On Tuesday, May 4 at 4 p.m., David Garvin, the C. Roland Christensen Professor of Business Administration at the Harvard Business School will come to the University of Baltimore to talk about his much-anticipated book “Rethinking the MBA.”

The presentation will take place at the Merrick School of Business, University of Baltimore (M. Scot Kaufman Auditorium of the William H. Thumel Sr. Business Center, 11 W. Mt. Royal Ave, Baltimore MD 21201). The presentation is being co-sponsored by the Merrick School of Business and the Harvard Business Alumni Club of Baltimore.

Tickets for Professor Garvin’s May 4 presentation are $20. To register for the event and purchase tickets, contact Danielle Giles at dgiles@ubalt.edu or 410.837.4948, or visit www.ubalt.edu/rethinkingmba.

I filmed this a few weeks back. It is a brief introduction to the UB/Towson MBA program and its major benefits to students.

I read a New York Times article a few weeks back that tackled this question. I recently Googled the topic and was surprised by the number of hits. As with any topic, opinions abound. Therefore, I feel compelled to offer my take on the whole situation.

Yes, MBA programs and business school are in part to blame for the downtown. However, like any crisis, there is never one contributing factor. MBA programs are threads in a tapestry of other factors. But, for the purposes of this article I’m only going to discuss MBA programs.

According to the New York Time’s article, the last time business schools really took a hard look at themselves was during the 1950s when the Ford and Carnegie foundations made a series of recommendations. These recommendations suggested that B-Schools become more “analytical and rigorous” in their curriculum. The pendulum might have swung too far in that direction.

As I read various articles regarding the culpability of business schools, I found that most critics blame business programs for teaching that businesses are in business for one reason and one reason only; to maximize shareholder value. Programs have focused heavily on a short-term, quarterly, bottom-line perspective. It’s all about the quantitative and not much on the qualitative. Robin Humphrey, in her response to a recent Harvard Business article, wrote,

“Talk to the vast majority of MBA graduates of any business school about the relevance of managing and leading people to achieve outcomes and a blank look descends over their faces. They don’t do people, as they cannot be measured in black & white terms; it’s all grey.”

What’s the prescription? I believe that MBA programs should not simply model what the business community wants but should help lead and guide the direction of business. To do this, business schools must:

1. Teach students to maximize stakeholder value.
   B-Schools and MBA program must help future business leaders understand that business is about being profitable AND being good stewards to their employees, their customers, the community in which they reside, and the planet. It’s called sustainability management.
2. Teach Corporate Social Responsibility; not ethics.
   My opinion is that ethics cannot be taught. B-Schools have been teaching ethics for decades and look where we are now. Instead, teach students to act in ways in which their organization can be socially responsible.
3. Teach that leadership is about both the “big picture” and “the details”.
   The Harvard Business article stated that leadership should not be separate from the hard, quantitative aspects of business. Leadership is about vision and execution. It’s about motivation and financial statements. It’s about strategy and managing projects.
4. Become learning organizations.
   B-Schools must continually survey the environment and adapt and change. B-schools must be nimble and quick. They must be forward thinking and drive innovation in thought and strategy. It’s frightening to learn that the last time business schools did a thorough self-examination was in the 1950s. It’s time to do this much more frequently.

The UB/Towson MBA is launching a new curriculum in Fall 2009. To keep this article short, I’ll defer the details to a future blog post. All I will say is that I’m proud that we’ve addressed the criticisms and will be preparing our students to be responsible leaders who will promote profitable, long-term, sustainable business practices for all stakeholders.

Here are two press releases regarding our new Sustainability Management specialization and new and updated curriculum.

Press release from Towson University

Press release from the University of Baltimore

Point #1: The Statistics Prove an MBA is Worth It.

Statistics show that those with an MBA earn more than those without one (reference my previous article, Is the MBA Worth It? for detailed stats). I won’t belabor the point here.

Point #2: Your Competitive Advantage

The MBA can be your own personal competitive advantage. Every organization must have a competitive advantage over the other players in market. Wal-Mart has low prices. Nordstrom has excellent service. Starbucks sells a coffee experience. Without a competitive advantage it is difficult to differentiate and draw customers.

What’s your competitive advantage? Think of yourself as a brand. How do you want to be known? What differentiates you from other prospects in the job market? Why should you get the promotion over a colleague? Why should you receive a pay increase? If your current boss or a prospective employer cannot answer these questions, they’ll give that job or promotion to someone for whom they can easily answer these questions.

The MBA is one powerful way to begin gaining a personal competitive advantage. It is not the only way, but it demonstrates your drive to learn and succeed.

Point #3: Expanding Your Mind

In the workplace, it is easy to put on blinders. You work in the same cube everyday, meet with the same people, and work on the same projects. You are presented with problems that are similar to previous problems so you use the same mental models to solve them. The MBA can radically shake your world.

Imagine that you are in an MBA program. After work you go to your class and your Operations Management professor begins discussing process improvement and change management. She discusses best practices to bring about change. Another student tells how his company failed at a change initiative and why. Another student tells of a fantastic success story of radical change. The professor notes on the board the differences between the two and asks the class why one failed and the other did not.

