Become a Master of Expertise and Credibility

Weigh the value of the most common graduate degrees that HR professionals obtain.

By Eric Krell May 1, 2010
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0510cover.gifWhen Andrew Powers reflects on his experience earning a master’s degree in human resources and industrial relations from the University of Minnesota, he says the business courses have proved to be first-rate.

"The program incorporated business administration into our regular HR course work," says Powers, who is now progressing through Chevron Corp.’s HR development program. He lists as examples courses in subjects such as strategic operations, marketing management, statistics and labor relations.

While attending the university’s Carlson School of Management, he did not realize "how much I would really be using my labor relations and statistical knowledge in the real world." Now, early in his career, he has already demonstrated mastery of these subjects to company leaders.

In the past decade, the real world has changed dramatically for HR professionals: Many HR functions are routinely outsourced, as HR executives begin to enjoy the roles of strategic business partners. Evidence of these changes exists in stringent hiring specifications for entry-level HR managers and high-ranking HR executives alike. Deep, functional HR expertise is a necessity. Yet, business literacy is an equally important qualification; demand for it is reflected in recruiters’ appetites for HR managers who exude credibility.

Administrators of master’s degree programs for HR professionals seem well-aware of these demands and are eager to address them. "We want HR executives to offer valuable insights in these strategic decisions," says Anthony Davidson, dean of New York University’s Division of Programs in Business, in New York City. The division offers a Master of Science in human resource management and development with "strong strategic context and focus," he says.

The rise of both Master of Business Administration (MBA) programs with HR concentrations and HR-related master’s degree programs housed in business schools also show that educators recognize the real-world demand for HR professionals with deep HR expertise and practical business know-how.

To obtain HR expertise and business fluency with the help of a graduate degree, HR professionals should understand the value of these degrees and the differences among them.

Sustainable Value

During his senior year in college, after consulting with his professors on his interest in HR, Powers came to a "realization that I would need to extend my education if I ever wanted to obtain the type of career and opportunities I imagined."

Graduates of HR-related master’s programs typically take management-level positions; many, like Powers, enter company-sponsored development programs where they rotate through three- to nine-month stints in various HR functions.

The difference in compensation when entering an HR department with a master’s degree vs. a bachelor’s degree is significant—about $25,000 more per year, according to Rob Heneman, director of The Ohio State University’s labor and human resources master’s program in the Fisher College of Business in Columbus.

For HR professionals with graduate degrees, "Starting salaries have gone through the roof," claims Ryan Zimmerman, director of Texas A&M University’s Master of Science in human resource management program in the Mays Business School, located in College Station. The median starting salary for his graduates is about $80,000.

Graduate degrees also enable upward mobility: General Mills hired Katie Oberg, a graduate of the University of Minnesota’s human resources and industrial relations program, as a corporate diversity specialist in 2007. In 2008, the food manufacturer promoted Oberg to a broader HR role in a manufacturing plant. Last year, Oberg was promoted to HR manager of General Mills’ Latin America and South Africa regions.

Brian Acker, SPHR, director of human resources for the Paulding County Board of Commissioners in Georgia, speaks highly of the industrial-organizational psychology degree he earned in the early 1990s, after a couple of years in the workforce. Every graduate class had a practical application and helped him earn credibility, Acker says.

Selection Strategy

To select the graduate degree best for you, ask the following questions:

What do you want? “It’s all about your aspirations,” says Chris Jensen, director of global and executive compensation for Austin, Texas-based Freescale Semiconductor Inc. If you aspire to be vice president of human resources at a $4 billion company, earning an advanced degree in industrial-organizational psychology or organizational behavior may not give you “the critical edge.” Yet, Jensen, who earned a Master of Business Administration (MBA) years after graduating with a bachelor’s degree in organizational behavior, asserts that master’s degrees in psychology or organizational behavior can be valuable for HR professionals who seek specialized HR positions in large companies.

Who are your classmates? The average age of students in an HR master’s program is roughly 24 to 26, vs. the 27- to 29-year-olds in an MBA program and the age 30 and older students in an executive MBA program. More-experienced classmates are likely to bring greater real-world experience to in-class discussions and projects.

Some programs, regardless of the degree, attract more international students. Katie Oberg, now HR manager of General Mills’ Latin America and South Africa regions, credits her globally diverse University of Minnesota human resources and industrial relations classmates with helping her succeed in her first position as a diversity specialist.

