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Have American Businesses Been Stranded By the MBAs?
theodp writes "In his new book, Car Guys vs. Bean Counters: The Battle for the Soul of American Business, legendary car-guy Bob Lutz says to get the U.S. economy growing again, we need to fire the MBAs and let engineers run the show. The auto industry, writes TIME's Rana Foroohar, is actually a terrific proxy for a trend toward short-term, myopically balance-sheet-driven management that has infected American business. In the first half of the 20th century, industrial giants like Ford, GE, AT&T and others used new technologies to create the best possible products and services with the idea that if you build it better, the customers will come. But by the late '70s, if-you-can-measure-it-you-can-manage-it MBAs were flourishing, and engineers were relegated to the geek back rooms. 'Shoemakers should be run by shoe guys,' argues Lutz, 'and software firms by software guys.' Learning that China plans to open 40 new graduate schools of business in the next few years, Lutz quipped, 'That's the best news I've heard in years.'"
Shoemakers most likely can run their business good.. but really, the usual geek.. no, and I'm one as well. Most of the geeks are truly hard to do business with or make witty comments about "how could this person possible know this thing?". There are exceptions, but geeks usually lack that kind of people skills. They also usually lack the knowledge of what people really need. Good example of this is the linux usability and GUI. It's far from good and mostly unfinished with most software because geeks just aren't interested in that kind of thing.
People work best together. You mix the best attributes from several different kinds of people. Hell, if you want a good geeky example look at different classes in multiplayer games. No one can do or master everything. That's why it's best to do what you know yourself and let other people handle the other parts.
Most engineers know next to nothing about marketing and sales... to the degree that they actually despise interacting with customers. You can have the best product in the world, but if no one knows about it, your business will fail. Consistently in this world, inferior products with better marketing win over superior products. You have to know how to get your name out there, and how to get people to buy your stuff.
Engineers have a superiority complex. Who knows more about how space movies should be made, an engineer or nonengineer? Invisible lasers, never miss guidence, no sound in space, no fire burning without oxygen.
But with the person, his/her creativity, technical vision, soft skills, etc
"If you can measure you can manage" is something a geek could say. And many say it and do it (with other words, and in similar situations)
In a related note, both Bill Gates and Ray Ozzie are geeks.
Geeks created all those mp3 players that were forgotten in favor of iPod.
how long until
Go find a software engineer who has an MBA.
I agree your average engineer has zero business skills, but moving them to the back room and having MBAs run the show is still bad.
Get rid of the MBAs and let the engineers have business input, but not run front office.
Oh, and get rid of the lawyers, they are even worse than an MBA.
---- Booth was a patriot ----
Indeed, people with different beneficial skills are essential in any organization. The key idea there isn't "different", however; it's "beneficial skills".
MBAs typically have absolutely no helpful skills or abilities. They are often people who tried engineering, but couldn't cut it. They are people who tried accounting or finance, but couldn't cut it. They are people who tried marketing, but couldn't cut it. They are, in essence, the rejects of the business world.
For many of them, their only "skill" (if we can even call it that) is forcing bullshit down the throats of productive, useful people. They do this by holding wasteful meetings, by putting in place absolutely stupid and counterproductive workplace policies, by making decisions about stuff they know absolutely nothing about, and by hiring in a way that protects them from any negative repercussions.
They've been successful at this, and that's why America is as economically and socially fucked as it is today. The rejects are leading the operation, and it shows. Thankfully, it's only a temporary "success". It inherently can't be sustained. It's a so-called "race to the bottom", and the bottom is going to be met very quickly. "Free trade", off-shoring, outsourcing and other popular MBA techniques are the best way to destroy not only individual companies, but entire economies.
I don't think that anyone is suggesting that a software business, for example, should consist only of software developers. Rather, it should merely be led by people who understand how to properly build and provide on-time, on-budget, functioning software systems, rather than by some MBA who can spew out this month's buzzwords in order to fool some other idiot MBA at some other company into buying a shitty software system. Different kinds of people will still be needed, of course, but they should be useful workers, not MBAs.
Hey, I'm glad engineers exist, because without their inability to convey complex concepts to average people, tech writers and trainers wouldn't be needed. I rose through the ranks very quickly because I could translate Engineereze to Usereze on the fly.
Well, I started to write something along the lines of engineers do not see eye to eye with their customers sort of deal. But, then I thought, just because you have logical people running the show does not mean there will be no marketing, sales, customer service, managers, or what not. Those do not disappear, they just would not dominate the internal corporate structure.
Much of their objectives would remain the same, albeit tweaked and re-prioritized, simply because the overwhelming majority of both coworkers and potential customers still utilize irrational forms of decision making. People do not magically lose the ability to communicate normally because someone somewhat rational is making decisions.
So, what's with the panicky "nerds are dumb at business" meme, anyway? (Checks glass for kool-aid.)
Any sufficiently advanced influence is indistinguishable from control.
According to executive bios at apple (http://www.apple.com/pr/bios/) 4/10 of them have MBA's. Additionally of the top positions, legal, hardware engineering, industrial design, and software are not traditionally associated with an MBA anyway.
I dunno about MBAs but but I agree that most businesses focus to much on short term gain, often at the cost of their long term success. It's part of the mind set, of high powered business, and perhaps even Americans in general.
Your idea lacks an important component. If the MBA doesn't spew out this months buzzwords in order to fool idiot MBAs at other companies, then who will?
Its going to be very hard for the US, UK etc to be competitive. Even if you could build a factory in Europe or America and sustain a strong business (using Henry Ford principles lets say) bankers would not give you the money, you'd have to build in china to get the funding. Andrew Grove former Intel exec and John L. Hennessy, MIPS chip inventor, said the same thing. Economists are also turning against the way modern business is outsourcing to developing countries for a short term gain, Paul Craig Roberts and Michael Hudson to name but a few. Outsource to Asia, you'll impoverish us all, we'll in turn have less purchasing power, and not be able to buy the goods produced. No ones listening there is only attention paid to shareholder value, not even the customer, and who are the largest shareholders in a publicly listed company the BANKS. The MBA's may have the same problem that the economists profession, if we can call it that, has. That is to say a corrupted syllabus, designed to serve the needs of a few moneyed interests.
Some MBA programs are specifically targeted at people coming out of college with science and engineering degrees - geeks. I'd think graduates of those programs would be more attractive than graduates of Ye Olde Online MBA Mill.
CAPTCHA: overseer
^ lol, internet
After all, our previous POTUS was an MBA, and things worked out awesome under him! Why wouldn't we want MBAs to run everything else, too?
Damn_registrars has no butt-hole. Damn_registrars has no use for a butt-hole.
Only an MBA could be as ignorant as you are, and publicly display so much blatant misunderstanding of reality.
Engineers and technicians are often the best at dealing with customers. Hell, many of them enjoy it, too. They just don't like to bullshit the customers, though. They want to provide them with the best service and the best products. True, this may not be in the best short-term interests of the company, but it often works much better for everyone in the long run.
Engineers and technicians are good at thinking for the long term. They can think beyond the next quarter's results. They realize that maybe they can't please the customer today with the current offerings, but they'll be able to provide the customer with what the customer needs in the future. Sure, the company could sell them some shit today and make a little bit of money now, or we could be truthful with them and make a far bigger and more significant sale in the future.
When this happens on a large scale, the whole economy benefits. Resources end up being allocated far better, and the resulting systems actually do help improve productivity. Contrast this to America today, however. With MBAs running the show, we end up with trickery being used to sell useless products that don't provide any tangible benefits. That's why we see the daily Slashdot stories of some software system implementation project being millions upon millions of dollars over budget, and then often just discarded in the end. This misuse of resources harms the entire economy, and is what allows third-world nations like India and China to pull ahead of America.
While I was attending University of Missouri, Columbia we had to take accessment exams and every year the engineering department would stomp on everyone else in EVERY catagory including the ones they were supposed to be good at.
And yes it drives me nuts to watch movies. Almost to the point where to enjoy a movie, with a lot of technical elements I need to have a beer or five so I don't nit pick.
The only things smarter than an engineer is a technician (I happen to be both). Engineers may know all the math, but they usually have no practical hand on and have a nasty habit of designing things that are half impossible to repair.
"WHY would it every break I'm a very smart engineer"
To which the tech responds: "You are a fucking moron. You put the part (that "never" breaks every 6-18months) behind three other parts and an access panel for absolutley no reason, when there was plenty of space to mount it where I could fix it in five minutes instead of 6 hours.
HP is a great example of a company founded by engineers and later ran in to the ground by MBAs.
Company problems are like people problems, sometimes there's a systematic reason, other times it's completely down to the individual and the circumstance.
While you've focused more on the personal skills that many geeks lack, you're also missing that many geeks don't seem to understand how difficult running a business, really is. Even small businesses. There's so many things going on, so many things out of your control, so many people you rely on, and so many unintuitive "systems", which are really hard to get a grasp on.
The worst companies I personally know of, that I have worked for, or with, are run by engineers/scientists.
While there is something to be said for the executives having been in that industry, there's also a lot to be said for people with outside perspective, and a fuck load to be said for people who understand how businesses run. The article has said MBA's, but I take that more to mean accounting/management/finance/economics professionals, so MBA's/CA/CPA/CFA/* all in one bag. It's condescending to suggest that this is due to "MBA's", and the real discussion seems to be one of "short-term balance sheet driven management" versus "long-term" and or "non-balance sheet driven management".
Well, short-term versus long-term versus some mix of both, has and continues to be, one of the most debated topics amogst "MBA's". To suggest that somehow they don't understand this, is absurd. Hell, the very fact that Bob Lutz is writing about it, shows this is absurd, since he is in fact one of those "MBA" people.
Oh well, for those who haven't read the the Business Week article, I recommend it. It really gets to the heart of his story. The TIME one, not so much.
This is my footer. There are many like it, but this one is mine.
Most of the posts will probably be "yeah MBAs don't contribute anything" versus "engineers are geeks who can't communicate". In reality MBAs working for companies usually know what the company does in detail, and there are plenty of engineers who can communicate.
It's still an issue though, because the opportunity cost of learning about "business" is less learning about something else. According to this article,
The rise of MBAs is also tied to the rise of finance. Most people agree that the US funneled too many resources into the finance sector, which then just destroyed them. Instead of designing more complicated mortgage securities, those physicists could have been doing physics. Although "managing" doesn't necessarily have to be about finance, most business schools spent a lot of time teaching their students about CAPM and Black-Scholes. (If you don't know what these mean, good for you!)
But of course business schools are not a fixed target. Most have reacted to the financial crisis and are now, for instance, emphasizing globalization and how to work in multiple countries. Time will tell I guess if this path is any better.
Personally, I think the biggest damage is done by the outlook that most MBA programs teach. Instead of thinking that your company's goal is to build the best vacuum or whatever, you learn that the goal is to maximize shareholder value, and that gaming the system is what everyone is doing. Over the long run, countries probably don't want too many of those people in charge.
is interesting advice coming from and MBA.
This is just my take on things, my opinion. The way things used to be, one joined a company, gave 30 years to it, and retired in peace. Thanks to the MBA Mentality, that doesn't happen anymore. People have always hungered for security in life; secure marriage (or relationship), stability, and secure careers. That went out the window back in the 70's, when Managers with MBA's decided the 'little people' were interchangeable/disposable. Take a loyal good employee with two months left to retire, and boot him out the door. The company saves money, it's more for the shareholders, the Manager who conceived that gets a huge bonus. The guy who got let go? (shrug) Hey, it's a tough world out there. Survival of the fittest.
The so-called Cult of Management (I'm Management, you're expendable) has crippled more businesses and employees than anything else.
Yeah right dude, Steve Jobbs certainly knows nothing about marketing.
Let's face it, the best tech companies out there are run by tech guys.
