KARACHI: Do employers really care which business schools their potential employees went to? In fact, does an MBA degree matter as much as it is made out to be?
“It’s significant only when you are applying for your first job. Later on, your performance in the last job is all that really matters,” said Shell Pakistan Human Resources General Manager Leon Menezes while talking to The Express Tribune.
Menezes said it was a misconception that most management jobs at a multinational company like Shell required an MBA degree. “There are two HR vice presidents in our global operations who majored in history. The head of Shell Global has a background in finance. The head of finance is an engineer.”
Although industry sources contend that Shell Pakistan is not the highest paymaster in the energy sector, saying oil and gas exploration companies pay far higher salaries to fresh graduates than the average starting salaries at Shell.
Currently, the starting salary of an MBA graduate at Shell Pakistan is roughly Rs75,000 a month. For BBAs, it is about Rs45,000 a month. “We get a market survey done every year. Salaries go up by 10-15% every year, so that takes care of inflation at least,” Menezes said.
HR managers at multinational companies believe there are far more MBAs in the market right now than can be accommodated. According to Saleem A Butt, chief operating officer at Hascol Petroleum Limited, an oil marketing company that runs 250 retail outlets across Pakistan, most business schools are churning out unemployable graduates.
“There are three tiers of business schools in Pakistan. LUMS, IBA and CBM are in the top tier, Hamdard, Szabist and Iqra are in the second tier, and PIMSAT, Biztek, Greenwich and others are in the third tier,” Butt said.
He added that fresh graduates of even the best business schools had only a ‘superficial knowledge’ of the corporate world. Complaining about the high expectation of business graduates vis-a-vis remuneration and performance evaluation, Butt said MBAs in Pakistan are actually ‘good for nothing’.
“Business schools should stop handing out MBA degrees to anyone who comes to them. Work experience of a few years should be mandatory in order to get into an MBA programme,” he said, adding that the going rate for a fresh MBA from an average business school was Rs13,000 a month – an amount less than what he paid to his driver. IBA recently made two years work experience mandatory for admission into an MBA programme, however, there is not set policy across the board.
A chartered accountant himself, Butt’s criticism of the MBA degree per se is biting. “MBAs tend to have better analytical skills. But the problem is that it’s the only skill they have. That’s why you’ll rarely find an MBA working as chief financial officer or head of the finance department.”
Butt is critical of the graduates of foreign business schools in equal measure. Citing an example from his days at Shell, he said once he asked an economics major from the London School of Economics during an interview how the government controlled inflation. “She was as clueless as any MBA from a Pakistani business school.”
Talking to The Express Tribune, recent MBA graduate Sibte Hasan Jafri said the job market for MBAs was overcrowded. He said business schools introduced a range of MBA programmes on the pretext of ‘specialisation’ in response to the obvious market saturation.
“All these apparently different MBA programmes are actually the same, except the final few courses. That’s why we see strange nomenclatures in newspaper ads like MBA in media management,” he said.
However, Menezes is not too pessimistic about the state of business education in Pakistan. “About 30 to 40 Pakistanis are working in senior positions in Shell globally. The current CEO of Shell Pakistan is an IBA alumnus. So is the head of lubricants.”
Menezes says that business graduates often lack the ability to think critically. “It’s not about knowing the right or wrong answer. It’s about how varied one’s thoughts are. Can he or she form an opinion of their own, and critique it as well?” he added.
Published in The Express Tribune, December 15th, 2011.