Thinking of doing MBA in Finance? The 2020 Perspective

While it is true that a lot of students from different disciplines get confused about choosing specialization during the MBA, there is no direct answer as to what they must accept and what they mustn’t.

MBA is a two year post graduation course where students study all subjects in the introductory session of the first year. It is in the second year that a student has to choose his or her area of specialization.

Most B-schools offer the below specialties: Marketing, Finance, HRM, operations, IT among others which the students must choose from.

Each of these specializations is popular among students and Finance is among the most popular ones, after marketing. The confusion of choice mainly occurs because no specific criteria are mentioned by B-Schools to make that choice.

Irrespective of one’s academic background or scores, a student can take up any specialization of their choice.

However, it is noted that most students from science and commerce background choose Finance as a specialization, although no such criteria are mentioned anywhere.

Finance as a field is highly in demand in organizations as it is the backbone on which any business operates.

Irrespective of what its products are, where it operates, its employees are humans or robots, it is a monopoly or oligopoly, no company can work without finance. Hence, the fund will never go out of fashion and will only become more and more critical for the sustenance and survival of a business.

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Let us look at some of the reasons why finance is so outstanding and among the top choices of many MBA students:

1. 1. Tremendous opportunities: Gone are those times when studying Finance meant getting a job in a bank. There are numerous financial companies such as asset management, investment banking, portfolio management, shares and stock handling companies that have a massive demand for Finance professionals. But the jobs for Finance professionals are not restricted to BFS institutes alone. Every company, irrespective of their business domain, needs an efficient team to handle its finances. Thereby creating a massive requirement for able and talented financiers.

1. 1. Talent pool: Despite there being a lot of opportunities in finance, there is enormous competition owing to the high number of students pursuing finance and related courses. However, when it comes to trusting someone with money matters, everyone including businesses, prefer to hire those with professional experience and knowledge. Thus students with an MBA in finance outweigh those without it.

1. 1. Lucrative Field: It is not hidden information anymore about the salary of an investment banker or that of a Financial Analyst. There is no limit to the number of digits in the figure. It is possible to start at that level after a finance management degree from a college of repute or certainly rise to that level with the right skills.

1. 1. Limited Resource: Finance is a finite resource that any business has. Be it the starting capital, or revenues, or profits or investment, no company or economy has unlimited financial support no matter how big or rich the organization may be. Therefore it is crucial to utilize that resource efficacy because the other resources to run the business are dependent on finance. In such a situation, finance management becomes the most essential function of any organization.

1. 1. Growth Path: The career path of the Finance management professional is pretty enriching and rewarding. One of the core functions of a business, finance offers rather quick options to grow within the organization. The Chief Financial Officer or the CFO of an organization is seldom known to have been hired laterally. The position is always fulfilled internally, even though the CEO is often appointed from outside. The reason being, finance is a department where a professional has grown organically is always preferred to an external hire.

1. 1. An asset to a business: A finance manager walking out the door of a company is the worst news for an organization. The employee not only knows about the internal financial matters of the business but has also been invested upon through training. To lose such an employee to competitors could be the worst nightmare for companies. Often corporates have no-poaching policies so that competitors cannot hire key talents like these from one another. Being an asset to the company is a value proposition for any employee.

1. 1. Cut out for industry: An MBA in Finance helps finance professionals to stay relevant to the industry standards and practices. To give an example, a commerce student who starts his career in finance has a limited understanding of the business practices in the financial world although he may have general knowledge or understanding of the basic concepts. On the other hand, if the same person goes for a finance management course after his graduation, then he gets an in-depth understanding of corporate finance before stepping into the industry.

1. 1. Building competencies: An MBA is a course with beliefs in the overall growth and development of an individual to become an efficient manager or entrepreneur. This aspect of an MBA makes it a popular course as compared to other academic courses. Almost any and every course focus on academic tenets and enrichment; however, to put those tenets to practice, relevant competencies are required to perform. As an example, knowledge of medicine and diseases alone does not make an excellent surgeon. The person needs to have an eye for detail, analysis, ability to handle stress, make decisions in moments of crisis to become a great practicing surgeon. Likewise, with a finance manager. This critical competency development happens during MBA

1. 1. Relevant Assignments: An MBA program is not a textbook course that can be cleared by learning concepts and definitions. There are several assignments and projects which build the actual abilities required to practice a profession. Case study discussion, debates, solutions of real businesses provide a student practical perspective of real-life instances.

1. 1. Conflict resolution: Contrary to the popular belief, a finance professional is not a nerdy lone wolf who works on a masterpiece in a silo. He needs to work in a team and lead a team of his own. Conflicts are characteristic of any organization. Yet, it is a manager’s job to resolve such disputes and align individual goals to the company’s goals for optimizing performance. An MBA in Finance Management is so much more prepared to face these challenges and work out a resolution for his team.

