This post is a continuation of my review of the book titled The Personal MBA by Josh Kaufman. The title of this post is a quote by the author in which he discusses the cost of obtaining an MBA degree.
In India, the MBA program at top-tier colleges like IIMs (A, B, C) costs around Rs. 25 lakhs. The newer IIMs are charging less than Rs. 20 lakhs. Check this article for more details: https://www.shiksha.com/mba/articles/iim-mba-fees-structure-blogId-19877.
If you omit the IIMs and look at the fees for the next set, XLRI Jamshedpur, SPJIMR Mumbai, FMS Delhi, etc., the fees range from Rs. 15 lakhs to Rs. 58 lakhs depending on the subject of interest. A B-School like ISB Hyderabad charges around Rs. 41 lakhs as fees.
How does one get into the top colleges? For starters, one will have to write the CAT or the Common Admission Test which is conducted annually. You can search the internet and get more details on the CAT.
Coming back to the book, what Josh Kaufman says is that while the MBA program has benefits, the price to pay to be a part of this cohort is huge. The two-year time spent on the course plus the high fees to be part of this network is not worth it according to him.
He quotes a study by Jeffrey Pfeffer of Standford University and Christina Fong of the University of Washington in this regard. Their paper titled "The End of Business Schools? Less Success Than Meets the Eye" analyzed forty years of data to look for evidence on whether business schools make their graduates more successful.
The study brought out some startling insights that are relevant even today:
1. What is taught in class is not exactly what happens in the real corporate world. Theory is different from practice. B-schools emphasize theoretical/abstract models that have very little practical value in the real-world life of a manager.
2. Getting an MBA degree does not guarantee career progression or better performance. The study found little or no evidence linking the degree with success on the job (salary, promotion, job performance). Many business leaders do not have this degree and therefore, it is not essential.
3. B-Schools are more focused on research and less on teaching once again proving that the degree has very less real-world relevance. Professors are rewarded based on the number of papers they publish and not how they teach their students or how useful their insights are for managers. From my own experience teaching at a B-School, I can tell you that the emphasis is so much on publishing in academic journals, that often the topics chosen are irrelevant and add no value to practicing managers.
4. The degree is a status symbol or a badge and is not an actual toolkit for leadership. The MBA degree is perceived as valuable and serves more as a credential not at all indicating whether the person holding the degree has any managerial expertise.
5. The Purpose of B-Schools is unclear. Do they want to be professional trainers or do they want to teach and be an academic institution?
6. Soft Skills like Empathy, Communication, Leadership, Ethics, etc. that are more important for running a business, are not taught at B-Schools and instead they focus on quantitative analysis, data modeling, finance, etc. This leads to having managers who are smart but not necessarily effective.
In the end, the authors of the study suggest that B-schools need to evolve:
1. To reflect real-world challenges.
2. Focus on teaching and providing practical insights along with research
3. Faculty must have both academic rigor and industry experience
4. Learning outcomes have to be prioritized rather than just the ranking of the school.
Imagine paying such high fees and not getting it's worth! And less said the better if one gets an MBA degree from a Tier-2 or Tier-3 B School that is at almost every nook and corner in major cities in India.
Josh Kaufman quotes the above study and makes a point on how getting the MBA degree might put you in debt for which you will have to work a decade or more just to break even. Interesting! Isn't it?
Would you like more insights like these from the books I read? Or are you feeling that you are not sufficiently equipped with skills to further your business? Let's change that! I offer personalized coaching and soft skills training for professionals and small entrepreneurs who want to lead with confidence and clarity.
Get in touch with me: hustellebyanupama@gmail.com
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