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Should I enroll in a low ranking MBA program?

  1. Nov 23, 2009 #1


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    I spend a year in an EE PhD program and decided it wasn't for me. I took a one year leave of absence and I haven't decided if I want to return. I might return but I would like to find a different research group.

    I am currently jobless and things are looking bleak in the job market. I am trying to decide if I should go to night school for an MBA in the meantime, which might boost my resume and it will give me something somewhat productive to do. This might help me get into an engineering management role later on. The problem is I have no real work experience in a corporate environment except for a few months as an intern (all of my other experience has been in academia) so I wouldn't be able to get into a highly ranked MBA program. Is it worth it to go to a low ranking school for an MBA? My goal isn't to become an i-banker or anything. I just want to get some basic management knowledge.

    I am looking at Lawrence Technological University in Michigan (which is near my home). It is only 36 credits and they said they would transfer 3 of my graduate credits from ASU into the MBA program so I would only need to take 27 credits. Should I do it or should I just get a job, get some engineering experience and then apply to a higher ranked (top 30) program? LTU said I can start in January.

    What do you think?
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  3. Nov 23, 2009 #2
    No. It isn't. You are going to end up far, far better off if you finish your Ph.D. or if you at least get a EE Masters. The book learning that you get from an MBA, you can get from reading books on Amazon, and the culture and connections go with the big names.

    The best way of learning management is to manage or be managed.

    If you can get a job, you are going to end up much better off.
  4. Nov 23, 2009 #3


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    I am going to echo what two fish is saying.

    Consider the following two scenarios:

    In the first scenario you get hired by a company of reasonable stature. Every six months/one year you get rotated around the various departments gaining experience in many areas as diverse as management, finance, engineering, operations, manufacturing etc.

    Through the rotation you get exposure to many organizational facets of the company and through this experience you get to move up to a management role if your performance review warrants such an option.

    At this point in time you could then consider doing an MBA to give you a theoretical background behind what you are doing and help you understand a framework of knowledge that will hopefully help you make better decisions.

    Alternatively you could get an MBA before you start working however consider what was mentioned about being "prepared" for such a role.

    A person that has been exposed to all facets of the business, understands its market, business economics, its customers, the niche it serves, and the myriad of skills one needs to work in all the different areas and understand the "big picture" of what the business is all about is going to have a hell of a better chance in instituting the right changes than someone without this prior exposure.

    I'm not trying to discourage you from getting an MBA but I would caution you that its going to be more valuable to not only you but the company you work for to have some experience behind you so that you can not only appreciate this experience but use it as a means to build on the understanding of elements I previously mentioned.
  5. Nov 23, 2009 #4
    The other thing is that MBA through night school by itself isn't a huge resume boost for entry level positions. Most of the target audience for a lot of these programs are people that already have some experience, don't need a big name MBA but do either need some theoretical business skills or else need some random MBA as a "union card" to get in. Also, it's pretty surprising how many MBA classes end up being taught by people with no business experience. If you already have business experience and you just need theory, then this isn't going to hurt, but if you need experience, it might be a bad thing.

    Also, if you are reading this forum and do want to work in an investment bank, you probably stand a much higher chance of it getting either a Ph.D. EE or a EE masters degree than you do an MBA. Finance hires tons of EE Ph.D.'s.
  6. Nov 24, 2009 #5


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    I would have said no, you don't learn anything in an MBA that isn't better learned on the job, big name MBA programs are mostly about making contacts and in the 90s multinationals sent every middle manager on some sort of MBA program so they are a dime a dozen.

    BUT I am seeing a lot more job ads requiring an MBA for any management positions. I think this is just to reduce the number of resumes they receive in the current market But it could become normal, especially in public service - just because it takes a decision (and blame) away from the hiring dept = he had an MBA, therefore was qualified, therefore not HR's fault that he was useless.
  7. Nov 24, 2009 #6
    It's a function of the bad economy. A degree lets you get rid of X% of resumes without thinking about it. It becomes much, much more important in a bad economy, and much, much less important in a good economy.

