UK
Will an MBA really do wonders for your banking career, asks George Trower, our resident columnist and banker under cover.
The MBA is much maligned. Despite that fact, MBAs are being pumped out in greater and greater numbers and firms are lapping them up offering higher and higher pay packages.
In my own experience, a business school gives you all of the following and more:
1. A theoretical business education.
2. A network.
3. A damn good time if you are up for it.
4. A break to regain some perspective (and sanity).
5. An opportunity to change direction.
6. Higher pay and better career prospects.
7. Access to the most sought-after employment opportunities (at the top schools).
8. Streams of letters asking you for more money for the rest of your life.
However, if you’re already working in banking, is an MBA really worth the two years out of the market and $150k (if you want to enjoy it at least) of direct cost – not to mention lost income?
Possibly not, particularly when you consider that instead of spending two years getting an MBA, a second-year analyst can make it straight to associate and probably be earning more than the starting MBA package in the same time.
How about the network, a damn good time and a good break? They get tick, tick, tick – no argument there.
As for business education, you will certainly learn lots. But the benefit will be greatest if you want to work in corporate finance – if you’re doing due diligence on an M&A or ECM deal, you will probably be able to use your knowledge about supply chains to impress your clients and boss.
However, if you’re a trader, a sales person, a structurer, or anything on the markets side, the roles are so niche that you won’t really get any immediate benefits from the breadth of business education that an MBA offers. Better to do an MSc in finance, which will offer some of the real depth that’s required for your job and teach you how to price derivatives rather than about informal and formal management models.
And yet I would argue that an MBA will be of help – even if you work on a trading desk – further down the line. An MBA will help if you ever have to manage desks, divisions etc. and need to think about more than how much to mark down that CDO, what that stock is worth, or where the short end of the curve is pricing. I-bankers are typically horrible managers: an MBA might help mitigate that.
The decision to do an MBA is therefore about balancing discounted future benefits against current costs. From a pure career standpoint, an MBA will only be worthwhile if you have aspirations for senior management and are happy to slip back a year or two against your peers. The benefits will only come a decade later.
This talk about Msc…MBA’s…its all talk empty propaganda. Used only to stop your career progress by simply using the fact that you dont have one against you. So what if you have one!! Then the fact you didnt go to the ‘right MBA school’ willbe used against you and your MBA isnt worth the paper its printed on….There’s only one thing that really matters, and anybody that denies this lives in another plane of reality..In banking/trading roles where the money is huge there 3 qualifications that count….1.Connections 2.Connections 3.Connections.
If this could be clearly be recognised by all it would be a start to ‘equality’ and ‘fairness’…but then again this isnt the business world.
Get your genetics right and luck wont enter it!! let alone MBA’s Doctorates etc!!
I agree. It’s all about the “Who do you know?” rule. I was recently interviewed for a modest role at a City bank. Interviewer asked me whether some members of my family were in banking. I said no. And it was a No. I know some people who are less qualified than me and they work in F-O positions. But they’ve got the connections…
I graduated from a top b-school – was and am never really a fan of MBA programs – but 5 years after qualifying as a CA, my career in corp finance cud only go so far
top MBA program definitely has an allure and there’s nothing wrong in capitalising on that – definitely opens doors – ended in a prop desk after MBA where multi million $ were made by non MBAs and MBAs alike
don’t see a distinction in talent, skills and capabilities between MBAs and non MBAs atleast in a banking/hedge fund context – but the qualification is definitely nice to have
thats why you do the mba – can’t you read – for the connections/alumni network etc as well as learning a thing or two!
I disagree entirely. I’m american, never worked in the UK, have no connections, and got a job at a top 3 bulge bracket investment bank in London after graduating from a top 3 american business school. I found the recruitment process to be quite objective and skills based.
It means the money spend on MBA is actually on getting good connection, which can be used.
I like to hear more about PhD in Quantatitive Finance
All for the MBA, not for the connections or whatever else… just to take one year out, relax, and have lots of sex with other Married But Available people
A PhD is admirable but it depends on what you want to do. To crunch numbers its fine but the higher you go the less relevant it becomes. Armies aren’t run by accountants, universities aren’t run by math professors. A star trader can earn more than a CEO but it depends what you want. An MBA can transfer to another industry with more ease than a quant who is stuck in finance for the rest of his days unless he makes it big in a Gred Coffey style. Hedge the risk and think what is the most useful if you fail. Unless you can gurantee great returns why not make a living talking MBA nonsense. More chicks and travel.
I work for one of this big management consultancies, have been for the last 18 months. I want to move in to Sales or ECM. Would an MBA in a year or 2 be the best option to change careers since I don’t have a finance academic background?
If you work in the market side than it’s pointless, it offers a marginal improvement on your CV (HR seems to rate it and would give you better chance for first interview), but costs in terms of time, money and effort are not worth it. This is especially the case for trading, structuring and sales, MBA will teach you nothing about mathematical modelling, trading styles and trading strategies etc. It’s worth it if you work in corporate finance or maybe equity, fixed income research where actual analysis of a business is required.
what about the CFA… learn and work! get the best of both worlds!
“I disagree entirely. I’m american, never worked in the UK, have no connections”
…where do you live???? what planet are you on?? Dohhhhh I won the euromillions 44 million jackpot…I dont understand what anybody problem is? why..hmm why doesnt everyone win? hahah An excepection doesnt make the RULE!!
99.99% is based on genetics….a gene pool.
thats enough of my rambling, good luck to those out there on there own!!
ps we went to iraq to save them??no…? or wait a minute oil at $120plus the rest
CFA’s great : gives you very good background and a strong brand you can use as an asset. And you don’t need to take 2 years off! But no connections of course…
Great for asset management but not that useful for investment banking
I am embarking on an ambitious change in career; from property to investment banking but am thinking of doing an MBA. With 2 years (3 if my industrial placement counts) full time experience is this the right time???