The myth about business degrees

My reader Ronald Seah has raised a good point about business degree which I want to talk about today. I have said this many times before - business degrees (or anything to do with business studies) are a complete waste of time and money. I couldn't be more cynical about business degrees and I have talked about this in my previous posts. Ronald does raise a good point though - let's begin with his comment:

Ronald Seah28 December 2013 02:10

Yeah I have also heard many people saying that business is good, business gets you a super well paying job blah blah blah, and I honestly believed it back then. I'm glad I read your blog then, as your articles told me that a business degree is rather worthless. Although I am rather curious about how this myth became so widespread. Was a business degree really worth a lot back in the 70s or 80s because not many people had the ability to go to university back then? Then the people singing praises about business degrees may simple be giving outdated advice.

Now before I deal with this myth, allow me to summarize very quickly why I feel business degrees are useless. I know I have talked about this in the past, but here is a quick summary in five points.

1. Employers don't really care what you've studied at university - rather, they care about the ranking of your university. So Oxford and Cambridge graduates get instantly put to the front of the queue regardless of their degree and if you're from a crap university languishing at the bottom of the league tables, it doesn't matter what you've studied or how well you've done. Oxford = you're smart, crap university = you're stupid. Brutal but true. Welcome to the real world.

2. Would you rather learn about business from a successful businessman who has spent his career making a lot of money, or an academic who has been hiding away from the real world in the safe environment of a university instead? It is like learning how to swim from a man who doesn't even dare get into the swimming pool. This is why I am very cynical about learning about business at a university - like if you're such a bright business guru, why aren't you out there in the business world making big bucks, why are you hiding away in academia?

3. As a young graduate, you will be recruited to perform a specific function within the company and they will train you up when you start the job. You are simply not expected to hit the ground running at an entry level job, you will be given clear instructions as to what the company expects you to do. This training is far more important than anything you would have learnt at university for a simple reason: the university cannot predict what job you will do upon graduation, so the vast majority of what they teach you will not be relevant to your working life - the curriculum will be very general. By that token, employers are looking for graduates with degrees that would be useful to certain products: so for example, a petroleum company may be looking for graduates with degrees like chemistry, environmental science, geography or geology, rather than something as general as business studies.

4. Employers are looking for certain qualities that would make a person a good employee - a fast learner, a good listener, someone who is able to follow complex instructions, someone who is a team player, good at multi-tasking and managing projects etc. These are fairly generic skills that can be learnt outside a university - a lot of it is common sense and will come with work experience (and work experience simply cannot be replicated in a university).

Are you generally sociable and good with people?

Successful businesses are usually very good at what they do - that is why they have been around for so many years and are making so much money. They are not looking for people who have studied business studies at university to come and tell them what to do based on what they've learnt at university - rather, they are looking for people who will come with the right attitude to learn how to function as part of their team. The worst kind of employees are those who under the impression that a course at university is a viable substitute for years of actual work experience.

5. Many people who are successful in the business world do not have a business degree - it is not a vital step to becoming good at business. Heck, there are so many people who are not graduates at all but have made it big in the business world. Compare this to doctors, where all successful doctors have been through many years of medical training at university. The most successful businessmen in the world have thrived on natural business acumen - that's a gift that no university can teach you. The famous tycoon Lord Alan Sugar (of The Apprentice, UK edition) did not bother with university and he is always pouring scorn on anyone who tries to impress him with their degrees in the boardroom. I encourage you to watch that programme as you can learn a lot about business from it.

I am not saying that a business degree is totally useless - let's look at a practical example. You can do a degree in business administration at NUS. Whilst you clearly know how I feel about business degrees, NUS on the other hand, is a very respectable university with a great international reputation. So in this case, as a gatekeeper, if I were to receive a job application from an NUS student with a BBA (Bachelor's degree in Business Administration), the first thing I would note is that s/he made it to NUS and that instantly proves that s/he is of a certain academic calibre. Secondly, I would also note that s/he has manged to complete a degree course at NUS, that shows a certain degree of tenacity and ability to follow instructions. Thirdly, I would then look at evidence for 'soft skills' to be demonstrated in other aspects of the applicant's life (part time work, charity/volunteer work, sports, social life). By that token, it wouldn't have matter whether the applicant studied business admin, political science, chemistry or English. If you have made it that far in the process, that's when you would be invited in for an interview where you would be subjected to a range of tests for the gatekeeper to find out what you are like in person.

Now, let's turn to Ronald's question - why is the myth of business degrees being useful so widespread in Singapore then? I have the following reasons to explain why this myth had become so widespread. Please note that I am speaking pretty much from a Singaporean perspective, but I am sure the following reasons are valid in most parts of the world.

Why does this myth persist even today?

1. Back in the old days...

Back in the 1970s and 1980s, graduates were a lot more rare and it really didn't matter what you studied at university - it was simply a big deal to go to university. So back in those days, yes a degree in business studies would get you very far because any degree in those would impress most employers. Times have changed - now there are so many universities, maybe too many universities around, producing so many graduates, that is why the way employers perceive graduates have changed with time. So a business degree was worth a lot more back in 1983 compared to today - the conditions were different then, hence there is definitely an element of "old people giving out-of-date advice".

