Before you jump in and spend months on the GMAT or GRE, build up your school knowledge, and create your application to business school, stop and think through why to get an MBA in the first place. If you do that, you'll not only be inspired for the long road ahead, you'll be laying the groundwork for an amazing Personal Statement: One of the keys to your success in gaining admission to the Masters of Business Administration Program of your choice!
This article will help you definitively answer once and for all: should you get an MBA or not?
Table of Contents
What is an MBA degree?
It stands for Masters of Business Administration don’t ya know. It’s the preferred degree program for Wallstreet wannabees, management consulting acolytes, marketers, and certain strains of entrepreneurs, techies, and social impact mavens.
For a much more in-depth treatise on the meaning of this masters in business degree program, check out our article on what is an MBA and how to get into your dream school. For now, I’ll just tell you that it’s everybody’s favorite graduate degree these days. Yes, even now, even with the pandemic, applications are through the roof. Despite the inflated cost of education all around in the United States, the MBA is still an advanced degree that attracts future leaders, changemakers, and the ambitious from all kinds of backgrounds.
Apart from graduate study in dentistry or medicine, year for year the MBA is still the Masters Degree with the highest Return on Investment on average. It’s available to everyone (no special undergraduate study required as a prerequisite) and for many people who view themselves as future leaders, it’s the most expeditious path to having everything you want in your career.
There are a lot of reason to skip an MBA. But this article will help you figure out if you are one of the many, the proud, the ambitious for whom an MBA is a very good idea.
In case you’re new to this site, full disclosure, I have an MBA, and I coach MBAs. Pretty much my whole life revolves around MBAs. So we could say that I am at least slightly biased. Ha! Nonetheless, I will try to include the harsh realities of the MBA so you can make a well-informed decision for yourself. Ain’t nobody should be buying a $250,000 degree they don’t need!
What is the main purpose of the MBA degree?
The History of the MBA according to me:
The MBA was invented in the U.S. around the turn of the last century. As it is wont to do, Harvard Business school takes credit for being the world’s first MBA program. I am guessing they make this claim on the basis of coining the term “Masters of Business Administration”? (shrug emoji). In reality, The Wharton School pioneered the first Graduate Business Degree in the US in 1881 and Chicago Booth followed shortly after in 1898. Harvard Business School came along a full decade later in 1908.
The idea was to study the “science of management” and to train America’s young men (Yes, in those days it was just for men – Harvard Business School didn’t admit women for another 50 years) for a life of service in middle management. Middle management having been invented only a few years prior on the heels of the industrial age as electricity and transcontinental transportation was becoming widespread.
Before the industrial age, everyone was an entrepreneur: they were sole proprietors or family farmers and craftsmen. Then factories shot up, cities grew, and production got consolidated under these big umbrellas called companies. There were still a handful of entrepreneurs (at the top of these companies and in all the fields growing vegetables and raising cattle) but now there were a lot more employees.
Then came capitalism as we know it today in the form of electricity, machines, and time-saving technologies that enabled mass production rather than assembly lines utilizing entirely human labor. Companies invented, built, or purchased labor-saving machines that allowed production to scale while reducing labor costs. It was a big deal – kind of like the robot revolution we’re undergoing right now! More capital meant more pronounced hierarchies. Some people just worked their role on the assembly line. Some people watched those people and made sure the machines functioned. And then some people managed those people. Leadership positions and career opportunities appeared. And on and so forth in a game of business administration Matryoshka dolls all the way up to the top.
Managing managers was a new thing. As layers of activity piled up, somebody needed to sort through the problems at the bottom and relay them to the bigwigs at the top. Somebody needed to improve efficiencies and protect the company’s investments in capital in order to improve productivity, reduce costs, and increase revenue. Somebody needed to manage operations, employees, cash flows, finance, and customers. And so, the middle manager was born.
Shortly thereafter, the Masters in Business Administration followed.
The point of the MBA is to educate middle managers.
It is not, as some would like you to believe, to spawn entrepreneurs and CEOs. The fact of the matter is, if you’re a ninja middle manager working in a meritocratic company, someday you’ll move into the head office and become the CEO. And if you’re a terrible middle manager and flunk out, you’ll try to start your own business and become an entrepreneur.
