OK, let us get real. It depends on what you want from an MBA education.
- If it is to avoid looking for a job, because the economy is down, then any MBA will do. This article is not for you.
- If you want to extend your educational life, then this article is not for you.
- If you want to run away from parental controls, then this article is not for you.
- If you want a better job, do a correspondence MBA and hire a placement consultant, it is cheaper.
An MBA education is not theoretical – where you attend some classes, give a few exams and get a certificate. If you want to do that, see point 4 above.
The purpose of an MBA is the following:
- You want to boost your existing career, and you are leaving a job to do an MBA
- You want to be an entrepreneur. I am sure we can argue this.
- You want a good salary
- You want better growth prospects
- You want to interact with other future CEOs. Most of my classmates are in senior management and helping to change the world in their own way.
For all the above, you need to select the right college. Such a college should have the following characteristics (and I know that I am in a minority here):
- Does the college teach other subjects than the standard ones, like Emotional Intelligence, Critical Thinking, Relationship Management, Change Management, Business Process Management etc. This augments transferable skills in a student, which is looked at during a job interview.
- Do the faculty members have industry experience and can they relate the theory to practice of management?
- Are the type of exams mug-and-vomit or are the questions thought-provoking and challenging?
- How many practical exercises and projects are done in the fields of team management, selling, negotiation, project management etc.?
- How much encouragement and facilitation for doing outside projects during the MBA tenure?
- What was the mode salary (what salary did most of the students get)?
- Is the academic curriculum tough? I know that this is counter-intuitive, but the tougher the curriculum, the more your ability to handle stress – am important aspect in the job?
- Does the alumni return to campus on occasions to mentor and give feedback?
- What is the student culture – is it mediocre and not MBA oriented or is it supportive and MBA-focused?
- Do the same companies come regularly to the campus for placement? This indicates that companies are satisfied by the quality of the students.
- What type of jobs are offered by these companies. This indicates the quality of the specialization.
All the above have to be weighed against the cost of doing an MBA. If a typical 2-year MBA costs INR 7 lakhs and you get a pocket money of INR 3000 per month, and the number of study hours is say 10 per day (class and self study) and the number of study days is say 200 per day, your cost per hour is around INR 250.
You better be damned sure you are getting an education.
Most students join an MBA program for the following reasons:
- A simple graduation does not fetch a decent job
- Having done Bachelors in Business Administration, there is little choice but to do an MBA
- Extending their academic life by two more years
- Go far away from their parents and relatives to a place where no one knows them
- After doing an MBA, the salary levels would increase dramatically.
Reasons 1 to 4 are legitimately related to the reality of your past.
Reason 5 is a prediction of the future.
But do we know the future and do we know what determines salaries of an MBA?
The salaries are determined by the ability of the placement cell or your own contacts to approach the right companies.
The salaries are also based on the demand and the supply of MBAs. More the demand, higher the salary. More the supply, lower the salary!!
What determines demand?
- The college ranking determines the demand not because the students learn better stuff in those colleges, but your ranking in the various exams show that you are hard working or smart or both. Your ranking determines the college you get.
- Your own intelligence, attitude and transferable skills determine demand
- The business climate determines demand. If the markets are not looking good, there is no growth and there is less demand. But markets go in cycles, and if today the market is bad, by the time you pass out, the markets may look up.
- The state of the recruiting company determines demand. A growing company needs more MBAs than a mature company.
- The alumni of the B-school determines demand, based on how they are doing in the market.
- Your specialization in the B-school may determine demand, but this is debatable.
What determines supply?
Let us qualify supply in terms of quality and quantity. Fly-by-night operators may offer a cheap MBA, but they also take short cuts in education and placement. Quality is determined not just by the courses offered and the course content, but the quality of the classroom interaction and more importantly, how serious is the faculty member in imparting an education. There are more than 4500 MBA/PGDM programs in the country.
How do we select the right one?
- Is the top salary offered to a graduate the right criteria?
- Are you similar to that top graduate who got a great salary, or are you assuming that you will be?
- Is the same company coming with the same job offer?
- Are the market conditions the same?
- Are you doing the same specialization and are you qualified for that specialization?
- Should you not ask what is the mode (which salary band and what type of job profile did most students get ?).
