Lessons from my MBA
I’ve had a few months post-MBA to think and process and let things percolate (one of my favorite ‘visuals’ for how I feel that I process information). I’ve had a bunch of people ask me what I think that I learned/got out of the MBA program. Today’s thoughts distill the entire experience down to two main things.
First, is the ability to learn. You’d assume that any university program is about learning. I’d argue that in most cases its about what you learn. My MBA taught me the process of learning. I could pick something up (finance, accounting, operations, marketing, etc.) in reasonable detail in a six week period of time. What does this mean for my future? That if you give me something new to do, I’ll be able to learn about it and do it in a short period of time. I think that’s a pretty awesome skill to have.
Second, is the ability to access information. I may not remember every single detail of what I learned in my MBA (i.e. the exact process of calculating an IRR and what to look out for – we only did one example!). However, what I did learn was a management information system. I developed a way to categorize and catalogue data. So if someone is discussing a specific finance term that I’m not 100% on, I have a set of tools that will help me answer the problem quickly because I can access the data faster.
I’m still not totally sold on a lot of the content I was taught (although much of that is a result of personal business philosophies that are at odds with many standard and current business practices). I am however sold on the underlying lessons.
And yes, it still feels strange to say MBA and not MBA Candidate.
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IRR?! You learned nothing! It’s all about NPV. IRR is almost total BS!
Riz, I personally don’t think that either makes much of a difference. There are so many assumptions that can be manipulated that the final result is rather meaningless.
What about good old fashioned common sense to determine if a project makes sense or not?
Common sense usually doesn’t translate to the board. :p
I think it does make a difference because you *know* an assumption is incorrect when using IRR that can be addressed using NPV. Why not address the incorrect assumption without a whole heck of a lot of work?
You can address the assumption that is incorrect re: IRR. However, NPV still doesn’t address the remaining assumptions that go into any business case – how much projects will earn, cost, when things will go live, etc. My experience has always been that when a project doesn’t look profitable enough from the get go there’s pressure to change these assumptions until it looks better.
So even though NPV might be a better measurement from a technical finance standpoint, the actual data that goes into determining future cash flows is likely just as flawed.