1. 1. Campus placement: Given the vast competition in the job market, a significant advantage of an MBA in Finance Management is that he or she can avail of the campus placement organized by his institution. Almost all B-Schools organize a placement fest at the end of an academic year to get students placed in different recruiting companies. This facility is a significant boost to aspiring students’ careers. Finance professionals with MBA do not need to go job hunting in the market and welcomed into a company under their degree.

1. 1. Demand outside corporates: An excellent financial analyst is not just required in business but also the economy of a nation. There are many prestigious jobs in the public and government domain where MBA s in Financial Management are required. The finance, money and economy are almost synonymous, therefore in several roles in the finance ministry or in Economic organizations such as ICRIER, OECD where there are requirements for.

1. 1. Team player: Even an investment banker indeed needs to be a good team player. Anybody working in any profession becomes more effective only when he or she is a good team player. Being a team player does not mean giving up on one’s capabilities. But it means that one is open to viewpoints different from his own. Especially in a critical function like finance, which involves managing the assets of a business, the views of each member in the team must be taken and considered. This is possible when the unit is led by the team player. An MBA in finance teaches this among other things.

1. 1. Comprehensive course: There are several finance courses available in the academic field. However, unfortunately, none are so varied and extensive as the MBA finance course. It is the one-stop-shop for almost every area in finance. Yes, it does not go too deep in each of those subjects. However, the coverage is extensive. As someone rightly said that in MBA, the topics go only a meter deep but a mile wide. This is perfect for those who ultimately need to understand the basic concepts behind each sub-zone to decide which field is meant for him or her. Once the decision is made, one can anytime choose to study further into the selected topic. Some of the topics covered in the financial management course in MBA are:
      Portfolio managementCorporate investment managementCorporate financeBalance sheetHedge fund management

      Small business finance

      Accounting

      Investment

      Collections

      Securities analysis

      Fundraising

      International finance

      Disbursements

      Volatility in international markets

      Macroeconomics

      Global financial institutions

1. 1. International Business: Any other finance course in India would primarily be relevant to Indian businesses and concepts, and this includes all financial certifications. On the other hand, Financial Management provides a global benchmark to the course and is equally acceptable to foreign multinational companies.

1. 1. Exposure to Business: An MBA student undoubtedly benefits significantly from the industry visits which are part of the curriculum for most B-schools of repute. Not only these, but the MBA course also involves several conferences and seminars where industry experts from different echelons are invited to speak to students in B-schools. Through these, students get exposed to business scenarios. They can engage in discussions involving problems faced in organizations, what are the solutions and what is the way to achieve such a solution. A regular finance course is a far cry from what an MBA in Finance program offers.

1. 1. Communication: A student pursues an MBA degree to skip the process of starting from scratch. They don’t start at the entry-level. Most placements provided by B-schools are for mid-management or leadership roles. For such purposes, the ability to communicate becomes essential and is key to success. Communication is not always in the form of public speaking but a manager is required to speak to his team, convince them, motivate them, give them feedback, communicate problem statements to higher authorities and establish his point. It does not matter whether the person is in HR, Marketing, Operations or Financial function. Effective communication is indispensable. In this scenario, a finance student with MBA gains tremendously from the course which focuses on the overall development of a new professional.

1. 1. Salary: The starting salary of someone with a Finance Management degree is somewhere close to Rs 10-15 per annum. This amount varies depending on the rank of the B-school. However, this could be considered as an average figure, which is way higher than the starting salary of someone in a finance professional such as in Accounting without an MBA degree.

1. 1. Society’s perception of finance: Even today society’s knowledge of a professional makes a lot of students choose a subject for their career. Investment is one such subject that society perceives to be meant for the “intelligent” and diligent. This “good image” of finance in society results in many students and their families to steer one’s career towards investment.

1. 1. Career fields: MBA grads in finance have several roles to choose from. The MBA finance professionals are recruited by various companies in profiles such as:
      • Account Manager
      • CFO
      • Financial consultant
      • Cash Managers
      • Investment Bankers
      • Financial Analyst
      • Credit Manager
      • Corporate Financiers
      • Treasurer
      • Insurance Officer
      • Risk Manager
      • Credit Specialist

There could be no doubt as to why a student prefers to go for an MBA in Finance management. It is right on average, an MBA in India costs between 7 lacs to 25 lacs, but the degree provides a lot more than just theoretical concepts. To be equipped better for corporate management roles in Finance, an MBA in marketing management is indispensable.