Thursday, October 11, 2007

The Value of a Graduate Degree

Both my dad and my father-in-law have PhDs. However, both my spouse and I finished our education at the BS level, and didn't go on to graduate school. While I do not regret finishing at the BS level, I wonder if the graduate degree is something my daughter should consider in the future. Here is my current thinking about the value of a graduate degree.

It is often assumed that a non-professional advanced degree, such as a PhD or MBA, will give one a long term advantage over peers in the working world. In my experience, the advantage of a PhD or MBA is primarily in two areas. First, such a degree may get one considered for a job over someone with only a college degree. At best, this is a short lived benefit,perhaps for one to two years. Second, and more important, I believe that a PhD or MBA may better prepare one for challenges of the globally competitive market in business. These skills and benefit will last a lifetime, if one can highly develop them in a graduate studies program.

Here are some of the characteristics related to a PhD and MBA that I have seen in people who are successful in business:

  1. Quickly assessing situations to set a new course of action. In today's market, businesses are often faced with new situations that haven't been experienced before, and require solutions that haven't yet been developed. The course of study for an PhD requires such thinking, i.e. research an issue that hasn't been done before and drawing conclusions. MBAs are often immersed in case studies, so that they can assess future situations and set a direction to follow.

    In my discussions with applicants, I often question them about how and why they chose a specific plan or action for their research. It gives me a good understanding of how they will approach challenges at work.

  2. Bigger picture thinking. Another important skill is to be able to see the bigger opportunity for the work they do. This will enable one to independently make good judgement decisions. A great example would be the founders of Google, Larry Page and Sergey Brin. While working on their PhDs, they developed a backlink protocol that eventually became basis for the Google search engine. They were able to see past the interesting programing they did to a potential business benefit and business model.

    In my hiring interviews, I like to ask candidates how their research fits into the bigger picture of their field. What is the potential application, how can it benefit society, and why might consumers want it? These types of questions give me a better understanding of the candidate's bigger picture thinking.

  3. Confronting adversity and succeeding. Winning in business today is about being successful in spite of barriers and obstacles. This means constantly assessing the market place, refining strategy, and organizing for overcome challenges. And then importantly, doing the hard work to achieve success. There is not a silver bullet to winning.

    I particular like candidates who have demonstrated the ability to follow their beliefs, influence others to follow, and overcome challenges to achieve their goal. They will need to do this many times during their career.

Granted for some careers, such as a university professor, a PhD is required. Also, to be a physician or attorney a professional graduate degree is needed. However, for many other careers, a graduate degree is only an initial boost, unless one also further develops specific skills that are important to being successful at work. That's when a graduate degree will lead to competitive advantage over a lifetime.

For more on Crossing Generations , check back every Thursday for a new segment.

This is not financial or education advice. Please consult a professional advisor.

Copyright © 2007 Achievement Catalyst, LLC


Money Blue Book said...

A graduate degree gives you predictive credibility. It's like a medal on an officer or a dressing impeccably.

Graduate school also affords opportunities to network and further develop one's maturity level.

I think if it is within one's financial possibility, a graduate school education is a must not a maybe.

Super Saver said...

Money Blue Book,

Thanks for your comment.

I agree on the benefits of Graduate school - credibility and opportunities. I also think that a grad student needs to make sure they develop certain skills (ie. as in the post), or the grad degree will be a short lived advantage.

If a grad degree becomes a "must" in the future, I think the education system needs to change to enable student to get a grad degree in there early 20s. Everyone entering the workforce at 27-30 after a PhD just seems too late to me :-)