To start and grow a business, you need more than just an idea. It doesn’t matter whether you run a traditional business, an innovative startup, or an NGO; your success depends on how you execute your plans. A Master’s in Business Administration (MBA) can help you develop the skills necessary to turn your ideas and goal into a successful business.
However, MBAs may not be the right choice for everyone. The degree is a valuable tool to meet specific career goals only if you know how to take advantage of its perks.
Is an MBA Worth it for Entrepreneurs?
MBA programs for budding entrepreneurs can teach them how to start a business, manage it effectively, and turn it into a profitable enterprise. The degree offers many benefits, including skills development, theoretical knowledge, and network building (after graduation, these contacts serve as a resource for the rest of your career).
Being a business owner, you may have asked yourself if an MBA is necessary. If you’re committed and persistent enough to stay with your business for a long time, then the answer is “yes”.
This business world is full of challenges and financial difficulties. You will always have to overcome hardships. With an MBA, you will be equipped to use the skills and abilities to solve problems and stay persistent.
If you are interested in becoming a successful entrepreneur or have already started your own business, consider getting a Master’s degree in Business Administration. But, if you find yourself constrained by your current business needs, you can also consider taking online MBA accreditation. Throughout the curriculum, students will learn everything a successful business owner needs to know about finance, management, marketing, and operations.
Still, if you aren’t sure whether an MBA will help you reach your business goals, consider the following four broad categories of skills and advantages an MBA can offer.
Develop Financial Literacy
An important contributing factor to the high failure rate of new businesses resides in entrepreneurs’ lack of financial literacy. They may have a great idea but lack marketing skills and budgeting knowledge. In addition, many make the mistake of over-investing, clinging too tightly to the belief that spending money makes money. Others try to grow too fast, expanding their equipment and staff at the first sign of success without considering long-term sustainability.
An MBA provides the foundation for making solid financial decisions in the early stages of a business. Taking classes in entrepreneurship, business finance, and accounting teaches you how to assess risks and opportunities, maximize shareholder value, finance startups, and set prices that maintain profits.
As part of your education, you can also learn how to read financial reports. The accounting course in your curriculum prepares you to produce and analyze income statements, cash flow statements, and balance sheets, allowing you to see the financial health of your business.
Also, you will be able to review famous case studies, gaining valuable insights into successful business methods. It will teach you what works, what doesn’t, and which warning signs to monitor if your company is in trouble.
Although obtaining a general master’s degree is an expensive endeavor, you might save millions by avoiding costly mistakes. And if you’re considering on-campus learning, the school offers a safe environment for testing ideas, allowing you to experiment with different concepts and assess startup costs. You can also ask teachers and peers for feedback, then use it to improve your business plan. Access to these resources is one of the biggest advantages of an MBA program.
Develop Interpersonal and Negotiation Skills
Even if a business is technically profitable, it may fail due to financial reasons. In most cases, failure is not caused by a lack of payments but rather by the failure to push their clients to pay them before expenses are due. To be cooperative business partners, most entrepreneurs accept payment terms that serve their customers’ needs and not those that serve their financial interests. Thus, despite pricing its products for a profit at the end of the year, the company is unable to pay its suppliers in the middle of the year and shuts down.
Inexperienced entrepreneurs tend to accept long payment collection periods because they think they don’t have any other options. The initial years are crucial for a new business, and many entrepreneurs do not want to alienate their customers by setting strict payment terms. However, new ventures cannot survive without timely payments.
During graduate school, you will learn how important it is to monitor your cash flow and manage your expenses consistently. You will learn how to handle client meetings and communicate your business terms. As opposed to common belief, MBA education combines hard skills with soft skills, enhancing your abilities as a leader, negotiator, and all-around business professional.
An MBA is an asset for entrepreneurs since it teaches how to run different aspects of a business. Through courses in operations management, logistics, and data analytics, you will gain the knowledge and skills to run your business effectively from the beginning. In the long run, this may impress potential business partners and investors and motivate them to work with you instead of your competitors.
You can start an efficient business right away once you acquire the necessary knowledge from graduate school.
Establish a Network
The graduate school offers many benefits, including the opportunity to make professional connections. Even if you study for your MBA online, it will allow you to build a valuable network of peers, professors, alumni, and invited speakers. Following graduation, these people can be valuable allies, either joining your company or setting you up with clients and investors.
Business networking cannot be overstated. As senior executives aren’t necessarily afraid of risk, they are interested in investing in new ideas and want to collaborate with people who possess sharp minds and determination. Moreover, they will be more inclined to partner with you as they are already aware of your dedication.
Additionally, companies might be more likely to work with you if you went to school with one of their employees, and connections that you made in graduate school may make investing easier.
Alternatively, you might become lifelong business partners with some of your graduate school peers. Countless major companies have grown out of college friendships. Starbucks is the most prominent example, as the coffee chain was founded by college friends.
As you approach your education with an eye towards networking, you’re sure to graduate with either a business partner or a list of potential clients and colleagues, or even both.
Having an MBA opens doors to financial success and social advancement. For those who don’t have the time or money to go to full-time MBA programs, other options exist. For example, a Management Certificate, or accelerated or specialized programs like MBA in leadership and management, are all tailored to the needs of busy executives and professionals who wish to continue business and studies simultaneously.
In conclusion, an MBA helps you optimize your business operations, giving you the insights and tools for long-term success.
Jason is the Marketing Manager at a local advertising company in Australia. He moved to Australia 10 years back for his passion for advertising. Jason recently joined BFA as a volunteer writer and contributes by sharing his valuable experience and knowledge.