2. People believe what they want to believe in. 

A healthy dose of optimism makes life a little rosier. Why do people believe in luck and carry good luck charms or do certain rituals which they believe will bring them luck? So if a young man has somehow allowed himself to be convinced that a business degree will set him up for life, then he is going to do his course with a healthy dose of optimism and hope. Now some people base their optimism on genuine evidence, others base it on superstition and religion - but at the end of the day, it often has the same effect on the person. The fact is many people do succeed in the business world without a business degree (and often without any kind of degree) - so having a business degree isn't going to hold you back per se, so you can succeed in the business world with a business degree but whether or not your success is based on this degree is another matter. Let me use an analogy to illustrate this.

People believe what they want to believe in.

My friend Sue has a lucky bracelet which she wears whenever she has no confidence in herself. I think it was a gift from her grandmother when she was a child, but anyway, Sue was studying for a French oral exam and I tested her once in a while. Now she got through that exam with flying clolours and the first thing she said was, "as long as I knew I was wearing my lucky bracelet, I was going to be okay." And I was like, really? What if you forgot that bracelet that day, what difference would it have made? The bracelet couldn't possibly teach her French - to her credit, she had worked very hard to improve her ability to speak French over the weeks leading up to the exam. She deserved the credit, not her silly bracelet - it was a shame that she couldn't actually see that for herself and had to rely on that bracelet.

I know how good Sue's French is and she would have aced that exam with or without that lucky bracelet. Likewise, many graduates who did business studies at university would have gone on to have great careers in the business world whether or not they did business studies at university. Let's not imagine that a degree has some kind of magical properties (like Sue's lucky bracelet) that can open all doors for you for the rest of your life. At best, a good degree from an elite university may give you the confidence to face prospective employers in the working wold, knowing that they would be impressed. You'll be amazed how many seemingly intelligent people (like Sue) fail to give themselves the credit they deserve and give that credit away to other things - from lucky charms to business degrees.

Do you have a good luck charm that you rely on?

3. Some people believe the marketing hype

Some of these colleges offering business degrees have pretty good marketing campaigns. Really, if a university offering a business degree can't come up with a decent marketing campaign, then they really don't deserve to run that course. Don't forget, these universities are not just there for the noble purpose of education - they are also profit making businesses themselves and these courses are often very expensive. Let's take a crap university, let's go for the very bottom of the league table in the UK: East London University is ranked 124 out of 124 in the current UK universities league table and they do have a business management (BA) course: that course would cost you £9,900 (about S$19,800) a year - and yes, they do make a profit from their students.

So what would East London University say to prospective students, to persuade them to commit to a three year undergraduate course with them? Do you think they will dwell on the fact that they are at the bottom of the league table and tend to be the last resort of the students who were rejected by better universities? No, they would focus on the most positive aspects of their course to try to portray a very respectable image to prospective students. That's what marketing is all about - you may not have a great product, but you focus on the most attractive merits of what you have to offer. It is very reassuring message for parents to here - that their child is doing a great course that will lead to fantastic career prospects, so many parents and students choose to believe the marketing hype.

Do you believe the marketing hype you encounter on a daily basis?

Besides, it is easy to promise all kinds of wonderful things when it comes to marketing a degree. You won't really know the true usefulness of your degree until after you graduate and try to find a job. If you are really unemployed without a job for 12 months and try to sue the university, the university can simply turn around and say, "at no point did we promise you anything about your job prospects - no contract has been broken and no judge in the land will rule against the university. You have to bear some responsibility for your inability to find gainful employment upon your graduation." Besides, imagine being the loser who becomes so desperate he has to sue his university - that's the kinda thing that people would circulate on social media as it is too funny not to share. Thus in reality, the university has actually very little to lose in over-promising the kind of career prospects for their graduates.

4. People don't know how to make the connection between academia and the working world.

Oh this is a very Singaporean problem. Here's the situation: many people realize that working life is going to be radically different from student life - yet they don't quite know how to make the transition from being a student to being a working professional and they mistake a business degree as a viable replacement for work experience. That is actually a fairly common mistake made by many students, let's take management for example. Can you learn about management in a university? That is an aspect of business that many universities do try to teach: they can give you case studies, they can teach you theories and even try to put students in role-playing situation to simulate situations where students have to exercise skills like mediation, finding a compromise, getting the others in a group to listen to them etc - but can all this really be a suitable substitute for real life work experience?

Working life is very different from student life.

I have blogged a lot about skiing - it is one of my passions and I love skiing! I can sit you down in a classroom and describe everything from the skiing attire you need to how to get on and off different kinds of ski lifts to how to tackle icy pistes to how to ski when the visibility is very poor - but if you and I never get out of that classroom and to a ski resort where we can actually get on the snow and start skiing, can I ever teach you how to ski in a classroom?

