Should I attend HBS or get a Masters in Finance from MIT?

“I have been admitted to both the HBS MBA and the MIT M.Fin.  I know I want a career in finance. Which one should I chose?”
–Edward

The Harvard MBA says:

Edward, congratulations on your achievement.  The good news is, there is no wrong answer.  You have two wonderful options.

I am not a finance expert (except for when it comes to angel investing and venture capital), so I don’t know about the relative attractiveness of an HBS MBA versus an MIT M.Fin.  It may very well be that the M.Fin. offers some advantages over the MBA.  But I tend to subscribe to the “best athlete available” approach to life.

This is a term that comes from professional sports, where teams selecting new players in an amateur draft can choose to draft “for need”–that is, to fill a specific need on their team such as quarterback or power forward–or to draft “the best athlete available” regardless of what position he or she plays.

History is littered with examples of how drafting for need is a bad long-term approach.  The classic story here is basketball star Michael Jordan.  The Houston Rockets had the first pick in the draft, and chose Hall-of-Fame center Hakeem Olajuwon, the consensus #1 pick, and ended up winning two championships during Olajuwon’s career.  The Portland Trailblazers held the second pick, and had to choose between drafting Michael Jordan, who was the consensus #2 player in the draft, but who played the same position, shooting guard, as their best player, Clyde Drexler, and Kentucky center Sam Bowie, who would fill a glaring need for a center.

The Trailblazers selected Bowie, and the rest is history.  Jordan won 6 championships with the Bulls, who selected him with the 3rd pick in the draft, and Bowie’s injury-plagued career never resulted in a Trailblazer championship.

In contrast, the Los Angeles Lakers have made two critical decisions where they selected the best athlete available.  In 1979, the Lakers selected Magic Johnson with the first pick in the draft, even though they already had All-Star point guard Norm Nixon.  The result was 5 championships.  In 1996, the Lakers traded Vlade Divac for a 17-year-old Kobe Bryant, even though no guard had ever successfully jumped from high school to the pros, and even though they already had All-Star shooting guard Eddie Jones.  The result was 4 championships and counting.

The point is, life is full of uncertainty.  I believe that a Harvard MBA is more flexible, and thus the “best athlete available” rather than the MIT M.Fin, which represents “drafting for need.”  I would go for the Harvard MBA.  But of course, I’m biased!

5 Comments

  1. Posted May 13, 2010 at 4:08 pm | Permalink

    Gosh, what a horrible predicament..

    I’d say the MBA packs more of a punch, plainly put, than the M Fin— just because.

  2. jOE
    Posted May 22, 2010 at 3:47 pm | Permalink

    Everything being equal (desire, happiness, life path, etc), hands down Harvard MBA.

    M Fin gets you to a certain place (namely high paying finance gig in some corporate office, etc.). But HBS might get you to places you haven’t even considered in your wildest dreams. For instance, your classmate could be the Prince of UAE, and you could be running contracts for the largest oil fields in the world in 10 years. Or you could be running a five star “experience” resort in the Seychelles. That’s the power of HBS (and I’m not an alumn… I went to a “lesser” school).

  3. Jag Shokar
    Posted September 20, 2010 at 9:27 am | Permalink

    I don’t think this is great advice, and neither are the comments helpful. The analogy doesn’t work and nor is it applicable. There are many examples of very good players coming into a team and failing through not having a well defined role (best available athletes who’ve failed); and there are countless examples of ‘lesser talented’ players who’ve thrived because they’ve found a niche within a team (successfully drafted for purpose). These aren’t exceptions that ‘prove’ your generalisation, but examples so numerous that they question its basis. But that’s irrelevant, even if the generalisation stood, it’s not applicable to this example. MIT’s MFin isn’t some ‘niche’ programme used to plug a leak. I’ve no idea on what basis it’s considered the ‘drafting for need’ of the two. Because it’s more specialised? So you’d necessarily rule out specialisation because it’s ‘drafting for need’….? While it’s more specialised than the MBA, but it’s not as specialised as it might appear to those lacking an understanding of finance – a degree in something like ‘financial audit’ would be specialised, a generic finance programme is still keeping a lot of options open. Going on stereotypes, especially within finance, I could just as easily say that the MIT course is perceived as the more ‘serious’ degree while the MBA is seen as a badge or a label.

    The comment alluding to prestige, measured here in how close you’re sitting to the Sultan of Brunei, is also misleading. You’re comparing the Harvard MBA to MIT’s finance degree, not to the a course in secretarial studies from Arizona State. MIT’s MFin is one of the most well known master’s courses in the world, just as Harvard’s MBA is. Again, going on stereotypes, I could just as easily have said: while the Sultan is more likely at Harvard, the person running the operations is more likely at MIT.

    The advice on this is surprisingly simple: it depends on whether you’re sure you want to remain in finance or keep options open. If you’re a resolute character who rarely changes his/her mind go with MIT (the finance components on the MBA are nowhere near as rigorous); if you want to keep options open then go for the MBA. Do bear in mind that most people, in their 20s/early 30s (an assumption you’re in that bracket based on statistical trends on these courses) often change direction and the MBA gives you more leeway for that. But also bear in mind that, again, as I implied, the MFin isn’t all that specialised, and a stellar background in finance often serves as a good platform for other things, whether it’s working for the UN building mud huts in Sudan or writing for the NY Times.

  4. Roger
    Posted April 12, 2011 at 2:09 pm | Permalink

    Thanks to Jag Shokar for that posting, it was informative and well-reasoned.

    That really helped me. Appreciate it.

  5. Shalabh
    Posted September 5, 2012 at 12:17 pm | Permalink

    Edward, it would be very kind of you to share your experience. Which way you went and how did it turn out for you. Also as of now, do you think you made the right decision?

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