Ideas swirl in your head about how you can help make positive change in your workplace. You raise your hand and tell the class about your experiences at work. You ask for their advice as to how change can take place given your specific situation. The professor adds her insights and students comment as well. You go to work the next morning with a different perspective. You’ve become empowered. The blinders are off.That’s the power of an MBA.

Point #4: Everyone doesn’t have an MBA. Even if they did, you better get one!

In the 1990s, there was talk about MBA devaluation. If everyone had an MBA, you could not use it as a competitive advantage and thus, it was useless. First, I’ll argue that even if MBA enrollments increase astronomically, most American office workers will not possess an MBA and therefore it still is an advantage. But let’s say we get to the point where “everyone” has an MBA. If everyone has an MBA and you decide not to get one, what do you think your career aspects will look like? Do you think it is a good strategy for you NOT to earn an MBA when everyone else has one? Absolutely not! In fact the opposite is true. If everyone else has an MBA degree, you MUST earn one just to stay competitive.

The MBA is known around the world as the advanced degree for business professionals. Should you get one? It depends. If you’re in business, then absolutely.

Read Is The MBA Worth It? Part I

The Research

I enjoy asking students, “Why are you seeking an MBA?” Some standard answers are:

• “I want more money.”
• “I want a better job.”
• “I want to move up the corporate ladder.”

These are great answers, but can an MBA get you any of these things? Research indicates that it can. Here are some facts:

1. In the United States, graduates who completed an MBA in 2006 earned an average base salary of $89,673. Globally, the average salary was $95,916. (TopMBA.com).
2. Average MBA salaries increased by 7.5% in 2006 (TopMBA.com).
3. Research has shown that executives who have an MBA are likely to have greater compensation than those who did not pursue an MBA. (Information Week, November 1, 2004).
4. 60% of women who possess an MBA have a greater income than their husbands (Business Week, Jan 7, 2003).
5. Employees with MBAs earn, on average, $10,736 more than their counterparts with other Master degrees. (GMAC MBA salary Survey - opens a PDF file).
6. A recent Mergis Group study stated that an MBA influences promotability and screening during the hiring process (2006 Mergis Group Salary Survey).

An MBA + Experience + Personal Drive = Success

I believe that an MBA in conjunction with work experience and personal drive is the key to building a successful career. Let me explain.

The MBA

To create business solutions, you must adopt a “systems thinking” mindset. An MBA education gives you a holistic view of an organization. Effective managers must see their “domain” in view of the larger whole. The organization is like an ecosystem. Each functional area must support itself yet at the same time act in ways to support the organization. If one area is performing poorly, there is a strong likelihood the rest of the organization will feel the impact. The MBA helps you to take the blinders off, so to speak, so you can see your organization as a whole. You will lead according to what is best for you, your department and the organization.

An MBA education also hones your critical thinking skills. Case work is the cornerstone of the MBA curriculum. Analyzing cases helps you to think beyond the obvious. You must delve deep and sift through the facts to understand systemic causes of various organizational issues. Cases also present opportunities for creative thinking. Some cases have you analyze new product launches and ask you to determine the appropriate marketing strategy based on a variety of internal and external variables. Cases force you to think beyond what is on the surface. These are the skills needed to succeed in business.

The MBA will also help you to fine-tune your soft skills. Professors will require a heavy amount of group interaction, case work, a multitude of presentations, and real-world projects where you solve real problems for real companies. In addition, many MBA programs, including ours, offer a variety of events and seminars outside the classroom to help students hone their “softer skillset”.

Experience

Though the MBA prepares you well for succeeding in the workplace, nothing can take the place of experience. Experience gives you the “street smarts” and the wisdom to understand how business works. Reading about a failed marketing plan and analyzing the case cannot teach you as well as living through a failed marketing plan. Forming and leading a team through the successful completion of a project cannot be replaced by a classroom lecture on project management.

Though work experience is crucial, an MBA education combined with work experience will give you a competitive edge. Experience can build complacency. Instead of solving a business problem in a new, different and better way, you’ll likely solve it the same way you always have. An MBA education gives you new tools to solve new or old problems. You’ll solve problems more effectively and perhaps more importantly, you’ll begin to see opportunities where you thought none existed.

You don’t need work experience to begin an MBA but the two together make a powerful combination.

Personal Drive

Determining what you want to achieve, setting goals, and taking action to achieve those goals is what will ultimately make you successful. Personal drive puts you, and keeps you, on the path to success. I believe personal drive is what separates the winners from the losers. An MBA education and practical experience are utterly useless unless you plan to take action. Without action, and MBA is just a piece of paper and experience just breeds complacency.

It will likely be personal drive and determination that convinces you to earn an MBA. It will be this same drive that will keep you on track with your studies and motivate you to complete your MBA program. After you’ve earned your degree, it is up to you to apply what you learn so that you can set yourself apart, do great things, and achieve the goals you have for your career and your life.

Read Is an MBA Worth It? Part 2.