Bob Lutz is dead-on. Several companies I've worked for were run by the sales guys, and they ran the businesses into the ground by focusing on short-term profits and allowing their products to languish and eventually become irrelevant. They failed to see that investing in good technology and having a vision would ultimately give you an even larger market share. Just like Apple and John Sculley. Sure he got the company back on solid ground, but he couldn't maintain it because he wasn't a visionary tech guy. When they brought Jobbs back again, we all got iPods, iPhones, Macbook Airs and iPads. The PC world has been transformed, and Apple's market cap exceeds Microsoft's.
Maybe you're too young to remember this, but in America in the 1950s and 1960s engineers and scientists did run the show. They discussed technical matters with each other, and they all knew when bullshit was being spewed. They'd call one another out on such bullshit, and it was often enough to ruin business dealings by trying to bullshit the other party.
Business dealings then were being conducted by parties who were equally knowledgeable, rather than today, where business dealings are between parties who are completely ignorant.
"Consistently in this world, inferior products with better marketing win over superior products." So how did Japan's superior quality autos displace Detroit crap in the 1970s and 1980s -- sometimes even at higher prices? And, don't tell us that a competent MBA can sell an inferior product. "(GM CEO from 1981 to 1990, Roger) Smith spent virtually his entire professional career working for General Motors. Born in Columbus, Ohio, USA, Smith earned his bachelor degree in business administration at the University of Michigan in 1947, and his MBA at the University of Michigan Business School in 1953." Undoubtedly Smith was held in high regard by the other MBA on the GM board. Yet, "Smith's tenure is commonly viewed as a failure, as GM's share of the US market fell from 46% to 35%, and as it took on considerable debt causing it to lapse close to bankruptcy in the early 1990s.[1][2] As a result, CNBC has called Smith one of the "Worst American CEOs of All Time".[3] (from Roger Smith entry in Wikipedia).
Dropping the entire anglo-saxon model ?
Attack the problem at it's root i say.
Business management is a worthy set of knowledge and skills, but I think we've reached an unfortunate situation where it's become considered the only skill necessary -- just as Lutz says, the notion that if "if you can measure it, you can manage it" and knowledge and experience of an organization's core specialties are considered unnecessary except at the most superficial level (usually in the 20 minutes or less PowerPoint presentation).
Worse, it's also badly distracted by the opportunity costs of profit maximization through technical manipulation -- which is really no surprise considering that so many MBAs got an undergrad degree in "business" with its relentless focus on technical details like balance sheets and finance mechanisms and measurements of marketing success. The MBA itself with its even greater technical focus on areas like finance and accounting seems to breed legions of people who think that given the data, they can understand anything.
That being said, those are worthy skills -- but how can you manage an organization that makes widgets if you don't understand widgets? I'd like to see an MBA program that won't admit anyone who doesn't have an undergrad degree in *something else*.
For 25 years I've watched as the same thing has happened to the pharmaceutical industry. It's just a few years behind the automobile industry. We've largely blamed the MBA's but maybe it's just the natural order of things.
1) Start an industry
2) Grow an industry
3) Get rich (profit)
4) Get greedy
5) Collapse
I mean, what person could actually turn around a behemoth like GM from the brink of disaster... oh wait, billions of dollars from the Federal government helped to decide who the winners and losers should be. Sorry Lutz, you don't know the first thing about running a business... let's try the underpants gnomes theory for GM:
1. Failing car company
2. Government bailout
3. Off-load pension obligation to the public
????
5. Profit
You're a genius!
The idea that current management is broken is correct. It's broken because it's not focused on managing companies it's focused on managing stock prices. Unfortunately, IMO, there is so much value in the equity market that major businesses no longer care what they produce or how they produce it as long as they produce stock value along side it. This attitude is a result of a couple of things. First the short term value from investments is worth many times the actual value of the company can produce from real assets/production/sales/fees/etc. Second we've tied executive compensation to stock price through options, grants, incentives, etc. It's not a problem of who is managing the companies it's a problem of incentives and motivations.
Fixing the problem doesn't necessarily mean putting a geek in charge but instead means altering incentives so they favor long-term profit and sustainable growth (20, 30, 50 years or more) beyond short-term stock bumps. Often engineer personalities get in the way and make them harder to incentivize than the bean counter personalities. Too often the geek only cares about the purity of a solution or the optimization of a process and that makes it difficult to incentivize him to put long-term profit first. Additionally, if the geek you select is flexible enough to not be stuck in the optimization mode then he is going to game the system just like the MBA in favor of stock indicators for his personal compensation. It's not dishonest or wrong it's human nature. You tell your manager what you care about by how you pay them. They in turn work to maximize those items to which their variable compensation is tied.
The best thing you can do is find good managers (MBAs or Geeks not withstanding) and incentivize them to run the company with the primary goal being long-term sustainable profits. I think more often than not you're going to find this is an MBA type with a compensation package not tied to stock but a smart board will look for the right personality traits, coupled with the right skills, coupled with the right compensation package. The answer is definitely not "just give it to the engineers" however.
You can have the best product in the world, but if no one knows about it, your business will fail.
Having the best product in the world seemed to have worked well for American businesses in the past.
It's not MBAs that are the particular problem here. It's more Dodge v. Ford Motor company and the legacy of that decision. The only goal most corporations have at this point is short term stock price increases or selling the company. Until more focus is placed on long-term outlooks, bad (and sometimes purely unethical) practices will rule corporate america.
I put on my robe and wizard hat..
The other is changing market conditions. In the case of ATT, consumers simply rebeled against the price they had to pay for what became a commodity. It is hard to explain to a young person how much the rate for phone service has fallen. Using a cell phone I can call from anywhere in the continental US to anywhere in the continental US basically for what my parents paid for local calls, inflation adjusted. With Skype out of country calls fell from maybe fifty cents a minute or so to a less than a dime a minute(the countries I call are not on the unlimited plan). ATT revenues has been more than decimated by market forces.
One thing that did happen in the 70s and 80s, particularly 80s, was the concept that profit was a right and that firms when they employed a certain number of people needed to ongoing bussiness, even if the management was incompentant. This, in effect, removed the incentive for compentant MBAs. As long as a manager has a piece of paper, the firm had done due diligence, and the financial sector, backed by tax payer money, would insure that funding for the incompetent and inefficient firms would be ongoing. The primary negative consequences was that compentent and creative individuals found it harder to get funding, and employess.
"She's a scientist and a lesbian. She's not going to let it slide." Orphan Black
So, who's hiring the MBAs in the first place?
And why hasn't a company considered hiring geeks to do this sort of stuff? If it's such a good idea then surely someone somewhere would have experimented and seen how hugely successful this has been.
I've been involved in companies run by geeks. They don't always understand business. They're very eager to play with new toys but are rubbish at business plans. You need people who understand business *and* innovation.
Ummm...
We're actually looking at a false dochotomy here, when it's actually a mixed set. I'm an MBA but I started out as a software engineer with a master's in science and about 50% of the people I studied on my MBA course with had a background in engineering. It just happens to be fashionable to blame MBAs at the moment because of the financial crash, so a lot of people are jumping on the bandwagon.
The problem isn't that one skill set is overused. Its that people in general are no longer willing to take responsibility for their actions. Any one especially those with high skill sets are prone to mistakes. Admit them and learn from them. Any degree or training someone may get does not liberate them from stupidity.The universal affliction that affects every rational person no mater race, standing, political stance, etc. The problem is that companies have made an environment of hide your mistakes. So what happens is that the person who, may be dumber than a bag of hammers ends up leading the way. They are stupid, but rewarded because they can hide their mistakes better. Rather the guys that make the big blunders, but figure out how to survive are the ones that should be in charge.
David Brin put it like this in the early '90s:
"Want to help Russia and America at the same time?
Send half our lawyers (freedom in both countries will go up.)
Send half our MBAs (both our economy and theirs will boom.)
And send half of NASA's managers (America gets a great space program and Russia some good farm labor.)"
Science is all about firing a drunk pig out of a cannon just to see what happens.
There are a lot of engineers out there who have business credentials too. At my company, a large aerospace company, "working level" engineers mostly have a BS in engineering/science & 2 advanced degrees -- a technical degree and an MBA.
Engineers still know something that is no longer taught to business majors -- that you have to make decisions for the long term. When you're building systems that cost many millions & must perform for decades you must keep this in mind at every stage of the process -- both business & engineering functions.
Decades ago this was a part of business majors' education. In management courses, accounting, every course you were taught to always make decisions assuming your firm is an on-going concern. Now business students are taught to extract as much money as possible in the least amount of time and get out. Think short term and eventually you'll destroy enough companies that that you no longer have anyplace to invest ... and the "wealth" that you have amassed is worthless. This same thinking has spread to government & investors.
"Glory is fleeting, but obscurity is forever." --Napoleon Bonaparte
insight n. - clear or deep perception of a situation
Most engineers know next to nothing about marketing and sales
Perhaps +5 Flamebait/troll would work as well.
Lutz drove GM into the ground, though it was headed that way anyhow. So it's a colossal surprise to hear him say something right. But then again, he's only half right. He's not identifying what MBAs actually do to help (which is formidable -- the shoe-maker can't make the right decisions about consumer desires or about management choices on human levels), and he's not pointing to the right areas where they're destroyed American businesses -- the quest for short-term growth over long and even mid-term gain.
Thus is is said that even a blind squirrel finds half a nut some days.
As an MBA engineer, I have seen too many MBA graduates drive down corporations, tiny one and huge ones. Yet, I cannot blame them alone. The root of the problem is the short term focus of the investors. Capitalism is failing. Enterprises that are controlled or subsidized by heavy, inefficient government are winning because they are forced to consider the long term. I see it in Europe, Canada, and China. It pisses me off, but raw capitalism does NOT work.
And the allmighty shareholder value.
And as long as execs only have this in their mind, companies will be bled dry and wasted. I wouldn't say that engineers should run companies. I'm an engineer and I would probably not be much more successful at running a business than the locust MBAs that run them today, just for different reasons. I would probably fail to produce a profitable product, striving for the perfect tool rather than keeping my eye on the cost.
Execs today have a different problem with the way they run a company. They don't even care what gets produced, or even whether something gets produced. Their eye is on the stock market and how to push the shareholder value up. And the perversion is that this is easiest done by doing exactly the opposite of producing: Firing people. Lay off half your staff and your SHV goes through the roof. And for good reason, it does actually push your revenue in the short term since you save on staff expenses (and for most companies this is a really big cost position). The drawback is that with fewer people you can usually also only produce less, or at least of lower quality. The times when you could save on staff by automatizing or streamlining production are past. We're automated and streamlined nearly perfectly in most areas. Firing people today means that certain work simply will not get done.
But this will not show until later, and for now it is beneficial for the shareholder value. The perversion is that it is the sensible thing to do if you want your company to survive. Because if you don't, your stock price will drop and it will become trivial for a "slimmer" company (that did fire its staff) to swallow you. This is, btw, the way a lot of these companies survived until today. They laid off their productive staff, pumped their value and swallowed up companies that actually did produce (and hence didn't lay off stafff, and hence were "cheap" to get because their stocks accordingly dropped). And that game got repeated, the productive staff was fired, the shareholder value went up, another productive company was devoured. And so on.
The problem is that today almost only the locusts are left over. And it's quite useless if they ate one another, since they're all just husks and shells, filled with administrative staff that don't really produce much anymore.
We used to have a Bill of Rights. Now, with the rights gone, all we have left is the bill.
I see the same thing in healthcare. A hot stroke intervention is considered the same as flipping a burger. Add in the new Health (whatever) Management degrees which are pumping out armies of people who don't really understand IT, facility operations, clinical needs, etc. and yet are hailed as the coming saviours, and you have a recipe for disaster. Advice is being sought from the likes of Accenture (formerly known as Arthur Andersen, the people who said Enron was a-okay), zealous kanban is applied to the supply chain (in spite of the recent earthquake/tsunami's proof of what it could do to a nursing unit with an interrupted supply of syringes, etc), everything is being LEANed (without any concern for the lost redundancies that lead to the new efficiencies), etc.
