Yes, Indeed. Why do companies give so much weightage to MBA's (or even BBA's maybe) ? You are selling engineering equipment? So, how come irrespective of your engineering degree, if you and a MBA start from ground zero, you lose out every time?
Have you ever pondered this question ? In almost every office you'll find slimy apparent know-alls... Ask them this and you won't see their ugly mugs for the rest of the day!
Okay friends, enough of foreplay than.MBA's study for two more years after graduation. It stands to reason that they must be studying something. Yes, they do study a lot of 'shite' , but they also study plenty of things that matter.
They know how to make a business plan,they know what factors are important to consider, how to make budgets , decision making as per future value of money; they know how to read a balance sheet, how to go through the inventory batches, they know legalese, they know the theory of constraints, activity based costing and R.O.I.
I once visited the blog of a sales specialist who was very dismissive of ROI. He says something like "ROI is a finance concept and I asked this friend of mine, who told me not to worry about it as its complicated and the importance given to it is a myth"; On reading this, I was sputtering with indignation. ROI -a myth? This gentleman is dragging the carpet from under me.
For people like me and you who are in the capital equipment sales and marketing business, ROI is what gives us our bread and butter in these times. The concept of "Return on Investment" is a terrific advantage if you have it and not to use it is a sin. The irony is that you know about it but you either neglect it or you mention it the wrong way. Say you are meeting Mr. Ravi for the 3rd or 4th time and you've got him hooked onto the technical advantages of your product. He takes you to meet the boss-man, a Mr. Tiwari and say you are asked to tell Mr. Tiwari all about your product. After all, he is spending a fifty thousand dollars on the system, so he wants to hear the advantages from you too.
You say "Mr. Tiwari, our product will be 3% efficient than our competitor"-he looks blank. Now rewind and say " our equipment will save you more than a thousand dollars per month on energy charges alone, which means that the machine/system will pay for itself in less than four years time". On hearing this, Mr Tiwari will show interest and ask Ravi " how will it do that Ravi"..Don't wait for Ravi as everyone wants to earn brownie points..take out the pad where you had written down the energy costs comparison. Put down the cost of energy, multiply the figures and the figure will come out. "This is rough calculation I had made. If you want, I can send a fair copy to you and Mr. Ravi"
On hearing this, Tiwari will smile at Ravi, Ravi will be pleased and smile at you and you will smile back at Ravi as 80% of your job is done. Then bring in the other advantages but please monetize them first and your job is over, save a little negotiation for which you may have to come another day. That is the power of ROI and its not at all complicated. The interest your bank gives you for parking your money with them is R.O.I. and someone is asking me to forget ROI.
But to be fair, our colleague probably sells something much less imaginative, which is cheap, mainly sold through channels and its business volume which takes the gravy. Or maybe he sells consumables like rubber belts, lub. oil or welding electrodes. Here, you need not be concerned about ROI but its such a simple concept that I found it very strange that the gentleman was not willing even to talk about it.
Business management knowledge is something like the ROI. Tiwari's goal is to earn money for the company's stakeholders. So, you need to tell him , instead of talking about efficiencies and low speed and low maintenance etc, how your system can help him to make money. In fact, in an organization, every employee's goal is to earn money. So next time, your MD asks you about your year's goals, tell him that it's to make more money than last year, and than show him how you will do it.
That's what we are going to find out the next time-we are going to discuss a business plan. To be an effective manager, you need to know about costs, finance, returns etc which we will see next time. MBA's are given importance when you have to manage a region or a territory's sales/business development, knowing these are more important than knowing about the technical principles of your product. You are supposed to know both if you want a region or a country for yourself.
Finally Tiwari and Ravi are just two imaginary people I plucked out of thin air. They do not exist. They are just examples and have nothing to do with the many Tiwari and Ravi's I know.
So, that was the lecture for today,
Hope you liked it
With love
someone from Bags-end.
Have you finished an MBA?
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