Not that all entrepreneurs are middle management flunkies. Hahahaha. Many people leave great jobs in companies to start companies with big visions, creative drive, and passion. The point is simply that the MBA isn’t designed to turn you into an entrepreneur. It’s designed to teach you business management so you can be a good middle manager.
In my personal opinion, there is no more noble position in our economic ecosystem than a middle manager. They’re the ones who make sure stuff gets done, that it gets done well, and that the business has integrity. They mentor the people at the bottom and manage the people at the top. Most CEOs don’t actually do much. They’re figureheads who make a few key important decisions based on the analysis and work of middle managers. The actual guts of the business and what makes it run is all the purview of middle management. So don’t knock it.
By the way, management consultants and investment bankers are just specialized temporary middle managers and their skill sets for hire (strategic problem solving and financial analysis respectively).
Here’s one really good reason to get an MBA: You want to be a great middle manager.
You see yourself within an existing company, leading a team, building culture, creating results, and improving efficiencies. You want to help something big get a little bit bigger and a little bit better. That’s a great goal. If it’s yours, then an MBA may be of huge value to you.
But no matter what your personal goals are, the MBA could be beneficial for other reasons.
Hear first hand from one of our clients her reasons for pursuing an MBA despite being a successful entrepreneur.
Is an MBA degree necessary?
Let's just cut to the chase here: Nope!!!
Business, unlike law or medicine is a free for all. Literally anyone can do it, whether they have any idea what they’re doing or not. Ha!!
It’s even generally true that there is almost no job out there that actually requires an MBA degree. Even when recruiters specify MBA preferred, that’s rarely a dealbreaker. Even for the industries that recruit heavily from MBA programs: Management consulting, and especially Bain, BCG, and McKinsey; investment banking; and high-tech project management roles, there are multiple ways in the front door that don’t require business school.
Increasingly, those firms source talent from the existing pool out there. BCG and Bain sometimes hire from other consulting firms; McKinsey hires specialists in various industries. You can even get in the back door into a research or internal role and pivot to a consulting role within these firms.
No matter what you think you want to do with your career, I promise there are other ways to get there than through an MBA.
Here are some jobs that people think you need an MBA for that you don’t:
- Strategy and management consulting
- Venture Capital
- Private Equity
- Tech product management
- Brand Management
- General Management
- Being a CEO, CFO, or COO in any industry
- Real Estate Development
- Hedge funds
- Asset Management
- Investing of any kind
I could go on. But the bottom line is that no matter what you think you want to do in your career, you can do it without an MBA.
So I think we can put to bed the question of whether an MBA is necessary.
More generally, here’s some life philosophy for you: leaders create their own career opportunities. The passionate won’t take no for an answer to their dreams. If you’re working towards something meaningful through your career goals, go get it. The MBA won’t give it to you outright, but it may help you get it faster.
What do the MBA Haters say?
There are some great articles out there about why you shouldn’t get an MBA, and I always think it’s great to start there. If after you read what the haters say, you still want an MBA, then the degree is probably for you!
Some of them raise some really great points. But they’re all written by people who don’t have MBAs, and most of them are just transparently trying to convince you that their world view is the right one without bringing any circumspection to the question, like this one in Forbes.
The author’s reasons (my commentary):
- You won’t make more money. (Most people will experience salary increases.)
- The value of an MBA depends greatly upon the rank of the school. (This is true but only for some people.)
- The debt puts you risk averse at a time you should be trying things out. (True for many people.)
- Earning an MBA is a time suck. (No one who actually has an MBA ever said this ever.)
- An MBA may not be relevant to the job you truly want. (VERY true.)
- The value of an MBA doesn’t last forever. (This argument isn’t valid. Nothing lasts forever.)
- You don't need it for a career pivot. (Maybe or maybe not, but it makes a pivot WAY easier for most.)
- Hiring managers may perceive you as overqualified. (True, but do you really want those jobs?)
- You don’t need an MBA to build a solid professional network. (TRUE!)
