Have you ever thrown money at a problem? It always seems like a good idea at the time, and it’s easy to do, but usually a terrible mistake. We almost made this error twice in the last few weeks but, fortunately, we came to our senses before spending needlessly.
Before I explain how we solved the problems, here’s what we were up against in each case:
Problem #1: At our quarterly planning meeting where representatives from each department come together to prioritize short-term objectives, everyone came up with the same conclusion: We didn’t have enough resources to accomplish all of our agreed-upon goals. My CIO said we’d need two full-time contractors to make it happen. He constantly reminds us of what he calls the “Triple Threat” (scope, time, and money). You usually can’t have all three, and in this case something definitely had to give.
Problem #2: A few weeks ago, a confluence of factors doubled the number of in-bound calls to our customer service call center. We were ill-equipped to handle those calls, so customers were understandably upset with extraordinarily long hold times. My VP of sales asked me if he could hire more people as it appeared the number of calls was not going to subside, and the data he analyzed seemed to mandate it.
Both situations seemed to require more money. Or did they?
As the CEO, I believe two of my major roles are to (a) make people the best they can be, and (b) create a culture of effective execution. The question was whether I could do both in these situations. Would more money really solve the problems and improve the quality of our team, or were we not being creative enough with the resources we already had?
I took a chance and decided it was the latter. In the first scenario, I told the planning group that I would not authorize more contractors. Period. This was somewhat of a shock because we had all agreed on a list of priorities and must-accomplish goals. I asked the group to look at the list again and identify what they could not live without. Our senior programmer told our CMO that if we postponed one of the bigger, less critical projects, it would free up enough time to obviate the need for the extra programmers. Enough said. Case solved.
In the second scenario, I took the same tactic. “Figure it out,” I said. And that’s what they did. Our VP of sales had originally said he and his direct reports “had thought of everything.” But this time, he brought in more people — some of whom had never been asked for their ideas — to brainstorm a solution. Within two hours they came up with 11 ideas, implemented seven by the end of the day, and the other four by the end of the week. Not one more person was needed.
Here’s what I learned from the experience, which you can apply to your own business:
1. Necessity is the mother of profit. If you force employees to think harder, they normally will. Setting limits and asking penetrating questions encourages people to think through all of their decisions and come up with work-arounds that will both help the company and themselves. It’s a classic leadership development lesson I learned in Larry Bossidy’s and Ram Charan’s best-selling book Execution.
2. With diversity comes more perspective. Involving more people in the process helps bring a fresh way of thinking. It also puts pressure on those who’ve already given the matter a lot of thought. Even if the new people don’t have the answer, they normally say things that catalyze ideas in others.
Before throwing money at a problem, throw the question right back at a larger, more diverse set of people. Pushing your staff to think more critically has two advantages: You’ll get a more creative solution out of them, and they’ll improve their problem-solving skills. Everyone becomes better that way.
Friday, August 27, 2010
Is An MBA Sometimes A Waste Of Time and Money?
MBA applications always go up during a bad economy. That is because business school generally attracts people who are lost, and more people who feel more lost when the bad job market is lousy.
But let’s be clear: This is not the type of recession where there are no jobs for young people. This is a recession where there are no GOOD jobs. McDonald’s is hiring in management. There is a bank teller shortage and a shortage of actuaries. There is a shortage of insurance agents. It’s just that people don’t grow up dreaming of these jobs. So they don’t take them. Instead, people who are early in their career - in that time when an MBA sounds like it might work - those people are determined to have only a good job. And if they can’t have that, they get an MBA.
The problem is that an MBA makes it worse.
Here are seven reasons why you should take a bad job instead of getting an MBA.
1. Business school won’t help you be a good entrepreneur.
There is no correlation between being a good entrepreneur and going to business school. In fact, according to Saras Sarasvathy, professor at University of Virginia’s Darden Business School, the most important skill for an entrepreneur is that you know your weakness and you can find people to fill in your gaps. So you pay a bundle to go to school to learn what you don’t and how to find people who can do stuff you can’t? Sorry, that doesn’t add up. The ultimate irony: entrepreneur programs are booming at business schools.
2. You likely don’t need an MBA for what you want to do.
There are some jobs, very few, where you cannot land if you don’t have an MBA. These are mostly high-level officer-type positions in the Fortune 500. Even then, though, you probably don’t need an MBA. In fact, Forbes reports that CEOs without MBAs bring more value to investors than CEOs who went to business school.
3. MBAs who are not from a top 10 school don’t increase their earning power.
So if you’re not one of the elite, the degree won’t help you earn more. According to the recruiting firm Challenger & Gray, the degree simply does not separate you from other people in any significant way; it’s too easy to get an MBA from a second-tier school. The cost of the degree is so much more than the combined cost of taking two years off of work and paying for the degree that you are better off taking a job you don’t particularly like and getting a night-school MBA after work hours.
