John Warrilow, noted writer for BNET.com, asserts that those looking to launch their own businesses need not complete an MBA program to be successful. In fact, he goes so far as to claim that an MBA is bad for entrepreneurs.
First, it’s important to acknowledge that the list of successful entrepreneurs who were also dropouts is fairly lengthy and includes some heavy hitters like Bill Gates, Walt Disney, Coco Chanel and Steve Jobs. However, that’s not conclusive evidence that traditional education is lost on the entrepreneurial-minded. Warrilow provides four reasons that he believes seals his argument:
- MBA programs teach causal reasoning. In a study performed by University of Virginia’s Darden School of Business, professor Saras Saravathy researched the differences between 45 ‘super-entrepreneurs’ and a group of MBA-toting corporate executives. She found that they differ significantly in how they plan for the future. Apparently, the executives make goals and then determine a path to achieving those goals—what Sarvathy calls ‘causal reasoning.’ The entrepreneurs, on the other hand, use ‘effectual reasoning’ which means they determine what resources they currently have access to and then decide what can be created from those resources.
- MBA programs teach adaptive thinking. Another study—this one conducted by Dr. Michael Kirton—found that people can be grouped in two categories: adaptors and innovators. Adaptors use others’ ideas and improve upon them while innovators create cutting-edge concepts and ideas of their own. Warrilow argues that more entrepreneurs are innovators, and he doesn’t expect that an MBA will do anything but train this tendency right out of them.
- Classmates will not be entrepreneurs. Most students enrolled in MBA programs have attended the right universities, earned the right grades, and participated in the right extra-curricular activities. This eliminates the majority of entrepreneurs who have used their time to dabble in various entrepreneurial ventures. As Warrilow explains, “In a tier-one MBA program, your peers have gotten to the top of their class by answering the question correctly, not by examining the efficacy of the question itself. By the time these model citizens have put the finishing touches on their pristine educational credentials, every ounce of creativity has been replaced by pounds of correctness.”
- 40% of ‘risk-free’ years wasted in the classroom. There’s no doubt that the older one becomes, the more responsibilities and attachments one acquires, including a spouse, children, mortgage payments and other bills. The 20’s can be a great time of risk-free years when most are generally unburdened by such responsibilities. Spending those years completing an MBA program can steal these precious years from prospective entrepreneurs.
While there are good reasons to develop new skills and develop one’s expertise, that doesn’t mean that graduate school is always the way to go about it. Sometimes, it’s important to look for other avenues that will not hamper a strong entrepreneurial spirit.
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Warrilow, John. “4 Reasons an MBA Is Bad for Entrepreneurs.” 3 March 2011 BNET.com