No. I can give you a very clear idea about what is required to ski confidently and what my experiences are, but for you to actually do that, you need to get out there and do it yourself. Trying to learn about management in the classroom is like learning how to ski in a classroom, or learning how to swim without getting into the swimming pool, or learning how to play a guitar without actually even picking up the guitar.

I absolutely love skiing.

There isn't a one size fits all solution to management for example - it has to be learnt organically on the job, learning how each person ticks and how you can get them to listen to you, how you can get them to do what you want them to do. Some people make much better managers than others - they naturally have charisma, they are good listeners, they are persuasive and know how to convince others, they are good with people, they know how to calm a volatile situation down through mediation. These are skills that we pick up from a very young age - if a child is brought up in a social environment, where s/he has many siblings and friends, then those are skills that the child will naturally learn as a child.

However, if a poor kid is an only-child who spent most of his/her childhood watching TV or playing computer games, then s/he would have missed out on that vital aspect of development and no university in the world can plug that gap with a module in management. This is already something I have talked about in my previous post where Singaporeans have these unrealistic expectations of a university to undo the damage of neglectful parenting, when really, we're dealing with a period of development that goes way back to the time a child is as young as 18 months old.

Parents can start teaching children about management from a very young age.

5. Pride gets in the way of honesty.

How many people would actually have the balls to say, "I went to a crap university, I wasted my time and money on the wrong degree and I am a really struggling now because of those bad decisions." Well, they might just about admit that to very close friends I suppose, but to do so publicly would be embarrassing really. We all want to look good to the world, nobody wants the rest of the world to look at them and think, "hahaha, what a pathetic loser."

There must be generations of business studies graduates who are disappointed with their degrees and they would either keep quiet about it or lie about it. I know I have told this story before and I will tell it again. Years ago, my sister went to JC with the daughter of one of my mother's colleagues Mrs Tan. Now Mrs Tan would boast about her daughter doing so well at school, how she was trying to decide what scholarship to apply and my sister actually told us, "please lah, her daughter is nothing special, she is not scholarship material. No way. Not by a long shot."

Why did Mrs Tan lie about her daughter?

Sure enough, when they received their A level results, my sister earned herself a place at NUS easily but Mrs Tan's daughter did so badly that every single department at NUS rejected her. What did Mrs Tan do when all her colleagues asked her, "hey how did your daughter do? Which university is she going to?" She lied. She claimed that her daughter loved all things Australian and had always wanted to study at an Australian university - so she was sending her daughter to Australia for university. She then claimed that Murdoch University was one of the best in Australia and that's where her daughter was going. May I remind you that this was back in 1990, way before one could whip out one's smart phone on the spot and Google "Australian Universities Ranking League Tables".

For those of you not acquainted with the Aussie universities ranking system, allow me to explain. There are about 30 universities in Australia although most people don't even take those at the very bottom of the league table seriously, hence some are left out of the rankings. The top four in Australia are ANU, Sydney, Melbourne and Queensland. There are then a bunch of other universities that populate the top 15 which are considered decent because they are at least in the top 50% of Australian universities. Any university outside the top 50% does not attract the best talent - let's face it, why would you apply for a crap university when your grades can get you into Melbourne or ANU? It's not rocket science. Murdoch is usually somewhere in the bottom quarter of most ranking systems (ie. it is not even in the top 75% of Australian universities). It is simply not a good university by any stretch of the imagination.

Murdoch is a pretty crap university. 

Mrs Tan's daughter did so badly in her A levels that she had to settle for Murdoch (well, the alternative was to retake her A levels - but she was not going to do that). So instead of admitting the truth, Mrs Tan told everyone what a wonderful university Murdoch was and how her daughter had made a great choice in choosing to study at Murdoch. Of course, those of us who knew better were not convinced - but we got the feeling Mrs Tan was trying to convince herself rather than others. What was the alternative? Admit that her daughter had disappointed her and that she was very angry with her daughter for doing so badly? Oh you know Chinese parents, that would tantamount to 'losing face' and Mrs Tan would rather tell a very unconvincing lie than to 'lose face' in front of her friends and colleagues.

Interestingly enough, I just tried this: I went to google and entered the words, "my degree is useless". Well, my article "my degree is irrelevant and useless" (well, I guess it was easy for me to admit it as I did get a degree from a very respectable British university) actually comes up as number two in my google search! There are not many people who would gladly admit to the fact that their degrees are useless - the other top search results mostly involve either journalists talking about the issue or discussion boards/forums where people are talking about the issue (mostly anonymously). It is a subject that concerns people but few are willing to talk about it honestly.

Would you admit that your degree is useless publicly? 

Hence in this context, you're never going to her people telling you that doing a degree in business studies was a mistake - oh no. You're only going to hear positive messages about doing a business degree - hence this cycle serves to dupe more people into doing a business degree and those who are duped go on perpetuating this myth: that is why this myth still exists today and will continue to persist for a long time to come.

So there you go, that's it from me on this issue. I hope I have done the topic justice - if you have any further questions on the topic, please feel free to leave a comment below. Thank you very much for reading, as always.