Who do you want to recruit you? Each master’s program maintains relations with different hiring organizations. For example, University of Minnesota graduates routinely join Chevron Corp., Eaton, General Mills, General Electric and Microsoft; Texas A&M University graduates regularly accept offers from Exxon, General Electric, Lockheed Martin, Raytheon and Shell.


Education Is Business

HR executives say increased credibility represents a top benefit of earning a master’s degree. Chris Jensen, director of global and executive compensation for Freescale Semiconductor Inc. in Austin, Texas, went to school to earn an MBA through Baylor University’s executive program in 2003. He wanted to "speak the same language" as the chief executive officer, chief financial officer and corporate directors he now deals with. He credits the course work and collaboration with fellow students for helping him "understand the business perspective" and then translate the implications for the HR team. "Without this experience, I’m not sure I could walk in and have the same credibility," says Jensen, who earned a bachelor’s degree in organizational behavior in the mid-1980s.

Bernard Ruesgen, SPHR, logistics HR group manager for Sports Authority in Englewood, Colo., says his management degree, combined with real-world experience, equips him with a better understanding of the company and gives him more credibility when he interacts with operations people.

Academicians also promote the business aspects of their schools’ advanced HR degrees. Rutgers University’s master’s program in human resource management enables graduates to "talk the language of business," notes Richard Rabjohn, IBM’s vice president of human resources, sales incentive compensation, who recruits graduates from Rutgers.

Core Curricula

While standardization still eludes degree nomenclature—for example, a Master of Science in human resources and industrial relations may be nearly identical to a Master of Arts in human resources—the use of core curricula is increasing, thanks, in large part, to the Society for Human Resource Management(SHRM)and the Society for Industrial and Organizational Psychology, both of which offer guidelines for master’s degree programs.

To select a suitable master’s program, an HR professional should set career goals and identify the type of advanced education that addresses gaps in his or her skill set. Consider the following distinctions.

Master of Business Administration

Courses touch on major business functions. For example, Baylor University’s curriculum exposes students to six disciplines—accounting, finance, information systems, operations, microeconomics and statistics—every semester.

"An MBA broadens the HR professional’s perspective," explains Gary Carini, associate dean of graduate programs for Baylor’s Hankamer School of Business. "It makes perfect sense for an HR person to take, for example, an accounting class. By taking that class, they can quickly understand some of the constraints facing accounting and the contributions that accounting makes to the direction of the organization." And that’s the case for all of the business disciplines covered in the MBA program.

Master of Business Administration In Human Resources

MBA and master of management degrees with HR concentrations offer slightly more specialization. Ken Bettenhausen, management program director at the University of Colorado Denver Business School, says the MBA in human resources and the Master of Science in management-human resources provide "a broad foundation because these programs teach you the grammar of business and the mind-set of the executive." As in a traditional MBA program, students receive advanced instruction in business disciplines, complemented by HR electives.

Master’s in Human Resources

While these programs go by many names, they all provide instruction in major HR functions—training, staffing, compensation and benefits, labor relations, employment law, organizational change and development, and organizational behavior—in an applied business context. The programs may offer Master of Science or Master of Arts degrees.

Heneman says Ohio State’s master’s degrees in HR tend to offer the greatest breadth of experience in the HR arena but offer less business content than MBAs. "Most of our students are generalists," he adds. "That’s what our program is designed to prepare." Yet, electives provide students with many courses found in MBA programs.

Within Texas A&M’s master’s degree in HR management program, students take business courses next to MBA students. Electives include, for example, leadership in organizations, managing projects, international business policy and multinational enterprises.

Master’s In Industrial-Organizational Psychology

The Society for Industrial and Organizational Psychology’s lengthy list of job titles for master’s degree recipients includes every form of HR executive. Although these programs typically are housed within psychology departments, HR professionals with master’s degrees in industrial and organizational psychology can be just as business-savvy as, if not more so than, HR professionals with more business-focused graduate degrees, asserts Anthony Rucci, clinical professor of management and human resources at Ohio State’s Fisher School of Business.

