23 Comments

Summary:

Is an advanced business degree from Harvard or MIT or Stanford something that tech startups really, really want? It didn’t seem so at last weekend’s Harvard Business School Cyberposium. Where do you sit in the on-again debate between the builders and the bean counters?

Harvard Business School
photo: Barb Darrow

Does a Masters in Business Administration make its recipient more or less attractive to tech startups? Or does it have any impact at all?

It’s a serious question.  A day after Harvard Business School’s Cyberposium 18, I remain struck by the concern attendees seemed to feel about what their advanced degree will mean in a tough economy and in a tech business that elevates technical prowess above everything else. After all, college dropouts Paul Allen, Michael Dell, Bill Gates, Steve Jobs, Steve Wozniak, and Mark Zuckerberg all built hugely successful tech companies — Microsoft, Dell, Apple, Facebook —  without a degree among them.

One Cyberposium panelist basically told MBA candidates interested in big data opportunities that they need not apply unless they also had technical chops.  I’m simplifying here, but that was the gist.

Dropbox founder Drew Houston — who does hold a bachelor’s degree in computer science from MIT  — was gentler but still not all that encouraging. Asked what he wanted in an MBA he said … um pretty much the same thing he seeks in any hire. “What we look for in any candidate is that they’re smart and passionate and not just chasing money. We look for a cultural fit,” Houston said in a Q&A session. “The guy who runs most of the business side [at Dropbox] has a Harvard MBA but what we look for isn’t that different from what we look for in other areas,” Houston said.

The underlying theme was that business skills and teamwork are valuable and much desired. Attitude and a sense of entitlement are not.

Hunter Walk, director of product management at Google (and a Stanford MBA) must be hearing the same concerns. Yesterday, he shared a great post on the topic: “It’s fine to get an MBA, but don’t be an MBA.”

One of his points:

Getting an MBA means you shoot out of school wanting to prove yourself and see what you can contribute to others. Being an MBA means thinking the world owes you something and that your value 10x’ed just from spending two years on a campus.

Given the economic climate, it’s natural for students to worry about the worth of their degrees. And this topic crops up periodically in the sort of “builder versus spreadsheet guy” debates that get heated. Last year, auto executive Bob Lutz’ book “Car Guys vs. Bean Counters: The Battle for the Soul of American Business”  stoked the debate anew. Lutz’ argument, according to the Time Magazine review was: “To get the U.S. economy growing again,  we need to fire the MBAs and let engineers run the show.”  Harsh, But I would bet lots of people who watched the decline of US industry in the 70s and 80s under the tutelage of MBA CEOs would agree with that sentiment.

Still, promising business students should take heart. Every tech company needs people with business and financial management expertise.  As one commenter to an earlier Cyberposium story put it:

Harvard Business School was where the concept of the spreadsheet developed. Don’t be dismayed … fellow MBAs. Your day will come… Take the Disruptive Innovation courses, and pick up some Advertising while you’re at it.

And, let’s face it,  there are many times when the best technology in the world won’t win unless it’s accompanied by real business savvy.

I would love the discussion to continue, so please post your thoughts in comments below.

  1. George Mathew Monday, November 5, 2012

    There should be ZERO shame in holding an MBA & working in technology. It’s just another set of skills that are helpful at any stage of a firm’s growth. I’ve always believed that MBAs with prior technical chops are a great addition assuming cultural fit, team needs, etc.

    Share
  2. You have to just smile when Engineers (and, ironically, salespeople) dismiss the MBA. That’s as sensible as dismissing a JD, MD or any other specialized training.
    Being successful in business is very, very hard. Woz had Steve, Allen had Gates (the one true engineer-business genius mentioned), and Zuck had Parker . . . for every Woz, Allen and Zuck, there’s hundreds of thousands of engineering brainiacs whose good product never sees the light of day because its too late, expensive, unknown, or all three.
    When it comes time to pricing, marketing and managing the product, their suggestions are reminiscent of error-and-omission-filled case studies done by first year MBAs: Poorly thought through, off-target, and knee-jerk.
    Unfortunately for them, MBA-bashing just strengthens their pride, and even after running out of time & money, they stay defiant . . of course, they’re back at their day jobs, taking orders from who else? MBAs! lol!