But, one of the greatest tools that these types have is the ability to make the numbers say whatever they want. No matter how badly they screw up, they can produce a spreadsheet or chart that screams success. And when it all falls down, they are already gone to another "project" (or organization). Their success is on file, and it's considered a question of competency for the sustainment teams that they can't take a gold plated turd and crank out the savings promised by their vendor pals.
Do I sound disgusted? I am.
Let me first admit that I have an MBA from Michigan. I went to business school as it had been quite apparent in my tech career that the folks in finance, operations, and sales were absolutely clobbering the IT staff in terms of salary, work conditions, and being able to work more-or-less safely past age 40. Yes, I know a few very wealthy tech personnel who made it from stock options, but I know far, far more wealthy people who made their fortunes producing nothing of value, shuffling imaginary wealth from system to system.
In business school you don't really learn about business administration - you don't learn how to lead people, how to innovate, how to manage. You primarily learn about how to extract as much money as possible from every single process. You learn about how to shift inventory allocation systems to minimize taxes, you learn how to maximize bonuses to executives by playing with the balance sheet, you learn the glories of outsourcing jobs to enhance the all-holy shareholder value. Yes, there are exceptions in the coursework - namely operations and economics - but most of the time you simply learn how to become one of the poetical Hollow Men.
MBAs have done such enormous damage to the Western world that its a wonder that the business schools haven't been burned to the ground. Outsourcing, fees for baggage on planes, value meals, all sorts of nonsense dreamt up to earn a last bit of profit, damn the effects as those won't show up on your balance sheet. MBAs are taught to be amoral, to basically ignore anything other than shuffling money around. Business school needs to return to teaching students that businesses are part of the community, that business leaders have a responsibility to their customers, employees, and countries. MBAs need to focus on managing people and businesses, not just learning how to play accounting games. Compensation for MBAs needs to be tied to long-term corporate performance, not quarterly results. And business school faculty should be forced to work in a factory, or a store, or an airplane, whatever, for a few weeks a year to understand how businesses actually make money - not through games, but through the actions of the line employees who get the work done.
/* Dang, I can't type that well. */
The problem isn't engineer vs MBA, the problem is where they end up in the corporate structure. A health company will have a mix of MBA's and engineers throughout their management structure, the two play off each ether to achieve a good balance of technically and financially sound decisions.
Sadly there's a selection bias towards MBA's for upper management positions so over time older organizations become MBA top heavy and they fail as they're out competed by technically superior companies.
Younger start up type organizations have an inverse distribution and tend to be engineer top heavy, they frequently make technically superior products that still fail for financial reasons.
...you end up with GIMP
The core problem is that MBAs only understand one unit of measurement and thats the dollar.
The engineer has tens or hundreds of variables that they understand. Volvo concentrates on safety. BMW on the the driving experience. Honda on reliability. But to an MBA there is only who made the most money.
If our MBAs were looking at metric tons of export, joules of energy per ton of export, tons of export as a function of each element involved, iron, copper etc.
If MBAs were smart enough to handle more than one variable they would have a place. But by and large they are not.
Even in marketing where there are legitimate variables like stickiness, brand awareness, sex appeal, etc it all reduces down to money and the CEO only wants to know how will this make us money?
Very few companies say ok regardless of cost what is the way for us to have 15% of brand awareness and maintain the highest innovation in product function. Personally I think this is why Apple is so successful, Steve Jobs sees his peers as engineers and designers. He wants to be their god not the MBAs god. And that is why he is still a major force in the pc market and ibm isn't and microsoft is becoming less so.
I'm a computer engineer, and let me assure you, most engineers don't know dick about productization. Sadly neither do the bean counter MBAs. Perhaps people in cognitive engineering, which is a subdiscipline of industrial engineering. At least they know something about meeting needs and usability. Rely on the typical engineers for designing products and you'll end up with "clever" bullshit that useful for like three people.
Seriously, we should not have sold off chrysler and simply bailed out GM. The problem in America is that America's business school are in charge of far too many of our businesses. These are basically neo-cons who think short terms rather than long-term or what is good for everybody. An engineer who is in charge would keep everything local so that they can deal with issues quickly. An American MBA has no real knowledge so they trust that others will botch everything and they can pass the blame.
I prefer the "u" in honour as it seems to be missing these days.
said, "Charge me a buck more and make this part out of metal instead of fucking plastic" or words to that effect?
Pick the product, I mean it doesn't matter what it is anything thing from your car, house, cell phone, kids bicycle, toilet paper, laptop pick the damn product.
THAT is the MBA / Bean Counter Problem.
They don't think in terms of high customer satisfaction they think in terms of "I can shave 0.0001 dollars per unit" and "I can predict that we will only increase our returns and warranty repair by 0.0001% and we will increase profit by .5 %".
Huge pet peeve... I like gauges I like to see actual oil pressure in my car, actual engine temperature but these days those are rare things in cars. I know the cost difference might be 2 dollars per car and frankly I will happily pay 30 times that since 60 bucks on the cost of a new car is nothing.
Plastic gears in assemblies... My wife drives a Mercedes C320 and there is a plastic gear someplace under the dash that is attached to a vacuum servo of some kind that has something to do with the air handling. The damn thing has some teeth missing and it chatters now and the sound is really annoying. The replacement part costs 40.00 bucks. But it will cost close to 1000.00 bucks in labor to get at the damn thing since you have to basically dis-assemble the dash to get at it.
The above reasons are why they need to be yacked out of the chain of command.
Hey KID! Yeah you, get the fuck off my lawn!
The geek squad used to be good and they did a good job now it's all about how much you can sell and it you don't up sell your hours get cut and they want sales men over techs any ways. Best buy used to make a big deal about how there sales men where NON commission but now they are hidden commission where if they don't sell rip off monster cables and extended warranty they get there hours cut down. I hear that at staples the easy techs are under alot of pressure and lack of sales can make it that you get kicked out of the business machines department. Also at staples they when from on of best bonuses in retail to one of worst.
Circuit city used to have sales people who knew what they where doing and selling and then 2 times Circuit city fired the long term sales people and replaced them with new people who had no idea on what they where selling.
I went to Business School; my dad and brother are engineers, several friends of my brother's created small companies. "Build it and they'll come" doesn't work too well, and there are issues at 4 levels:
1- company strategy: it's not enough to build something good, you've got to make sure there's a market, that you're not missing a big neighbouring market, that you do have some info about what your customers want/need, what your competition offers...
2- marketing: once you know that, you've got to decide which segments you'll target, and create the appropriate marketing strategy (price, distribution, cimmunication, product/services packages...)
3- sales: cold-calling, understanding customers requirements and constraints (expressed or hidden), doing nice writeups and presentations, hanging in there, closing sales, being a pain to internal project managers... is a job by itself
4- playing nice with banks and investors is a whole game by itself.
I find that engineers are not very well equipped, nor motivated, neither technically nor personality-wise, to deal with all that.
Know, there is a real issue with short-termism, and lack of leaderhip. I'm not sure it's about MBAs vs engineers, more about shareholders wanting quick paybacks to start with, and compounding the issue by putting in charge and incentizing business leaders to have short-term goals, too.
The Cloud - because you don't care if your apps and data are up in the air.
This is a very important issue, IMHO, and cuts to the very heart of the problem with corporations today. Everyone is so shortsighted allowing the money to move them. What we should be doing is having a long term goal of providing good service/products and taking care of employees that do well. Money is a means to an end (products we need like food, technology. housing, education...etc) not an end into it's self. "One thing that did happen in the 70s and 80s, particularly 80s, was the concept that profit was a right and that firms when they employed a certain number of people needed to ongoing bussiness, even if the management was incompetent" There it is.
"The Brady Bunch is back...working homicide"
I've seen lots of people underperforming at work, unhappy with their career thinking and MBA will fix it. They get their degree, get a management gig, and suck just as bad, or worse.
I've seen a lot of people who are very good at their jobs interested in and MBA, but don't have the time because they are doing well and getting promoted and making money.
It's not a complex when you really are the smartest guy in the room.
-- "So they told me that using the download page to download something was not something they anticipated." - Bill Gates
The US economy has been "stranded" by politicians who think they can regulate every aspect of business. The uncertainty created by the current administration holds back job creation. The housing bubble created by previous administrations and Congress has set back consumer spending. Corporate welfare and cronyism keep politicians flush with cash and keep crappy companies like GM in business. Deficit financing forces more taxes into servicing debt. Unions keep wages high and force companies to relocate out of the country to be competitive. In short, Big Labor, Big Business, and mostly Big Government are strangling the US economy.
Most engineers know next to nothing about marketing and sales... to the degree that they actually despise interacting with customers. You can have the best product in the world, but if no one knows about it, your business will fail.
Which is true and important and entirely beside the point. MBAs aren't about marketing. They hire people for that. MBAs are all about managing, not marketing. MBAs are the guys who export American manufacturing jobs to the Third World, the guys who cook the books to pump up their employer's apparent profitability enough to raise the stock price again this quarter, the guys who, with apologies to Oscar Wilde, "know the price of everything and the value of nothing." They're the guys who have spent the last 30 years or so systematically dismantling America's industrial base while simultaneously enriching themselves. They nearly destroyed the world's economy three years ago, and yet, mysteriously enough, they're still in charge of basically everything today.
They are the people to whom Santayana was referring, when he warned about repeating the past's mistakes. They are our leaders.
May Chthulu have mercy on our souls.
Check out my novel.
I couldn't agree more with this! Really well said and it is completely true.
While I was attending University of Missouri, Columbia we had to take accessment exams and every year the engineering department would stomp on everyone else in EVERY catagory including the ones they were supposed to be good at.
I'm guessing this test didn't include spelling? :p (and yes I see your sig--I do find your boasting humorous!)
I also think your experience in this particular area would be very different depending on your university environment (top research university, middle grade public, small liberal artsy, etc)
Oh, and get rid of the lawyers, they are even worse than an MBA.
Lawyers are risk management. Getting rid of them is getting rid of insurance--opening yourself up to major downside risk in everything from employment discrimination to your lease to the agreements you make with your clients. Effectively, it's a transaction cost of doing business.
Engineers tend to intuitively dislike lawyers because they seem to make things less efficient--transaction costs do that. When everything goes well, the lawyer was basically an expensive insurance policy that you never collected on. But when things go badly, a good lawyer can make the difference between riches and insolvency. Even having good agreements drafted can discourage people from suing you. Putting together a new corporate form can easily save millions, for example.
Sometimes a lawyer does too much--they effectively purchase too much insurance, spending far more to achieve additional downside protection that is not worth the expenditure. Think of it like a corollary to Amdahl's law. In these cases, good lawyers can (Depending on a client's preference and the specific trade-off) advise you about the relative costs and downside risks, or make some of these decisions using his or her own judgment.
Granted, there are a lot of fundamental problems with the legal system--good tort reform for everyone might be a better solution than limited liability conditional on legal forms, for example--but it also greatly benefits business (e.g. agreements are enforceable), so legal expenses are a cost of doing business well.
-- IANAL, this isn't legal advice, and definitely isn't legal advice for you. Also, Squee!
Reading this piece, I can comfortably say that the author is right on the money with regards to how a focus on being "data driven" is actually slowly running companies into the ground.
I started off my career writing really low level network stack drivers. I got pretty familiar with the windows kernel, became a star in my office and got put on an MBA track because I had demonstrated some aptitude with customers and sales. Fast forward a few years and I've got an MBA under my belt and work for what was formerly a very large provider of consumer SaaS that is now trying to win in what can be loosely described as the call center space.