Rucci, who has held positions such as chief human resources officer and chief executive officer, earned a master’s and a doctorate in organizational psychology. Such master’s programs offer classes that cover three areas: psychology, data collection and analysis, and "core industrial-organizational domains." The final category includes classes in:

  • Ethical, legal and professional contexts.
  • Measurement of individual differences.
  • Criterion theory and development.
  • Job and task analysis.
  • Employee selection, placement and classification.
  • Performance appraisal and feedback.
  • Training in theory, program design and evaluation.
  • Work motivation.
  • Attitude theory.
  • Small group theory and process.
  • Organization theory.
  • Organizational development.

Optional courses may include compensation and education and training or industrial and labor relations.

Law and Other Degrees

HR professionals who choose to pursue law degrees typically work for—or want to work for—large companies, notes SHRM’s Chief Knowledge Development and Integration Officer Deb Cohen. Legal training may help HR managers who are responsible for employment law and legal departments or who manage outside legal counsel.

General Mills’ Oberg considered earning a joint MBA and law degree but decided "My passion was in HR."

Law degrees do not offer as much opportunity for students to specialize in HR areas as an HR-specific graduate degree. The first two years of most three-year law programs include a similar set of legal course work. Electives in the third year can include two to three courses in labor and employment law.

The Association of American Law Schools’Executive Director Susan Westerberg Prager asserts that legal training can help HR professionals strengthen other skills as well as impart knowledge of employment law.

"An important aspect of the work of accomplished human resource professionals is to ensure fairness as well as clarity in communications with supervisors and employees," Prager says, adding that an understanding of applicable laws and the policies serves as an important foundation.

Other master’s programs of interest to HR professionals include focused business degrees, such as a master’s in finance. Mark Steinke, vice president of global recruiting for software giant SAP, says a candidate for an HR management position equipped with a master’s degree in finance, for example, "creates credibility quickly when they also have the HR expertise."

The majority of graduate programs HR professionals enroll in come with an internship requirement or opportunity. For younger HR professionals, especially those who enter master’s programs directly after college graduation, internships offer valuable, real-world business experience. A revalidation study for SHRM’s HR Curriculum Guidebook and Templates finds that 76 percent of organizations now require candidates to have one to five years of HR-related experience to secure an entry-level HR position.

Redefining Business Literacy

The emphasis on business context within any HR-related graduate degree program reflects a challenge for HR professionals.

Within many companies, the profession has been transformed from a tactical, back-office "personnel function" to a genuine strategic business partnership. "A new kind of HR professional is emerging to manage this transformed function, someone who deeply understands not only talent management processes but also an organization’s strategy and business model—someone who is responsible for, say, hiring and training marketing managers but who also knows how to put together an effective marketing plan," wrote Matthew Breitfelder and Daisy Wademan Dowling in the July-August 2008 issue of Harvard Business Review.

Breitfelder, vice president of management and leadership development at MasterCard Worldwide, and Dowling, executive director of talent management at Morgan Stanley, eachgraduated from Harvard Business School with an MBA in 2002. Their 2008 article, "Why Did We Ever Go Into HR?," presents an eloquent argument for the strategic value of HR—and the authors’ career choices.

That Breitfelder and Dowling were compelled to explain why they entered HR—rather than become consultants, bankers or general managers like most of their classmates—illustrates the challenge: Both HR and industrial-organizational psychology professionals "have a stereotype, particularly at the boardroom level, of not being the most business-literate," Rucci says.

Regardless of validity, that perception exists. Overcoming it requires HR professionals to demonstrate business literacy.

Some recruiters, including Steinke, insist that having a business-focused graduate degree, such as a master’s in finance or an MBA, demonstrates business literacy. Yet, potential graduate students should keep in mind that they must prove their business literacy and credibility on the job.

Rucci knows about demonstrating business literacy. After starting his career in industry as an HR manager, he quickly progressed to chief human resource officer, chief administrative officer, president of strategic corporate resources and chief executive officer at companies such as Baxter International, Sears and Cardinal Health before returning to academia. During his business career, Rucci charted corporate strategy, studied potential mergers with investment bankers and evaluated metrics such as return on invested capital without any formal finance or accounting education.

He asserts that his promotions had nothing to do with whether he understood the nuts and bolts of finance and accounting and everything to do with "whether I understood the fundamental business of the company—how we make money, who our customers are and who our competitors are."

When HR professionals approach Rucci and ask for advice on selecting a graduate degree program, he delivers a straightforward response: "If you come out of any one of those programs and you are genuinely interested in business and understand business, you are going to be successful."

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The author is a business writer based in Austin, Texas, who covers human resource and finance issues.


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