. A person could adopt the strategy of using college for learning the stuff that's hard for them to learn at home.
Regarding business, same thing. Some folks can pick it up by reading books, the newspaper, and just soaking it up at work. Others might benefit from learning it in a classroom.
I agree. Veering slightly off on a tangent but another major (and oft-forgotten and undervalued, I think) advantage of the degree path is that a good course will lead you down the best and possibly most efficient paths of discovery for the important things, and also give you a bit of a kick in directions you maybe wouldn't naturally go on your own, but which turn out to be very valuable after some uphill struggling.
These are things you can figure out, and discipline yourself into, but on your own time and with a fair probability you won't do a great job, when self-learning. With a degree much of that work is outsourced to specialists who have a lot more context and ability to iterate on experience, and that gives you a much smoother path to just focusing on your main job - learning.
So, a good compromise, and the reason I ask this question, is to get recommendations on what to learn, then decide myself how I will do it and on what schedule, etc.
I think this depends on the kind of person you are, as well as the field you are in.
If you can learn things for yourself effectively then there are a whole range of degree level courses which are completely unnecessary. In fact, not wasting your time with them, can be an advantage of its own...
Although even then... its always good to have others with experience teaching you. Regardless of the subject matter.
There is no 'rocket science' in business and there is plenty of material available to learn from.
As many have noted, it's not necessarily 1:1 useful in the context of advanced skills training. However unsavory, many mid to large tech companies have a relatively high concentration of engineers who later received MBA's in very senior positions. So yes - the cliche that it's a way to climb the corporate ladder can still ring true for tech, if the tech company you want to work for is structured in the conventional way.
The biggest value an MBA provides (and this is not me claiming it does or doesn't provide other value) is that companies recruit out of them. If you are looking to make a career change, it can be tough to get considered for roles you might do well in, given your lack of experience, but companies are demonstrably more willing to hire into roles without relevant work experience if coming from a solid MBA program.
More important was her connection to Larry Summers, the Secretary of Treasury. She was given a role that far exceeded her experience, which gave her an advantage over the other 2000 Harvard MBA grads in her class.
In a tech consultancy, especially if you are in the payments space or do any work with financial institutions can be very helpful. Closely defined, yes it doesn't seem helpful in tech alone but we work in/for businesses and our software solutions are often used by business. Understanding overarching business drivers is very helpful.
There is a common perspective in this thread that XYZ skills/knowledge are useful to understand (even if one's not seeking the social signaling associated with a top tier MBA).
Can anyone post some favored texts/resources for self-directed learning?
Unsurprisingly, someone has attempted to make a business out this exact question. The Personal MBA site has a good selection of books to get your started. It's categorized under different topics like marketing, finance, strategy, etc.
I think of Sheryl Sandberg as an ad exec who happened to get into tech at the right time. I'm not really aware of any technical bona fides, just the usual executive ability to extract money from technical processes for personal gain.
Oh, it matters. It can easily be a hindrance because the thinking required by large business, consulting and wall street is quite different that that required to get a business off the ground.
I don't know that more education is necessarily a bad thing. For a startup it's the opportunity cost of someone who has spent several years in an MBA program that makes that candidate unattractive.
You are implying that startups value experience, and more so when gained early in one's career - so they would be discounting knowledge based on how late in one's life it's gained.
I reckon this comes form the American/British style tradition of going straight to college, graduating at 22 and then starting a career. In Europe styding/working isn't a mutually exclusive, binary option. It's not uncommon to graduate at 25 or even 30, whether that's because of mandatory military service, self-funding study concurrently with studying, finding interesting opportunities while at university, pursuing arts/theatre/sport, etc.
In fact, I've never disclosed my age to employers whether during or after hiring. Since it can't be easily deducted from graduation years, I've had people estimate anything from 19-40 in the past few years.
If you are comparing two potential hires, the age should be irrelevant. Experience, skill and future value (including fit and other subjective aspects) vs. their price (salary) is pretty much the only relevant consideration.