    Curiously that sort of thinking really doesn't happen a huge amount in businesses. If you hire someone that is incompetent and it impacts profits, then there is a good chance that everyone is going to end up in the unemployment line. The thing that you get with a degree is some assurance of at least minimal competence.

    One curious statistic though is how few CEO's have MBA's. For Fortune 500 companies, I think the number is around 20%.
  8. Nov 24, 2009 #7


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    It scales with the size of business, in large companies or public sector any real outcome is beyond any employees control so they tend to do what has least risk to them.

    If you're a CEO of a fortune500 you already made contacts so don't need the MBA
    It's worse at smaller companies, you find the original founder/CEO gets surrounded by layers of MBA middle manager types.
    There is also a big USA-Eu difference. In the US (and UK) the head of a large company will generally be a lawyer/finance guy who has worked in other big companies - whereas in Europe they will often be more technical and related to the industry. The CEO of a German car maker is very likely to be an auto engineer - they wouldn't hire the CEO of Pepsi simply because he had fortune500 experience.
  9. Nov 24, 2009 #8
    In well run large companies, people feel that they have some control over the "primary group" of about five or six people, and this puts a lot of peer pressure on people to act in ways that are consistent with the direction of the company. If you have someone totally incompetent on your team, then something very bad is going to happen to you, which is why most high tech companies that I've seen put most of the responsibility for hiring on the work team with HR playing a very, very limited role.

    How to motivate people and avoid the problems of bigness is why management is so tricky, and why we have MBA programs, and why MBA programs work a lot better if you have real world experience.

    MBA is one way of making contacts. Anyway it's hard to be successful in business or academia without a lot of networking. Also a lot of the "book learning" that comes with MBA's is quite useful (i.e. how to read a balance sheet).

    Studying how companies evolve is also part of the business curriculum. One thing to remember is that an MBA is a curriculum for middle managers. If you want to start your own company, the MBA training is probably the worst place to start since it teaches you the wrong things.

    Part of it is that the US and Germany large companies have different very financial structures. Large US companies are often basically large holding companies in which the point of the corporate HQ is to raise and manage money from the capital markets. German companies tend to be owned by banks, which means that the financing function tends to be external to the company.

    To do well in business you both technical and management skills, and someone starting out should probably get the technical skills first, since there are more opportunities to go from technical to management than the other direction.
  10. Nov 24, 2009 #9


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    I think that's definitely true, somebody described recently US industry as basically a pension fund that does a little car making on the side. I think GE pretty much gave up the manufacturing and just became a bank.

    It does create some problems. The 'all business is the same' attitude means that a new CEO comes in from another industry and all they can do is the same thing they did before, redundancies, reorganizations and a few takeovers - anything else would make the markets nervous. They certainly wouldn't suggest building a new/better car (at least not since Iacocca).

    It also creates a bad feeling inside the company. An engineering manager at GM knows that however the good the car they design, the company will be more interested in the money it's making from currency trading. I think this has a bigger effect on the quality of the product than the fact that the boss of VW came up through the engineering dept.

    In the UK it's worse, since all big business is government IT contracts or defence - the way to the top is to be an ex-civil servant with 'contacts'
  11. Nov 24, 2009 #10
    What's happened is that the world has globalized and so multinationals are now spread all over the world. There's no such thing as "US industry" now, it's "US parts of the global economy." There is a connection with academia since I think what the US is likely to turn into over the next few decades is basically a "global college town."

    GE is basically a bank holding company owning manufacturing divisions, but it's rather unusual among US industrial companies.

    Building a decent car is a *lot* harder than it looks, but Ford seems to have gotten it right. One thing about senior executives is that no one has all of the knowledge that they need to run a large industrial company, so what they really need is a team of people with specific skills.

    And how to avoid this sort of thing is part of the art of management. The main problem is that if there is an obvious glass ceiling for technical people, technical people will leave and find other things to do. One reason I like finance and investment banking is that although there is a glass ceiling, it's much, much higher than in other industries, and it's possible for a math geek to get to the top of the food chain while remaining a math geek (see James Simmons and Rentec).