- The degree has become diluted. (Maybe, but we can’t go back to 1975 and that doesn’t refute its present-day value to you personally.)
Then there’s this great article in Inc that raises some really good points, especially 2, 3, and 4: An MBA won’t make you more successful, you won’t learn how to run a business, and you won’t learn how to manage people. That’s all true. An MBA won’t give you those things.
Then there is my favorite one, written by an idol of mine, Penelope Trunk. The 5 Types of underperformers who get an MBA.
What she’s doing here is attempting to bust the myths people have about the problems the MBA solves, as is Geoffrey James in the Inc article. She does a good job of that, as she always does. I love busting myths myself. If you want, check out my attempt to bust some MBA myths.
But it’s a logical fallacy to conclude that people having the wrong belief about the value of a thing negates the actual value of the thing.
Be sure to scroll down in her post (or search my name) to read my response. Here’ a snippet of it:
As someone who has an MBA who works almost exclusively with other MBAs and MBA hopefuls, I wanted to add a few more types of underperformers to the list (there were others in my response):
- People who need the confidence and credibility booster before pursuing ambitious leadership opportunities
- People who goofed off a little in college and just studied philosophy
- People who want to be awesome middle managers, which is the hardest and noblest place to be
- People who just love to nerd out on stuff like econometrics, Human Capital, and competitive strategy and want to study business with the great minds of our time
But what if none of these applies to you?
So… should you just NOT get an MBA?
Maybe!! We’ve already said you don’t need one.
If you are hoping that the MBA will solve all your career problems, grant any career wish, or magically turn you into entrepreneur or CEO material, you are going to be EXTREMELY disappointed.
Check out this video where I bust some bad reasons to get an MBA and propose some good ones on my YouTube Channel.
You know, that old truism, mo’ money, mo’ problems, it's really true. And the MBA doesn't actually lead you to have more money right away. In fact, it leads you to have a lot less money because most of you are going to have to take out significant loans to fund your B-school education.
As most of the haters point out, the Masters of Business Administration has gotten awfully expensive. So if you don’t get MBA scholarships and you don’t have a plan to capitalize on that financial investment in your degree program through your own career in management, you may be setting yourself up for some nasty career setbacks.
Be sure to note that everyone’s opinion is just their opinion. Including mine!
To wrap up the haters’ perspective, it’s useful to notice that the “Get an MBA”/“Don’t Get an MBA” dichotomy is being propagated along experiential lines. Everybody’s biased by what they chose and trying to convince you that they’re right.
Take this article, for example, which I first thought was a feature in the Onion. It’s called 50 reasons you should get an MBA, but a more apt title would have been “50 things a handful of specific people did in and after their MBAs.” It’s written by a business whose whole revenue model hinges on more people applying to B-school, so don’t take the biased framing to heart.
And then of course there’s what all the haters say.
In the end, those who have an MBA, say get one. Those who don’t, say don’t. In my estimation, this type of bias is purely a function of human nature and the Consistency Principle – an anomaly of behavioral decision-making taught at business schools worldwide. If you want to skip the MBA and get this concept anyway, just read Influence by Robert Cialdini. We can’t help but justify our own decisions after the fact and presume that what we did is also what everyone else should do.
That means that if you’re trying to make this decision yourself, you can’t really trust anyone’s advice.
But it also means that whatever you do, you will think it’s right!
Ok so we’ve determined you can’t trust other people’s reasons to pursue advanced business education, so what are some good reasons to consider for you personally?
Let’s start with the purpose and value of an MBA degree.
Yet again, the internet abounds with opinions on this subject.
Hear what business schools themselves are saying about the value of an MBA:
- Why get an MBA according to a Harvard MBA student (new business knowledge and abilities, access to job opportunities, and social awareness)
- Why you should get an MBA according to Wharton Business School (global awareness, improved communication skills, network, job opportunities, and better time management)
- The 16 benefits of an MBA from a Berkeley Haas MBA Student (my favorites: Increased self-confidence, credibility, a broader worldview, and a re-energized career)
And here’s what pundits think about the benefits of graduate degrees in business:
- The top 10 underrated reasons why to get an MBA on Forbes.