My days are now spent trying to determine strategic initiatives on the basis of consumer behaviour as represented in a slew of really badly coded Cognos reports. This wouldn't be so bad except for the fact that analytics and data driven decision making is anything but in most companies. Data is used to validate a hypothesis instead of being explored to reveal patterns, associations and trends. Every executive asking a question about customer behviour is secretly asking for validation of their own theory on the business and wants to gloat about it come performance review time. Obviously, in this kind of operating model, data is bastardized to lead to really bad decisions.
I'm all for scientific approaches to management, however they need to be undertaken following a method that is in line with the scientific method to be labelled as such. When I leave this job (which is ridiculously well paying but completely unfulfilling compared to my career in engineering) and run off to create my startup, I will probably hire an MBA at some point. However, I won't hire them to be a bean counter.
What many companies fail to realize is that the key to having a great leader is equal focus on product and market. The MBA that I would hire would be chosen because they've demonstrated an ability to be highly technically proficient but decided to expand their horizons and take on "soft-problems" as well.
And therein lies the problem, tunnel-vision focus on quarterly profits and short term goals based solely on immediate gratification are dooming American business.
Henry Ford did not raise the daily wage to $5/day when the going rate was only $3/day out of any love for the workers or altruistic motives, he did it to insure his employees would have the means to purchase the autos they produced. Today we are fast becoming a country that produces nothing and will soon be reduced to third world status...
No, Engineers are terrible managers. Although too many MBA's & Bean Counters are concentrating on squeezing every penny out of an operation, when they should be concentrating on the big picture.
I'm shocked how many people inside Oracle have no idea about the things they sell or even basics of IT.
Sometimes it's bizarre when you have to prove your technical reasons to people who have no idea what you are talking about, but they will still argue with you, because their perception of the things makes their world more comfortable. And still, they run the show. Amazing.
But it's not a new thing. Just remember the story about the wheel and "what color should it be" from HGTTG. Adams was spot on :-(
Sorry for the AC....
Who knows more about how space movies should be made, an engineer or nonengineer? Invisible lasers, never miss guidence, no sound in space, no fire burning without oxygen.
You have 98 minutes to tell your story.
If your film is Wall-E you will have less than five minutes free for conventional dialog and exposition.
Ideally, everything your audience needs to know will be conveyed without words:
Exposition sucks rocks. It stops the story in its tracks.
The audience sees weapon fire.
It doesn't see a laser. It doesn't need to see a laser.
The geek sees a laser because he can't think of any other form of beamed weapon.
That's not even close to what Lutz says. I've just read his book.
GM management was engineering-dominated. Lutz's big push was for "perceptual quality" - sheet metal fit, interior design, and styling. A "cool look". He was willing to give up engineering quality for that.
One example Lutz gives: GM had a standard that vehicles must be able to hit a 4" curb straight on at speed without damage. So if you hit a pothole or a rock, you could keep on driving. But the "big rim, thin tire" style borrowed from lowriders couldn't do that, and GM didn't use such tires. He insisted on giving up the 4"curb requirement to get a cool look.
What Lutz actually did was to strengthen the role of the designers over the engineers.
MBAs typically have absolutely no helpful skills or abilities. They are often people who tried engineering, but couldn't cut it. They are people who tried accounting or finance, but couldn't cut it. They are people who tried marketing, but couldn't cut it. They are, in essence, the rejects of the business world.
Yes, they are rejects. That's why they're paid more in a year to slash and burn your company than you get paid in 10. Obviously, they're failing at SOMETHING. Likely though, they console themselves with 7 series BMWs and lots of pretty women. I doubt that your scorn causes them to have problems sleeping at night.
The "I want to get an MBA" started here where I live -Costa Rica- back in the 80s-90s and some universities started to graduate dozens of MBAs, with a very low quality, they just wanted to make money and people receiving that bad education just wanted to have a "Master" degree in anything, no matter what.
Now that the MBA turned into a non-value degree (because every body has or can get one easily) I'm starting to see a new trend: people is starting to get a "Project Manager" degree.
PMP for everyone !
And please do not forget that you have to pay to the PMI, a "non-profit organization", every 2 years for your certification to be valid. And don't complain about that. Please be kind and remember that they -PMI- need to travel everywhere in the world every week (and stay in good hotels of course) to show you why, they are "Making project management indispensable for business results.®" (pmi.org)
Plus, of course, our nation was led for the past 8 years by the first President to have an MBA,... He was also a C student at Yale,... Look where that led us!
I seriously doubt that MBA managers make these kinds of efforts when they take charge of companies. The dominant ethos of that profession appears to be to run a company by the numbers just long enough to move on to a higher paid position.
That's pretty much it. That's how the corporate American works and we're taught accordingly.
Engineers who want to know the business end of things this is what you study:
Pretty much the first semester of B school is all you really need. That's all. everything else is fluff. And as far as the group behavior/personal dynamics class goes, we were taught that "sensitivity training" was the solution for all human resource problems - it was all basic psych and sociology and lots of buzz words. Let's put it this way, if you don't have any social skills, getting personal coaching will do much more for you than those fluff classes.
There! Now you won't waste 2+ years and $40K+ on a big piece of toilet paper.
Want a Masters Degree for ego, promotion, or whatever? Get it in something you'll enjoy.
Using cheap plastic parts is not (or at least not only) about shaving a penny of the total cost. It is to ensure the product will break down quickly so you need to buy another product.
There simply is more profit in selling you a craptastically bad $100 product every two years than in selling you one well engineered $500 product that will last you a lifetime. It is not even an option anymore, in most categories there is no quality product for sale at any price.
Hard restrictions are blunt tools; a better means to the same end would be to revise the tax system in such a way to encourage dividends rather than increased share value as the primary mechanism for shareholders to earn returns from a corporation.
Business PhDs argue about all manor of interesting stuff. Business BA and MBA programs are just degree mills operated by business academics so their salaries can be even vaguely competitive with the business world.
MBAs are soft degrees for people who want money but lack direction, drive, and guts, i.e. they're risk-averse personally. You don't really want that sort of person running your company.
You might view an MBA as a qualification to manage someone significantly less educated and less intelligent than yourself. I'd hire an MBA from a tier n school for managing engineers from say tier n+2 schools.. or tier n school engineers if the MBA's undergrad was a STEM degree. I'd usually hire a business BA from a lower tier school only for managing people who held no collage degree.
You also shouldn't make managers from the engineers who cannot manage. duh! Yet, there are actually enough engineers and scientists who can handled the organizational load & inter-personal factors.
I'd imagine the "scientists" you mentioned were academics who started a company. Imho, anyone fresh out of academia should not be running a company, this even covers business PhDs. Instead, they should take a couple years acclimating to the real business world.
Conversely, you'll actually find good manages much more frequently among some non-academic science degrees, although not computer science. Bowing has been considered the best run large aerospace company for decades. Bowing traditionally prefers hiring physics majors for their management positions. I'd imagine that mathematics majors make fairly good managers for software developers too, google certainly does that occasionally.
The Christian religion has been and still is the principal enemy of moral progress in the world. -- Bertrand Russell
The problem isnt the MBAs or the technical/production people. It's HR who don't have a clue what people need to be hired. They hire MBAs who cant function at their job. They hire CS majors as programmers and sysadmins when CS degrees have nothing to do with either functions.
Dont blame the MBAs and dont blame the cs majors. Blame HR for being such failures. Headhunter and placement agencies are covering up HR failure. What businesses need to do is fix their HR hiring processes.
I have worked in software and computer product development for 20 years. Here are my observations. A company can be run by an engineer, an MBA (includes marketing types), and finance guys. The engineer will be popular with the rank and file engineers and will look inward for company solutions. The risk with him is that he does not control costs and may be susceptible to the 'not invented here syndrome'. The MBA is usually convinced of his own genius and impatient with the lack of genius around him. He loves to make deals and partnerships with other companies, and outsource, and therein lies the risk. If successful he can be good for your career. More often he will not and the company will die from within. Example, Boston Scientific and its disastrous mergers over the last 5 years. The last guy in my opinion is the most dangerous, the finance guy. At best he is caretaker, at worse your company will slowly evaporate in ever more desperate efforts to control costs without innovation. I agree with the story that we are headed for a period of engineer dominated management. We are in a period of stagnant innovation and it is a natural part of the cycle. The other guys will be ready to step in and 'manage' those innovations to extract maximum value some time later in the cycle.
an ill wind that blows no good
It is more the fact that the corporAte environment has become very friendly for corporate psychopaths, who will do a quick buck during a 6 month/1 year stint (merger, outsourcing, unnecessary reorganization, firing of random number of employees (1000, 5000 and 10,000 are common) offshoring) and then flee to the next company and management position.
"The agriculture ministry is not in charge of Gundam" - Japanese ministry official.
Disclaimer: I'm not an MBA, I'm one of those techie geeks the MBAs grudgingly keep around to make things work and help build new products for them to sell. :-)
My thoughts on the main reason for our economic problems are that short-term cash hits take precedence over long-term strategy. Part of that is due to public ownership of companies and the fact that almost all Americans' retirements are now linked directly to the stock market. The MBA itself just trains a generation of corporate managers into this mindset. Even more dangerous in my mind is the fact that it encourages revolving-door "professional executives" who go from company to company, collect performance bonuses for getting these same short-term cash hits, then leave when things turn sour.
If you're an entrepreneurial sort (definitely not me...) and you start a business that ends up being very successful, you probably want to make sure it keeps running and stays successful. Founders of businesses will generally pour their heart and soul into a company, investing everything until it's either a huge success or totally obvious that it will fail and nothing more can be done to fix it. More importantly, they want the business to be around to provide them income and a place to do what they do best. In the case of a public company, this immediately disappears. The company's stock price is all that matters anymore, not the quality of products, the jobs/tax revenue/new innovations that the business generates, or anything else. This is because the new "owners" of the company are you and me, either directly through speculative trading or indirectly via 401(k) balances and mutual funds. You and I need those balances to keep gong up so we don't starve to death when we're 76, so whenever a public company tries to do something that might pay off in the future over something that pays off RIGHT NOW, it's always rejected.
For example, a board is presented with two options. Assume (probably correctly) that they have no idea about technology, quality of products, etc. Also assume the company is a high-tech manufacturer doing cutting-edge product design.
Option 1: Close a US R&D facility, lay off 3500 workers and open a new R&D facility in China hiring 5000 new workers at 20% of the US rate. License company's core technology/IP to the subsidiary company you had to set up in China to get the investment done. Time to completion: 3 months. Net guaranteed raw profit: $2 million.
Option 2: Invest in an incredibly promising new product line, totally revolutionary from what the business is doing now. Expand the R&D facility in the US, hire more people, and hope this pans out. Time to completion: 4 years. Potential profits: $2 billion.
Option 1 is ALWAYS chosen now. Executives are paid on what they do in the next quarter, even if Option 2 may make them tons more money in the long run. Option 2 would probably be chosen if there were people with a real stake invested in the company, not just a few thousand shares of a bunch of letters on a trading screen.
"Option 2 thinking" produced some of the most interesting innovations of the 20th century. To get back there, we would have to:
- Break the link of people's retirement from the stock market, or at least abstract it one level. Pension funds did this -- they were the ones on the hook if things went south and have years and years to make up for failed investments. This may reduce the constand talking-head CNBC/Bloomberg chatter that causes these short-term decisions to be made.
- Reiterate the fact to private companies that going public may be a personal windfall, but they will never be able to do another long-term project again.
Some of the stock market focus is out of the bottle and never going back in -- cheap web-based stock trading took care of that. Before, only pension funds and the incredibly rich invested in stocks, and even then, if something happened, it usually took an iteration of the Wall Street Journal news cycle to bring it to light, and a call to a traditional broker to act on anything.
