Go to any elite business school, especially one where the average years of pre-MBA industry experience is low, and ask students what they want to do. Most first year students will tell you that they either want to do “marketing” or “investment banking”. Second year students will still say this, but some will also say “consulting”.
With the benefit of a lot of hindsight (it’s nearly 16 years since I graduated from business school), there is definite merit in these being primary career choices for business school students – rather than other seemingly equally valid careers such as B2B sales, or product management, or not-for-profits, or data analytics, or logistics.
It has to do with reversibility, and “one-way doors”.
Different professions have different levels of “returns to experience”. In some professions, all that mattters is the total amount of contiguous experience you’ve had in that particular profession.
I figured this out the hard way, for example, in my brief flirtation with getting back to becoming a banking quant in 2017. I had left the profession (banking quant) in late 2011, to become an independent consultant. A series of financial services projects later, I wondered if I could get back to what I was doing earlier. Except that they wouldn’t have me back – all they cared about was that I had “been out of the industry for 5 years”, and what experience I got in those 5 years didn’t really matter.
In other words, investment banking is a “high returns to experience” industry, where your experience within the industry is highly valued, but anything outside is completely disregarded.
Marketing (though not “digital marketing”) is also similarly – your experience outside the field is not valued at all. So even if you look to get into consumer goods marketing at a later point of time in your career, you will most likely have to start right at the bottom, at an entry level position. All your years of experience doing something else are of no use here.
You notice a pattern (despite the small number of data points I’ve offered)? Popular out-of-business-school careers are professions with a high “perceived returns to experience”. The reason why so many business school students want to do marketing or investment banking is because they are irreversible choices. You either get in from school, or get in later on but start at the bottom anyway. So you might as well get in straight from school.
Technology and data and product management and B2B sales and corporate strategy and logistics and general management are all rather more forgiving – a large number of employers offering these jobs give adequate weightage to experience outside of the field as well. Which means it is easier to switch into these professions at a later point of time in one’s career.
Putting it another way, starting your career in a hard-to-enter (or “enter-at-bottom”) field is a risk-averse way of building your career. If you don’t like it, you can always move to a more welcoming career path. Start in a more welcoming place, and you’ll find it harder to move to a less welcoming career.
So that explains marketing and investment banking, but what about strategy consulting? Surely, strategy consulting should value diverse experience, for that will make you a better consultant? The difference here is between strategy consulting and “brand name strategy consulting”. If you work for a “brand name strategy consultant”, you’re not only offering your own advice – you are also offering advice on behalf of that firm.
This means, in order to do so, you need adequate training in the ways of the firm. And so there will always be (less than 100% of course) a discount on the rest of your experience – in order to learn the ways nad means of the firm that you are going to represent, you will need to start at a more junior level than your experience dictates. So once again you might as well get in right upfront, straight out of school.
So the next time a business school student tells you she wants to do marketing or investment banking or strategy consulting, don’t berate her for “being too cliched and not open minded enough”. She is just being rational, and playing the optionality in the way it should be.