We're cranking out MBAs 10x faster than we did 10 years ago. Is there any real value in an MBA, or is it just an irresistible money-mill for universities? I'm reading a book that makes a rather strong case that all management is built on illusions.
Harvard was the first to create an MBA program, around 1900. That's the same revered institution that, after it had become the mecca for business knowledge, failed the business plan for FedEx.
We publish about 10,000 business books a year. Yes, of the approximately 50,000 nonfiction books published each year, 20% of them are business books. So we're trying. Admittedly, a lot of those books are published by people attempting to boost their consulting career or fees, so out of that 10,000 there aren't too many that really have new and interesting insights. The Management Myth: Why the Experts Keep Getting it Wrong by Matthew Stuart is one of the rare ones, because the author's goal is to tell the truth about the illusion that management is scientific.
For example, instead of harrumphing and pretending that everything was OK, Harvard and the whole MBA industry might have stopped in their tracks and said, "Hey, we must be doing something astoundingly wrong, the way we said FedEx would fail." But that's not the business they're in, and self-examination would be bad for business. Everyone secretly knows that if they really looked at the value of an MBA, it would only cause problems.
That very self-reflection would be an indication that management was some kind of science. Even more interesting would be to discover the hidey-hole where all the experts disappear when whatever they're currently touting fails. Remember Y2K and all the expert predictions of disaster? Those experts must have been teleported off the planet on January 1, 2000, because you couldn't find one (maybe they just climbed into bomb shelters and are still there). How could Harvard have any pride after failing the FedEx business plan -- how could they not say "let's go back to first principles and see what we missed here?"
I don't really expect a cogent answer to that last question; one of the things that I have been trying to learn about is self-deception itself, and how and why we make mistakes. A big part of this is accepting, as one with a scientific background, that people don't pay attention to facts. As Daniel Pink points out in A Whole New Mind, people are wired for stories, which means that any facts you hope to convey must be ensconced in stories (or for that matter, any lies you want to be absorbed).
A story makes things real to a person; indeed, it's how we remember things. The fact is that Harvard failed the FedEx business plan, which strongly suggests that an MBA is not going to produce much in the way of interesting or revolutionary ideas. The story is that you could burst in with the headline to this article and people will bow down and defer to you. Which one gives you positive vibes when you imagine yourself in it? (Part of the problem is you can't imagine yourself "inside" a fact. You can only imagine yourself in a story).
Apparently there is a thriving religion founded by a guy who predicted the end of the world, got it wrong, then just kept predicting it and getting it wrong. More and more people kept showing up until they decided to just institutionalize it. Matthew Stuart's telling of the creation of "scientific management" doesn't make it sound much different. Frederick Winslow Taylor, the creator of "time and motion studies" and the "father" of scientific management, just made stuff up. According to Stuart, Taylor's own disciples often observed that he would go off on meaningless rants. But the "studies" that he based his conclusions on (and he was also the first management consultant) were just stories. Taylor's success was not that he actually applied science to management, but that he told good stories about applying science to management.
How do you do that, anyway? Apply science to management? When have we ever, for example, run two projects to produce the same thing, in parallel? We mostly can't get one project off the ground. And everyone who's worked on a project knows that there would be no way to repeat conditions, even in parallel (different people produce different conditions).
The idea that management could be a science makes a great story. We really want to believe that it can all be as predictable and repeatable as a scientific experiment, because that means we can control everything, and we like to think that we can control things.
One of the oft-repeated maxims is "you can't manage what you can't measure," but that's only for the scientific management crowd. THEY can't manage what they can't measure, so they pretend that anything you can't measure is unimportant. A real manager knows that most of what you have to manage is not measurable, as is most of the stuff that has the biggest impact (I've talked about this in a recent blog).
I'm only partway through Stuart's book, but the destruction he has wrought so far on the value of an MBA and management consulting in general is satisfying, somehow. Probably because the damage that MBAs have wrought on business and the economy has been so deep.
