Better for Business? Size up the Benefits of an MBA
Over the past couple of years, there has been something of a trend in product management circles for criticizing (or at least challenging) the value of an MBA. As a current MBA candidate, here’s why I think this is misguided.
A couple of years ago an article appeared in the Wall Street Journal and elsewhere which highlighted the growth of product management. In it, Ruta Singh, a recruiting director at Facebook, suggested that tech companies value people with product management experience “who have actually built products” more than those who have business school degrees.
Reading the piece, I was surprised at the implied disconnect between an MBA and relevant experience. After all, the MBA has always been a degree for later in life, designed to build on an already established career. I was again surprised by a Quora discussion in which Keith Rabois, a Harvard law graduate and tech angel investor, remarked that he would normally recommend against business school, and that “credentials” are not what they used to be because those in the startup space “normally thrive by ignoring conventions”.
Singh and Rabois are not alone in criticizing the value of an MBA, but I believe their criticism is unwarranted. I think it is based on a misunderstanding of what an MBA offers, and an old-fashioned view of the business atmosphere. If you are a product manager and are considering applying to business school, here’s why I think you should.
The Value of Business School
Product management once implied working for a large corporation alongside scientists and mechanical engineers to develop expensive prototypes that took months, if not years, of planning. Today, digital product management in the tech industry moves much faster than that old-school practice. Those traditional, methodical processes of old product development are being exchanged for nimble and flexible approaches that put a premium on experience and good instincts, rather than by-the-book repetitive methods.
The way most people become involved in product management has changed as well. Various tech startup booms have bred a new generation of product managers. They tend to come from a wide range of backgrounds and are pulled in by the energetic atmosphere, driven coworkers, and fantastic perks offered by many tech startups (I know this was what pulled me in).
I believe the primary reason that an MBA is advantageous for a product manager is the inconsistency of the skills learned from working at startups. New talent can be shaped by (often unique) startup-specific experiences, and may not be prepared for broader challenges down the road. As startups grow and evolve into small companies, a more formal business education is often necessary. It may even be that functioning without such a foundation turns into a liability.
The Tangibles and Intangibles
Although it is now much faster and less expensive to test new digital products than their tangible counterparts, the pace at which the tech industry moves has accelerated to make up for this difference. If product managers are not using the most up-to-date data that is organized in the right way, they run the risk of wasting valuable time and resources on product testing. This, I believe, is where MBA courses with specialisations in fields such as statistics, business analytics, and data science start to look all the more useful.
An understanding of the legal landscape is also needed as internet law becomes established (note the major e-commerce case being reviewed by the Supreme Court at the time of writing). Failure to take into account proper legal considerations can be a major setback to any digital product team. This is where courses in business law and the legal environment of the digital space are also valuable.
Outside the specific courses of an MBA, there is also more subtle importance in the experience itself. If I think back on attending tech conferences early in my career I wonder what it is exactly that made those convention halls so exciting and awe-inspiring. It’s hard to pinpoint. There may have been a specific trick I picked up or product I learned about, but in most cases the takeaway is difficult to isolate. Often, it’s simply the consolidation of great amounts of energy, talent, and ambition into a single space that gives you the feeling of motivation which can be hard to find in everyday work life. If nothing else, the value of a ticket to such a conference is simply the feeling of being part of a larger movement.
I’ve found that the same is true with the MBA. Beginning with orientation, the energy is palpable. There is a common sense that the people surrounding you are motivated to make an impact in their fields and, as you get to know everyone, you learn that many already are. You get the opportunity to hear experts in their craft lecture about the unique challenges they faced and the obstacles that they had to overcome. You work collaboratively with students with similar backgrounds, as well as those from different industries. And lastly, you make connections which will undeniably prove useful down the road – a priceless benefit.
What’s the Outcome?
Of course you need good experience to be a valuable addition to a product team, but overlooking how an MBA education can complement this experience is, I think, naïve.
Andy Lee, an entrepreneur and prominent writer on product management remarks how “an MBA gives you many benefits — a brand, a network, business skills; but it doesn’t give you any unfair advantages to build successful products”.
Andy’s statement is entirely correct, but I think it also approaches the MBA with the same tangible / intangible misunderstanding I’ve just described. I would argue that those “business skills” are more important in the long run than one might initially think. Of course, an MBA is not like a degree in hard science or engineering, where you learn a specific set of skills and take a board exam to become certified at the end of the program. An MBA provides an array of experiences from multiple disciplines that are important for success, especially in the tech space. No, of course you’re not guaranteed to fail if you don’t get one, as the many college–dropout tech kingpins demonstrate, but is it worthwhile? Absolutely.