MBAs have enjoyed a spike in popularity in the last decade. These prestigious programs are largely debated and common topic of conversation amongst ambitious professionals seeking to step-change their careers.
In 2018 the Financial Times reported a fall in MBAs intakes and yet – the top tier MBAs are not suffering from a fall of aspiring students – on the contrary. According to Poets & Quants – a news site devoted to the coverage of business schools – the top business schools are growing fast, with the top 120 business schools worldwide now accounting for 36% of total market share, up from 25% in 1996.
MBA fees are high, very high – anywhere from $20,000-30,000 up to over $150,000. Critics argue that MBA fees are not worth it, but many alumni would swear against it. Let’s take a look at the key facts.
An MBA is much more than a Master’s in Business and Administration (i.e., what an MBA stands for)
An MBA, although from a certification perspective comparable, is not the same as a master’s degree in business. In fact, many MBA students already have a master’s in business, economics, marketing or other related subjects. To access an MBA, a few years of work experience are generally strongly suggested, often required.
Professionals would generally embark on a full time MBA after 2-5 years of work experience. Top business schools will attract applicants through partnerships with prestigious firms that often recruit directly from the campuses. Increasingly, business schools have been diversifying their proposition to gather to seasoned executives with several years of experience, offering part-time and distance learning formats – as later in a manager’s career the cost-opportunity of stopping working for a full year to go through an MBA might be too high.
In short, an MBA prepares students to think like managing directors – giving them exposure to a diverse set of subjects, from corporate finance and supply chain to marketing and entrepreneurship.
Due to the high-ticket price of top MBAs, several critics have argued that the time and resource investment to get an MBA certification are too high for the return.
Picking the right MBA program will most likely pay back within just a few years
Although some research might suggest it could be true for the so-called ‘tier-B’ business schools – more affordable but less prestigious institutions – the competitive advantage that comes with an MBA is hard to argue with when looking at hard numbers.
Firstly, in a fast-globalizing business environment, where international exposure and the ability to collaborate with colleagues from several countries becomes a must have, a good MBA offers a unique opportunity to be exposed to senior professionals from several countries.
In an evaluation of the Hult Business School by Forbes, one alumni boasts about the opportunity to ‘get a real international experience and network’ through the MBA experience. Indeed, 95% of Hult’s 2018 International MBA were foreign nationals. Hult offers a total of 6 campuses globally, located in some of the most exciting cities in key global cities – such as Boston, New York, San Francisco, Dubai, London and Shanghai.
Using the Hult MBA as an example, we could also argue against the supposed lack of return on investment for MBA programs. Sure, aspiring alumni of a prestigious business school like Hult will have to consider an upfront investment of $69,800 – according to the same research from Forbes.
However, looking at the stats from the 2012 MBA intake we can see that alumni went from a median salary of $42,000 pre-MBA to a whooping median of $106,000 in 2016 – more than doubling their salaries only 3 years after graduation.
Most of these alumni will not only have dramatically increase their salary but will also be on a fast-growth career trajectory that will keep on accelerating in the coming years.
The quality network an MBA comes with goes beyond the business school institution where one chooses to study: an MBA will allow a CMO to have a more productive dialogue with the CFO of the company. Many alumni go to the extent of changing career path after the MBA: marketers become management consultants, many leap from one industry to another or are able to skip a seniority step in their career progression.