4. It’s pointless after a certain age.
Let’s say you do get into a top-ten school. Don’t go if you are older than 28. You are too far along in your career to leverage the degree enough to increase your earning power enough to make up for the sticker cost of the degree. In fact, it is so important to get the degree early in your career that Wharton and Harvard have started accepting women earlier than men because the biological clock truncates a woman’s ability to leverage the MBA early enough in their career to make it worth the money.
5. An MBA is too limiting.
You can’t take an entry-level job after you get an MBA, so you had better know what you like to do. And can’t take a job in a low-paying industry because you have to pay back the loans. So not only is an MBA useless for most jobs, but it also makes you unqualified for more jobs that it qualifies you for
6. An MBA makes you look desperate
Top ten business schools will not accept you unless you have a clear plan for what you will do with the degree after you graduate. You need to have shown that you have a propensity for some sort of business and that you need the degree to get where you want in that business. Unfortunately, most other schools will take you if you don’t have a plan even though it’s been shown that people who go to business school with no plan for their career graduate with no plan for their career. And then you look not just lost, but desperate.
7. Business school puts off the inevitable.
Look, it’s really hard to be an adult. You go to school for twenty years being told what to learn and what to think and when to show up, and then you get tossed into adult life and there is no one telling you what’s right for you. You have to figure it out, but you didn’t go to school for that. In fact, school is the opposite of that. So it looks fine to be lost in your 20s. This is when everyone is taking time to figure things out. It does not look fine to spend $150,000 to go back to school just to put off the hard knocks of figuring out where you belong in the workforce. Face reality. Join the workforce.
But let’s be clear: This is not the type of recession where there are no jobs for young people. This is a recession where there are no GOOD jobs. McDonald’s is hiring in management. There is a bank teller shortage and a shortage of actuaries. There is a shortage of insurance agents. It’s just that people don’t grow up dreaming of these jobs. So they don’t take them. Instead, people who are early in their career - in that time when an MBA sounds like it might work - those people are determined to have only a good job. And if they can’t have that, they get an MBA.
The problem is that an MBA makes it worse.
Here are seven reasons why you should take a bad job instead of getting an MBA.
1. Business school won’t help you be a good entrepreneur.
There is no correlation between being a good entrepreneur and going to business school. In fact, according to Saras Sarasvathy, professor at University of Virginia’s Darden Business School, the most important skill for an entrepreneur is that you know your weakness and you can find people to fill in your gaps. So you pay a bundle to go to school to learn what you don’t and how to find people who can do stuff you can’t? Sorry, that doesn’t add up. The ultimate irony: entrepreneur programs are booming at business schools.
2. You likely don’t need an MBA for what you want to do.
There are some jobs, very few, where you cannot land if you don’t have an MBA. These are mostly high-level officer-type positions in the Fortune 500. Even then, though, you probably don’t need an MBA. In fact, Forbes reports that CEOs without MBAs bring more value to investors than CEOs who went to business school.
3. MBAs who are not from a top 10 school don’t increase their earning power.
So if you’re not one of the elite, the degree won’t help you earn more. According to the recruiting firm Challenger & Gray, the degree simply does not separate you from other people in any significant way; it’s too easy to get an MBA from a second-tier school. The cost of the degree is so much more than the combined cost of taking two years off of work and paying for the degree that you are better off taking a job you don’t particularly like and getting a night-school MBA after work hours.
4. It’s pointless after a certain age.
Let’s say you do get into a top-ten school. Don’t go if you are older than 28. You are too far along in your career to leverage the degree enough to increase your earning power enough to make up for the sticker cost of the degree. In fact, it is so important to get the degree early in your career that Wharton and Harvard have started accepting women earlier than men because the biological clock truncates a woman’s ability to leverage the MBA early enough in their career to make it worth the money.
5. An MBA is too limiting.
You can’t take an entry-level job after you get an MBA, so you had better know what you like to do. And can’t take a job in a low-paying industry because you have to pay back the loans. So not only is an MBA useless for most jobs, but it also makes you unqualified for more jobs that it qualifies you for
6. An MBA makes you look desperate
Top ten business schools will not accept you unless you have a clear plan for what you will do with the degree after you graduate. You need to have shown that you have a propensity for some sort of business and that you need the degree to get where you want in that business. Unfortunately, most other schools will take you if you don’t have a plan even though it’s been shown that people who go to business school with no plan for their career graduate with no plan for their career. And then you look not just lost, but desperate.
7. Business school puts off the inevitable.
Look, it’s really hard to be an adult. You go to school for twenty years being told what to learn and what to think and when to show up, and then you get tossed into adult life and there is no one telling you what’s right for you. You have to figure it out, but you didn’t go to school for that. In fact, school is the opposite of that. So it looks fine to be lost in your 20s. This is when everyone is taking time to figure things out. It does not look fine to spend $150,000 to go back to school just to put off the hard knocks of figuring out where you belong in the workforce. Face reality. Join the workforce.
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