This is an email I received a couple of months ago. But I thought it was a refreshing take on the whole b school brouhaha. What's more, there's a topical edge to the subject raised, in light of the film 'Guru', which is inspired by the life of an extraordinary man who thought exactly the way.
The 'Shell' job he spurned, being the equivalent of an 'IIM type' job in his time...
I am a final year Bachelor of Management Studies student from Mumbai. I am taking the CAT' 06 in November and had a few questions. I would be really glad if you could answer them.
I found out that the average salary of an IIM-A gradutate is around 8 lacs. I do not have any work experience but I still feel that I could earn a lot more than that in a few years after completing BMS by starting my own business or joining my dad's business depending on where my passion lies.
Don't you think one can make more money by starting their own business where they have full control and freedom inspite of the risks involved?
I would love to have financial security which a job would provide but a pay of Rs 8 lakhs per annum is nothing great in my mind and considering the background I come from, I don't think a pay of that kind would offer me much financial security. I know you are not a education or career counsellor but I thought you would be the perfect person to answer this because you have studied in IIM-A and now you have your own business.
Ultimately, even i want to start my own business. Can you tell me how an IIM experience will help me in doing that?"
My reply: The question is, would it help or hinder you in starting your own business? Assuming you make it to the IIMs in the first place.
Not making it - or even trying for it - may actually be a good thing. It could mean you're a streetsmart person who can't be bothered with swotting over the CAT exam... when you can be out there doing 'bijness'. But the fact that you are asking these questions indicates a level of self-doubt. So here are some general observations on entrepreneurship and MBA.
There are MBAs who are successful as entrepreneurs but it is a fact that the vast number of highly successful entrepeneurs are not MBAs.
Coming from a background where the family already owns a business, it is generally easier to visualise a career as an entrepreneur without an MBA. Whereas those who do make it to IIMs and other top b schools generally come from middle class backgrounds. Through a mix of intellect and intensive effort they make it to these institutes, and to them the concept of a job paying Rs 8 lakhs (more, with every passing placement season!) is very attractive.
Yes, at these institutes there are courses and seminars on entrepreneurship. There are even business plan competitions. But, let's face it. The MBA best prepares students to operate within existing frameworks. The most obvious fit is as an expensive cog in a designer corporate wheel.
Secondly, placement is the default option. The reason most aspire for an MBA in the first place. NOT taking placement requires action. It means taking a risk. And that upsets parents and well wishers. But again, those who are truly convinced go ahead and follow their dreams.
There is a trend of b school grads opting out of placement to set up their own enterprise. Last year around 16 students across IIMs opted out, this year 4 IIM A students have spurned PPOs from the likes of Deutsche Bank to set up their own business venture.
But it's still a very small trickle, compared to the overall bschool population.
So the answer is - MBAs become entrepreneurs despite the temptation to 'play safe' and stick to jobs. Lack of family support and more importantly, lack of capital are hurdles. But those with spirit and self-belief overcome these hurdles.
Back to the final year BMS student.
Firstly, an MBA immediately after BMS is quite redundant. It would make sense only after a couple of years experience - either with the family business or running your own enterprise. That's a call you have to make.
The 'own enterprise idea' may not go down well with the family. And it may not take off immediately. But you should stick in there, learn and grow with it.
After 2-3 years, if you feel the need for an MBA, you could consider IIMs. But a 1 year course at an institute like ISB would make a lot more sense. Around 8 students who are part of ISB's class of 2007 are entrepreneurs and most plan to go back to their own business. That kind of profile is unheard of in IIMs.
The other option is a 1 year MBA at INSEAD/ LBS/ IMD, provided you have the money. Again, the idea of pursuing the MBA is to be able to grow one's vision, as often a family concern is stuck in the old pattern of doing things. The focus would be on gaining as much knowledge as possible, as getting a job is not a prime objective.
In case you still feel ki nahin, MBA karna hi hai, abhi karna hai there is the 'Family Business MBA' option. Options include SP Jain, NMIMS and Nirma Institute of Management. FMB programs do not offer placements.
Of the lot, S P Jain has the most hands-on approach. Classes are held 1 week in the month and the rest of the time you are expected to apply what you have learnt in your own business.
In the final analysis the phrase 'I would love to have financial security' is what is creating the dilemma. A 'secure entrepreneur' is an oxymoron. Let go of that desire, believe that you will make it happen. Everything else will follow.
P.S. If you are a young entrepreneur - with or without an MBA - do share your story and any views on this subject. Email email@example.com. Some of these stories will get featured, in a future post!