Should you get an MBA? (MBA value proposition)

ZACH DE GREGORIO, CPA
www.WolvesAndFinance.com

This video discusses the value proposition for an MBA. What value does an MBA bring to an organization? Understanding this question will help you decide if an MBA is right for you. Some reasons people give to why companies should hire MBAs include: they are hard workers, smart, and have broad business knowledge. While this is all true, I suggest an MBA is something much more than that. There is one thing that is unique to MBAs that sets them apart from other degrees. During an MBA program, students spend two years studying many different business cases. All these cases have a unifying factor. They are all about allocating resources with limited information, and building a case for a financial decision. This is a very unique skill. You have limited information so you don't know for sure what is the right or wrong answer. This happens in business all the time, and you still have to make a decision. This skill is different than what they teach in other programs. Engineers learn to look at data and select the right decision, but if they don't have enough data, they are encouraged to gather more information. This is good, but different than the approach in business school. Lawyers often don't look at data at all, as they are dealing with philosophy which is an entirely different approach. MBAs however work with their fellow students on developing this skill, just like you do exercise to build any muscle. An example where this plays out in the real world is the annual budgeting process. Here you have to allocate resources among potential projects with limited information. This is very difficult and often leads to decision paralysis. The result is "peanut buttering" which is spreading the budget equally among projects which leaves every project underfunded. The ideal would be to select the project with the highest ROI and fully fund that project to success. But that means you have to take money away from other departments, and that is a difficult decision. That is where MBAs come in, because they have spent years practicing for this specific scenario. If companies can get good at this skill, it can even become a competitive advantage because it is so difficult.

Neither Zach De Gregorio or Wolves and Finance Inc. shall be liable for any damages related to information in this video. It is recommended you contact a CPA in your area for business advice.

Видео Should you get an MBA? (MBA value proposition) канала WolvesAndFinance