    I don't know of any bureaucratic organization in which can make it to the top without contacts. A lot of it involves the number of jobs available. If there aren't many jobs then networking becomes more important. After all, that's what a recommendation letter is for,

    One thing that is interesting is to people within academia is how useless recommendation letters are in industry. Except in very rare situations, pretty much no one at the entry or near-entry level cares who issues a recommendation.
  12. Nov 24, 2009 #11


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    The same can be said of EE coursework or any type of education for that matter.

    Thanks to everyone for your help. I will reconsider getting an MBA.
    Last edited: Nov 24, 2009
  13. Nov 24, 2009 #12


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    That's what we were discussing.
    The opinion on MBAs was always that it wasn't for what you knew it was for who you knew.
    And since the advantage of the old-boys network didn't stretch past the top-10 places it wasn't worth spending $50K at Nowhere College for an intro to accountancy.

    But if MBAs are becoming a gatekeeper to any management job then you might have to find a better company to work for.
  14. Nov 24, 2009 #13
    Curiously it's not.

    In order to understand mathematics, engineering, and physics at any sort of non-trivial level, you need do problems which implies something or someone that is grading and correcting the problems. There is a huge amount of learning that you can do with MBA's that just involves reading books. A lot of MBA work involves reading case studies, and adding them into your mental database, and at least at the very basic levels, there is less "problem solving" than in most EE or physics curricula.
  15. Nov 24, 2009 #14


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    The MBA won't cost 50K. It will cost only 17K since I will only need to take 27 of the 36 credits in the MBA program. Does this change anything?

    And if an MBA is a gateway to any management job then why not just get an MBA rather than find a "better company"?
  16. Nov 24, 2009 #15


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    To be honest I have never taken a business class so I don't have any idea what a business curriculum might entail.

    I guess the bottom-line is whether or not the intrinsic value of the knowledge obtained in a part-time MBA program outweighs the money it costs. Will the knowledge help me in my career as an engineer and as a future manager? It undoubtedly will, but is it worth the tuition? I am not necessarily looking for networking opportunities as I am looking for a decent business education.

    I cannot see myself in 5 years quitting my job, spending 2 years in a full time elite program, and spending 80-100K in the process. I think a part-time MBA would be a decent alternative. And since I have no job right now I have time to devote to further education. I am also not thrilled about finishing the PhD to be honest. Taking some non technical business classes might be a breath of fresh air after doing engineering and physics for so long. I would like a job that mixes both the engineering and business aspects. I do not desire a purely technical career path to be honest. I am also not all that interested in research.

    I have always been interested in getting some business education for its own sake. I would also like to start a business one day and I would think the education obtained in an MBA program (even a low ranked one) would be beneficial.
    Last edited: Nov 24, 2009
  17. Nov 24, 2009 #16
    The MBA is mostly useless. There are some quantitative type courses like accounting, finance, operations and supply chain that are somewhat helpful. Other than that, it's a degree in giving effective power point presentations.

    Do you want to spend 20000+ to get a degree in power point?
  18. Nov 24, 2009 #17
    An MBA is much more useful if you have business experience, because a lot of MBA's that are geared toward mid-career professionals have a huge component in which people basically swap stories about what they've seen and what works and what doesn't.

    For people without business experience (i.e. people with bachelor's degrees), an MBA basically *is* just a degree in giving effective power point presentations, but that's not totally trivial, but it's something that you can learn in other ways.
  19. Nov 25, 2009 #18
    You might take one or two.

    That's not the real question. The real question is whether or not you'll get more out of the MBA than out of the other options which are currently open to you. There is also the risk factor. You don't know what is going to happen, so part of your effort would be to avoid really bad situations.

    The two are quite strongly connected. Also you may find you'll learn more about business working at a company or even doing your Ph.D. than you will in business school.

    I'd take a few classes first but I wouldn't count on it. One thing that is different between physics and business is that a rather large fraction of people in physics do it for the intrinsic interest of it. This isn't true for most business and economics majors who don't have a serious amount of intrinsic interest in what they are studying and are there just to learn what they need to make money.

    It's really hard to find a job that doesn't have engineering aspects.

