It started as a side project. Josh Kaufman worked at multinational company Procter & Gamble and did self-study in his spare time. The American read all the books and blogs about business he could find in order to improve his knowledge and skills. With this he put together his ‘own MBA’. As an alternative to the expensive and time-consuming official MBA business course he decided not to take.
The bibliography became longer and longer and then Kaufman started writing about entrepreneurship himself. He eventually quit his job to fully focus on the project. His book was published in 2010 The Personal MBA: undertaking a crash course, in which he explains the basics and key terms of doing business. A revised version was published in 2020 and a year later the Dutch translation: The personal MBAs.
Even stronger than his belief in self-study is Kaufman’s aversion to the MBA. In the first chapter of the book – “Why should you read this book?” – he strongly and extensively criticizes the training. You learn about “worthless and outdated concepts”, and “99 percent of the essential tasks that are part of the daily reality of business people are not covered during the study”.
And then the worst is yet to come: that you put yourself in debt for the rest of your life, because the tuition fees are unaffordable for a mere mortal. No, from “business administration” comes only misery.
Business Administration is not an MBA
What is immediately noticeable is the translator’s mistake. In this Dutch edition, the terms MBA and business administration are mistakenly interchanged. For example: “But the problem is this: Business studies are expensive, and the price goes up every year. Unless you’re wealthy or have a big purse, you’ll have to borrow money, with your future earnings as collateral.” And: “With a high debt burden and a questionable return, a study in business administration is not a good investment, but rather a pitfall that you have to watch out for.”
That sounds quite dramatic. Can you only study business if you are already rich? Do all those eighteen-year-old freshmen really fall into a trap at the end of the summer? Be careful, these are two very different courses that are mixed up. A university study in business administration consists of the ‘classic’ bachelor and master, and you pay the regular tuition fee for this in the Netherlands – more than 2,000 euros. (And this year, with the ‘corona discount’ for beginning students, only half.) That is certainly not the “debt burden” that Kaufman warns about.
MBA stands for Master of Business Administration and is – unlike a regular university master – part-time, professionally oriented and intended for students who already have a master’s degree. The costs are a lot higher than that of a regular master. At the Vrije Universiteit Amsterdam, for example, a two-year MBA costs around 20,000 euros.
Okay, so Kaufman is talking about that expensive MBA. But in the Netherlands it is also many times cheaper than the hundred thousand dollars that an MBA at a prestigious American university can cost. Then the question arises: how relevant is the claim of an ‘educational replacement book’ for the Dutch student who, unlike his American counterpart, does not tie an eternal millstone of student debt around his neck when enrolling for this programme?
The author then cites research that shows that an MBA education is hardly profitable. It turns out that business people who are in possession of the diploma do no better and earn no more than those who have learned the trade in practice. Yes, then you better buy this book for a few bucks.
In the American context, Kaufman is of course right. A ton for a two-year course is absurd and outrageous. But his indictment should be against the entire American (higher) education system, which is fundamentally unhealthy. Also law school can easily cost $50,000 (42,000 euros) per year. The chance that you will get a return from such a study is very small, simply because you spend so much time repaying your student debt. Why then does Kaufman assume that the quality of the training is to blame for the meager return? He does not give concrete examples of this.
What is also less spent on the average Dutch reader is the enormous amount of inspirational quotes which Kaufman sprinkles. That’s not uncommon in the management and self-development genre, especially when the author is from the United States. It’s often fun and useful too – what aspiring entrepreneur wouldn’t want wise advice from entrepreneurial heroes like Warren Buffett and Henry Ford? But to open every paragraph with Einstein, Nietzsche, Shakespeare, Goethe and Cicero? “Greatness is for all, for all can serve” – Martin Luther King, human rights activist, under the heading ‘service’. That gets a bit ridiculous.
The personal MBAs does offer a solid and accessible overview of the basic principles of entrepreneurship. From marketing to systems analysis and from finance to collaboration (and the occasional fatherly advice: “Drink herbal tea and sleep at least eight hours a night”). As a (starting) entrepreneur, you want to know all this. Kaufman explains a wealth of concepts in a pleasant way, divides them into clear, short paragraphs and illustrates them with successes and failures of major companies such as Apple and Toyota. In short, The Personal MBA is a very useful book for anyone who wants to expand their knowledge of the fundamentals of entrepreneurship.
But is it a substitute for an MBA?
“Customers’ perceptions of quality depend on two subjective criteria: expectations and performance,” Kaufman writes in the ‘Value delivery’ chapter. He gives the example of shoe salesman Zappos. The company ensures that the order is delivered to the customer earlier than announced. The result is a positively surprised customer, whose expectations are exceeded. The quality of the shoes has not increased, but is valued higher because of the surprise. That is ’emotional added value’. Kaufman writes: “You can represent this relationship in the form of a quasi-equation I call the Expectation Effect: quality = performance minus expectations.”
The reader experiences the opposite with The personal MBAs. When I am assured, barring salesman exaggeration, that one book can replace an entire course, my expectations are high. When the book turns out to be ‘just’ very good, I am unnecessarily disappointed. If, on the other hand, the book had been promoted somewhat more modestly, I would have been positively surprised after reading it and would have appreciated it more because of this emotional added value.
“Never promise more than you can deliver,” Publilius Syrus, Syriac-Roman mime and aphorism writer, first century BC.
Josh Kaufman: The personal MBA. AW Bruna Publishers, 512 pages, 2021 (revised edition), 24.99 euros (paperback)
A version of this article also appeared in NRC in the morning of July 27, 2021