>"I think its pretty clear, the time invested in a mba degree is quite enough to really improve or learn new technical skills."
By "technical skills", do you mean programming? Because plenty of financial based technical skills are taught in MBA programs.
Of course, HN loves to blame MBAs for everything that goes wrong in tech companies; meanwhile, how many founders can't read financial statements, have no idea how to market, can't budget, can't do HR and get suckered in by VCs? Plenty. I think there's a direct correlation between people who think MBAs are "useless" and those who don't understand that running a business is much more involved and harder than it seems.
MBAs aren't required in tech in much the same way Computer Science degrees aren't required. But they're certainly valuable.
>>and having an MBA from a top-5 school gives a person a huge advantage.
Certainly. There's a saying that having an MBA from Harvard will guarantee you at least an interview anywhere in the world.
The problem is that the vast majority of MBAs did not get their degree from Harvard, or even the other top 4 schools. They got their MBAs from regional universities or no-name business departments.
Most people with a top-tier MBA would never wanna work in tech.
Sure, it may seem interesting to be an executive in Facebook, but that is not nearly as lucrative (and interesting) as working in trades or billion dollars deals in finance.
>> "Sandberg suggested a career in tech might not even be necessary to catch Facebook’s attention. “We don't look for a specific background or skill-set when we make hiring decisions,” she wrote. “As my friend and Instagram COO Marne Levine says, we hire athletes and cross-train them.”
So how does one interpret this? It sounds like she doesn't really have a good idea as to what makes a great employee, and falls back to magic catch phrases, altough this is probably an industry (actually multiple industries) wide problem currently (How to identify a great employee a-priori).
So if she doesn't really know what makes for great employees, is her advice about MBA's really relevant then?
IMHO yes MBA's have a bad rap, but just like everything the knowledge you gain from a MBA program can open your mind to thinking about problems in a whole different way. A lot of techies have no concept of how the business side of the industry works, and it would not be a bad thing to understand it. But you can also gain that awareness from a couple of good books on the subject, not just from attending a MBA.
Just for completeness the other advantage of a MBA is the network, which is another discussion. (Of value for the person, not necessarily for the business, which is the point of the article)
"So how does one interpret this? It sounds like she doesn't really have a good idea as to what makes a great employee, and falls back to magic catch phrases [...]"
How is that your interpretation? She's making a perfectly valid, and fairly common, point: as long as you're smart and talented, your specific background isn't so relevant because we can teach you the specific technologies you need.
I think most developers will agree to this to some extent.
> ..the other advantage of a MBA is the network...
This may be true for a small number of top-ranked business schools (and even then it's debatable) but not for the vast majority of educational institutions offering MBA degrees.
Well I don't have a MBA :D, but I do have a masters degree of a similar orientation (Masters in engineering management). I can only recommend the ones I have read and found of value:
[1] Crossing the chasm (Marketing related)
[2] Peopleware (HR related)
[3] How to win friends and influence people (HR related)
[4] The Goal (Business related)
[5] Critical chain (Project management related)
[6] Who moved my cheese (Change management related)
and any of the lean / agile businessy books for ex.
[7] The lean startup
These might not be viewed as traditional MBA material, but my course featured some of these along with more traditional academic books on subjects like financial management, people management, operations etc. I can provide these textbooks to you as well if you like.
*Amazon links just for convenience, no affiliation.
A friend convinced me to take a few MBA classes at a local university. The first class was accounting. It opened my eyes to understanding what our product and business owners were saying on my projects at work. Now I could understand the "why" behind the screens I was building! I asked questions that made them re-think their screen mockups. Since then I've graduated and taken classes in Finance, Leadership, Economics, and my favorite: Strategy.
I use more knowledge from my MBA in my coding career than the stuff I learned in my undergrad in Computer Engineering.
In my experience, an MBA doesn't make me a better "coder." But it has given me confidence and competence in my interactions with customers and the leadership team. I'm very glad I took the time and effort to pursue my MBA.