    Share
  3. Jenn Hutchison Monday, November 5, 2012

    The best answer to this debate is the old cliche: It takes all kinds to make a world. MBA’s are as vital as we make them. But often being successful with a huge tech company requires something more than a simple degree can give you and no school will teach you how to acquire drive, passion, and creativity. Oh, school will help, but as it was mentioned above, sometimes a higher degree isn’t for some, but it still shouldn’t be a death sentence. Look at Bill Gates, look at Steve Jobs and Mark Zuckerberg. All successful and all without a degree. Like Hunter Walk said “being an MBA” is a whole different story. Maybe the moral here is to not let your degree get to your head. Yes it shows you have goals and achievements, but you’ve still got work to do. Speaking as a recent grad(with an English BA however!), I’m finding that everything I learned in college is minimal compared to what I started learning once I was out of school and working, but I still wouldn’t of passed it over to go straight into working. I needed marketable skills and college gave me that. Not to mention there were other benefits to attending! My point is that we shouldn’t discount MBA’s too quickly…or let them pass by completely. Measure and judge and pick the right person for the job, not the right degree.

    Share
    1. That comment came from a college grad with a degree in English who can’t write. Enough said.

      And academics say higher ed is still valuable? How risible.

      Share
  4. You have to just smile when Engineers (and, ironically, salespeople) dismiss the MBA. That’s as sensible as dismissing a JD, MD or any other specialized training.
    Being successful in business is very, very hard. Woz had Steve, Allen had Gates (the one true engineer-business genius mentioned), and Zuck had Parker . . . for every Woz, Allen and Zuck, there’s hundreds of thousands of engineering brainiacs whose good product never sees the light of day because its too late, expensive, unknown, or all three.
    When it comes time to pricing, marketing and managing the product, their suggestions are reminiscent of error-and-omission-filled case studies done by first year MBAs: Poorly thought through, off-target, and knee-jerk.
    Unfortunately for them, MBA-bashing just strengthens their pride, and even after running out of time & money, they stay defiant . . of course, they’re back at their day jobs, taking orders from who else? MBAs! lol!

    Share
  5. Whenever an engineer offers business advice, I respond with a suggestion about the code he’s using!

    Share
    1. sounds like a reasonable response

      Share
  6. I did my MBA in one of the top 10 business schools in the world. Yet, I don’t really think you need an MBA if you have a healthy Startup Ecosystem in your city. I wrote about something similar in my blog along with some comments from my fellow MBA friends::
    http://startupq8.com/2012/07/17/my-mba-wasnt-that-useful-after-all/

    Share
  7. HBS invented the spreadsheet? Say what?

    This is my THIRD startup and I have an MBA (from MIT Sloan). I don’t think that needing / not needing an MBA is a black and white issue. MBA degrees are definitely useful for some (but not all) people. For example coming out of B School, you get more self-confidence, ability to speak in larger settings, ability to communicate to a broader set of audiences (these are all things that engineers tend to lack). If you are born with skills such as these, and of course possess the ability to lead people, well then good for you. You don’t need an MBA. But most people who want to run companies don’t have these skills. So an MBA is ONE way to get these skills. Working in a startup and carefully observing others who do possess these skills is another way.

    As with most graduate programs, what you get out of it is based on what you put in…

    Share
    1. now that i think about it not sure that HBS did invent the spreadsheet!

