The MBA: It’s Your Ticket to the Middle

You’ve put a lot of time and effort into your job.  Yet, year after year, your performance reviews provide little insight into what you need to do to gain some upward mobility.  No raises. No promotions.  Eventually, you begin to realize that with little movement after 5 years or more, it’s unlikely that any real movement will be coming in the near future.  You’ve got to change your outlook and the MBA seems like the perfect credential to boost your career.  If you want to get into management, it seems like the ideal tool.  But can it really get you to the top?

When I was working on my MBA, I was just as optimistic as every other student.  I thought the MBA would propel me into management quickly.  I earned my MBA while working full time.  The managers around me didn’t have a lot of credentials themselves, so I felt that my MBA would have a huge impact on my growth in the company.  The only MBA in the company was a Harvard graduate and he was the CFO.  When he came in the company, he came in at the top.  He had considerable management experience at the top level and a MBA from Harvard.  This was my introduction to the two things that get you into top management.

Many believe that the possession of the MBA will push you to the top of any organization.  I wish it were true.  The challenge for MBAs entering the workforce is that there are too many MBAs for too few positions.  According to Statistics Canada data, 10.4 percent of all jobs were management jobs in 1995, but that has reduced to 7.8 percent today.  The recession has brought about change that will greatly impact your ability to climb higher in your career.  About 1 in 10 management jobs that existed in 2008 are gone.  Wal-Mart Canada cut costs by targeting more than 200 head-office jobs. After Tim Hortons merged with Burger King, the coffee chain cut 40 per cent of its middle managers. When Rogers Communications restructured its business under CEO Guy Laurence, it let go of several hundred middle managers and up to 15 per cent of its executives.  While the rate of MBA enrollment has not increased in recent years, it still remains high.  About 52 percent of students around the globe are exclusively interested in the MBA, indicating that the supply of MBAs is unlikely to decrease anytime soon.

If the reduction of management jobs and the large numbers of MBAs doesn’t deter you, then you’ll need to create value for employers to convince them that you’re ready for top management.  There are two things you must have to create that influence: a recognizable value and desired work experience.

The MBA is a faster ride to top management positions if you get it from a top program.  It’s not because they are considerably smarter than everyone else, it’s because they bring a perceived value that the company needs.  For example, if a company is preparing itself to be sold or seeking investment funds, bringing in top program alumni creates the perception that the company is well managed.  This makes investors feel more comfortable about the risk of investing in the company.  It’s little more than managing perception. It’s similar to reasons why professional athletes earn so much money playing a game.  They bring an inherent value to the organization, which for sports athletes lie in their ability to sell apparel with their name on it.  Do you think an MBA from an unknown university would create such perception?  If not, then it’s likely that the MBA won’t carry you to the upper echelons.  Even the ivy leaguers who start out with the Fortune 500 companies don’t start at the top.  Andrew Ainslie, dean of the Rochester University Simon School of Business, said “You’re reporting two to four levels below the CEO. That’s middle management, and that’s where most MBA students go and it doesn’t matter which university they came from.”

Another factor that will slow your rise to the top is work experience.  Companies looking for top level professionals will focus on the experience of the individual in the areas they need support in.  That could be mergers, acquisitions, startup, restructuring or dressing up the company for sale.  Company needs are often very specific and without such experience, you don’t have a chance.  Is experience more valuable than the MBA? I would say it certainly is.  Lynn Lee, managing director at Atlantic Research Technologies, a global executive search firm, says “Corporations typically call us in to help them identify people who are already in the upper management or middle management ranks. When recruiting these candidates, most companies, large and small, Singaporean and international, usually look first and foremost at the candidate’s employment experience, and at his or her achievements and management style. A person with a truly outstanding employment record can get a great senior management job without an MBA or other advanced degrees.”   How do you know what experience they want?  That’s a great topic for another post.  That’s coming soon!

After I earned my MBA and spent many years in middle management, I learned about another extremely important factor that can greatly decrease your chances in reaching the corner office.  It’s self-preservation.  Most managers at the top are focused on growing their own career, not limiting their employment by promoting someone else to take their job.  This mindset creates an environment that I call the “dark side of management” and I have an upcoming ebook that will dive into this topic in detail by providing real examples of situations that often happen that can limit your middle management career because someone at the top was trying to preserve their own career from poor organizational performance or create some organizational change that has great potential for personal financial gain.   I was really unsure about creating this ebook since the world wants to focus on all the happy stuff in life but it’s these unpleasant situations that damage and limit your ability to grow your career.  You will run into them at some point.

No matter where you earn your MBA, it’s all about value (i.e. perceived or real).  If you earned your MBA from a lower tier program, don’t expect it to have high perceived value that executives look for when they want to manage perception.  This will limit your upward mobility.  Therefore, you’ll be forced to develop specific experience that executives and boards are looking for if you want to draw their attention for any opportunities at the top.  Experience has value.  Otherwise, you’ll be stuck in middle management.  While that may sound exciting, especially when you consider where you are now, it comes with a big set of problems (which are covered in my upcoming ebook).  Then, when you consider the sheer quantity of competition for an ever shrinking pool of opportunities, you might just find middle management to be one of the toughest places in business.

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