A recruiter needs three types of skills
1. Subject matter expertise
This is the main thrust of most MBA programs. The professors are aggregators on knowledge and they cram it into the students. Most B-schools teach the same subjects. Different students retain this knowledge at different levels based on their capability and interest and sometimes the ability of the professors. Given that there are 4500 B-Schools in the country, the quality of the teachers cannot be uniform.
If a new recruit has the right attitude, to work and to learn, he can be moulded. If he thinks that he should determine the type of work he should do, then the company has a problem. Recruiters look for a ‘can-do’ attitude, the ability to remain focussed and in balance and ability to learn.
3. Interpersonal, team-building and presentation skills.
If the new recruit does not blend with the culture of the organisation, cannot work in teams and cannot present his ideas, he is more of a liability than an asset.
You should look for an MBA college that teaches you all the above in equal proportions. Any college with a heavy weight on academics but not enough weight on other things cannot create an ideal candidate for recruitment.
You have two types of customers.
- External customers to whom you add value by selling your products.
- Internal customers, like your boss, who you convince to give you resources and rewards.
If both are happy with you, you are promoted.
If either one is happy with you, you retain your job.
If neither is happy with you, you lose your job.
And if you do not have external customers, you really, really, need that internal customer on your side.
To understand the market and how you fit in, you need to do an analysis of the placement scenario, the trend, and how you can sell your services. It will be worth your while to download the following document.
This answers to the questions in this document are not readily available. You need to make an effort to get the best possible answers. Human tendency is to take shortcuts, and ask the nearest amenable person for the answers. Please ensure that the person giving you answers is knowledgeable about facts, and not opinions disguised as facts.
There is a lot of wishful thinking that goes on in the name of placement. The reality is based on demand and supply.
For example, some one asked me yesterday whether they should do NSE’s Certification in Financial Markets (NCFM) modules. The objective is to get into brokerage and investment banking.
My answer was as follows:
- Salaries and jobs are determined by the demand of the recruiters and supply of the right MBAs. More about the MBA market can be found in Chapter 5 (MBA for sale – what salary will I get) of my book, “What recruiters want?”
- Investment Banking and Brokerage is attractive to MBAs, therefore this is an overcrowded market with a lot of sellers.
- There are a limited number of well-paying brokerage houses and investment banking firms. There are others, which are more discount shops with low margins and therefore with low fixed salaries and high variable, performance based salaries.
- If the impact of the European crisis spills over to India, the stock market would be down and hiring will freeze.
- If everyone has NCFM certification, then it becomes a basic requirement (hygiene factor) and not a nice-to-have factor (motivator) for hiring.
- If you do join a brokerage firm, the chances that you will actually be doing trading or company evaluation and research is minimal, given that all Tier-1 B-School graduates too want to do the same job.
- You will probably, and specially in a bad market, be asked to get more customers for the brokerage house. At best, you will be asked to create market analysis / research documents and sell them. For that you do not need the NCFM modules.
- Nitesh Mittal (a reader) pointed out that there are other options – for example, be a certified financial planner. (http://www.fpsbindia.org/)
- Sunil Dath (another reader) pointed out that there is a third option – to do a Diploma in Banking and Finance (www.iibf.org.in)
When we seriously start thinking about our MBA, we realize that we do not possess the skill sets required for corporate life. For example, handling procrastination, thinking less emotionally, managing relationships etc. Therefore we realise the need to change.
In the initial stages, we are enthusiastic about the change and go for it with “vim, vigour and vitality.” Over time, this enthusiasm fizzles out and we revert to our comfort zone, and then rationalize our inaction.
What is this comfort zone?
As we develop a habit, neuron paths are created in our brain, as the habit moves from the conscious into our subconscious. This becomes a convenient path and familiar path, a path of least resistance. The more we use it, the smoother it becomes. The psychological reasons for using this path also become ingrained.
When we change the habit, we are trying to create a new path, through a jungle. we need to cut down trees (overcome resistance from self and others) we need to smooth the path (try the new method enough numbers of times) and become familiar with it.
This is tough, and in most cases we give up, as the other, familiar path is there.
Even if we create a new path, we now have choices. The new, untested one, and the old tested one. We take the old one.
How do we handle this?
- Before making even the first path, decide if it is the right path. My friends in the IAS say that agreeing to the politicians the first time is tough, but it gets easier. The first time you pay the bribe, you feel bad, and then it becomes easier. A path is created.
