Five Takeaways: What’s the Point of an MBA?

For many aspiring business leaders, pursuing an MBA is a critical and extremely valuable step to advance their careers. In today's dynamic business landscape, an MBA offers enhanced leadership and management skills, while opening doors to new opportunities and an expanded network. But critics argue that the high cost and time commitment of an MBA may not align with the returns in a rapidly changing job market that values specialized skills and real-world experience over traditional academic credentials.

At the heart of contemporary business education lies the perennial debate: Is an MBA worth it and what’s the point? To delve into this complex question, Stanford's GSB community, comprising faculty, alumni, and students, gathered on November 13 for an enriching dialogue hosted by the Corporations and Society Initiative (CASI).  

The discussion brought together esteemed faculty members, including:

• Anat Admati, Finance and Economics Professor and co-faculty Director, CASI
• Deborah Gruenfeld, Organizational Behavior Professor, Stanford GSB
• Glenn Kramon, Lecturer in Management, Stanford GSB
• Paul Oyer,, Economics Professor, Stanford GSB
• Alicia Seiger, Managing Director, Stanford Steyer-Taylor Center for Energy Policy and Finance, Managing Director, Precourt Sustainable Finance Initiative, and Stanford Law School Lecturer.

Stanford GSB alumni included Scott Brady, (MBA ’00), Matt Devine (MBA ’22), Karin Underwood (MBA ’19) and Lenny Mendonca (MBA ’87).

The event served as a deep dive into the multifaceted purpose and evolving relevance of an MBA. CASI student leader Renata Stewart moderated the discussion with panel members Scott Brady, Professor Deborah Gruenfeld, Lenny Mendonca and Karin Underwood.

CASI student director Claudia Alvarez Pujol (MBA ’24) shared her five takeaways:

Takeaway #1: The diversity of perspectives accelerates learning: An MBA exposes students to people with a large diversity of backgrounds. Exposure to this breadth of experience is a key advantage of an MBA program. Karin Underwood (MBA ’19) noted that this accelerates learning as students educate themselves about parts of the world they’ve never been in, get a deep understanding of different industries and functions, and hear from people with very different opinions to theirs during case discussions. It helps students grow as well-rounded people beyond simply furthering their education.

Takeaway #2: Students develop a sophisticated way of thinking: The MBA teaches students soft skills that are applicable to all industries, including for-profit corporations, non-profits, and governments. These include creating change in organizations, engaging groups, fostering discussion of diverse perspectives, and prioritizing well. The more technical classes (finance, accounting, microeconomics, macroeconomics) give students the opportunity to learn how to think more broadly and deeply about business problems and evaluate them from multiple perspectives, helping them become more nuanced in their thinking.

Takeaway #3: Soft skills are increasingly important: In the words of Scott Brady (MBA ’00), there has “never [been] a point in time at which having an MBA is more important than now.” In the past, it was possible to give capital and responsibility to someone with narrow and deep expertise. But today’s most important problems are multidisciplinary. The ability to listen, have empathy across groups and motivate others towards achieving great goals are critical today, and this is at the core of what the MBA teaches.

Takeaway #4: The learning experience is constantly updated to remain relevant: MBA education evolves to suit the needs of the environment. Professor Deb Gruenfeld noted how, compared to the last two decades, the learning experience today is more experiential and interactive, and new topics are being covered (e.g., entrepreneurship, climate, AI, engaging across differences). Stanford takes a faculty + lecturer approach, which gives classes a blend of intellectual rigor and real-world applicability and ensures that lessons remain relevant and timely. Lenny Mendonca (MBA ’87) noted that the focus of the business school has also changed from forty years ago when he graduated, from maximizing shareholder value as the single goal of business to an approach that considers the impacts on multiple stakeholders today.

Takeaway #5: A Stanford MBA opens opportunities: The GSB allows people to pivot industries and functions and find careers where they can truly make an impact. After being at the GSB, many alums got opportunities beyond what they would have expected and realized that their degree gave them credibility to stretch themselves into their goals. They took more risks and gave themselves permission to fail, knowing that they would remain credible given their degree. 

The Stanford GSB discussion underscored the enduring relevance of an MBA, emphasizing its role in developing sophisticated, multi-dimensional leaders equipped for today's complex business challenges. As alumni and faculty perspectives highlighted, an MBA is more than an educational achievement; it's a transformative journey that opens doors to diverse opportunities, encourages risk-taking, and equips students to make a substantial impact in their chosen fields.