    It's really not, and if you want to start your own company, you really want to *avoid* getting an MBA. There was a professor at a big name university that started a class on entrepreneurship that basically started out by saying. "Let's get one thing straight. None of you people in this class are entrepreneurs, You are all bureaucrats. If you were really entrepreneurs, you'd be out starting your own companies, and not wasting your time listening to me talk about starting companies."

    MBA's are for corporate bureaucrats. Now once a startup starts getting off the ground and expands from 20 people to 5000, it's going to need tons of corporate bureaucrats. Also startups need finding which means that it has to deal with private equity firms and investment banks with tons of corporate bureaucrats that hopefully have some sympathy for startups. So corporate bureaucrats are important for the economic ecosystem.

    But corporate bureaucrats just do not start companies. Wrong skills and wrong personality. One thing that's interesting is that it is totally economically irrational for anyone to start their own company. If you run any sort of rational cost-benefit analysis on starting your own company, it just does not make any sense, so entrepreneurs are all a little crazy.

    The MBA degree is designed to train middle managers for established companies. It's rather *bad* training for anyone that wants to do a startup. An MBA is basically a degree in giving powerpoint presentations, and if you find yourself a middle manager in a 50,000 person company, you'll need to give a lot of effective powerpoint presentations to get anything done. However, its precisely the *wrong* set of skills if you have a 20 person startup. If in a 50,000 person company, the powerpoint projector goes out then you call someone to fix it. In a 20 person startup, you'll have to fix the damn projector yourself, and in the time it takes to get the fonts right to make a decision, you could have had everyone in the room, made the decision, and made half a dozen sales calls.

    I'd say that if your goal is to start your own company, then you are much better off getting the EE Ph.D. One thing that will happen if you run your own company is that you will have some seriously, seriously bad days. There will be days when *everything* goes wrong, you are looking at all of the crap that is being dumped on you, and it looks totally hopeless. In a non-startup you can go home and have the boss worry about this, but in a startup, you are the boss. If you are a corporate bureaucrat, you can always quit, but if you are a founder of a startup, then you have several dozen people looking up to you, waiting for you to make a decision, and you can't really quit even if you want to.

    So what you have to get yourself to do is to get out of bed, salvage what you can, and if you go down, at least go down fighting. That's more Ph.D. than MBA.
    Last edited: Nov 25, 2009
  20. Nov 25, 2009 #19
    This I believe. I just had to express my opinions after taking some information systems courses in a lower ranking business school. There's not necessarily a lot of knowledge there to help you.

    What may be interesting is attending a lower ranking law school part-time. There are some JD programs in southeastern Michigan that cost nothing for smarter students (160+LSAT, 3.5+ GPA). Knowledge of things like contract law, tort law, and property law are very helpful in navigating the small business arena. Of course, you may be cheating yourself and professors if you really don't want to become a lawyer. Plus 3-4 years is a lot of time.
  21. Nov 25, 2009 #20


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    I see. Well what about the master of engineering management?

    http://www.ltu.edu/engineering/mechanical/_eng_mgmt.asp [Broken]
    Last edited by a moderator: May 4, 2017
  22. Nov 25, 2009 #21
    It's also a degree for corporate bureaucrats. A slightly different type of corporate bureaucrat, but still a corporate bureaucrat. Engineering management degrees tend to be project management degrees that are focused toward mid-career professionals. Personally, I think someone that wants to go into engineering management is much better off getting a straight engineering degree, and then working their way upward later.

    I'm interested in what other people think about this, but my sense is that an engineering management degree is probably worse for entry level than an MBA, because companies will hire MBA's at entry level, but I don't know of anyone that will hire an project manager at entry level, since they would prefer that project managers have some engineering background. It's also interesting the fascinating academic politics that causes schools to have two separate management degrees.

    Also, a Ph.D. will give you some direct experience in project management.
    Last edited by a moderator: May 4, 2017
  23. Nov 28, 2009 #22
    Ignoring the recently drastic downsizing in GE Capital, GE always needed to have 50%+ revenues from manufacturing to keep its cost of capital down. The majority of the company has and will be manufacturing focused. Having said that, the goal of the company is to make money. If finance is where the money is, we'll be involved in finance. Capital is it's own division of the company though. People from Capital aren't running the industrial divisions nor is Capital in any way above the industrial segments in the corporate structure.