Its not about the type of background a manager has, its about how to incentivize properly.
If you put only engineers in charge you end up with a lot of cool products... and relatively few markets to apply them to
If you put only MBAs in charge, you end up with lots of market opportunities... but little real innovation
Combine the two and you end up with cool products with real market applicability. There's no black or white solution here, real business grown through shared vision and cooperation.
Frequently, an MBA is obtained by an individual with a BA or BS in some other field. Engineers, for example, often go on to get an MBA to fill in the economics, budgeting and planning and resource allocation skills that they will need in addition to their basic (engineering) knowledge. In this sense, an MBA can be a useful degree.
The problem arises when companies compartmentalize their functions, making the business management side of the house responsible for one set of decisions, engineering for another and operations for something else. Each group does 'their thing' and throws it over the fence to the next one. So the end solution is suboptimal.
Anecdote: When I was at Boeing, we were developing a higher capacity electrical power generating system (EPGS) for the 747-400. One aspect of this was to spec relays and contactors to withstand the higher available short circuit current. And once the vendors had developed the 'heavy duty' components, it was my job to test them (blow them up). One special purpose relay incorporated some voltage sensing logic which would cause it to switch to an alternate source should the primary fail. It was a very low volume part. So we took a sample to the lab, hooked it to a 4 generator source and applied a short to its output. Bang! The magic smoke came out (not supposed to happen). Back to the manufacturer for a redesign. The next sample, less smoke came out. The next one, even less. After a number of iterations, the vendor had it down to the case just bulging a bit. Still not suitable.
At this point, the purchasing guy called up and asked what the hell we were doing blowing up all these $7500 relays. $7500?!! If someone had told me that's what they cost, I could have easily designed the part out of the airplane. But that wasn't my job. The guy whose job it was was still adapting a WWII era design to the system. And he had no idea of parts cost. Not his job, just build the system so it works. Cost is a different department (where all the MBAs work).
Have gnu, will travel.
Engineers are the people who will make stuff that people will want.
MBAs are the people who will spend company assets doing things like share buybacks.
MBAs are tools (in both senses of the word).
Plus, of course, our nation was led for the past 8 years by the first President to have an MBA,... He was also a C student at Yale,... Look where that led us!
Unfortunately we replaced him with a President with higher levels of education and zero experience, and we've gone from a bad situation to worse.
Browsing at +1 - no ACs, I ignore their posts. So refreshing!
There is no degree more overrated than an MBA. The article is right, these people are disastrous when placed in command of tech companies, and one could make a strong point they screw up every other company they touch.
Every conversation I have heard when a group of these "leading lights" set around a table, is buzz-speak laden drivel, totally hollow & devoid of any rational or critical thinking. Usually along the lines of "I heard company x is doing this" which in MBA speak "means we should too", i.e. I am just a stupid MBA and have no original thoughts.
One of my worst corporate experiences is remembering a dinner "meeting" I had to attend once with HR, marketing, executives, and a small group of IT developers. HR the manipulative & shallow eye-candy gathering intelligence, technophobe market droids droning on about branding, narcissistic executives showing off their newest mobiles and laptops they were too stupid to use, and the small band of young developers with few social skills required for "small talk", but great at in-depth conversation.
The only silver lining is that was a self-cleaning affair, the quantity of vacuums in the room ensured that.
There is a trend on Slashdot whenever the phrase MBA is mentioned ... the assumption is this is a short-term thinker fresh out of college with no fundamental understanding of the business (not really) and even less understanding of the technical aspects. Mod points often go towards who support such opinions.
However, why is it possibility of an engineer with an MBA never mentioned? Do such people not typically exist? I know several from both my alma mater and where I work. They have done VERY well in their respective companies.
Any, I repeat, ANY company that puts the "short-term" sort of people in charge needs to go under. Any company which bases their executive compensation on short-term needs to go under. Any company who has a Board of Directors that is not diverse (read, minimum one member from academia, one from a non-profit, one or more CEOs from another company) needs to go under.
Each of those items is poor leadership within a company, and such companies are not meant to last. OR, they are meant to be forced to undergo restructuring and incur losses for a period of several years until they get their act together (see IBM, Cisco, Ford, GE, a number of others). Placing poorly qualified candidates into such positions (MBA or otherwise) speaks of poor leadership. Such companies are not meant to last. However, at the end of the day, it is leadership at a company, not the MBAs, which is the problem.
The problem is that MBAs are niche people not super business majors who can fit into all aspects of business operations and do better than a normal business major (an undergrad degree I could bash at length.)
I've tried consulting and failed. I hate business at all levels; I'm an engineer.
I've seen many companies from their administration systems (which contain everything about the business) and talked with people at all levels. I can see how to make their business better, but my job was computers not management - I could manage them better than they could as far as the non-political issues; but all the other aspects of business I hate and would fail at. I know it. But what I could do is manage a group of geeks; or probably do well at managing production.
What I saw was that the parents 1-4 points are spot on-- they are almost more important than whatever the business does. I've seen places that don't deserve to exist but were great at 1-4 and could sell bags of shit to people and get the investors and customers to keep it going... I've seen places that were going under who did great work and ran the "real" business extremely well but failed to handle all the external aspects of business (1-4.)
We put "business" management under 1 broad area when these MBA types are really only good at certain aspects--- they do harm in other areas but we ignorantly think its related to their expertise when they may be less capable than the janitor doing it.
External business issues should are EXTREMELY different than internal business issues. Internal business is production management, planning, worker relations, H.R. etc. A different set of problems requiring a different mindset.
The MBA should be dealing with the bankers and investors; they seem to be almost totally geared towards kissing ass of investors and bankers-- every single one I've met has been trained to think from that perspective --- which is damaging when applied elsewhere; hence, the problems we are discussing.
Nobody should put an MBA in a management, HR, or CEO position. The top decision makers should be diverse and reflect different aspects of the business. I think engineers should manage themselves for the most part; production management and planning especially. The board/CEO need to be connected with production in some way. The MBA can deal with the external business issues that marketing and sales do not handle. (I'm not sure putting marketing and sales under their control would be bad but it might do less harm.)
Who knows more about how space movies should be made, an engineer or nonengineer? Invisible lasers, never miss guidence, no sound in space, no fire burning without oxygen.
Those "lasers" are actually firing charged particles. Those never-miss guidance systems use temporal dilation in order to give the guidance system a head start on the target. There's sound in space, that you hear it is just a testament to how LOUD the explosions are. Those fires are plasma fires.
Engineers have no imagination. Oscar Wilde might have said that they know the cost of everything, therefore they think everything is impossible.
Don't blame me, I voted for Baltar.
What this article seems to ignore is that most MBAs are in fact, geeks. I've recently graduated from an MBA program and my classmates took pride in being geeks - they also put an immense amount of effort to understand the companies they were interested in joining, probably alot more than most people at those firms.
To which the MBA responds that it is done that way so if you need a quick fix, you replace the entire assembly and besides, building it the way reduced the steel required by 3%.
I wonder what nerds will think about replacing their bosses: their bosses are competent and do a fine job, or they think they can do a much better job....
The truth is that management takes a different skill set. If it was dramatically better to run a company by engineers, it would become the dominant model: engineer-run businesses would best their MBA swamped counterparts. You can find exceptions on either side, but by and in large, nerds don't run companies. Which is pretty good evidence it isn't the right way to go for every business.
If you, as a nerd, think you can do a better job with management than the MBAs at your firm - go start a firm and beat your old employer at its own game. You may also be interested to know top level MBA schools do take a lot of engineers and teach the importance of understanding the business.
As a nerd, I don't want to be in management. I like writing code and solving real tangible problems. I don't want to deal with finances and accounting and pick salaries and hire people and invent some BS "vision" for the company. Leave that to the management types.
This comes to mind:
http://web.mit.edu/voodoo/www/degree.gif
Just because someone made a large personal profit does not mean they were not a complete and utter failure in a grand scheme of things. I would hardly call our baking executives as success stories given the banking crash, though none of us can deny how rich they got off the bailouts. Were our economy and justice system not so rife with incompetence, many of our captains of industry would be unemployed and/or jailed.
"They that can give up essential liberty to obtain a little temporary safety deserve neither liberty nor safety."
What makes you think the short term thinkers are neo-cons?
At the company where I work, located in Seattle, it's being driven into the ground by a bunch of Liberal nut-jobs with short term thinking.
Short Term Thinking != (any political philosophy)
MBAs *and Government* should mind their business and no more.
MBA people are part of a secret club with a secret language and only they understand that it is meaningless. They have outsourced, insourced, off shored, in shored, brain dumped, and had us drunk the cool aid.
They have had us jump through hoops, perform somersaults, hot desked, home worked, wear suits, dress down Friday'ed and all manner of other pointless gunk. Sack the lot of them. We would be no worse off without them and would save a lot of money.
An MBA is just a certificate which says to other MBA types, "Hi, I'm one of you. Let's cream off the profits for ourselves"
The problem isn't that the business folks devalue engineering. It's the opposite.
The MBA toolset is valuable. All big businesses need MBAs to operate and administrate several key functions. You can't live without them.
Also, business leaders need business skills. You can pick these up on the job. But much better to be immersed in it full-time for two years and pick up the deep theoretical foundation. That means business school. I mean, you wouldn't want an engineer who didn't have a four-year engineering degree, right?
Engineering skills alone aren't enough to run a serious company. Technical founders and geeks who try to be CEOs usually fail.
But business skills alone aren't enough either. MBAs who don't understand the technology, the product, the processes, and the nuts and bolts are useless. The investment banker and management consultant "masters of the universe" think they are so brilliant they don't need to know the details. Their failures are the most damaging. They optimize short-term profit by killing brands, destroying capabilities and mortgaging the future. The stock market rewards them for great quarterly results, they cash out and move on before the company collapses.
What the world really needs is engineers with MBAs. Instead of taking hot-shot know-it-all 22-year-olds who want to go straight into executive roles, business schools should look for accomplished professionals. Train people in their 30s and 40s who have a solid industry track record and send them back into that industry. In many industries, that means taking veteran engineers and equipping them with the know-how to be line managers, product managers, marketing and operations executives, and eventually CEOs.
The problem is really that business schools respond to market demand. And engineering organizations don't often hire from business schools. So the schools produce the keen analysts that are in demand with their biggest customers - consulting firms, investment banks, and enormous corporations.
So what we really need is for engineers to appreciate the value of a business education. And hire MBAs. The kind who already know the guts of your business. Send veteran engineers to business school, and hire them back!
Originally, an MBA was a particular program for *engineers* who wanted to get involved in management, but did not have accounting, leadership, or other skills needed to manage projects and know how the rest of the business ran outside their area of expertise.
Today, you need pre-managerial skills and having a b.a. in business administration is essential. I listened to NPR last year, and an economist was on saying businesses today used to have former engineers become promoted to senior management positions. Today, accountants and financial anaylsts are being promoted to these positions and what they were trained on is how to raise the stock price and cut costs. The program continued saying how these financial guru's are great with giving Wall Street what they want are dumb by relying so much on JIT inventory and using only 1 supplier and ignoring things like I.T. that something like a single supply disruption can cripple the whole us economy. Interesting ...
But these trends come and go. I personally feel Wall Street is becoming unreasonable and it is maxed out. Growth can not continue indefinitely, and people today are looking at other investment options. If it can't continue then perhaps the engineers will become the new CEO's again and not the accountants.
http://saveie6.com/
I actually interacted with a manager who literally quoted, "if you can measure it you can manage it". My mantra in reply regarding software was, "we're not laying pipe here".
