Why do companies employ MBAs for PM positions who have no prior experience?

I can see why they want an MBA. What puzzles me is why they will only employ a fresh PM from an MBA program for an “MBA-PM” position and not for other relevant PM positions at the same level. Anecdotally, based on the outcomes of myself and my MBA classmates, this is done at bigger companies. Why are these individuals unable to receive interviews for particular teams? Teams that would (probably) be given to them after they joined the company.

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There are a few reasons why companies might hire MBA graduates for product management roles, even if they don’t have specific product management experience. One reason is that MBA programs generally cover a wide range of business-related topics, including leadership, strategy, finance, and marketing. This can provide MBA graduates with a strong foundation of knowledge and skills that can be valuable in a product management role. Additionally, MBA programs often place a strong emphasis on teamwork, communication, and problem-solving, which are all important skills for product managers to have. Finally, some companies may view MBA programs as a way to identify high-potential candidates who have the ability to learn quickly and take on new challenges.

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Similar to why IBs and MBBs hire consultants and bankers fresh out of MBA programs without any work experience: established pipeline. Companies presume that MBA admissions have done the labor-intensive process of pre-qualifying (read: filtering) appropriate potential candidates since they receive applicants who, on average, are of a certain perceived caliber. Additionally, businesses can launch extensive training initiatives once pipelines are established.

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Hello there, New to Prowess here…

I think, wealthy, blue-chip companies seeking consultants with an MBA from a top program like Harvard or Stanford often pay $200K to $350K per year and demand the candidate start at $75K.The consulting industry’s infatuation with MBAs is largely due to a perceived pedigree (read: perceived competitive advantage). When consultants manage executives at companies like Goldman Sachs, McKinsey, or Microsoft, their jobs are generally deemed prestigious and lucrative. Consultants who have MBAs also have the benefits of being perceived as more intelligent (again, relative to other candidates), with better quality work, and a higher potential for career advancement.

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The downside of being a consultant with an MBA is that you will be perceived as more intelligent (again, relative to other candidates), but this intelligence is often accompanied by arrogance and the inability to work well in teams. The one major downside of having an MBA while consulting is that you will be perceived as a bit of an “elitist” in the work context. An MBA can help you get ahead in consulting, but it’s not a good idea to make that your career.

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Educating yourself about business has many benefits, including broadening your perspective and understanding the world around you better. Additionally, having an MBA can help with salary negotiation and job performance reviews. Colleges and universities may offer scholarships for students who demonstrate financial need and a commitment to bettering the world. Business schools across the country are offering graduate programs that can be completed in as little as 18 months. Eighteen months is not enough time for students to acquire business experience in a particular field, but it may be enough time for them to make an informed decision about what type of field they want to pursue.

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As a counterargument, MBB employs both MBAs and undergrads in the same position. In staffing teams, different pay starts are interchangeable 1:1 with virtually similar tasks and promotion paths. both had no prior consulting experience. Although it’s possible that Amazon is playing the same role.

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A warm Welcome to all the new members of the community. Feels good to see some movement on the forum. Well I think that people with an MBA typically have real-world experience and are intelligent and quick learners. Take 100 of them and place them in a sink-or-swim situation. Once you have identified the survivors, you may move them up the ladder and double your investment in them.

Kind of the typical hiring procedure for MBAs across industries (IB, PE, VC, MBB). Pay entry-level employees enough to draw talented individuals. Pay the level slightly above a metric tonne of cash to commend the deserving performers.

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First of all wishing you all a very Happy and Prosperous New Year. Also a warm welcome to all the newcomers…
I’ve only met one person in the PM discipline (who wasn’t already a high-level person who had done years as a PM) who had an MBA and seemed to actually understand their product. The others I’ve met were typically more focused on “the business” (when they had no actual role in affecting the business) or climbing the corporate ladder so they wouldn’t have to be around the plebians who do dirty work like talking to users and figuring out how to solve problems for them.

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Welcome to Prowess @JaneWinfred, @TerryAnthony, @CoreyAmorin and @WhitneyChard.
@LawrenceMartin, I haven’t worked with any MBAs. I have noticed that better PMs know the product and the users really well, so an aversion to detail (which seems to be what you’re describing, although it also sounds like straight up incompetence) would be a problem.

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@ShiyaoLiu, Yes, that’s it—a dislike of details. or at least a concentration on the incorrect details. It seems pretty strange to me when a mid-career PM who oversees a single feature area discusses CAPEX and OPEX, yet I’ve seen it happen. I’m all for having goals, but doing so seems like it would be putting the horse before the cart. or simply doing the incorrect job.

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Yep. I mean, I’ve discussed it in a job where meticulous accounting was everything, and I eventually left because they essentially wouldn’t fund our product until a client essentially paid for it. I don’t have to discuss it where I am right now, which is a wonderful thing.

Numerous business cases I’ve completed reveal the same pattern. They will adore the numbers if they want you to accomplish it. They will tear them apart if they don’t.

Absolutely, that is the wrong strategy. Probably the incorrect job, too.

Even a slight improvement makes me happy when it happens. When I see the usage data and in-app feedback, I become as enthusiastic as a dog because I know that customers care about it.

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Because MBAs have the potential to be unpredictable and take many different paths

It’s possibly because individuals with experience in a certain area are sought after for other specialized PM responsibilities. Fresh MBAs have a wider range, so a separate course is created to account for that optionality.

because it is more simpler in terms of outbound recruiting. To meet headcount targets, they can simply hire at scale and address the allocation issue afterwards.

Additionally, the majority of MBA graduates lack prior PM experience, and I would argue that they lack the knowledge necessary to choose the right team in a large corporation anyhow. MBA applicants will put up with any team they are assigned to since they are so desperate to break into the PM industry through school recruiting.