The MBA Dilemma

Handwritten by TVD

An MBA isn’t inherently a bad thing. It’s just an impossible dilemma. On one hand, you come out with tons of theory. In the next, you come out with little experience actually running a business. Neither of which is practically acceptable. Pragmatism being the remedy to each.

Watson is an artificial intelligence computer system - developed by IBM - capable of answering questions posed in natural language.

There is no extra sale for hypothesizing your SWOT analysis. Try getting a customer to pay you double because you spent 120 hours on your Porter Five Forces. If you spent that much time on analysis, how much time could you have spent on development? How much of that time you could have spent actually reaching out to customers? Exactly!

Let the Engineers run the show!

As a nation, the time has long passed for us to fire the MBAs. With the right advisers, an Engineer can add more value to a company than an MBA ever could. You can take that to the bank!

The greatest companies were started and run by Engineers. Many believe that American Businesses have been stranded by the MBAs. I couldn’t agree more. You won’t find innovation while counting numbers. But, most importantly, you simply can’t Start when you’re buried in the busy work that makes up large portions of SWOT analyses and dead on arrival business plans.

The Start is all that matters.

The truth is the Start is all that matters. Countless potential Starters are right now spending an absurd amount of hours guessing what their business will look like. That’s all malarkey!

The truth is you never know if you’re going to sell a dime. So your best bet is simply to start selling. You will quickly know which of your products have value and which do not.

You could spend months guessing about the value of Widget X, but you won’t truly know until it’s in front of a customer. When that customer is faced with the option of slicing his credit card - or not - that’s the arena that will test the value you are selling. No theory. No nonsense. Pragmatic.

If that customer slices his credit card, then you know you’ve got a winning concept. Until then, it’s just fluff and make believe. And at that point, you’d be better off watching Sesame Street and using Crayons to color within the lines of your MBA.

A Generation of Doers

Don’t get me wrong, some of my best friends are MBAs - and believe me, we have some truly spirited discussions. But, at the end of the day, they’re pushing paper and I’m pushing product.

Fundamentally, we have a difference in opinion that I believe goes beyond endless open-ended debate. I believe a shift from theory to pragmatism is a defining moment for our generation and indeed history itself. Cause make no mistake, future generations will judge us!

I want them to judge us as the generation that saved Detroit. I want them to judge us as the generation that rebuilt the American promise of life, liberty and the pursuit of happiness. I want them to judge us as the generation of doers instead of the generation of guessers.

That is a fundamental difference. Fundamentally, I believe guessers don’t possess a passion for any craft beyond number crunching. And that leads to thinking where money is placed on a higher platform than value.

As a doer, I believe slightly opposite. I believe intention to provide value is the ultimate indicator of the money I can charge for my product. I believe I should provide my customer with so much value, that my product’s price is a mere pittance in return.

We can be a Nation of Producers again

We need to become a Nation of Producers again. That’s the kind of Country I want to live in. That’s the kind of Country that leads.

For close to fifty years, MBAs have been running our country’s greatest companies. What do we have to show for it?

Software Industry

In the software industry, we have two tech bubbles (one of which we are currently in). And just look at hallmark companies like IBM. Just so you know, I am in love with IBM. I grew up tinkering with IBM machines and loved the brand. Fast forward to now and you have to ask, “What does IBM sell?” I don’t know.

They used to sell hardware, but sold that off. They used to sell great software, but have backed out of that market. And now, what’s their biggest market? Selling (99% foreign) outsourced IT labor. Really? Only an MBA could have envisioned such an Orwellian liquidation of technical dynasty.

An Engineer would have never took IBM in that direction. An Engineer would have expanded hardware sales from primarily business to the consumer market. An engineer would have paid the brass tax and made a run at the Operating System (OS) market too.

But, most importantly, an Engineer would have nurtured local engineering and technical talent. And the harvest would have been plentiful. More plentiful than the guess work that went into IBM divesting most of its greatest assets.

So what has this cost cutting amounted to you ask? Well, that’s elementary my dear Watson. Brilliant! A Jeopardy playing, barely literate, thinking machine. Seriously!?!

What’s next on the MBA roulette? Gold farming MMO bots? We can do better. For the sake of our children, we must do better.

Let’s throw HP into the hat too. Both HP and IBM have something very fundamental in common. Both were founded by passionate Engineers. Both were run into near obscurity by MBAs.

The Car Industry

In the car industry, we went from the spectacular Ford Mustang to the bulimic Ford Focus in less than thirty years. An Engineer would have never let that happen. MBAs figure, the market hasn’t much choice - so we’ll make some cash. An Engineer’s heart would bleed to offer such a diversion to customers. Why can’t your car be both affordable and beautiful? An Engineer would make sure you had that and a pickle.

An Engineer’s biggest motivator is building a better product. An MBA’s biggest motivator is cutting costs. Which person do you want running your company?

The Science Industry

Politicians (this is NOT a political post) are quick to assert we need to focus our people on technological innovation. I agree. To start, let’s make NASA’s budget 10% of our National budget instead of 1%. NASA’s entire budget over the last 50 years is comparable to the US Bank Bailouts over the last 3 years. This is not acceptable. We must start walking the walk.

The Food Industry

The food industry isn’t any better either. Most people would need to be a PhD microbiologist to even know an inkling of what “foodstuffs” are in our food today. It’s insane how food has ventured so far away from its wholesome, natural state.

We went from fresh real milk delivered to your home every day to real milk being outlawed in all but a handful of States. A farmer with love for his product didn’t do that. An MBA did that!

It really boils down to this: Shoemakers should be run by shoe guys, and software firms by software guys. We need to put producers at the helm of our most cherished national past times - from business all the way to government.

That’s the kind of thinking that produces an Apple over an HP - that’s the kind of thinking that needs to proliferate right now!

Closing thoughts

Seriously, don’t get me wrong - some of my best friends are MBA types and I love them to death. But, the guessing and over thinking is just plain wrong for new businesses. And more importantly, I believe that way of thinking stifles innovation at mature businesses.

I know you know and love an MBA out there. I once worked with an MBA on a consulting project. Just for fun, I challenged him to write no more than a one-page analysis. He was pissed at first. But, afterwards he confided in me that it was the most challenging and rewarding project he’d worked on in a while.

Look, no one is saying fire the MBAs. What we are saying is there needs to be a fundamental shift in how we value quality over cost cutting. In times past, our penchant for quality made us the most powerful nation on earth. It’s time we get back to the fundamentals.

Update (Netflix):

We talk about The MBA Dilemma and the very next day, Netflix gives us a prime example of why you don’t want MBAs running your company. After increasing their price by over 60%, they left a nice little zinger to show you - their beloved customer - just how little you mean to them:

As always, our members can easily choose to change or cancel their unlimited streaming plan, unlimited DVD plan, or both by visiting Your Account.

Is that how you show the love? Hell no! But that’s what happens when you have the mindset of giving as little as possible for as much as you can take. That’s what happens when you let formulas and numbers dictate how you treat people. That’s what happens when you have the mindset of an MBA.

Netflix should focus on providing the best entertainment value it can. They needed to show their customers they valued them above all else. Instead, they showed their most loyal customers what they truly valued and it wasn’t them. That ain’t right! Netflix customers deserved better.

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