When a small business owner looks at hiring a new manager, the hiring cost can seem discouraging when the prospective employee has an MBA. There is a strong assumption that MBA students are trained too generally and that they lack decision making skills from a lack of real world experience. Can they be trusted when left unattended with helping to run your business? These are undeserved and unfounded assumptions as MBAs bring real value to small businesses.
The EMBA Advantage
If you’re willing to hire from within your company, you can pay for your employees’ MBA program.
EMBA programs allow your employee to work while attending school. The most apparent downside to this is that you may end up paying for their training and there is no guarantee that they will stick around after graduating. If you create a “golden handcuffs” arrangement, by requiring the employee to sign an employment agreement that stipulates that he must complete a certain number of years of service to the company after attaining his MBA; you’ll be guaranteed an employee with improved performance and existing experience in your industry. An incentive could be tied into this agreement, such as a profit share for example. The advantages of training an existing employee as opposed to a new employee are that you will have had time to establish trust and procedures. By using proper judgment when deciding on sending your employee for training, you could end up with a loyal worker that becomes core to your operations long term
A popular connotation is that MBA graduates have a lot of “book smarts,” but lack any real-world experience and communication skills. Contrary to this belief, many MBA programs now include extensive training in interpersonal skills. Better communication reduces mistakes and improves employee morale overall, making your workforce more productive. Good communicators have to be able to convey ideas effectively as well as have excellent listening skills under their belt.
Good Strategic Planning Skills
MBA programs often emphasize the lifelong learning process as part of this process involves training the employee to think long-term. MBA grads bring to small businesses exceptional problem solving and strategic planning skills. Rather than being focused on a single aspect of the business, MBA grads often possess varied skill sets in the fields of marketing, sales, accounting and loss prevention. Many small businesses that have grown organically do not typically have someone that is trained in all these areas.
Experience and Practical Training
MBA programs force students to address real-life business problems and require them to work through multiple case studies. Regardless of whether you hire from within or externally, you’re getting an employee that already has experience in solving complex business problems. For example, small business owners often face a cash flow problem at some point. You might have unpaid invoices that need to be collected upon before you can make payroll or expand your operations. What should you do? An MBA would help in navigating through your options, including whether to factor those invoices, obtain a short-term loan, or tap into the company’s other equity to pay for necessary expenses.
Another bonus is that MBA students are also well versed with the online networking sites like LinkedIn. What does this mean for your business? Your MBA graduate could already have established relationships with established employees in other businesses that have advanced their training. These friendly relationships could be fostered into working relationships much easier than cold calling for new business.
Therefore your new manager could possess the negotiation and networking skills necessary to cut you a deal that you otherwise might not get. Sometimes in business, it’s not what you know but rather who you know. In this sense, you’re getting more than just a manager. You’re getting access to a network that could significantly improve your company’s bottom line.
Guest post contributed by Sarah Rawson. She is a freelance writer and is currently studying for an Executive MBA Degree. Her articles appear on various higher education blogs.