The MBA Pathology

In my last article I highlighted one of the major pathologies leading to weak product managers and weak products.  While the CSPO pathology is large and growing, it is relatively new compared to the MBA pathology.

I have not written as much about the MBA pathology.  It’s alluded to between the lines on some of my articles, but in truth I always thought this one would correct itself on its own many years ago.  But it is clear that I was overly optimistic on that.  And in case you’re thinking that while the well-known problems with MBA programs may have been true ten and twenty years ago, they can’t possible be true today, my evidence for this article was collected this academic quarter.  And from the most elite programs in the country.  

So, no, the problems described here unfortunately appear to be as strong as ever.

But before we dive into this one, a couple disclaimers:

First, I don’t personally have an MBA.  If I did, maybe I’d feel differently about this pathology. 

Second, it’s no secret that there are many strong leaders in Silicon Valley that are absolutely allergic to MBA’s.  They feel like they bring the wrong mindset, arrogant attitudes, and obsolete skills:

“As much as possible, avoid hiring MBAs. MBA programs don’t teach people how to create companies … our position is that we hire someone in spite of an MBA, not because of one.” – Elon Musk

This is a belief that has ebbed and flowed in Silicon Valley for several decades.  

I understand where they’re coming from, but I’m not one of those people.  I have hired and coached many exceptionally strong people straight from top business schools, and I know many more such people.

Moreover, in my own experience, I’ve found that many of the students accepted into top MBA programs often have the right raw materials to be coached and developed into exceptionally strong product managers, and eventually very strong product and company leaders.

That said, even with the very best, there is usually some critically important coaching and “unlearning” that needs to be done.  And when that coaching doesn’t happen, I see it leading to many of the serious issues we see in companies today, especially those that are victims of disruption. 

And to be clear here, I’m not just talking about product managers and product leaders.

I’m also talking about VC’s and other investors, Board Members, CEO’s, CFO’s, and GM’s/business unit leaders and countless other stakeholders.  

If you’re not willing to coach and develop these MBA grads to help them unlearn, then you may indeed be better off avoiding MBA hires.  But to me, the prize makes it worth the effort.  These are often very high-potential people.  And I’m not alone.  Several of the top product companies recruit directly out of top business school programs.  They just know they need to “de-program” the students, as one of my friends from Google refers to the coaching process.

These problems have long been attributed to the fact that MBA programs were originally designed to teach industrial style command-and-control style management thinking.  

While I think this has long been true, and sadly is still largely true, I also think it’s oversimplified.  Today’s MBA programs are not all bad, and the people that graduate from them are most definitely not all bad.

Rather than risk throwing the baby out with the bathwater, I believe it’s worth looking deeper into the pathology.

I loosely categorize the problematic thinking and behaviors into four major areas:

Equating Management With Leadership

Even putting aside for now the fact that the management style learned (command and control) is usually exactly wrong for a tech-powered company (discussed below), there is still this deeply rooted conflation of management with leadership.  

The belief that managers are inherently supposed to be viewed as leaders. Or more generally, believing they are supposed to act like “the boss.”  

In fairness, it’s hard to blame someone that’s just paid a boatload of money, and dedicated two years of their life, for a degree in business management, for thinking it’s their birthright to step into the role of the boss.  

And remember that ambition and competitiveness are effectively selected for in admittance to these top programs. 

For those going straight from business school to a product management job, this can be especially problematic.  Many times I have had to intervene with serious coaching about how as product manager, you are actually not the boss of anyone.   As a product manager, you are an individual contributor.  You are true peers with your designer and engineers.  Moreover, you need to earn your spot as part of the team.  And this typically requires skills that you didn’t learn in business school.

Not Knowing What You Can’t Know

And related to this problem of not knowing what you can’t know, is not admitting what you don’t know.  Also very related is the illusion of predictability.

This one is tough.  The belief in predictability, the religion of business cases, the blind faith in business analytics, and more generally, the pressure to have “the answer.”

The premise of product discovery is that with technology-powered products, we can’t know in advance how much revenue we’ll make, or even whether customers will purchase our products, or what something will cost to build.

This can be hard to unlearn.  Most of us figure this out with experience, but what hinders so many MBA graduates is that they believe they are supposed to know these things, and if they don’t, that speaks to their own weaknesses, rather than an acknowledgement of the realities of innovation.

Again, these are important and often necessary coaching topics, especially for product managers.

The Role of Technology

One of the most serious and deeply rooted problems is thinking of technology as a cost center, rather than the core enabler of the business.  How many ways, both explicit and implicit, in the typical MBA program, is the message sent that the manager is the one responsible for the decisions, and we can simply hire engineers and designers to do their bidding?  

Is it any surprise so many think of the engineers and designers as subordinates?  Or even worse, as resources that can just as easily be outsourced?  I tackle this with explicit coaching along with a constant stream of examples from our industry.

Command and Control Leadership Style

Now don’t get me wrong, I doubt very much anyone sits down in a lecture to hear a professor list the virtues of “command and control” as a leadership style.  I’m suggesting this is inferred or implied.  Consider the many case studies, guest speakers, business books, and the whole mythology around business leaders, where the leader is command and control personified.

Yet the best tech-powered product companies know that empowered teams are where innovation comes from, not from top-down business strategy sessions.  As Reed Hastings of Netflix emphasizes, “lead with context, not control,” and work to push decisions down to the teams.