- Create the new path only after you understand the benefits, so that you are motivated to take the new path. Walk on it enough number of times.
- Close the old path, so that even if you want to go on this path, you are unable to do so.
Take addiction as an example.
- Decide not to smoke.
- If you do start and it becomes a habit, then, since smoking is also an emotional desire, you need to find an alternate emotion, that is more powerful than the current emotion.
- Make sure that your friends and family are supportive and stop you from smoking, reward yourself for not smoking for a certain number of days, etc. Work in a smoke free zone.
I have some comments on the recent furore over Mr. Hazare’s campaign to bring in the Jan lokpal bill.
There are three levels of corruption depending on the amount of money and the number of persons involved:
- At the top level (this is opportunistic and gradually becoming systemic),
- At the department level (this is systemic and the process and ROI is clearly laid out)
- At the individual level.
I will not focus on the first two; Mr. Hazare and his well wishers are doing that, and I wish them all the best.
Is the individual level of corruption systemic or opportunistic? When a policeman finds fault with my motorcycle papers and demands a graft, do I not pay? Is this not systemic, since every month the policeman needs to fulfill his quota. Is it not systemic, as he has paid a bribe to get a choice posting and he needs to recoup this expense? Are you a victim or is he a victim? Is the government not to blame to raising prices and not raising the policeman’s salary? Am I not to blame for taking a shortcut of paying the bribe, because I can afford it, my time is valuable, I need to see the movie or reach my destination?
Can this bribe be considered the self-adjustment of the system towards an equilibrium, towards a peaceful co-existence? It is possible that we rationalise the bribe-paying as balancing some inequality of status and opportunity?
When we asked our representative for the freebies he should provide us if he needs our votes, or accepted those freebies, did we not start corrupting our representatives? Did we not rationalise this action?
When Chanakya talked about ‘Daam,’ is ‘Daam’ only about payment for services rendered, be it legitimate or illegitimate? Is it not our thoughts that rationalise and determine legitimacy?
When I consider some act unfair and seeks redress, I believe myself justified in taking any means to correct the unfairness. We have done this all our life. Our thoughts determine the legitimacy of our act.
When a CEO considers some laws unfair and evades them, we lionise the CEO as being creative. Did we not allow corruption of the laws?
Corruption is inside us. Let us not blame the outside world, the ‘system’, the CEOs as being corrupt and consider ourselves to be pure. When we take short-cuts, cheat, lie, rationalise to ourselves, create beliefs about people and situations, we corrupt ourselves.
Our beliefs lead to emotions and actions. Justified and rationalised beliefs lead to justified and rationlised emotions and actions. We cannot label these emotions and actions as corrupt, and we cannot separate corruption of beliefs from the resultant corrupt thoughts and actions.
Is there some ethical and moral code that we are believe in? As long as our thoughts are selfish, what morality are we talking about? If we justify survival of the fittest and intolerance towards others, are we justified in taking the high ground about morality?
Is it the money that we pay as bribes that we are objecting to, at this individual level, or is it the blackmail? Is this why Mr. Hazare’s campaign seems to be gathering force, that we can see that we can blackmail the government? The shoe is on the other foot?
Why is this support against corruption gathering force, and other ongoing campaigns not having support? What about Ms Irom Sharmila and her 10-year fast, the fights against systemic corruption in the rest of India like the mining mafia in Goa, Karnataka, Bihar, MP, the dams and the uprooting of people, and the old Bhopal Gas leak tragedy?
Is this a better orchestrated campaign? Is it the drama? Is it our need for instant gratification, where we are seeing immediate results? Is it the tilting at the windmills, cocking our snook at the powers-that-be, showing them that they are not as invincible as they thought? Is Ms. Hazare our new angry “young” man, fighting on our behalf?
There is a certain corruption inside us: our need for gratification, need for excitement, the emotions of self-righteousness, need to be part of history, specially winners. Mr. Hazare’s campaign gives us all this. Which is why long-drawn campaigns lose support. All informal surveys seem to indicate people do not know the difference between the bills, students are enjoying the drama and absence from classes, and everyone is out there, abdicating their duties. Gandhi had the ability to withstand the lathi charges, I wonder how many supporters in this campaign would do so?
