Business school holds a special place in my heart. However, that doesn’t mean that it didn’t have its shortcomings. Reflecting back, I suppose I was a bit naïve going into business school. There are things that I thought I would learn but didn’t and a few things I have taken away from my two years of schooling that I didn’t necessarily expect.
Things You Don’t Actually Learn in Business School
Personal finance / Money management. Getting an MBA doesn’t mean that you know how to manage your own money or someone else’s. Personal finance isn’t taught as an academic subject, although even the best business school students would benefit from it, since so many of us graduate with substantial amounts of school debt and many of us start careers with significantly larger salaries than our pre-business school jobs. However, we learn few practical skills about how to actually manage this debt and how to properly allocate our increased income following graduation. In fact, I fall into the camp of one of those who struggled to pay my debt for many years, despite finally hitting the coveted 6-figure salary. It turns out that returning to life in NYC with a business degree didn’t make me financially-savvy. I was lucky enough to graduate college without debt and thus was not used to managing it. I didn’t prioritize my debt and that was a mistake. It was a hard lesson to learn and my poor money management in those initial years continues to take a financial toll. Beyond debt management, there are also so many other relevant topics, like income taxes and general strategies on investing, budgeting, and savings that seem to be purposefully omitted from the business school curriculum. Over time, I became significantly more financially savvy, but it’s certainly not attributable to business school. To be fair, is it something I would have paid money to learn in business school? Probably not. And personal finance is definitely not something you need a PhD to teach.
How to start a business. Here’s a story. One of my classmates went to business school knowing that he wanted to start a business. He came from a retail merchandising background and knew he ultimately wanted to sell some kind of tangible product. By the end of our first year, he already had a plan. He casually started to recruit interested folks (including myself) to help out on various tasks so that he could do a trial run over the summer. While the rest of us (mostly) went on to do standard corporate internships, he started making the rounds at various food fairs. By the end of the summer, he had a proven concept and he formally submitted his request for academic leave. He never did finish business school, but he did successfully start a chain of grilled cheese mall kiosks in New England. Does one need business school to learn how to start a business? Not at all. Maybe it’s a fun (albeit expensive) stop along the way, but certainly not a requirement by any means.
Presentation skills. You would think business school would offer a formal class on how to present. Nope. We had an evening elective on communication skills that a few of us opted to take, but I would say no more than 5% of my entire business school class actually attended. Presentation skills were developed informally in certain classes, though – surprisingly, my corporate finance class required us to make frequent presentations on the case studies we analyzed. However, while such classes gave us the opportunity to present, and perhaps to overcome the fear of public speaking, there was no focus on presentation skills improvement. A formal class would have provided critique and development on style, delivery, posture, cadence, etc – things that people don’t get much practice or feedback on in regular day-to-day life.
What Business School Does Teach You
Networking. Networking was pervasive in business school. Again, there was no formal instruction, but through sheer repeated interaction with peers, professors, and various professionals in many different fields and industries, I would say we all saw improvement in our ability to network. I think what we learned, consciously or not, was how to be interesting and more importantly, how to be interested in people. We probably also learned to develop a somewhat thicker skin – not everyone is going to like you or be interested in you. Being snubbed – in varying degrees – happened frequently enough given the number of people we met that it was something many of us got used to and some even tolerant of. My experience has helped me be more comfortable in professional and personal settings where I don’t know people. I don’t like being in that situation, but it’s something I have been exposed to and can emotionally and mentally handle and navigate.
Negotiation. A formal class that I truly found both useful and fun. Sure, it was academic in nature, but the theory was applied in practice. We had a 3-hour negotiation class once a week and each class included a case that we prepped for and then actively negotiated in small groups. It may seem obvious, but I learned that effective negotiation requires preparation, math, and the assessment of alternatives. My most successful negotiation was the one in which I had adequately prepared by mapping out the financial impact of my options, so that I could make changes and decisions as I engaged with my negotiation partner. Negotiation class also taught me that there are few negotiations that are zero-sum and that most can be modified into opportunities where there is mutual gain and value creation – what academics (as originated by Harvard Business School) call integrative bargaining. Formal negotiation training was a highlight of business school for many of us, and the skills I learned continue to be applicable in both personal and professional settings.
Opportunity Cost. Although I understood opportunity cost, it wasn’t until business school that I truly appreciated the impact and consequences of opportunity cost. Opportunity cost is essentially the economic value of what is lost from choosing a specific path. I wholeheartedly chose to go to business school full-time and consequently, I chose not to work. I missed out on two years of salary, growth in my salary, growth in investments I would have made from my salary, and career advancement. On top of that, my choice of business school cost money. At the simplest level, without going into too much math and omitting less quantifiable costs like career advancement, my two years of salary was equivalent to $170k. Coincidentally, business school cost approximately that much, and that excludes any interest associated with that debt, which is substantial. Opportunity cost was a real lesson in business school.