5 Reasons Why MBA is Necessary to Become Successful in Business
After MBA one gets access to a very premium club that can bring a lot of resources in this world to one's doorstep
An MBA degree might not make you an entrepreneur but MBA can make an "Already entrepreneur" more resourceful and more capable of creating success in a venture or any business you plan to start. Although MBA independently cannot shift someone's mindset, they need to start depending on your own actions to create a livelihood and gain success. But it can significantly help the existing entrepreneurial genes in a person and help them in creating a huge success out of their venture. Here are five reasons how MBA can help you achieve more in your entrepreneurial journey:
Your ability to develop rock-solid business plans
One of the very important benefits of doing an MBA is that an education in business helps entrepreneurs develop great business plans. Everyone has an idea and everybody's neighbour has an idea to, but one needs a strong structure and a plan to put that idea and make an enterprise out of it. An MBA helps one understand how to build a strong business plan that can measure the effectiveness of the actions the teams will take in order to scale an organisation.
A lot of entrepreneurs tend to stay busy or stay occupied with actions that may not yield results. I am not suggesting that these entrepreneurs pretend to look busy. No! I am suggesting that it is hard to find out if one is working towards creating results or if one is stuck in the morass of working hard. A solid business plan helps you keep track of your performance, and an MBA helps you develop one.
A very important factor influencing the success of any enterprise is the effectiveness of the top leadership. How will you motivate teams to run in a direction or explored uncharted territories and stay motivated? People tend to look focus on early-stage companies in the wake of financial uncertainties. Not just employees but even the founders tend to chase easy money at the cost of long-term goals, and it can hamper the growth plans or the whole purpose of the existence of the organisation. Business schools expose MBA's to a wide variety of chaotic cases and situations, and train entrepreneurs to deal with these situations in a simulated environment.
You cannot afford to grow in 50 years with money saved across three generations. You have to reach out to external investors, be conversational in finance and accounting, understand how your actions are related to the wealth creation to attract investors. An MBA makes one very conversational across these subjects and competencies.
It is quite common for VC's to invest in teams and in companies, and not necessarily in MBA's. However, most of the entrepreneurs raising capital have been MBA's in the recent past as they get used to playing with money and measuring their effectiveness financially.
Being the right general manager
You got to understand how the various functions such as finance, operations and marketing play with each other. If you are investing tonnes of capital and human resources in operations, you got to understand how to back up your organisational claims with the right set of marketing messages, and how to assess the financial results for the actions you took while restructuring the operations. For example- if a Pizza chain decides to invest in their delivery model in order to compete with the existing 30 minute or a free Pizza campaign, an MBA has to assess the benefit of that investment. What tools will you use to measure – how much incremental benefit will you get in delivering a pizza in 18 minutes, and if that is worth the investment. How will you leverage the 18-minute delivery message, and get your customers to know that it is going to make a difference? Sitting in silos and building the most effective supply chain will not help if your customers do not value you, or if your corporate finance team hates you for the amount of money you had to spend just because you thought a change was important. An MBA builds this muscle necessary to juggle these balls simultaneously.
Getting credibility and network
This is another thing that may or may not matter to an entrepreneur. An MBA from a top school brings in a lot of credibilities. If you go to a top school, the view of the world changes. Although I wish the world did not operate like this, the reality is that – Just because you are associated with a top school, the world thinks that you are very likely to make the right decisions. Investors become more open to meeting you, people become more open to working with you, and customers tend to believe you more with a rock solid MBA. An MBA also brings a solid network of people who graduate from your school, and you get to find business partners, mentors, friends, and customers from this network. You also get access to a very premium club that can bring a lot of resources in this world to your doorstep.
In the nutshell, an MBA has a strong intrinsic value for people exploring to be their own bosses. It is definitely worth it even if you do not know what will you get from it. It is an expedited learning curve and totally worth the time and money.