(My favorites: The chance to make some lifelong friends, your fellow students, who will accomplish great things over their careers in business – AKA your Alumni Network!, to realize how little you understand about the world, and to listen to many accomplished executives from the corporate sector when they come to talk at events on your campus.)
- e-gmat found 20 reasons to get an MBA.
(My favorites: removes entry barriers for career opportunities and career growth, but I take issue with several of them: entrepreneur abilities – not necessarily – and “no age limit” – that’s just not a benefit.)
- And the Princeton Review’s concise summary is perhaps my favorite.
Best answers include: you’ll acquire knowledge and business skills you missed in your undergraduate degree, and you’ll be offered more management and leadership opportunities.
What skills does business school give you?
If you dig into the articles I referenced above or talk to any MBA alumni, you’ll see the answers cluster around concepts that are important for middle management:
- An immersion in the language of business (SO beneficial for non-business undergrads!)
- Exposure to a variety of industries and functions, their various problems and how they work together
- A more global and macro view of the world and of business issues
- The ability to think through problems cross-functionally
- Better critical thinking skills
- Stronger communication skills and soft skills
- Team management, teamwork, and collaboration skills
- Frameworks, theoretical knowledge, and techniques to manage people (note I didn’t say actual management skills! Those can really only be learned through experience on the job!)
All of these are valuable if you hope to chart a course to leadership of any kind in business. They’re valuable if you want to start your own business. And they’re valuable if you just want to understand better how the world works and you didn’t study these subjects sufficiently in college.
What skills doesn’t the MBA give you?
What the MBA haters are mostly trying to discourage is self-delusion: going after an MBA because you think it will solve certain career problems you think you have. Again, you can review my entire diatribe on the problems the MBA degree doesn’t solve if you like.
It’s really important to recognize that the MBA is not going to solve any of your career problems. The MBA won’t give you these things:
- a suddenly transcendent sense of self-awareness or ninja interpersonal skills
- the answer to what you want to be when you grow up or even what job you want next
- a sense of purpose if you don’t already have one
- a powerful network of mutually supportive friendships if you aren’t already working hard to build one even without an MBA
- the ability to manage (upward or downward)
- any specific technical skills or subject knowledge you might need for your next job (did you know many post-MBA investment bankers take classes at places like Wallstreet oasis to learn modeling because it’s not taught in class?)
- the ability to start a business from scratch, achieve startup success, or the skills and courage required to be a true entrepreneur
- a guaranteed salary increase, better job, or happier worklife
If you want to succeed post-MBA, you still need to be self-aware and understand what you actually want to get from your career, from your job, from your team and from your work experience.
You still have to cultivate your own skills of communication, networking, upward management, and analytics. All the ways in which you're going to need to be successful post MBA are going to require more work than what it took you to get to this point.
By the way, these are precisely the skills we help our clients build in the process of assembling their Authentic MBA Application.
Read about it and schedule a call with us to learn how to become a better leader in the process of applying to B-school.
Most importantly, A Masters in Business Administration is not going to help you figure out what you want to do with your career. It's not like a luxury spa vacation of two years with a dedicated career coaches. If you haven't figured out what you want to do post MBA before you apply, you're going to be in trouble. Not only because recruiting starts really fast when you get to campus, but it's also a big part of your application.
What job and career opportunities does the MBA facilitate?
We talk a lot about the kinds of job opportunities an MBA does and does not facilitate on our YouTube channel. Start here:
As you’d expect, the MBA is fantastic for career advancement in a variety of international business sectors. If you already have an idea of the job you’d like to get post-MBA, check out our in depth MBA Career Placement Report. You can also read about the primary industries MBA grads from the top schools go into and the preferred functions of top MBA grads as well. We even analyzed which specific companies recruit the most MBA talent worldwide.
Our purpose in doing all that analysis was to give you the opportunity to compare schools with each other and determine which ones would better facilitate the career opportunities you are seeking post-MBA. Take some time to dig through them and get inspired.