    FYI we build power plants and their guts, wind turbines, water treatment plants, parts for oil drilling, industrial software, trains, jet engines, MRI machines, appliances, etc.
    I don't think the attitude is so much "all business is the same." The reason a variety of experience is wanted in management is that the manager will know what works and what doesn't in different situations. Managers in GE will rotate through energy, finance, and media, for example, so that they will be able to adapt to new situations and come up with new solutions no matter what comes up. In this way they are also replaceable.

    This is especially relevant in manufacturing. The thinking is that all manufacturing is the same. Someone who has been building capacitors their whole life will never be the plant manager of a capacitor factory. How do they know what works and what doesn't? How do they evaluate their own operations critically? Bad blood will only occur if the manager doesn't know how to handle the situation properly with humility or whatever it takes until he builds credibility locally. But again, that's why it's critical that managers have experience coming in to new and unfamiliar roles - so they can handle the transition.

    Disclaimer: I'm an operations manager at GE Energy rotating to a new location every 6 months. Obviously I'm not authorized to be giving any company stance on anything though.

    As for MBAs, we primarily hire people with business and engineering degrees. GE will support part-time MBA study but typically will not send anyone to a full time MBA program. We do not recruit heavily from MBA programs except for one sales focused rotational program. Our CEO and CIO have Harvard MBAs. One of our vice-chairmen has a state school MBA that he got while working. School brand in general doesn't carry much weight at GE, but personal networks of course are a part of all business.
  24. Nov 28, 2009 #23
    It will depend heavily on the placement record (network) of the program. In my mind the degree is a little suspect for someone with no experience. If someone told me they had this degree but no experience, I might think, whether true or not, that they will probably be stuck up and think they should be running the place. If someone has experience, I would completely ignore the degree and not give it a second thought. It is my impression, and I have been told by several engineer friends in aerospace, that a master's in engineering is more desirable for engineering management than even the two year MBA from a resume perspective.

    I have also heard reports that the training has eventually been relevant and helpful on the job even if the degree itself isn't a resume boost. Your mileage may vary. I wouldn't generally recommend it.
    Last edited by a moderator: May 4, 2017
  25. Nov 28, 2009 #24
    One has to distinguish between external finance and internal finance. Pretty much every industrial company in the United States has to run a pretty sophisticated financial operation in order to finance its operations.

    This is highly, highly unusual for American companies. The standard MBA theory is that companies should focus on their core competencies. What happened was that the way that GE does things was pretty standard for conglomerates in the 1960's, but GE is really they only company that I can think of off hand that has gotten this business model to work after the 1970's and 1980's.
  26. Nov 28, 2009 #25
    Right. When I refer to "Capital" I'm talking about the external finance organization in the company.
    Management consultants rotate around between companies for a living :smile:. Former management consultants are generally sought after in industry as well. I believe it's standard in pretty much all manufacturing for managers to move around frequently, although focusing in one industry is rarely a negative. At GE you typically stay in one industry until you are the CEO of the business unit involved in the industry. Only at that point will you move to something new. Only the CEO of the entire company would realistically have been in industries as diverse as energy finance and media.

    It's likely, however, that if the CEO of the appliance division is successful he will be promoted to run Transportation (trains). The Transportation CEO may be promoted to run the jet engine division. GE execs are also sought after by diverse companies, although some have famously failed. Bob Nardelli went from GE Power Systems to CEO of Home Depot to CEO of Chrysler. James McNerney, now CEO of Boeing, has the following experience per Wikipedia:
    GE may be the the only company to formally and internally pull off this sort of thing. Many other companies just go outside of their own organizations to find experienced managers with diverse backgrounds. This may be more prevalent in industrial manufacturing companies - just looking anecdotally at the examples I can think of. You'll also find quite a few McKinsey alumni CEOs though.
    Last edited: Nov 29, 2009
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