There's even a phrase that's been going around for awhile, among MBAs themselves (as they figure out the holes in what they're being taught): "It's not really about the education, but the people you meet." Seems like there should be a better, and far cheaper and less damaging, way to rub elbows with interesting people. An open-spaces conference, perhaps.
<i> According to Stuart, Taylor's own disciples often observed that he would go off on meaningless rants. But the "studies" that he based his conclusions on (and he was also the first management consultant) were just stories. Taylor's success was not that he actually applied science to management, but that he told good stories about applying science to management. </i>
Given the wholesale adoption of Agile practices based on just-so stories, the software industry is not exactly in the position to point the finger at the business world on this one.
> I'm feeling like someone who doesn't know what an iPad is > in a geek convention. What's this about Harvard and Fedex?
I tried to look it up but found nothing. The guy that started Federal Express went to Yale. He said in an interview that "Naiveté was also a big part. I didn't know that I couldn't do this." Which suggests to me that his idea was never 'failed' to his knowledge. There's no reference to Harvard at all in the interview.
The idea that management science believes that there is an objective test for whether a business plan will succeed is ignorant or crazy or both. It's also really weird to think that any type of degree is expected to produce "interesting or revolutionary ideas" in the receiver. If the test for the value of a degree is that every recipient creates a revolution, then all degrees lack value.
Ironically, if you look at the summary of the book he's reading, it appears to be a critique of business consulting which is what Bruce aspires to.
George W. Bush had an MBA. Perhaps that's all that needs to be said.
Next--I'll preface this with the disclaimer that I'm sure there are brilliant people out there who have MBAs and have found their education to be invaluable. I just have never personally met one.
Re: FexEd, I love this FedEx commercial because it echos my experiences--if somebody has an MBA they haven't been taught to figure it out, they've been taught to spend $120,000 to learn how to do something http://www.youtube.com/watch?v=NcoDV0dhWPA
In my experience at two corporations, MBA's are not taught creative thinking. They all seem to be taught to draw a square with four quadrants, in which anything can be mapped. This looks very official and tends to mean absolutely nothing and generate no insights other than, "That looks very official, don't it?"(Every single MBA I've ever worked with, no matter where they went to school, has drawn this same grid, every single one, and in no case has it ever been useful).
Every new MBA who would appear, highly touted ("She has an MBA from Stanford... Harvard... Wharton...) would either 1) have no real world experience at all and even their theoretical knowledge was dated or just useless, or 2) come in as a VP from somewhere else, where they also somehow managed to have no real connection to results--all they did was play management games.
In one example, an MBA/Former VP at Oracle came into a company that sold software to mostly individual and small business clients. Coming from Oracle, she had no experience with this market at all.
She proceeded to spend over $80,000 on a "magalog" marketing project, a small mailer that was ostensibly a magazine but was really a catalog, hence the ungainly name.
All the content was supplied by the online magazine I created and edited, so the content cost her nothing. Where the $80K went is a mystery (though I'm sure the postage cost a lot).
In the end, her $80K project brought in 14 orders, which means it cost $5,700 per sale for each $400 box of software, which, even an MBA should be able to figure out meant a less of $5,300 per unit.
Clearly flush with success, she left soon after, for a better job at a bigger company, her MBA as shiny and Stanfordy as ever.
For me, educational "credentials" are meaningless. They only say somebody made it through a school, was able to pay for it somehow and pass the tests. It doesn't really mean they've learned or are good at what they do.
Yes, it looks impressive to go into a doctor's office and see their diploma from Harvard Medical school. But it's their real-world experience that I care about. How many patients have they seen? How many have they diagnosed (correctly?).
Going to school does not make you a master of anything. Doing whatever it is, repeatedly and correctly in the real world does.
Ooops, then, it was Yale. It was a big deal back when Fedex first became successful, that an MBA school had told him the idea didn't work. Perhaps I'll run across it later in this book.
I don't know when I said I wanted to be a management consultant. Certainly not by that name, after reading this book.
