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Tuesday, February 7, 2012

HR, Law and Operations-the next hot things in MBA?

Even thought MBA was originally conceived as a general management diploma, there is no denying that at any given time, some disciplines have always had better prominence/pay/recognition than others. As I see it globally, the way various function disciplines evolved can be understood by the industrial mode/consulting focus etc. What is interesting is also that functions earlier perceived as core became support/being outsourced(like manufacturing) and vice versa(like HR now seen as a strategic advantage).
  1. Operations Till 1930:-Taylor was among the earliest management consultants, and focused on operational improvements. That spread to help companies refine their mass production.
  2. Marketing and Strategy 1930s till 1960:-Undoubtedly the age of marketing and strategy. As industries become deregulated, mass media exploded thus allowing marketers to reach wide audiences, as the Henry Ford model of mass production become popular
  3. Operations and Strategy 1960s till 1980s:-Prodded by the competition from Japan, companies again went on a operational improvement spree, prompting some strategy consultants to diversify into the field rather than pontificate from ivory towers. 
  4. Finance and Strategy from 1980s till 2010:-The golden age of junk bonds, LBOs, hostile acquisitions, demergers, mergers and what not. Corporates went on a finance binge, supported by diligently prepared strategic plans. MBAs began to enter those two fields with a vengence! 
  5. HR and Operations from 2010 till date(atleast in India):-In India, management consulting is still a nascent discipline,and so the consulting firms are still hiring en-mass. But Indian entrepreneurs are quite savvy with little patience for only ideas-they also wish a fair dose of implementation also.Hence, the Indian arms of even the global strategy consulting firms are laying a strong implementation focus as well. Also, there is a shortage of good HR professionals, and the pay is slowly but steadily reflecting that.Even in the top echelons of finance where rationality prevailed, the fields of psychology and behavioral finance are taking root, be it via designing better products/trading strategies/controls/remuneration structures. And these fields directly impact HR.
  6. Law too important to be left to lawyers last decade:-Winning legal wars in this age of trial by media, often entails taking the high moral ground and careful planning. Microsoft in its infancy was rescued in an arbitration case early in its career. With intellectual property enforcement increasing even in India, and the case of Indian business houses facing significant legal wars/lobbying concerns etc, law has become too important to be left to experts, and aspiring managers would need to improve their legal acumen. 
The reason I'm focussing on these 3 areas is that I feel outsiders can add substantial value in other areas, be it marketing, finance or IT. But in these 3 areas-HR, Legal and Operations, the top consultants are often niche and not too well known. Also, in my view, those areas represent the last bastion of value creation, as even private equity firms have realized when they need to turnaround firms in 5-7 years instead of flipping them(that is why they appoint operational consultants). I do not say that finance and strategy have lost their mojo, just that the large growth areas and value creation seems in the other 3 areas. 

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