Elon Musk Just Said MBAs Are Overrated and Totally Nailed the Reason Why

Just to be perfectly clear, Elon Musk has nothing against academia. After all, he was a dual major at the University of Pennsylvania, earning a Bachelor of Arts (BA) in physics and a Bachelor of Science (BS) in economics (the latter from the famous Wharton School of Business).

Nevertheless, in a recent interview (provided below), Musk pointed out that an MBA does not automatically qualify the degree holder to be an effective manager or leader. Here’s a brief quote (kudos to WebProNews):

“The path to leadership should not be through an MBA business school situation. It should be kind of work your way up and do useful things. There’s a bit too much of the somebody goes to a high-profile MBA school and then kind of parachutes in as the leader but they don’t actually know how things work. They could be good at say PowerPoint presentations or something like that, and they can present well, but they don’t actually know how things work. They parachute in instead of working their way up. They’re kind of like just not aware of what’s really needed to make great products.”

Elon Musk’s skepticism towards the MBA degree are echoed throughout the entrepreneur community. A study conducted at Stanford University, for example, found that very few successful entrepreneurs in small cities either had an MBA or plan to get one. As Henry Mintzberg, Professor of Management Studies at McGill University explains: “The MBA trains the wrong people in the wrong ways with the wrong consequences.”

Not surprisingly, MBAs even from the best universities tend to have a negative return on investment (ROI) when compared with the money that you would make if you spent that time, for example, starting your own business or gaining fluency in, say, Chinese.

While there’s no doubt MBA candidates learn useful skills, many can be developed more cheaply and easily through a program of directed reading or even watching videos online, provided, of course, one is self-disciplined enough to pursue a course of study without a professor looking over one’s shoulder.

With that in mind, here’s the full interview: