Comparing both traditional and new MBA specializations, IIM-A alumnus Abhishek Sareen discusses which MBA course is best for future, and how to decide the right one for you.
In today’s COVID-19 pandemic times, the global economy is in recession and jobs losses are common place. Most people who have been affected by it, especially in non-management and tech functions, would be considering doing a post graduate program in management to fill in the professional gap.
One of the most common questions people are asking these days is, “Which MBA is best for me?” So today, we discuss how to choose your specialization, which MBA course is best for future, future scope of MBA and whether you should even do an MBA at all.
Best MBA Courses/ Specializations
The MBA (PG diploma in Business Administration/Management) program is over a century old, which was first offered by Harvard Business School in early 1900s. An MBA course is designed keeping in mind the needs of big corporates who want officers, trained for managerial positions across various organizational functions like marketing, finance and human resources. These traditional MBA specializations are still the most relevant when it comes to job search and recruitment.
Over the years with the changes in industry requirements, MBA curriculums have tried to adapt themselves by catering to specializations like production operations, information systems, etc. In my opinion, these MBA specializations have more fluff than substance. Most student and employed professionals with below 10 years of experience see these degrees as a stepping stone to get in to middle or top management positions in their or other organizations.
However, when companies are looking for mid-management staff in these operational roles, MBA is not their search-criteria for candidates, as they are looking for skill-sets and experience. B-schools often create these new sub-specializations to attract a diverse student body. Similarly, students also see this as a way to add coherence in their resume, although it doesn’t matter in the long run. In fact, I doubt these fancy MBA specializations increase their employability.
How to Choose MBA Specialization
An MBA degree or diploma definitely creates opportunities for managerial positions. But one must also be aware of job market trends and demands. For example, between 1970s and mid 1990s, engineering was the most sought-after career option for students in India as there were plenty of jobs. Post the 1990s, MBA became the most sought-after post graduate degree program.
By the 2015, India had been producing over 500,000 MBA’s and 1,500,000 engineering graduates, which led to such oversupply that it created high unemployment and lower salaries. According to an All India Council for Technical Education (AICTE) report, more than half of MBA graduates failed to secure a campus placement in 2016-17.
The global scenario was more or less the same. Once people see success and glamour in a job sector, a herd mentality takes over and the education sector tries to fill the public demand. However, the industry demand does not match the supply.
Which MBA Course is Best for Future in Post-Pandemic Era?
The job market has not been in a great shape for the last 3-4 years, even since before the pandemic shook the world in early 2020. The job market has not been very kind to engineering and MBA graduates for some time now.
Students and professionals who have lost their jobs need to understand what the new emerging requirements of our industry are. What success formula worked 20 years ago, is unlikely going to make us succeed in the present times. And MBA or engineering are no longer as lucrative as they were in early 2000s.
Going forward, we foresee the new job demand to remain stagnant for some time. Technologies like automation, cloud services, online delivery, and artificial intelligence have reduced manpower requirement to some extent. However, new emerging sectors like robotics, drone technology, renewable energy, etc. have also come up. My advice to students and graduates would be to broaden their horizon and look beyond traditional jobs into sectors that have latent demand.
Ideal MBA Specializations for Experienced Professionals
If you are an experienced professional with 8 to 10 years of experience and have very limited understanding of management, and want to take the conventional MBA route, I would advise you to get exposure into one of the 3 core functions of your company, i.e. Marketing, HR and Finance.
These would certainly be the best MBA specialization for future in India and even abroad. In the companies I have worked for, many senior management professionals in these 3 areas have MBAs from good institutes. Most good MBA programs will educate you through case study methodology. It is imperative that that you have good knowledge and fundamental understanding of these organizational functions.
To get a good understanding of marketing, you should get yourself involved in customer facing functions like sales and customer services. For HR, you should try to understand the organizational structure and HR related policies of your company.
Finance is the backbone of any business. You need to understand the basics of finance terms like P&L, cash-flow, balance sheet, etc. All these concepts will be a part of any business case study that you would undertake during your MBA program. They’ll also help you during your interviews, even if you’re applying for jobs in other areas.
When thinking about senior-management positions, one needs to understand fundamentals in all these 3 areas, in fact. A combination of basic people-skills, finance skills and marketing skills helps you take the right decision for your company. And that’s what management is. These concepts will be time and again tested throughout your management career.
Consider Your MBA’s ROI
One of the other key decision-making criteria is an MBA program’s tuition fee. MBA programs are notorious for having exorbitant tuition fee, which could range anywhere from $50,000 to $150,000. One needs to look at the financial aspect of doing a management program from an ROI perspective also. It’s not an easy one for sure, but one needs to be pragmatic about the decision. You shouldn’t get swayed by placement offer stories, which are often overstated. Student loans debt is a big problem that runs into trillions of dollars.
Finance and Marketing MBA specializations are best paid in India, provided you have solid and relevant pre-MBA experience. In fact, professionals with MBA in Finance are generally higher paid than those with MBA in Marketing.
And Lastly, do you really need an MBA?
Often graduates and working professionals who want to do a management program, believe that an MBA will skill them for CEO position and land them in a cozy job. Well, this could have been true a few decades ago, however such stories are more glamorized than they should be. According to a 2017 survey, only 28 per cent of India’s CEOs have a master’s degree in business.
Thanks to the rise of internet and easy access to information, knowledge is no longer a differentiator. As such, I predict the MBA demand in future will only decrease further. Companies will be on the lookout for professionals who have functional skill-sets, technical know-how of SaaS, etc. and relevant experience.
Students need to up-skill themselves in different ways by educating themselves like taking up courses in psychology and behavior. Or get a hands-on experience in digital marketing by creating websites and running social media campaigns, etc. This could add value when applying for marketing jobs. Students and professionals need to think from the company’s point of view. They should differentiate themselves to stand out by showcasing new skill sets that add value to your profile.
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