> is > > in a geek convention. What's this about Harvard and > Fedex? > > I tried to look it up but found nothing. The guy that > started Federal Express went to Yale. He said in an > interview that "Naiveté was also a big part. I didn't know > that I couldn't do this." Which suggests to me that his > idea was never 'failed' to his knowledge. There's no > reference to Harvard at all in the interview. > > http://www.achievement.org/autodoc/page/smi0int-1 > > The idea that management science believes that there is an > objective test for whether a business plan will succeed is > ignorant or crazy or both. It's also really weird to > think that any type of degree is expected to produce > "interesting or revolutionary ideas" in the receiver. If > the test for the value of a degree is that every recipient > creates a revolution, then all degrees lack value. > > Ironically, if you look at the summary of the book he's > reading, it appears to be a critique of business > consulting which is what Bruce aspires to.
I agree with many points that you stated, especially regarding the "scientification" of management. But, this is the same topic that i disagree with you.
What i'm trying to say is that controlled experiments in management field are really difficult, and i agree with you in this. However, we can't reduce science to controlled studies neither measurement oriented hypothesis testing.
In fact, changing our subject to software engineering which is an area that suffers with some of the same problems that you stated, i think we should try to look for alternative scientific methods to explore phenomena in the area. Recently, i surveyed the software engineering journals and conference proceedings to see what is the state of the use of "alternative" methods to software engineering (in case, action research methodology).
The results are published here: http://portal.acm.org/citation.cfm?id=1671296. The papers that i have found shown that there are other (better?) ways to investigate software engineering field. I think the same could be applied to management. By the way, action research is relatively widely used in management field.
- Perhaps unintentionally, your references to stories is congruent with how business schools teach, particularly Harvard MBA: the case study method, aka stories. A system I was involved in building, in 1973, was developed into such a case study. The professor, whose name I've long forgotten, would show up periodically to interview us. I never did get to read the case, alas.
- The problem with Business School, whether MBA or lesser, is that its original purpose has been perverted, at least within the structure of Harvard. The Harvard program through the early 1960's was designed to provide academic credentials to experienced middle and upper managers. It was explicitly not intended to teach immediate graduates. If memory serves, the minimum experience in management was 5 years. I don't know what the requirement is today. Even so, Business School programs suffer from the illusion that management is a separable skill: a Manager can manage any activity, and is thus superior to any of those managed. The end result, not surprisingly, is supreme arrogance. This is the crux of the issue with "bright MBA's". Nor is it a coincidence that the preponderance of course work is accounting; this quarter's bottom line is all that matters, don't you know?
> I agree with many points that you stated, especially > regarding the "scientification" of management. But, this > is the same topic that i disagree with you. > > What i'm trying to say is that controlled experiments in > management field are really difficult, and i agree with > you in this. However, we can't reduce science to > controlled studies neither measurement oriented hypothesis > testing.
I think maybe the confusion about 'scientific management' is that it's pretending to be a hard science like Physics. It's more akin to a soft science such as anthropology and sociology. There are many sciences where the creation of controlled, repeatable experiments is not possible e.g. geology and cosmology. Management science is largely about using statistics for making decisions. Obviously if you fall prey to the McNamara fallacy, you are going to have issues but to say you must choose statistics or no statistics is a false dichotomy.
> Next--I'll preface this with the disclaimer that I'm sure > there are brilliant people out there who have MBAs and > have found their education to be invaluable. I just have > never personally met one.
I'm 7 credit hours into an MBA and I've already learned a ton (and I'm not paying anywhere near 120K.) I don't think that just passing the tests will guarantee anything but most everything I am studying is highly complimentary to my existing experience and education. The only class that I have outright taken before is statistics and it's a far cry from what I took in the math department i.e. actually useful to me.
I'd be interested to see what people think is taught in an MBA program.
I have been told that the original reason for an MBA was to give engineers the tools they needed to run a business as business became more technical and therefore engineers more important.
> In my experience at two corporations, MBA's are not taught > creative thinking.
Why is it that humans seem to have an implicitly Calvinist opinion of how the world works? Let me see if I get this straight: 1) Experts warn that an impending bug will cause significant problems unless we fix it in time. 2) We listen to the experts, and spend billions of dollars and huge amounts of time fixing the problem before the deadline. 3) The deadline comes, and while there are many small problems, the large problems that were predicted (if we didn't fix the problem ahead of time) fail to occur.
