Barriendo pá casa: FT 13/11/05
MBA versus professional qualification: Complicated equation of which
qualification to go for
By Matthew Richards - FT.com
Published: November 13 2005 18:10 | Last updated: November 13 2005
18:10
Twelve years ago, Bob Johnson, a professor at Creighton University in
Nebraska, US, advised a bright student to study for the Chartered
Financial Analyst qualification after graduation. The student replied
that he did not need the CFA charter, because “any idiot can get a job
in this market”.
Three years later, Mr Johnson’s former student told him that he was
taking the final level of the CFA exams. “Any idiot could get a job in
that market,” he told Mr Johnson, “but any idiot couldn’t keep it.”
Today Mr Johnson is a managing director of the CFA Institute, and a
strong advocate of the view that qualifications count. Citing his
former student as an example, he says: “When organisations are
downsizing, they like to keep individuals with the most credentials.”
While there is a consensus that formal training makes it much easier
to get (and keep) a good job in business, ambitious youngsters are
faced with a wide range of options. Three stand out: the CFA charter,
an MBA degree, and accountancy training.
Taking an MBA at a prestigious business school has long been
considered the best route to senior management. “We prepare for
management and, later, leadership,” says Caroline Edwards, director of
external relations, marketing and admissions at Insead. One of the
world’s top-ranked business schools, Insead has campuses in France and
Singapore, and prides itself on its international outlook and
diversity. Ms Edwards says an Insead education combines academic
rigour with practical skills. “Our professors are thought-leaders in
their fields,” she says. But she adds: “A lot of what [our students]
learn is not theoretical principle, it’s about working in a team and
negotiating skills.”
Simon Williams, an Insead MBA graduate and chief risk officer at
Citibank’s global consumer group, agrees. He says: “You really benefit
from being forced to get out and work in a group and being in a
position where you’re uncomfortable and have to stand up and put your
case.” Having to give a presentation on a complex topic when you do
not have all the relevant information is, he says, good preparation
for the pressures of business life.
While most MBA programmes offer a broad grounding in topics such as
finance, strategy and marketing, as well as teamwork exercises and
case studies, accountancy training is much more focused. Nevertheless,
the CVs of many business leaders include years spent with an
accountancy firm.
“Most people want chartered accountancy as a renowned business
qualification,” rather than because they want long-term careers as
accountants, according to Paul Newton, who trained as a chartered
accountant and is now managing consultant for the financial division
of Nigel Wright, a recruitment consultancy based in Newcastle,
northern England. He says the exams, which have a 50 per cent pass
rate in the UK, “show you have a certain intellect”, and that in big
UK companies it is taken for granted that senior finance jobs will go
to chartered accountants.
Mr Newton claims “MBAs can be a waste of time once you’ve got to the
age of 30. They can even be seen as a negative, illustrating a lack of
experience.” He says by that age, one should be able to demonstrate
knowledge of business and practical skills without taking a degree,
and that “people doing MBAs later in their career are doing it for
personal satisfaction, not career advancement”.
Another problem with MBAs is that management fads come and go, so some
aspects of the syllabus soon become out of date. “An MBA is valuable,
but it has a time value,” says Greg Spiro, who teaches on Georgetown
University’s MBA programme. “A colleague and I were recently saying to
each other, ‘our MBAs are dead in the water if we don’t refresh our
knowledge’.” Mr Spiro also holds a qualification from the UK’s
Chartered Institute of Professional Development, a body that
specialises in human resources and requires its members to keep up to
date through professional development.
However, Mr Williams – who trained as an accountant before attending
Insead – emphasises the advantages of an MBA. “[Accountancy] is a very
powerful qualification for folks who want to be in finance,” he
says. “But an MBA is a good basis for any area.” He says his
accountancy training made it easier to master the syllabus at Insead,
and an MBA’s advantages include the opportunity to “switch tracks” –
from accountancy to senior management, for example.
Some universities are starting to offer specialist MBAs. For example,
the University of Nottingham in England offers an MBA in legal
practice. Recent graduates include Rosemary Martin, Reuters’ company
secretary, and Robin Farey, administrative director of Ashurst, an
international law firm.
While MBAs and accountancy training have enjoyed decades of
popularity, the CFA is a late entrant to the field. Fifteen years ago
there were fewer than 10,000 CFA candidates and the vast majority were
American. Today there are more than 100,000, most of them outside the
US. Originally aimed at investment professionals, the prestigious
qualification is increasingly popular in other areas of finance.
Mr Johnson says the CFA’s biggest advantage is that all candidates
follow the same syllabus. “If an employer sees the letters CFA, he
knows exactly what the standard is. If you see MBA, there are so many
different levels of quality out there, ranging from very good
programmes at prestigious schools to programmes where the person had
to do very little.” Dozens of universities have incorporated the CFA
programme into their specialist finance and investment degrees.
Ms Edwards at Insead says some students there study for the CFA
charter as well as an MBA. She stresses the advantages of the MBA’s
broad base. “We sometimes talk to applicants thinking about an MBA
versus other qualifications if they’re thinking about finance or
banking. We encourage candidates to think about the long term – other
qualifications may give them useful skills but an MBA’s general
management skills are very useful in the long term. Our people need to
have a broader view of a business when they go into senior management –
they need to understand strategy and marketing.”
A survey by Russell Reynolds, the headhunter, showed that CFA
charterholders earned 18 per cent more than MBAs among US-based
investment professionals with at least 10 years’ experience. Those
with both qualifications earn most of all.
Mr Johnson says: “Investment is an incredibly competitive business,
and you want as many arrows in your quiver as possible.”
Bruno