To be clear here, I’m not suggesting leaders shouldn’t lead (a common misconception in certain Agile circles).  They absolutely should.  It’s about how they lead.

I have come to believe that these problems are baked into most MBA programs.  For a company that believes it needs to transform, these issues may need to be unlearned by the key senior leadership team.

But I’d like to dig deeper into the problem of MBA’s becoming product managers.

Beyond the four problems discussed above, I attribute much of the MBA pathology as it pertains to product managers on the old CPG (consumer packaged goods / brand manager) style product manager.

A few years ago, Martin Eriksson wrote a good article describing this history, and more recently Ken Norton highlighted this, so I won’t repeat the history here.  But today, I have a much deeper appreciation for just how fundamentally different technology product management is from those CPG product managers (which today are much more closely aligned with what we in the tech world would call product marketing managers).

And to be sure, there is still a need for product managers of CPG products.  I don’t know if there are more CPG product managers or technology product managers globally, but I’m pretty sure that the real growth is in technology product managers (as nearly all products are becoming technology-powered products).

Yet even today, if you peruse the online catalogs of the major MBA programs, especially any courses specifically teaching product management, you’ll find most of the faculty are professors of marketing.

Now, no question that good marketing is hard and valuable, and marketing knowledge definitely helps the product manager have a better understanding of go-to-market considerations, but many other backgrounds are at least as important.  

How much of this is simply a remnant of the CPG legacy?  How much is a consequence of viewing product through a marketing lens?

If you were responsible for developing a new brand of soap, or a new brand of beer, this was considered primarily a marketing exercise, and not an innovation exercise.

I remember way back when I wanted to learn product management, the person that was coaching me told me explicitly to ignore the books that had been published on product management, because he said that while they used the same job title, they were referring to a very different context.  I understand now what he meant.

Certainly pricing, placement, and promotion still matter, but nothing like they did in the days of Mad Men.  Today, product discovery in a technology-powered product company is dominated by deep collaboration with engineering and design in order to combine enabling technology with exceptional user experience in ways that provide real value to the customers and to your business.

How many MBA programs are teaching this sort of collaboration, versus still teaching the CPG model where the product manager builds a business case, based on predictions of revenue, and expected expenses for design and engineering, and then defines requirements, and finally looks for someone to implement their brilliant ideas?

My suspicion is that most of the MBA faculty are unaware of their implicit biases on all this, but I think the evidence that it’s happening, and has been happening for decades, is compelling.

The Perfect Storm of Bad Product

In recent years I’ve observed that when the CSPO pathology and the MBA pathology converge in the same company, the results are especially dangerous.

In many companies, especially larger and older companies that don’t yet understand the role of technology, you often have literally hundreds of stakeholders and executives that were educated in the MBA pathology, in particular the dependence on command and control style leadership and the illusion of predictability, and they meet an eager market of Agile coaches that tell them exactly what they want to hear – they can have the top-down, command and control they love, and still check the “Agile” box (if the process has Agile in its name it must be Agile, right?) – all they need to do is adopt the right process.  Hence the perfect incubator for a disease like SAFe.

I’m not trying to rehash all the reasons this is a particularly deadly disease.  I just want to try to highlight that this disease is enabled by these two pathologies.  

Summary

To be very clear, I’m not arguing here that an MBA is inherently bad, as some of the best product people I know came from that path.

I’m just arguing that the majority of MBA programs are explicitly and implicitly instilling some obsolete and detrimental values that are damaging their companies, and impacting their company’s ability to transform into a strong product company.

In order to transform, these people need to unlearn these beliefs if they hope to compete with the best companies, and avoid becoming yet another victim of disruption.

For those considering an MBA and seeking my thoughts, I rarely encourage people to pursue the degree, as I think there are much better uses of their time and money if they want to pursue a career in product, product leadership, or to start their own company.

But if you really want to pursue an MBA, then make sure it’s from one of the top programs as the main value is from the contacts and networking.  Also, if you have at least a couple years of actual work experience from a good empowered product company before b-school, you’ll largely be immune to the four issues I described above.

Today, most MBA programs have at least a couple faculty and courses that are more modern, but the problem is that the totality of the messages that students hear is still overwhelmingly command-and-control.

Because of the nature of this article, I reached out to a broad set of expert reviewers to get their perspectives, including Shreyas Doshi, Ken Norton, and my SVPG Partners, Chris, Christian, Lea and Jon, and I thank them all for their feedback and suggestions.

UPDATE:

After reading the article, several people have asked me about my experiences with Executive MBA programs.  First, in the spirit of full disclosure, I did one of those programs aimed at Tech Executives many years ago at Stanford University.  It was a summer program, and it was paid for by my company, and I enjoyed it and learned a good amount, especially from the case study method.  Second, the big difference I see is that in general people attending these Executive MBA programs already have significant work experience, and they are enrolling to fill some specific knowledge gaps.

And once more for those that missed this in the original article: I have, and continue to, hire many exceptional people from these programs, so I am most definitely not one of those that dismisses all MBAs.  I am just sharing that I’ve found these four problematic behaviors need to be assessed and if necessary, coached to ensure the person succeeds.  Just as with people that come from engineering backgrounds, like I did, or design backgrounds, or any other background.  Pretty much everyone has gaps and needs coaching.  These are just the common patterns I see for those coming from MBA programs.  Consider it a possible starting point for your coaching.