Alan Sugar might not give a “monkey’s” about MBAs, but universities across the country are offering courses directly aimed at entrepreneurs. GB Reports looks at whether business owners should consider going back to school.
Scepticism about the Master of Business Administration (MBA) course is well known and, in part, justified. Successful businesspeople have been around longer than the qualification, and many of the UK’s most famous entrepreneurs (Branson and Sugar, to name but two) left school in their mid-teens and never came close to attending university.
You don’t need a qualification to set up a business and, when you have millions in the bank, who can really say that you would have been better off if you had got one first? The case for MBAs has hardly been improved by the fact that so much of the teaching was initially focused on large US businesses, such as Ford and Microsoft, making both the outlook and the language seem alien when viewed by budding British companies.
Charles Clark is the managing director of Rosslyn Analytics, a £2.5m business, which conducts data analysis of company spending.
He did an MBA at Cass Business School at the turn of the millennium, while he was working in the City for investment bank Panmure Gordon. Clark says he benefited from his studies and found the course useful, as it has helped him to analyse business situations.
He is suspicious, though, of the view that established entrepreneurs would gain a great deal by attending a traditional MBA course. The rapidly changing and competitive world that growing businesses inhabit does not gel with the slow, calculative methods of the management theorist, Clark argues.
“The MBA teaches you to analyse a business situation in a structured fashion,” he says. “However, entrepreneurs have to ditch the theory and keep the tools. In an MBA, it is drilled into you that you have to analyse a situation and then execute your plan. But if an entrepreneur did that every time, they would never leave their room.
“If you are to survive, then you have to make decisions on instinct, and an MBA doesn’t teach this. MBA students are very well prepared to go and work for big structures, but they are completely alien to the Luke Johnsons and Alan Sugars of the world.”
So perhaps entrepreneurs are better off trusting instincts and common sense rather than highbrow theories proposed by the bigwigs of academia. But there is another side to the story. True, Branson and Sugar would not be able to sit still in an MBA classroom, but then these remarkable men are hardly typical of entrepreneurs as a whole. Sadly, thousands of businesses fail each year, while many others stall after the initial start-up phase, caught on a plateau where the cost of expansion appears to make growth impossible.
It also seems a bit rich to suggest that all academics live in ivory towers, when most are interested in testing theory with actual experience, and are often seasoned businesspeople. The hard facts about MBAs further undermine the sceptic’s view. MBA graduates quickly find well-paid work, with placement rates for most courses between 80% and 100%, and earn far more than the norm (achieving average salaries of £66,500, according to the Association of MBAs). To suggest MBAs are worthless is to argue not only that academics are missing the point, but also that the leaders of the world’s most successful businesses are deluded too. But can an established entrepreneur benefit from an executive education?
Getting smaller
MBA lecturers are seldom ‘just academics’, and often have experience working in business. Small companies are on their agenda and they don’t just focus on multinationals. Professor Patricia Rees lectures at Manchester Metropolitan University (MMU) and says that MBA courses and the approach of universities towards businesses has undergone a sea change since she has been working. With a background in small business, she is all too aware that there is a chasm between the working lives of an owner of a small or medium-sized company and an executive of a multinational.
“Until recently, the MBA hasn’t been geared much towards entrepreneurs and small businesses. It was more for people involved in finance. It just assumed you were going to work for a large multinational corporation,” she says. “However, we are trying to encourage more small business owners to do MBAs. The way we teach now doesn’t assume that you are going to work for a large company. There has been a realisation that the British economic future needs more small businesses to get it going. There’s also the fact that more women are starting up on their own. I came from a small business background, and it is about making sure you have a range of examples.”
Similarly, Richard Wheatcroft, who is a lecturer of finance at The Open University (OU), talks of small businesses influencing universities. As more entrepreneurs do MBAs, so the universities become more knowledgeable about smaller businesses, and refine their courses to reflect that, he argues. “Lots of schools are getting closer to the workforce; that’s a trend,” he says. “As you get more people from small businesses coming through, you get more examples from them, creating a positive feedback loop.”
What do I need to get started
An MBA is a master’s degree, making the basic entry requirement an undergraduate degree. However, those of you who left school early needn’t assume that you’ll be excluded. Universities are, in general, looking to broaden the base of their intakes, and are interested in talking to people who have experience on their side, but lack qualifications. Interestingly, the very concept of a ‘master’ comes from the old trade guilds. It is more recently that it has acquired its academic connotation.
Speak to your local university’s admissions officer, who can advise you on entry routes. Some might suggest a diploma on a specific area rather than a degree, but if you can demonstrate a good level of knowledge and suitability, then you might gain entry to the course straight away.
“If you have a lot of experience, you could get in without an undergraduate degree,” confirms Rees. “There are still people who were forced to leave school at 16, and some of my best students never went to university.”
The right course
You need to be clear about your reasons for wanting to undertake an executive education, whether it’s an MBA or another type of course. There are many available in IT, finance or business law, which you may want to consider before taking the leap to a fully-fledged MBA. The first step is to contact your local university and find out some specifics for yourself.
Universities typically have a lot of information online, and are happy to help enquiring potential students. They also hold open days, and dropping an email to a lecturer is not a bad idea either. For those who don’t want to commit to a location-based course, The OU is available from anywhere in the UK and offers MBAs, as well as many other courses aimed at entrepreneurs and professionals. Its courses are supported distance learning, where most of the work is done at home, but all students are given a personal tutor.
An MBA is not a one-size-fits-all qualification, and it may be that your local university doesn’t offer a course that suits you. Looking further afield or considering. The OU are both options in this case. But remember when you’re enquiring about MBAs that there are also Master in Business Management (MBM) and Executive MBA courses. Each has a different emphasis, so asking about business-related courses, rather than just the MBA, is advisable. Finally, there is one more barrier to cross: the fees. The courses cost in the region of £15,000, although this can normally be paid in instalments.