If software were a more mature discipline, I might have been more inclined to agree with him. He was not as bad as the person interviewed for the management slot who said he would immediately move us all to Eclipse if he were hired. He also couldn't believe that I made the same C program run on Linux and Windows. He literally thought Java was the only way to write software that runs on more than one platform. IIRC, I had one file out of dozens that was a few hundred lines of #ifdefs, and some 3rd party libraries such as RedHat's pthreads port. Problem solved. Sheesh!
The Reckoning by David Halberstam. Mainly be cause Lutz can't write as well.
That is all.
I seriously doubt that MBA managers make these kinds of efforts when they take charge of companies. The dominant ethos of that profession appears to be to run a company by the numbers just long enough to move on to a higher paid position.
That's pretty much it. That's how the corporate American works and we're taught accordingly.
That's not how I was taught at a public university ranked in the top 35 in the US. As matter of fact in some of our case studies the take away was that the perspective you offer was partly responsible for failure.
Engineers who want to know the business end of things this is what you study: Basic Accounting, Economics: basics of Macro and Micro, Managerial accounting (reports: balance sheet, income statement, cash flows!!! ), Finance: although the manual for the HP 12C covers it all ...
Uh, no. In my classes we were also taught to look for the financial gimmicks and tricks sometimes used to inflate financial reports. When found we were told to stay away from such companies. Well one professor actually suggested otherwise, he was of the opinion that one should wait for that company's failure, buy it cheap, discard the management and turn it around. He thought rehabilitating a mismanaged company with otherwise good products can be quite lucrative.
... Biz law - contracts. Pretty much the first semester of B school is all you really need. That's all. everything else is fluff ...
I call BS. Claiming the above is a semester demonstrates a tendency towards *extreme* exaggeration, it lowers your credibility. Also other typical classes are not fluff. Statistics: A quite different class from the one I had that was part of scientific/engineering program. Organization Behavior: While often joked about the case studies also showed company failures because management blew off the issues raised in this class, more below. Negotiations: often an elective but also considered one of the most important classes by those who take it. Global Business: Obviously critical today, and if someone thinks it is about outsourcing then that person obviously hasn't taken such a class. Marketing: As an arrogant engineer expecting this to all be snake oil I loved learning how ignorant I was. Marketing can be highly scientifically and mathematically based. Info Tech: Again, software types like myself are often terribly mistaken as to what this class is about. Stategy: Do you seriously consider this topic fluff? The case studies we read suggest otherwise. Entrepreneurship: Another elective rather than a core class but for many its a critical class, again something you would consider fluff?
And as far as the group behavior/personal dynamics class goes, we were taught that "sensitivity training" was the solution for all human resource problems - it was all basic psych and sociology and lots of buzz words. Let's put it this way, if you don't have any social skills, getting personal coaching will do much more for you than those fluff classes.
My organizational behavior class was quite different. This topic surfaced in many other classes and in various case studies neglect in the OB area was one of the factors leading to team or company failure. It also helped me to see events over my career in a different light. Teaching social skills is not what OB is about. As a matter of fact that sort of stuff was done outside of class, for example a club focused on public speaking.
There! Now you won't waste 2+ years and $40K+ on a big piece of toilet paper. Want a Masters Degree for ego, promotion, or whatever? Get it in something you'll enjoy.
I have a MS CS and an MBA. The MS CS was largely more of the same, taking many of the BS CS classes a bit further. There were some interesting electives and doing some research in one of these was fun. However unless you
Giving huge bonuses for short term profitability causes bankruptcy. I listened to a detailed presentation from a top automotive sector analyst on what went wrong in the auto sector. Every bad decision listed was an effort that created short term gains and long term liabilities. The managers of GM, Ford, and Chrysler have been brilliant in finding ways to boost short term profits, however they have done so by sacrificing long-term gains. Just before the crash, Chrysler boosted its short-term profitability by cancelling new car development!
Analysts have commented that the only profitable companies in the automotive sector are private. Fundamentally, a car company only lasts so long before it must produce new models of cars. A private investor wants both short term and long term profit, and balances those needs.
Find a list of the best companies in North America for consistent long-term growth, and you will get a list of companies with strong private interests putting the brake on unbridled short term growth.
I seriously doubt that MBA managers make these kinds of efforts when they take charge of companies.
That's an AWFULLY broad brush you are painting with there. A MBA is a college degree. Nothing more. People with MBAs go into finance, accounting, marketing, sales, engineering (yes, engineering), and of course management. Having a MBA is not an automatic ticket to management either. At best it might get you some interviews you might not get without the degree much like an engineering degree can open a few doors. After that it is up to the talent of the individual. Futhermore, lots of people get MBA degrees AFTER they already are in charge (see executive MBA programs) because they seek to do their job better. Management has a skillset much like engineering, and many (though not remotely all) of those skills can be learned in school.
The dominant ethos of that profession appears to be to run a company by the numbers just long enough to move on to a higher paid position.
A MBA is a college degree, not a profession. There are good managers with MBA degrees and bad managers with MBA degrees. The degree is just training. It is in no way, shape or form a profession.
Most that I have met have little to no underlying understanding of the businesses they are being paid handsomely to operate.
That would be true of many people regardless of whether they possess a degree in business administration.
Bob Lutz was in top management at each of Detroit's Big Three, often acting as the #2 guy running operations while the CEO went out talking to Wall Street and the press. And now he's telling us they were overrun by bean counting MBAs? If there was someone in a position to do something about it, he was the guy. Gee Bob, maybe you could have .... shaken up management, fired people?
The US IS competitive, and produces a massive amount of manufactured goods.
If it weren't for WWII literally killing off our competition we'd not be nearly as wealthy.
Americans have internalized the idea that the US should COMMAND is disproportionate share of world market and that everyone should be employed at a "good" job.
That's literally insane.
"This post is an artistic work of fiction and falsehood. Only a fool would take anything posted here as fact."
I worked as a technician for several computer stores in the past before I opened my own consulting company. 3 out of 4 were run by "Business men" or "Sales people" that had absolutely positively no clue how a computer worked or how to build or fix a computer, or to even use a computer. They were more clueless than most of our customers. One guy was a shoe salesman before he opened his computer shop. Yet another was a vacuum cleaner salesman. It was always funny to watch them stew in their own juices when a customer asked them a technical question.
Business types always want to fill positions with the exact requirements and experience but nothing more so they can maximize profits. The other thing they want is someone who does one task well. Why not require this of MBA's? Require them to specialize in major industries while they're in college. They have to actually learn about the tech sector, retail or whatever they're going to go into. This way, they at least have some knowledge to back their crazy logic.
MidnightBSD: The BSD for Everyone
Many people are not suited to run any kind of business for one reason or another. That doesn't mean than none of the members of a given category of people, except maybe autistics, are a-priori unable to run a successful business.
There are _lots_ of MBAs and their ilk who are not suitable for running a business.
The point of the article isn't "all geek and software guys should run businesses", it is rather the more salient point that "business should be run by the people interested and knowledgeable of the business at hand, rather than people who only possess a prurient interest in the money such a business might have wrung from its functions".
Neither "Lawyers" nor "Businessmen" should _ever_ be allowed to run a business (except for maybe a law practice) nor make policy for any business or government.
By analogy "min-max gamers" make terrible authors because they don't know how to balance characters, and Michael Bay is a terrible director because he doesn't know the difference between a special effect and a plot advancing event.
Money is supposed to be a tool of business, not be the point of one.
Innocent people shouldn't be forced to pay for inferior software development.
--"Code Complete" Microsoft Press
And if the purpose of this discussion was to make all the MBAs burst into tears and run home to their mommas, you'd probably have a telling point. But I don't think that's the object of the exercise in this case.
So far as I can see, the question under debate is to what extend the general MBA approach is toxic to the wider economy, and whether or not we are all of us paying the price for those "slash and burn" tactics.
I'm sure those BMWs are a source of great comfort to their owners, but they don't really constitute an argument for letting said owners keep slashing and burning.
Don't let THEM immanentize the Eschaton!
"Shoemakers should be run by shoe guys and software firms by software guys." That's called workers' self-management. It is best implemented through industrial unionism, anarcho-syndicalism, or a network of co-operatives.
The problem with corporate capitalism is twofold. One is that management (the so criticized MBAs) have a class interest separate from both owners and workers. There are cases where management will act to retain their own wealth and power even at the expense of overall efficiency. They are also not necessarily the most knowledgeable about the core work of the businesses they run; much of business school is unscientific trendy buzzword compliant model building and improperly contextualized case studies. The business world chants the mantra, "a manager is a manager". The assumption is they can run any firm regardless of actual knowledge of the technical and social aspects of a particular market. Workers end up with clueless destructive bosses.
The other main problem with corporations, from the perspective of the worker, is the market itself. The short term interests of shareholders often drastically differ from the long-term interests of workers, consumers, and society at large. Investors ignore systemic risk that can destroy whole economies, sell off valuable assets and cut R&D for short term gains at the expense of long term viability, move production to whichever nation can do the work with the lowest human rights and environmental protections at tremendous social cost, etc. This system is clearly sub-optimal, to put it mildly.
------ Take away the right to say fuck and you take away the right to say fuck the government.
Find a list of the best companies in North America for consistent long-term growth, and you will get a list of companies with strong private interests putting the brake on unbridled short term growth.
Yup. Like I said,
It isn't an MBA problem. It's a shareholders-demanding-immediate-profits-problem.
.
I'm sure those BMWs are a source of great comfort to their owners, but they don't really constitute an argument for letting said owners keep slashing and burning.
Sure, it's the MBAs that are slashing and burning. But you know who is hiring them? Shareholders. People who own stock. If you want to blame someone, don't blame the guy who gets approached by a publicly traded company, offered a HUGE amount of money and asked to go destroy the company from the inside. The guy with the MBA is smart - big money for little work? And it's not even un-ethical work, the company "boss" is asking you to take the job. You're not killing baby seals.
Who in their right mind wouldn't take said job?
Unfortunately we replaced him with a President with higher levels of education
Not necessarily. There's lots of reports that Obama was passed by his professors because he had connections that donated millions of dollars to the university. His classmates say he was a terrible student.
On top of that, both he and Michelle have been effectively disbarred ("on court ordered inactive status") as lawyers:
http://wiki.answers.com/Q/Why_was_Michelle_Obama_disbarred
Saying an engineer has no business skills is like saying an accountant has no medical skills. Yes, it may be true, but it is not end of the game.
There are plenty of engineers who are intelligent and flourish in social environments. Everyone is so focused on specialization, that education and skill sets are compartmentalized within the workers. A good, business minded engineer could go back to school and earn an MBA. I don't think this is unreasonable. These people will be at the tops of multi-million/billion dollar companies and will be making significant incomes.
I completely agree. Many of these same MBA-minded folks run our government too. Perhaps there presence in that arena threatens even more than our countries economic well being.
To be fair, it's not just Harvard. Rajanatnam, the Galleon hedge fund founder, went to the Warton MBA program. He was just convicted on insider trading.
Why is Snark Required?
That's like saying a rapist is better at picking up women because he gets laid more often.
Oh, I agree - I don't confuse education with intelligence! You can earn a lot of degrees without having real intelligence or wisdom - something that I think any manager (especially the President) needs in copious amounts!
Browsing at +1 - no ACs, I ignore their posts. So refreshing!
The car industry is THE case study in success of the "MBAs". The Japanese devastated the US car industry with techniques introduced through management theory, such as Kaisen and Just In Time. They also monitored the market and produced cars that there was demand for, rather than whatever the US car makers wanted to produce.
Of course, engineering was extremely important too, the point is they had a good balance of pretty much everything.
Men "for whom no vehicle could ever be too big, too fast, or too thirsty for gasoline" is whom caused the downfall of the US car industry and I don't see that changing unless something crazy good happens to the price of oil.
"China plans to open 40 new graduate schools of business in the next few years" is deeply disturbing news because while they can produce stuff for extremely cheap, they can't manage for shit. That's why you have Western companies ultimately turning most of the profit on Chinese-made goods.
