The Value of an MBA in the Economic Crisis of 2009

Is an MBA as valuable in the first quarter of 2009 as it was in the first quarter of 2007? According to Matthew Stewart, an MBA is "...overvalued piece of paper." I happen to have earned the degree, and while Mr. Stewart hasn't, he makes an interesting point.

His statement that short term, with the contraction of the financial and consulting markets, MBAs are going to be hurt, is generally a fair statement. It is also true for mortgage brokers, commercial Realtors, and bank personnel in general (Goldman Sachs). Executives & Professionals: Changing Jobs?

However, MBAs can be very successful as entrepreneurs. A thorough understanding of accounting, finance, marketing and broader management topics provide a one of three critical pieces for a successful business. While speaking with a major VC firm, the firm stated that they would invest in a company that had a "B" business idea, if they had an "A" management team. Further, they would not invest in a company with an "A" idea and a "B" management team. The VC firm continued that the management team either had to have significant experience and success or had to have at least one MBA with a less experienced team. Elite Jobs for elite professionals! Let Doostang help accelerate your career. www.doostang.com

In this financial crisis (2009), MBAs can also be success in leading restructuring or streamlining activities. They can also use their academic knowledge of quantitative and qualitative management to help develop new products, strategic vision, as well as train existing personnel on any number of business topics. Personally, having an MBA in difficult economic times is a strong differentiators in a field crowded with candidates seeking work. Try RingCentral Fax FREE for 30 days

Does this mean that everybody should run out and start an MBA program? No! An MBA is an expensive and time consuming investment. If you can't justify the expense, as it won't relate to your current or desired field, spend the time and money getting the training that will. I am a proponent of broad, life-long education, but I am not a fan of wasting money. Cheap? No. 100% Free. Trade stocks for free on Zecco.com. The Free Trading Community. www.zecco.com

This economic crisis will end and companies like Goldman Sachs, GE, and McKinsey will start to hire MBAs again. There will always be a need for people skilled in qualitative and quantitative analysis, as well as financial management, human resources, and supply chain management. While some will argue that an MBA is not particularly valuable, they may a true statement in a limited context. However, in a broader context, they may be even more valuable in the economic and financial crisis we face today, and will face in the future.

Steve Jobs Leaves Apple

Steve Jobs is leaving Apple, eventually. Whether because of health, age, or any other reason, key employees leave companies. It happens everyday. What distinguishes a great company from a just a good company is how they plan for this eventuality.

Succession planning is the process by which companies figure out who will run the company in the future. Succession planning isn't just about the morbid possibility of losing key talent to death or illness, but more about recognizing up and comers. Succession planning is also about creating a deep bench of talent that can be used when new opportunities arise or business conditions change. Compare Annuity Investment Plans!

While nobody likes to think that they are replaceable or even expendable, most people are. Steve Jobs leaving Apple would definitely affect a lot of people, but the company won't close up shop or quit making iPods overnight. Rather, Jobs has identified his top talent who will be able to run the company when he is long gone, or at least he should.

Take a look at GE. When legendary CEO Jack Welch left, the company didn't fall apart, instead Jeff Immelt took his place and dividends are still being paid. When the Denver Broncos fired Mike Shanahan, the team didn't fold, but it may actually do better than 8-8 this year. This is what succession planning is all about, recognizing that the organization is bigger than any one person. A Better Way To Search for $100,000+ Jobs. Join TheLadders.com!

Consider succession planning in your own business. You never know when that top developer, sales person, or executive may just up and leave. However, you will know who is capable of filling the big shoes left behind.

I Disagree with Jack Welch

Jack and Suzy Welch wrote an interesting response to the question of "What kind of person is a change agent?" in 09 October issue of "Business Week."

While no one can deny Jack's success at GE, or he and Suzy's success since then, I take exception to one of the statements they make. Find $100K+ Jobs

From the article:

"...Most questions we receive about change are from individuals deep within their organizations, .... They hunger to be change agents, but worry they can't be. They're right (emphasis added). Sure, a transformative idea can percolate from below. And yes, gains are being made with employee engagement, ...By and large, however, change is still made by people with some sort of authority."

Wow, talk about a "give up now" moment. What are those who are not in a position of authority supposed to do, just be automatons and hope they get credit for good ideas? While I don't disagree with the points of the article in general, such as change agents must be leaders, I think the Welch's miss the boat for the rest of the working populace. Change agents have to be cultivated and trained, they don't just show up as managers, directors, or CEOs.

If we consider the writings of Stephen Covey, in particular the concept of a "sphere of influence," this is where individual contributors can be change agents. Often, I have been approached by an employee, whether in the Army or in the civilian world, where they have an idea of how to do things better. I may have been able to implement it on a small scale, though it may not happen on a greater scale. Either way, that person made for change and succeeded. Find Premium Finance Jobs on Doostang. Start Now! www.Doostang.com

Further, some of the greatest change initiatives have started out as minor suggestions or incremental improvements. Change, and its second cousin innovation, take time and are often done in small steps. If you are a manager, you should encourage this among all of your employees. Promote your staff to think critically and challenge the status quo. There may be a better way to do it, but you may never know unless you ask. You may be cultivating that agent of change and not even know it.

Jack Welch Speaks!

In all of the posts so far, I have been the one giving the advice. Ok, there is a Monty Python bit in there, but by in large, it has been my mind at work.

To help provide some context into my thinking about management and leadership, I am posting a link to a video from the Sloan School of Management at MIT. It is 17 minutes of Jack Welch talking about being bold.

This is a good talk for both managers and employees, as well as a generally good life lesson. I hope you enjoy it!

http://mitworld.mit.edu/play/258/