It is, of course, inconceivable that we had the problem- we humans are powerless to change implacable fate, even if we created that fate ourselves. It is so completely implausible that we could fix a bug, even in code we ourselves wrote, that we don't even need to contemplate that possibility. The only possible explanation is that the bug never existed in the first place, and the whole thing was nothing but a giant con game, and a demonstration of how gullible we are.
Yes, there were some who over-reacted before Y2K. But note- they also assumed that we were powerless to affect our fate. That it didn't matter how much effort we threw at the problem, we were not going to able to change anything. The only difference was that they assumed the bug did exist- and that we were not going to be able to fix it.
> <p>There's even a phrase that's been going around for > awhile, among MBAs themselves (as they figure out the > holes in what they're being taught): "It's not really > about the education, but the people you meet." Seems > like there should be a better, and far cheaper and less > damaging, way to rub elbows with interesting people. An > open-spaces conference, perhaps.</p>
Bruce, is there anything that open-spaces conferences CAN'T fix?
Seriously, I had to go back to your October 3 post to find one that didn't mention open spaces. What happened to the technical insights I used to come to your blog entries for? The entries feel more like open spaces marketing than anything else.
I miss the old Bruce who would sometimes talk about python and java and flex and tradeoffs between different typing schemes and dynamic vs. static typing and had stories about consulting engagements that either validated or nullified your views and how you learned from those experiences.
Management may be built on illusion, but at the end of the day, for most people, perception is reality. Also, Harvard has gotten a lot of things right over the past century or more. So have MIT and Stanford and lots of other schools. I think there are problems with higher education, but there seems to be a lot of rumbling in the past few years about scrapping the whole damn thing. That it has outlived its usefulness somehow. I think this is a case of throwing the baby out with the bathwater.
People currently seem inclined to point out one or two failures of anything these days and deem the whole thing a catastrophe. I don't see it that way. And I don't have an MBA, so I have no idea what the value of one is. I know several people that have gotten MBA's and gotten a lot out of the program. I know some that feel it was a waste of money. Roughly speaking I think the same distribution would hold for groups I know and just about any credential or degree, at least among my associates and friends.
The interesting trend I've noticed over the years is that the people that do the most bitching and moaning about the value of something, whether it be an MBA, Computer Science degree, technical certification, College Diploma or any other piece of paper that says "Look I did SOMETHING" are the very people that don't have said credential.
>> George W. Bush had an MBA. Perhaps that's all that needs to be said. You can also draw similar conclusions, I guess, about the legitimacy of anything if you look for the failed results. Medical science? Looks like there is yet more damning evidence against the people that published the paper about vaccines being a cause of autism. Looks like medical degrees are a waste of time. Planes crash. Eh, forget having aerospace engineers design airplanes. They obviously don't know what they are talking about.
And, as Chris Stiles points out above, given the hype machine and "story" surrounding Agile, the One True Way if you believe all the Agile devout, maybe this deep knowledge of what is real and what is not should be pointed inward. Maybe we can fix all that is wrong with software development and write perfect software before we take on tackling everybody else's real or perceived problems and shortcomings.
> Yes, there were some who over-reacted before Y2K. But > note- they also assumed that we were powerless to affect > our fate. That it didn't matter how much effort we threw > at the problem, we were not going to able to change > anything. The only difference was that they assumed the > bug did exist- and that we were not going to be able to > fix it.
Is there a label for this type of fallacy? Y2K is not the only case I'm aware of where some action lead to a self-defeating prophecy which was ridiculed after the action yielded a successful result. I don't really think that Calvinism and believe in blind fate has much to do with it and suspect it is more related to media hype + alienation.
About the articles topic. I cannot say much about MBAs but I would assume that the number of successfully driven companies / projects is proportional to the GNP which will grow slowly at best in late capitalist economies. Moreover I don't think that any business method whatsoever will eliminate natural selection on free markets which is one of their major benefits.
Flat View: This topic has 19 replies
on 2 pages