But for all that to be useful, you need to already have an idea of what you want in your career. Still sorting that out? Check out our Career Game Plan Guidance on YouTube:
Here are several special motivations that the MBA can also help you fulfill:
- A big pivot in your industry. If you want to change from financial services marketing to tech marketing, for examp0le, the MBA can help.
- A functional pivot, for example, moving from accounting to a career in finance, or from finance to marketing.
- A geographic change: many MBA students seek the degree to gain access to job opportunities in new countries, including many international students who look to top U.S. MBA programs for job placement in the U.S. after their studies.
- Entrepreneurship, eventually. Entrepreneurship is not the right post-MBA path for most students (200K in debt is a bad time to take on more risk!), but increasingly, MBAs do start their own businesses later in their business careers.
Here’s a neat little graphic from GMAC demonstrating how that works:
Let’s make it personal, why should you get an MBA degree?
Every year I conduct hundreds of calls with MBA hopefuls through our free MBA strategy calls. In about 20% of those calls, I try to talk the candidate out of applying to business school. I do this despite the fact that it is basically sabotaging my chance at making a sale of MBA application services because I can see something they can’t: That the MBA isn’t going to get them more of what they really want from life.
See, there is really only ONE reason we humans do anything: because we think that thing will make us happy. We’re happiness-seeking, pain-avoiding machines. You should always let joy be your North Star. What brings you more joy is worth pursuing.
That’s why the right answer to the question of why you should get an MBA is something you’re going to have to answer yourself. No one can do it for you: not the haters, nor the lovers, the schools, nor the pundits, the admissions consultants nor your friends. Because everyone is biased and nobody knows your true motivations; nobody knows what will make you truly happy in your career.
No one that is, except – ideally – you.
Here are some of the reasons I try to talk people out of the MBA:
- they hate their current job, but they aren’t doing the work to figure out what will make them happy at work (the MBA will just prolong the suffering and make risk-taking more expensive)
- they are not performing in their current role and aren’t doing the work to either develop themselves to be more successful or to figure out what they would genuinely love and be good at (a masters in business gives you none of this.)
- they don’t really need an MBA to do exactly what they really want to do right now; the MBA might given them a little more confidence, but there are other ways to get that confidence without spending 6 figures
- their greatest interests are not in business or business-related fields (they prefer to go into academia or politics, for example – those paths have better degrees)
- they want to start their own business and they already have an idea (take out a business loan instead of a student loan and go start it now!)
- they want to start their own business and they have no idea what it should be (this is usually the first issue in different clothing)
For almost everybody else I speak with who’s considering an MBA, there is a good chance that an MBA will bring them more happiness in their careers: more confidence, more opportunity, greater salary, more impact, and the ability to be a better middle manager and leader of teams.
If you’re still not sure of your personal answer for why to get an MBA, here are some questions to ask yourself to determine if the MBA will be a plus for you:
- Do you have a vision for your career or a set of ambitious goals? Will the MBA provide specific skills and experiences the to help you realize them?
- Do you want to be a leader in the world of business, even if you don’t know which function or industry you prefer? (AKA, are you willing to be a great middle manager?)
- Are you already on a career path that makes you pretty happy? Would the skills of business accelerate your path to leadership on that course?
- Does the career path you’re on (that you’re happy with) ultimately require graduate education to advance beyond a certain level?
- Do you want to build more credibility and self-confidence in your business abilities so that you can either make a pivot into a different field or into a more serious business role in the first place?
- Is there a job that you’re really really sure you want (think consulting or investment banking) where an MBA might be your easiest path of entry?
So this is the bottom line: You need to have at least some sense of where you want to go. Then you need to decide if a master in business administration going to get you there faster and at a price that makes it worth it.
Despite having an MBA, I still can’t really think in terms of dollars and returns. Hahahaha. So if you want to get deep into calculating your personal ROI on the MBA, try this calculator from Haas.
If an MBA is really for you…
We can help with both of those.
For the first, please check out MBAmo.
He’s our MBAmo admissions odds calculator robot and he will give you a detailed 20-page readout on your chances at top U.S. Full-time MBA programs in only 60 seconds.