MBAs Do MBAs Still Rate? – What employers and recruiters think

Is an MBA ticket to employment or promotion? Both research and informal feedback confirm that students, their partners and families come under considerable pressure during the study period. So, from an employer’s perspective is all the money, sacrifice and hard graft worth it?
“It’s not passport to success,” according to Peter Lennox, general manager of organisation development at New Zealand Trade & Enterprise (NZTE), “it just pushes the odds little further in your favour.
“It’s not that an MBA gives person an advantage… rather, it opens doors by acting as another filter. But there’s just as many prats with MBAs as with other degrees, so it’s what people do and how they act that determines whether they grasp the opportunity they’ve worked for.”
Headhunter George Brooks, CEO of OCG Consulting, believes that the significance of an MBA to an employer is what it says about the candidate rather than the substance of the degree itself: “The content is less significant, has less influence than the fact that they’ve done the degree. What’s more important is that it shows [the candidate] has discipline, application and intelligence, time and financial commitment.”
However, fellow headhunter and MD of Executive Taskforce, Kevin Chappell, doesn’t believe that an MBA generally plays any role in employment decisions. “The question of whether or not candidate has an MBA just doesn’t come up.” He says he cannot remember in all his years in business ever being asked by an employer to include MBA in the candidate criteria. “It’s just not mentioned. The only situation where it might have influence is if there were two equal candidates and one had an MBA.”
But he says it rarely comes up in the interviewing process. “New Zealand is country of practical people. Practical experience takes precedence. It’s only where the degree is requirement for the position (such as in IT, accounting) and particularly in marketing that it becomes significant in the employment process.”
Brooks says all employers have the same criticisms of new MBA graduates: “They come out evangelical, know it all. Which is why groups of MBA graduates tend to band together after graduating in ‘risk everything’ start-ups.
“Wiser employers consider it great tool when it is accompanied by relevant experience. All graduates come out fired up and want to practise at their employers’ expense – employers are generally wary of enthusiastic new MBA graduates. The best candidates are those who have had the degree plus two to three years’ good experience.”
An MBA is “nice to have” on top of good undergraduate degree. “A good undergraduate degree [in the relevant discipline] is more important – the employer is aware of its content,” says Brooks.
Kindercare Learning Centres is company that values education. Its core business is the provision of early childcare and education – it now has 20 centres – and it has sister company, the New Zealand Tertiary College, which delivers teacher education to 400 student teachers.
“We value education, and yes, relevant tertiary qualifications influence our decisions,” says founder and MD Glennie Oborn. “A key value of an MBA is that it is broadly based. If the position is one where the focus is very much in one specific area such as accounting, we may be more influenced by qualification that included more depth in that particular discipline. Having said that, no one works in isolation and there needs to be balance between specialisation and understanding of other fields. We need people who can think and innovate; who can cope with constant change and help create an exciting future.
“But the real value of the degree depends on the person on whom it has been conferred. Qualifications influence, but the character and competency of the individual will always take precedence with Kindercare.
“The learning curve and the association with faculty and other students sharpens skills and increases awareness of possibilities as new level of thinking is required. It also enhances and extends networks. We have only one MBA, as most of our staff have teaching focus. One advantage he brings is an understanding of range of business models to draw on when working with our companies’ challenges.”
Colin Dale, city manager for Manukau City Council, the third largest and one of the fastest growing cities in New Zealand, is unequivocal in his organisation’s support for employees undertaking an MBA programme.
“We place significant importance on career development and personal development. An MBA is seen as significant milestone on that journey.
We have facilitated employees doing MBAs – assisted with their employment arrangements – because it’s [doing an MBA] big call. In an organisation of our size, we need to demonstrate best practice and management competence.”
Dale says an MBA is an indicator of several things: “The skills and knowledge that are derived from study at high level; it is also indicative of an individual’s commitment to and investment in, their own learning and development. As such, it is one of the factors we would consider when appointing staff to management and senior roles.”
And unlike other employers who give more weight to skill-specific qualifications, he says that organisations like Manukau City are moving away from focus on the more traditional engineering/accounting skills to more generic leadership issues. “It’s an ‘intellectual thinking journey’ beyond the more traditional tertiary courses. Contemporary organisations demanding leadership and management competencies give significant weight to the skills that an MBA develops as opposed to more traditional, [more narrow] qualifications.
“We have encouraged people to undertake an MBA and quite number have done it. Currently maybe 10-12 people here [have the degree].”
Dale says there are two main advantages of an MBA: “For the individual, they are exposed to an intensive learning experience which has good mix of both theory and practice. For the organisation, this knowledge is turned into practical application – often with research projects being completed around organisational issues.
“Whilst there are many criticisms of MBAs, the benefits outweigh these. One benefit is the ability to share, and learn from, organisational experiences with others from diverse organisations – people who [the student] may normally not interact with. The application of the learning and experience is fundamental need for organisations that hire MBAs. As with all education it is the application of the knowledge that is paramount.”
Pacific Business Trust’s CE Jim Mather is another MBA enthusiast: “Being an MBA graduate [he completed the Henley MBA in October last year], I suspect that my response is biased. However, to use an analogy, Pacific Business Trust (PBT) employees studying towards the Henley MBA are like seasoned golfers deploying to the golf course with full bag of clubs. They are able to select the appropriate club for the distance and conditions, and have the confidence that they can make the right shots.”
PBT is Crown Entity established in 1985 as charitable trust to assist New Zealanders of Pacific descent to start and develop successful businesses. It currently has two senior managers on the Henley MBA programme, with third person likely to be enrolling at the September intake this year.
Mather is convinced that an MBA on the CV should advantage applicants for management positions: “Absolutely, as it indicates that the appointee would have the capacity to see the entire ‘business battlefield’ around the organisation, from having strong theoretical base of knowledge. Obviously, knowledge is only useful if it can be applied, so having an MBA would be significantly more valuable if complemented by broad range of relevant practical experience.”
NZTE’s Peter Lennox says that “all else being equal”, an MBA qualification would influence him when appointing or recommending people to management or senior positions