We have to look inside ourselves and decide if we have the courage to (a) fight the corruption inside us (b) support other campaigns that too need our help.
Otherwise, this will be a flash in the pan. The press coverage will stop, as people seek a different drama. Even if we get the bill passed, the implementation is fraught with peril for two reasons:
- The Lokpal will have power, and with all power, comes the opportunity for misuse. Will we need a super-lokpal to check this? How much time will it take to set up the alternate bureaucracy and the checks and balances.
- With all the lok-ayuktas, the judiciary, the vigilance committees, the auditor-generals, which were supposed to take care of the second type of corruption; with Anna’s bill taking care of the first type of corruption, who will take care of the third type of corruption? And since the second type of corruption could not be taken care of, despite so many regulatory bodies, what makes us sure this is the right way?
All I say is, let us control the corruption within us, because all external measures will come to naught if we are not ready internally to accept the pain that accompanies incorruptibility. It is not easy.
This word has been bandied around a lot, and many companies, colleges and people pay lip service to it. http://en.wikipedia.org/wiki/Social_entrepreneurship
- How do we create a sustainable enterprise that makes profits and fulfills social obligations?
- Can we help uplift the stature of the small town that we came from, where we were nurtured, before the city lights seduced us to the big city?
- How can we make more money that by having a job in the city?
- How can we have more stature and recognition than being a factory worker in a big corporation?
- Can we take the unemployed youth of our town, the girls who are prevented from having a career in another city and make something that will create wealth for the young people of our town?
How I wish that some more mentees used this example, and created a sustainable enterprise in their home towns.
When you join an MBA course, you consider yourself a student. You behave like a student, learning from classes and books. When you leave the MBA course, after completing it, you are no longer a student. You are a corporate citizen and are being paid to behave like one.
In these two years, what have you learnt that makes you into a corporate citizen? Knowledge of management and its streams?
Does knowledge of Marketing, Finance, HR, IT and Operations make you a manager? Does that provide value to a company? The company can also search the internet for the data that you profess to have. In fact it is cheaper and more efficient, as this data is available in searchable form while it is available only incompletely in your mind. The difference between the internet and you is that you have arms and leg and can do things. But do what?
Doing things in a company means listening to your boss, understanding what he wants and doing it to his satisfaction. remember your boss contributes 90% to your career.
Doing things in a company means promoting yourself, your boss and your company and its products.
Doing things means executing projects to everyone’s satisfaction.
Doing things means influencing everyone to do what is required to be done.
How do you learn this in college if you are focused on memorizing and vomiting information?
If an MBA college teaches only theory, the instructors are simply aggregators of information. If you want book summaries, they are there on the internet. Why attend classes. Moreover, why not do a correspondence course?
So in order to be useful to any organization, apart from knowing the theory of management, you need to learn the practice of management.
You may argue: why do this?
- This is a college, not a company and there is no opportunity to practice management.
- Practice is what we will do in a company, we should focus on getting the maximum theory in college.
Let us evaluate these beliefs. By the way, these beliefs come from a resistance to transition from a student in academic life to an adult in real life. You will fight tooth and nail to resist these changes, because they move you out of your comfort zone.
- A company is made for profit and has an objective of creating a product, its need and to sell it. Everything else is secondary. You have an objective of creating yourself into an MBA, creating a need for you and sell yourself in an interview. Are you not a company?
- You need to listen to your instructors, the deans, will your boss be any different?
- You need to execute group assignments and individual assignments to everyone’s satisfaction, in a give time period. Is this not execution of projects?
- You need to convince your colleagues and your professors to give you what you want. Is this not practicing influence?
- Why should a company pay to teach you the practice of management?
- Why should a company give you a high salary because you have imperfect theoretical knowledge?
- Why should a company take a risk on you that you will be able to satisfactorily practice management? There is no proof and predictability of your capability.
So what should you do as an MBA student.
- Keep an eye on your placement-ability. What does the market want and what can you do.
- Understand that the college social system is no different from a company, with its own share of internal competition, cooperation, politics, groupism and need for influence. If you cannot handle yourself here, you will not be a good corporate citizen
- Apart from mugging up information, you need to create transferable skills like managing your emotions, critical thinking, managing others, managing projects, managing stakeholders…managing life.