      Share
    2. Reed Sturtevant Monday, November 5, 2012

      Actually, yes, Dan Bricklin says “The idea for the electronic spreadsheet came to me while I was a student at the Harvard Business School, working on my MBA degree, in the spring of 1978. Sitting in Aldrich Hall, room 108, I would daydream…” Source: http://www.bricklin.com/history/saiidea.htm

      Share
      1. ah yes, i remember now. I forgot that Dan was at HBS. thanks reed!

        Share
  8. Yes, It is obvious. You dont really need a product to be able to price it or sell it. If you have an MBA the product just shows up magically, no need to know any of that technical stuff…. Just know how the business side works, the products generally make themselves. In fact fire all engineers if you are stupid enough to even hire them in the first place.
    All this is pretty obvious yet I still paid $150k to “learn” this at one of top B-Schools.

    Share
  9. I always wanted to do MBA and never did it instead i did start up. Unlike many entrepreneurs i failed in my start up but i don’t regret but i feel its utter stupidity to discuss whether you need MBA or not. Education never goes waste just because we have some outliers doesn’t mean MBA is waste. For a successful company you need everyone.

    Share
    1. actually, most entrepreneurs fail.

      Share
  10. Futureengineer Tuesday, November 6, 2012

    This discussion is absolutely pointless.You need both MBAs and engineers in your organisation be it a startup or a big company.The engineers are mostly required at the back end to design the product while mbas are required to market and sell the product

    Share
    1. i’m not positive you need MBAs per se — but you do need good business people –people who know finance , who have business skills. that’s a no brainer.

      Share
  11. I think the skills that are learned while earning an MBA definitely make the student more equipped to be successful within a tech startup company. You don’t necessarily need an MBA to succeed in the business world (as proved by Zuckerberg, Gates, Jobs, etc.), but more education is never a bad thing. Some people are just naturally gifted with business knowledge and prowess, but for those who aren’t, education can help a student gain and improve those skills. This degree gives students specialized training for how to be successful in business and the student is able to work with aspiring and motivated businesspeople within their MBA program. Going after an MBA degree also shows that the student has the initiative and desire to learn more about his/her craft, which is a good sign for the student’s future work ethic within a company.

    In general, I agree with Barb that every tech startup needs someone with business and financial management expertise. Without that, how will the company succeed financially? You could have a groundbreaking idea for a tech startup, but if you can’t organize the finances and can’t market the product to potential buyers, you could be wasting your time and resources.

    Share
  12. An MBA is fine, as long as its backing up an engineering degree.

    Share
  13. The writer forgot to mention MBAs and the finance industry.

    There’s the negative earnings dot-com bubble, the housing bubble, the micro-bubble, the naked-short flash crashes and there’s ENRON style accounting frauds everywhere. Meanwhile every MBA demands deregulation and the financialization and monetization of everything.

    I think Harvard would like to hide their former president Larry Summers in the basement.

    In banks, all departments are managed and run by business majors hand selected to be the most greedy, self-centered and arrogant. That includes marketing (makes some sense), finance (less sense), risk management (little sense), operations and IT (outsourcing and off-shoring).

    For more details on the financial boom, bust, see: http://analytical-crm.com/UnMoney_TBTF.pdf

    Share
  14. As with anything else, what matters isn’t the theory you know but rather the actual abilities you have – as well as your network. A capable MBA does not need to fret about whether he’ll find a job when he graduates, he already has one lined up.

    Share
  15. As far as tech companies go. They are typically smaller and more agile. Being effective there requires a very different skill set compared to a large company – especially to be a leader.

    Also, an MBA who isn’t sufficiently versed in new trends and technologies may have little to offer. Education like an MBA seeks to substitute real world experience. That is a question any student should ask himself “Can I do a good job at this in a real company?” Have to remember to put effort in the right direction.

    Share
  16. From what I have seen and understand, people with MBA degrees tend to be risk takers, hence, good leaders on the short term. People with engineering degrees tend to look for stability, hence make good leaders on the long term. As I see it, tech start-ups need a good mix of both.

    Share

Comments have been disabled for this post