I took a LEAN class from a professor who had been a management accountant for a good part of his life. He wrote a few books about how companies are often driven into inefficiency and/or ruin by allowing the accounting and finance arms of the companies to be the dominant decision makers. This one, Relevance Lost is from 1991:
http://www.amazon.com/Relevance-Lost-Rise-Management-Accounting/dp/0875842542
In the late 90s, when Sega was developing the Dreamcast, Yuzo Koshiro knew it would be the perfect console for a Streets of Rage 4. He pitched the idea to them, and Sega of Japan was interested, but Sega of America shot it down. They owned the most successful brawler series ever (shut up, Final Fight fans), and if certain rumors are true, those people were completely oblivious to it!
Circumcision is child abuse.
That's like saying a rapist is better at picking up women because he gets laid more often.
That's like saying you love women who wear Hitler mustaches and wear SS armbands.
I feel like my comment stands all on its own - no need to explain how I came to such a far fetched conclusion. I'm not going to explain how it's related. If I can connect the dots, so can all the intelligent people out there that read my out-of-context, can't-be-bothered-to-quote-the-relevant-section commentary.
Citing from a book "The Stem Cell Hope" by a stem cell scientist when he met W in 2001.
Bush's opening remark, Melton recalls, ... “He sat down, asked me to sit next to him, and said, 'Here's your chance to pitch the President of the United States'". Melton, not one to be distracted or ruffled easily, was caught off guard. "I remember thinking at the time, first, this is surprising-- t he's talking about himself in the third person-- and second, I wasn't really there to pitch anything".
To me it seems that the guy has a deep seated insecurity and unhappiness about his incompetence, that he had a constant need to diss and put down the academically accomplished. It's sad that we had this guy for *two* terms just because the average Joe thought he could have a beer with him. Fucking pathetic.
A lot of companies are ran by engineers that also have MBAs, which makes this stupid.
Does this surprise anyone? Koreans are well-known for their online exploits (and offline, if you have the misfortune of meeting one).
Really? What company would that be?
The Australian Broadcasting Corporation (ABC) has a great podcast under their investigative journalism show called background briefing taking an in depth look at why hiring people MBA's is starting to lose it's shine and why savvy business owners are now thinking twice before hiring someone with an MBA. To make a long story short Universities are teaching the technicalities of of modern day business dealing but failing to teach students that some times they have to get their hands dirty and deal directly with the product and the customers and stop playing with spread sheets.
A Link to the podcast can be found here
An IPO might as well be renamed to Jumping The Shark, IMO. It's unfortunate so few corporate leaders have the ambition, balls and vision to maintain a controlling share and long-term direction. It's equally unfortunate that the public shareholder fails to value these qualities over quarterly earnings.
Amen. Businesses should be driven by domain experts informed by business/economics experts on staff, and not vice versa.
Higher Logics: where programming meets science.
Engineers and MBA's (God bless them) have much book knowledge for the most part, and very little street cred. Take an Engineering or MBA graduate into manufacturing environment, and what do you witness? We see the deer in the headlights look of terror and unspoken admission that screams: "College and University never prepared me for this".
When you hear assembly management scream: " I don't give a F**k about that repair, just give me my numbers of rolls test"; then you'll understand College and University never prepared any well meaning Engineer or MBA for that.
The blame lies with academia for sure. These well meaning young folk who present themselves like lambs to the slaughter to the god of industry; well they're not to blame; they've simply been trained to act and think in a certain way. There's a big gap (read chasm) that exist in that space between what industry and corporate business need and what academia supplies.
The bottom line? We need Engineers and MBA's who have the ability to recognize and work within both linear and non-linear business inputs and outputs.
Whole brain thinkers is what we need; but we don't generally get that; all we get for the most part, is logical A + B = C thinkers. Yes this is all good, but systems are abstract yet includes logic; so we certainly need more whole brain thinkers IMO.
Wallace Tait: Visualmapper
http://www.visualmapper.org
The MBA says, "Get the sucker to buy our shoddy product and hope he doesn't cause trouble if the piece of crap we produced is indeed a piece of crap." This is the mantra of the modern American business. Fleece the sucker and disappear! Hah, stupid idiot, you bought our crap or subscribed to our worthless service. Good luck ridding yourself of the tapeworn!!
No wonder why America is no longer competitive Glug, flush. Watch this country run down the drain.
The consumer is not blameless. He is utterly unwilling to pay for real value and quality. This adds up to a picture that is demented and sad.
The problem isn't that business types maximize quarterly profits - that is just one of many potential side effects of maximizing *your own* profits over the company's profits.
Predictably, slashdot readers, being technical types, make the intellectual mistake they always make - they look at "the larger problem" abstracted from the humans involved. The shareholder and societal problem is to align incentives, knowledge, and power in a corporation to that larger problem. Management is a *real problem*, and when it isn't solved, a parasitic class with the "people skills" to rule will do so.
Anyone else remember Thulsa Doom and the Riddle of Steel? The True Steel is flesh, and the power over flesh.
This is not to condemn business types for looking after themselves. Far from it. I'm all for people looking out for themselves. Engineers are only weak because they are on their knees. Let them rise. You have all the weapons you need. Now fight.
With all due respect to Mr. Lutz, he was part of GM management for a number of years and never raised these issues publicly. To the contrary, he was reportedly resented by many GM employees for profligate spending, including using a helicopter to get around when one of GM's cars would have worked fine. One of his last positions in the company was running GM Marketing and Advertising, a position for which he was clearly unsuited, and which he should have turned down. His inexperience at marketing helped to pull GM into bankruptcy. My belief is that a manager has a responsibility to speak up if he or she objects to the way that their company is being run, and an obligation to decline appointment to positions for which they are unqualified. Mr. Lutz looks like a hypocrite--supporting GM management when it benefited him financially, keeping his mouth shut when taking decisive action could have helped the company to avoid bankruptcy, and writing a "tell-all" book that vindicates him and his actions, when he was a central player in the downfall of the company.
I've long said that's what was killing Ford when I was there. There was no thought about what was happening next quarter, let alone 5 years down the line. It was all about making the numbers this week. That's what lead them to cede the small cars to the foreign companies, and concentrate solely on SUVs, which pretty much tanked the company when the SUV market fell over (that and the bad press about the Explorer, but that's another story).
with apologies to Oscar Wilde
Oh, it's quite all right.
There's a decent interview of Marc Andreesen in the NY Time Sunday Magazine for today, 7/10/11.
Quote:
M.B.A. graduating classes are actually a reliable contrary indicator: if they all want to go into investment banking, there’s going to be a financial crisis. If they want to go into tech, that means a bubble is forming.
You don't understand - that's the "business-type's" MAIN problem!
* In fact, it's WHY I don't think the likes of Mr. Ballmer have done as well @ Microsoft as say, Mr. Gates did!
(Now, there's a guy with a PROPER "mix" of tech & business in 1 package! You don't find them everyday either, & it takes years @ both to be GOOD @ both)...
That's why I respectfully call him "King Billy" in fact (not sarcastically either, no joke).
In fact?
I even told that very thing to Mr. Richard Russell who posts here as "Foredecker"
(He is or @ least was, Senior Mgt. @ Microsoft in their "Windows Client Performance Division"... he told me Mr. Ballmer's MAIN STRENGTH is his ability to groom new mgt. talent @ the executive level in fact - perhaps he should be relegated to HR level work IF that is his main asset... I don't know, just speaking based on what I heard is all!)
APK
P.S.=> Personally, I'd rather see a guy like Mark Russinovich running Microsoft... he's got the technical acumen, w/out a doubt (though I have had "minor run ins with him" over time, but also helped him once as well in his work on a program of his too & wished he luck @ MS) and has run a successful Winternals/SysInternals business on his own in the past with the help of his colleague Mr. Bryce Cogswell (iirc, both are PHD level in Comp. Sci. as well)
Yes - I think "the Good Doctor" Mark R. would actually be a decent "head guy" @ MS, because he's as close as I know of to "King Billy" tech skills (he has more than Mr. Gates in tech) & business skill too - leadership's all that remains (& imo @ least, either you're BORN with that, or you don't have it & NEVER will)
... apk
I've discussions with some managers that bugged me for a long time.
One day I realized that the basic part of the discussion that bugged me was their apparent belief that "management" was the product. (Instead of the software that we spent so much time and effort building, shipping, etc.)
Ever since there have been investors, there have been investors wanting assurances that the money is safe.
But time spent assuring is time not spent building. Looking at it another way, it is a reduction of efficiency. And efficiency is one of the great factors of competition.
Even Walt Disney expressed concern:
"You know, the only way I've found to make these pictures is with animators. You can't seem to do it with accountants and bookkeepers." —Walt Disney
Correlation is not causation. I'll take O over B2 any day.
I'm not sure I understood that. Perhaps you can find another way to express it.
No mater what all these MBA guys will say in this discussion these are the laws:
* If you do not have it ( a product ), you can't sell it.
* Some things - bridges, roads, space shuttles will never be subject of sale and need engineers; will never need MBAs.
* What US became since 16th century to late 70s is not result of MBA approach to problem but hard work and engineering.
* Where we are now sinking to is purely result of MBAs marketing nonsense.
* See Apple - pure engineering victory; there is not nonsense marketing push like the Microsoft business machinery.
I am an engineer, I have an MBA.
I am against outsourcing of critical jobs, as it leads to disaster.
I am against short term plans (eg, lets try to squeeze out as much as we can next quarter). This also leads to disaster.
I am against quota and silly performance reviews. (most if not all I have personally experienced are retarded)
I have learned business by numbers, but I have also learned that business is about people. People who deserve respect and who deserve to be listened to and who deserve to be able to take pride in what they do.
What I am reading here (the complaints) is piss poor management!
Unfortunately that is the norm. People put more emphasis on measurable achievement and by preference associated with big brand names than competence.
Sad world we live in.
Most shoe makers dont know how to do the math they're to busy making shoes and doing shoe math.. And if they're spending all that time doing numbers then whose making the shoes?. This will mean that they will have to increase the price because there are less shoes to be had. (Which are prollie less comfortable.) There needs to be someone there to manipulate internal investment, the optimal numbers at which there are being consumed and most importantly where the utility of something. You want your business to be profitable ? Everyone -_-^3 This. He wants the workers to rise up and take over the company they will run it to the ground or produce below maximum awesomeness. Its good to have the double check and i'm sure that there are lot of people who would fail the business ethics question at the billy Madison but at least there's not a guy on a horse coming around to collect our money cause that would get to me.
MBAs are all about managing, not marketing.
They are a cost centre not a profit centre. They never add value.
Collective noun for a group of MBAs "A Delay!"
I guess Bob is both right and wrong..There were no MBAs when the events that led to 30's Great depression happened. The need of the business in New Era is neither pure Engineers nor pure MBAs.
People who manage state of affairs should be MBAs with an ingenuity and curiosness of an Engineer or Engineers with a broader view of business as whole and who don't view everything as an Engineering problem to solve. Just look at those Engineers and Managers that made it to top... you get your answers.
I found GIMP useless except for special effects a couple of years ago. Now, I use it routinely. There are lots of people who need more than MTPaint but don't need the capability of several hundred bucks worth of graphics software. Who need capabilities like manipulating photos, making simple web page graphics, posters. GIMP is just fine for that kind of situation. Sure, it's got a learning curve. But so does anything above the MSPaint level.
Tech Public Policy stuff
I believe the adolation of MBA's and their culture have been very bad for business in this country, and has been a sea change for the worse here in the last quarter century. I don't think it is a mere coincidence that their short-sighted focus has corresponded with a collapse of American manufacturing. I saw it somewhere I think in the WSJ some time ago that "If Thomas Edison had had an MBA working for him, he wouldn't have invented the Lightbulb, he's have invented the Bigger Candle" The skills you learn there are about being polished and not much else. In my own experience, too many of the MBA's I have met have been clubby, ruthless, smug, arrogant little snotnoses, filled with their own sense of importance and self-worth.
Then again, Fox News spin and lack of an opposition who could keep their platform straight was another. People will often vote for something that is understandable, rather than truthful and wavering. If the level of education in the USA was higher then we might just find ourselves with better candidates, but we are doing everything to reduce the level of education, due to low financing. More money is put into dealing in the symptoms of this failing than the cause.
I can't say whether Obama is doing a good job or not, since he has been given a tough mandate. He is also having to deal with reduced tax revenue and many people who oppose raising the taxes. Playing government with a full coffer is easy. Playing the same game with coffers near empty, an inability to fill it properly and trying to deal with corporations that need help, to prevent worse damage is another story altogether. In fact, maybe running a country financially should be part of an MBA, since it is a far tougher problem than many business guys are willing to accept.
Jumpstart the tartan drive.
As I recall the auto industry, was brought to its knees by 2 things:
1) Greed from Wall Street, Banks, and insurance companies basically ruining the economy and drying up credit
2) A situation where you have more retired employees than working ones, and a health care system being profiteered by insurance companies.
So they were not competitive because of #2, and needed loans to keep going, and when #1 dried up all credit, they where screwed (unless like Ford they got a huge loan just before the credit bust)...
So no, MBA's were not directly involved with the auto industry going to hell. Though you could probably make the argument that the MBA's on Wall Street, in the Banks, and in the insurance companies did a pretty fine job of fscking everything up.
We need MBA to connect and sell people, process, technology, product and services to customers.
Slashdot = Sarcasm
At my parents house the garage door opener wasn't working. My dad took the cover off and there was a gear that was stripped. After that he called sears and asked what the cost to fix it would be. The response:
This will be $100+ for the part and $140 for the service fee, after which the sears employee recommended just getting a new one instead.
We have had OK service from this unit but in my mind this was total failure by design (10 years). The gear that failed was a soft plastic gear that could have easily been made of something more durable for a few cents more per unit.
Anyhow, I consulted Google and the instant feature really gave it away. Tons of suggestions related to replacement gears for this unit. I then went to ebay and bought the OEM part from someone for $8 (including the recommended lubricant and instructions). After that came it took less than 15 minutes for my father and I to replace it.
The gear is clearly too soft for the kind of loads it has to handle. The pricing for a replacement + service is way higher than a new unit and replacement part and labor were very minimal.
While I don't want to say that MBAs are at fault for every poor piece of tech or bad direction that a company goes in, I do feel that MBAs are at fault for a highly disposable and irresponsible consumerism. The economics of it (both short and long term) make it easy to understand how this situation arises. Rather than sell a product that will last for 20 or 30 years for 1$ dollar more (or one dollar less in profit), it makes a lot more sense to sell two or three units in that same time.
If consumers were savvy to this they might say "hey, I want to try a different product rather than throw money at the this company taking advantage of me" or they might even demand that statistics be available on these units. But ultimately, consumers don't care. Its unfortunately unrealistic to expect many to open up something to see what that problem is (and in many cases, you can't just open something and figure out what is wrong easily) and it is even more unrealistic to expect that consumers have the attention span and interest to buy from companies who try and build the most durable version of something (if there is an option). That being said, I will not shop at sears anymore.
To me, this problem is systemic at least here in the US, so much so that it is destabilizing our economy and way of life (although our way of life could stand to loose some stability. This type of business strategy is bad for the consumer, bad for companies (long term) and bad for the environment. The consumer ends up paying more. The company sells a ton in the short term, hires more people and then when times are tough and people don't want to fork over money constantly for the latest and greatest after their product fails, the companies fall flat on their face. Environmentally, we have china build them using tons of energy and enjoying their economically advantageous lack of environmental regulation and then we buy them, use them, something small and easy to fix breaks and we put them in a landfill and start over.
What we should do is gradually shift back to an economy where we manufacture in the US with our environmental regulations and stop sending all of our money overseas. MBAs and consumers though need to be encouraged to adopt this kind of institutionalized change. I don't know how to get either party to change but somehow it has to. We need responsible MBAs and if we can't get that we need responsible consumers that hold MBAs and ultimately their corporations accountable. Maybe the governement should incentivize it somehow. If you agree or disagree or have ideas I would love to hear from you.
Dan
mmm... doesn't work.
If I hire a hitman to shoot you through the head, I may have done a bad thing, but that doesn't excuse the fellow who pulled the trigger. And it doesn't matter if I paid him a ton of money to do so. Nor does it matter if he found the work to be really easy and really enjoyable. He's still done a bad thing.
Of course, you already argued that the work (unlike that of the hitman) is not fundamentally un-ethical. So let's talk about that next.
No, you're not. What you are doing is knowingly and willingly destroying the vital national economic infrastructure for short term personal gain. Which is arguably rather worse.
I think I'll stand by the "hitman" analogy.
Me. OK, I suppose we could argue about to what extent I can be considered to be in my right mind. Nevertheless ...
It comes back to the same point. Is the MBA slash and burn mentality sufficiently damaging to society that we should take steps to discourage the approach? It's not enough to say "it makes some people rich so it must be all right", otherwise shooting people for money would be legal.
Don't let THEM immanentize the Eschaton!
No, you're not. What you are doing is knowingly and willingly destroying the vital national economic infrastructure for short term personal gain. Which is arguably rather worse.
Really? You have proof? Or is that just your opinion. I think that retards like you are ruining the world. Am I morally justified (or even compelled!) to get rid of you?
It's not so much that MBAs are bad any more than those who have them are bad. The problem is when management assumes that an MBA sheepskin is conclusive evidence of good business judgement. Education is only a tool. There are some excellent wielders of MBA knowledge - unfortunately there are many who should never be given the keys.
Well, the basically destructive nature of the process, you've pretty much conceded with the term "slash-and-burn", or so it seems to me. The scope of that destruction is the point under debate.
We've both expressed a number of opinions in that regard. Or are you prepared to support your assertion that there is nothing un-ethical about MBA slash-and-burn?
Oh dear, and we were being so polite, too. To answer the question, if you can make a case that I'm damaging the quality of life of a large number of people, and you can find a way to do it within the law, then yes, you should probably make the attempt.
None of which is a reason why we shouldn't re-examine the role of MBAs in the world of modern business.
Don't let THEM immanentize the Eschaton!
Well, the basically destructive nature of the process, you've pretty much conceded with the term "slash-and-burn", or so it seems to me. The scope of that destruction is the point under debate. We've both expressed a number of opinions in that regard. Or are you prepared to support your assertion that there is nothing un-ethical about MBA slash-and-burn?
No, I'm not going to defend creative destruction. I will let both Karl Marx and John Maynard Keynes defend it. I figure between Marxism/communism and Free market economics, you'll find an argument that suites your political background.
...
As for ethics, you're confusing public ethics and private ethics. Which is so funny, since you go on to encourage me with
Oh dear, and we were being so polite, too. To answer the question, if you can make a case that I'm damaging the quality of life of a large number of people, and you can find a way to do it within the law, then yes, you should probably make the attempt.
So, on one hand, you'd like me to act within the law, if possible. Because that's alright. But on the other hand, you'd like MBAs to stop acting within the law. Because they need ethics?
Seriously. You know the character in this skit, that acts like an immature idiot college kid? That's you. Sure, it's lowbrow humour (idiots make such easy targets), but it's also on an intellectual level that you probably won't get - so I don't have to feel bad about hurting your feelings!
I'm not personally aware that either Keynes or Marx suggested that wholesale asset stripping of an economy would be a good thing. And even if they did, I would venture to say that it doesn't seem to be working out all that well in practice.
Of course, if you really want to get all snippy about justifying our arguments, then you have to do a lot more than drop the names of a couple of famous economists into the debate. A fallacious appeal to authority, I believe that's called...
Not quite. I'm saying that if you feel that I am a menace to society and must be stopped (as per your hypothetical argument in your previous post) then you have a moral right (and possibly obligation) to do so, so long as you act inside the law. Similarly, if wider business community decides that MBA short-termism is proving toxic to the economy then they have a right and possibly obligation to work within the law to counter that. Up to and including changing said law through legislative channels.
Fascinating. Remind me to look at it sometime. Meantime, we were discussing MBAs?
Don't let THEM immanentize the Eschaton!
I'm not personally aware that either Keynes or Marx suggested that wholesale asset stripping of an economy would be a good thing. And even if they did, I would venture to say that it doesn't seem to be working out all that well in practice. Of course, if you really want to get all snippy about justifying our arguments, then you have to do a lot more than drop the names of a couple of famous economists into the debate. A fallacious appeal to authority, I believe that's called...
Yeah... I'd have to name some economists and link you to the idea that they support. And in that link, it would be helpful if those economists were mentioned. Too bad I didn't do that, right? ... hold on, let me check something ...
... but you couldn't be bothered to read, because, you know, TL;DR...
... you'll never lose an argument. Mostly because the other person will realize that talking with you is an exercise in futility and leave. But also because that's not an argument, that's the "fox news" model of conversation.
NEVERMIND. That's exactly what I did. Not my problem if you're uninformed, especially after I wasted my time trying to inform you.
But sure, let's move on to ad-hominum attacks, since you're fundamentally incapable of assimilating new and relevant information to this conversation. You know, like concepts that are completely related, and sourced, and dumbed down to a level that even a 5th grader could understand
And don't forget, if you don't really bother to read the responses to your posts and just continue repeating your initial ideas
Well, you got as far as naming the economists. And then you vaguely suggested that if I went away and read up on the subject I'd probably find something somewhere that supported your point.
Thing is, it's not my responsibility to do the work to support your point. Otherwise all I have to do is say "You are an idiot. The Internet has proof. Don't come back until you've found it" and it's game over, dude.
Actulally, you've offered precious little but ad-hominems for the last three posts, so it's not exactly "moving on" in any widely recognised sense of the word.
About that. How well do you think it's working for you, right now?
First sensible thing you've said in four posts. Let's leave it there, before things degenerate any further.
Don't let THEM immanentize the Eschaton!
Well, you got as far as naming the economists. And then you vaguely suggested that if I went away and read up on the subject I'd probably find something somewhere that supported your point.
You're right! I should have linked you to the theory that I was talking about. Oh wait. I did.
Moron. Probably also republican, since one is a subset of the other...
Actulally, you've offered precious little but ad-hominems for the last three posts, so it's not exactly "moving on" in any widely recognised sense of the word.
Yes, you figured that out on your own? Good for you. Now I shall mock your spelling, and the fact that you didn't realize I was repeating back to you the attacks you were making. I'd suggest you re-read the previous posts, but I've already come to the conclusion (based on stellar evidence and the scientific method!) that you're unable to read, but strangely unable to write. Perhaps you should continue, so I can calculate a confidence value for my results.
About that. How well do you think it's working for you, right now?
Well, about as well as it's been working for you. See my previous comment.
First sensible thing you've said in four posts. Let's leave it there, before things degenerate any further.
You're right. Because I stopped actually arguing for my position when it because clear you weren't listening. I just kept mocking you. See my 2nd (and 3rd) comment in this post.
You mean to say it only looked like you'd run out of arguments and were being rude because you couldn't think of anything else to say? I must say, you were awfully convincing.
Feel free to huff and puff a bit more if you like. I'm not particularly interested in your opinions regarding myself, so I shan't be reading the next one.
Don't let THEM immanentize the Eschaton!
I've never had a head for spelling. I take that back, I do, I just could care less. But on a side note if I get within a drink or two of severe inebriation my posts and text have near perfect spelling and grammer. So much so when I'm drunk texting at 1AM my friends accuse me of lying about being drunk.